ARIZONA

Should you need a license to work from home? Lawmakers say no, cities say yes

Ryan Randazzo
The Republic | azcentral.com
The Arizona Capitol in downtown Phoenix.

Do people need government permission to work out of their house?

Home-based business owners are battling with cities and towns at the state Capitol over the issue.

House Bill 2333 would prevent municipalities from prohibiting home-based businesses that otherwise conform to laws on parking, traffic, noise and other matters.

Rep. Jeff Weninger, R-Chandler, introduced the bill and defended it during a Jan. 30 Commerce Committee hearing where it passed on a 6-3 vote.

Entrepreneurs don’t always have the money to rent commercial real estate, he said.

“I think economically, to people who are starting out, who are not as well-heeled and funded to start these things up, this is the best place to do it, within a certain framework that respects the neighborhoods and provides for health and safety and provides for not too much traffic and noise and unsightliness,” he said.

His bill would not allow a municipality to prohibit “no-impact” businesses, and it defines what would qualify as such. A business would be considered no impact if it:

  • Sells lawful goods or services.
  • Uses a temporary sign during business hours no larger than 24 inches by 24 inches.
  • Does not cause on-street parking congestion or substantial traffic.
  • Employs residents or immediate relatives, or no more than three outsiders.

Several cities and towns, including Phoenix, Tucson and Mesa, oppose the measure, as does the League of Arizona Cities and Towns.

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Vacation rental would be 'no-impact' business

Vacation rentals would qualify for the definition, according to the bill’s language.

And that is where some of the opposition arises.  

James Corkins is a Tempe resident who lives in a house next to a property that is being converted into a 10-unit rental.

The home, on a residential street filled with single-family homes, has been a constant nuisance with loud renters and construction, Corkins said.

“Unfortunately the Tempe City Council and lawyers don’t know what to do about it,” Corkins said.

He wants cities to have more power to regulate residential businesses, not less.

“The bill does not define business hours. What if I have a speaker store and I stay open until 10, 11, 12 at night?” he asked rhetorically. “I bought this house so my wife and I could have a family. I don’t want to live in a place where businesses are allowed. It will make our neighborhoods unsafe.”

A Chandler home business shut down

The bill’s proponents, which include Americans for Prosperity, The Goldwater Institute, Arizona Association of Realtors, Institute for Justice and the National Federation of Independent Businesses, brought in Chandler resident Kim O’Neil to show why the law is needed.  

O’Neil shared a tearful story of how the city forced her to shut down a medical billing practice she ran out of her mother’s home. Her father, who died in 2015, launched the company about 20 years ago.

O’Neil continued to run the business, with three employees, from her mother’s home so she could both care for her mother and earn a living.

In 2016, Chandler sent her a notification that she was operating illegally and would need a permit, she said. Because she had no signs, no customers visiting, and the workers all parked in the driveway, she thought she would be given the permit.

The city would not permit the workers on site, so O’Neil directed them to work from their own homes. The city still took issue with the occasional visits by the workers to pick up paperwork.

She said the city wanted her to build a proper parking facility, requested architectural drawings of the home and required her to get approval from all nine neighbors within 600 feet of her home to continue the business.

Instead, she closed the business.

“This has been one of the most stressful experiences of my life,” she told lawmakers. “We love Chandler and cannot understand why they did not want us in their community.”

MORE: Working from home is a piece of cake for Phoenix app creator

'People take things to an extreme'

Alexia Shonteff, an economics teacher who lives in Phoenix, said she has no problem with quiet businesses, but opposes the bill because she fears it will limit cities’ ability to deal with disturbances.

“Unless you live in an HOA … there is literally going to be no way you can go anywhere other than to the state to change the law,” she said.  “Unfortunately, people take things to an extreme. Neighborhoods have rights, too, to a safe and healthy environment.”

Weninger shared his own story of a time he was on the Chandler City Council and in about 2007 or 2008, an accountant who worked from home caused a controversy among the officials. He voted to allow the business but lost on a 6-1 vote, he said.

“I look at this as an economic issue,” he said. “An economic disparity issue.”

Weninger’s bill still needs a full vote in the House before moving to the Senate.

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