AZ HB2309

Prohibits cities and towns from banning vacation rentals or short-term rentals, but allows regulation for public health, safety, zoning, and nuisance issues applied equally to other residential properties.

Allows cities and towns to limit vacation rentals based on a percentage of residentially zoned buildings and to regulate them as transient lodging activities.

Requires vacation rental owners to provide emergency contact information to cities and towns, with civil penalties up to $1,000 per 30 days for non-compliance, and to notify adjacent single-family properties and floor residents in multifamily buildings before operating.

Establishes a permit or license system with fees capped at $250 or actual cost, whichever is less, and allows suspension for verified violations: three within 12 months (non-aesthetic) or one involving felonies, serious injury, sex offenses, or unauthorized commercial uses.

Imposes civil penalties of up to $500-$3,500 per violation based on night's rent, with up to $1,000 monthly penalties for owners who fail to apply for permits within 30 days of availability, and requires owners of accessory dwelling units built after September 14, 2024 to reside on the property.