It started out as a reaction to “The Zone,” an area near downtown Phoenix that was overrun with homeless people.

The Zone is gone. But now Republican lawmakers are asking voters to approve a law that would put local governments throughout the state on the financial hook if property owners say they incurred expenses because of the failure to enforce various state and local statutes and ordinances, ranging from illegal camping and loitering to defecating or drinking in public.

Lobbyists for cities and counties tried to talk GOP lawmakers out of putting it on the November ballot. They said communities often had little choice but to allow things like illegal camping because that was the ruling of a federal appeals court.

Since then, however, the U.S. Supreme Court has overturned that decision. And that leaves foes with arguments ranging from the technical implementation issues to whether the efforts – and the money communities might lose – might be better spent on providing services to keep the homeless out of neighborhoods.

But it isn’t just about residential neighborhoods. Some businesses also are supporting Proposition 312, saying that they, too, are financially harmed by loss of business.

Strictly speaking, the measure would not permit someone to recover for lost revenues, like customers staying away. It would, however, give them a property tax break for the expenses they incurred to “mitigate the effects of the policy, pattern or practice or the public nuisance on the property owner’s real property.”

But there is no definition in the measure of what that means, suggesting it could include everything from installing fences and hiring security guards to the costs of cleaning up the mess left behind.

As crafted, it would allow a property owner to seek a tax refund once a year for the documented expenses incurred if a local government maintained a “public nuisance” on that person’s land.

But the real key is aimed at cities, towns and counties that adopt any sort of policy or practice of refusing to enforce a number of any existing laws. That’s the list with obstructing sidewalks, drinking in public, illegal camping, loitering, panhandling, possession of illegal substances and public urination or defecation.

An affected property owner would then tally the costs and present a bill to the state Department of Revenue.

If the local government agrees or does not respond, the state agency pays the bill – up to the amount the property owner paid to that entity in that year. And then the Department of Revenue decreases that community’s state revenue sharing by that amount.

But if the community refuses, then the property owner can sue. And the law sets it up to say the burden is on the local government to prove that its actions or inactions are lawful, or that the amount sought is unreasonable.

It also is set up so that a prevailing property owner gets his or her legal fees paid by the community. But the reverse is not true: A city, town or county cannot get back its legal costs if a court rules against the property owner.

And if the problem continues, the property owner can seek a refund in each future year.

House Speaker Ben Toma, who crafted the measure, told colleagues during legislative hearings that the change in law is necessary.

“Homelessness has been overtaking once beautiful cities all over this country,” said the Peoria Republican. He put the blame squarely on local governments refusing to enforce laws on loitering, camping in public places and public intoxication.

“And the result has been a rise in violent crime, biohazard, pollution, property destruction and even death,” Toma said.

Exhibit No. 1, which was visible to lawmakers, was “The Zone,” just a few blocks from the Capitol.

The location of the unofficial homeless camp was not coincidental. It was near other services made available for the homeless. And it was not unusual for Phoenix police to drop a homeless person they found elsewhere at the site.

Often there would be more than 1,000 people camped out on sidewalks

The only reason it disappeared is that a state judge, ruling on a lawsuit from nearby property owners, finally ordered the city to clean up the area and abate the nuisance it was creating. Toma said the legislation should eliminate the need for future case-by-case litigation.

“This bill … ensures that hardworking taxpayers will no longer be forced to bear the burden of the city’s refusal to do its duty to protect the public health and safety” Toma said.

As originally crafted, the measure also would have allowed property owners to seek compensation for reduction in property values. But that was jettisoned amid questions of how that would be determined.

Sen. Justine Wadsack said this isn’t just a Phoenix problem.

The Tucson Republican told lawmakers she has been working with the Tucson Crime Free Coalition.

“The reason why they were formed was because the homeless were running rampant on local businesses of Tucson, breaking windows, breaking in, coming into the businesses during work hours with machetes threatening people’s lives, causing damage to their establishments,” she said.

“And let’s not forget the feces, the urine, the needles, the mattresses on the roofs of their buildings,” Wadsack said. “It’s getting to the point where people are closing their doors because they don’t have any relief for the damage they have to incur.”

Lobbyists for cities and counties argued to lawmakers they are legally helpless because of that 9th Circuit precedent. The judges said it was cruel and unusual punishment and, therefore, unconstitutional to make it a criminal offense to be homeless when there are no shelter beds available.

But that defense went away when the Supreme Court in June rejected those arguments, saying a law against camping in public places does not single out the homeless because it applies to anyone. The majority also said it did not criminalize the act of being homeless.

Still, attorney Jane Ahern representing the League of Arizona Cities and Towns, said this isn’t the answer.

“Homelessness is a critical issue for localities and it calls for comprehensive and collaborative solutions,” she said. “But instead of addressing the shortage of shelter capacity, this bill simply threatens to drain much-needed resources and expose cities to further litigation.”

That was pretty much the same reason that Gov. Katie Hobbs gave in 2023 when she vetoed Wadsack legislation that was designed to force communities to dismantle homeless encampments and, in some cases, arrest those who were staying there. The governor said the measure does not address the root causes of homelessness nor offers assistance.

In some ways, that veto is at least part of the reason Proposition 312 is on the ballot. With Hobbs blocking similar measures, lawmakers are seeking to bypass the governor and take the issue directly to voters.

Rep. Travis Grantham said linking a property owner’s tax liability to a city doing its job makes sense.

“I live in Gilbert,” said the GOP lawmaker.

“I pay to have my garbage picked up,” he continued. “If they stopped picking up my garbage, should I have to continue paying for that?”

In fact, said Ahern, yes you do.

“I don’t think you can just opt out of paying taxes because you don’t like what a city is doing,” she responded.

But Scot Mussi, president of the Arizona Free Enterprise Club, said that this is all about the fact that property owners pay taxes for services to ensure public safety that cities are obligated to provide but do not.

“This will not only justly make property owners whole but will incentivize cities to do their job — protecting the safety and welfare of its residents and businesses,” he wrote in an argument in support of the measure.

On the other side, Alejandra Gomez, executive director of Living United for Change in Arizona, said the measure will lead to Arizona `to be a testing ground for mass policing and incarceration of unhoused Arizonans.” She said elected officials should be moving to lower rents, make home buying affordable and ensure that those who are homeless “are able to find a roof over their head.”