2022 Arizona Revised Statutes
Title 37 - Public Lands
§ 37-287.01 - Default on long-term lease; forfeiture and cancellation of lease; extension of time for payments; penalty and interest on delinquent rent

37-287.01. Default on long-term lease; forfeiture and cancellation of lease; extension of time for payments; penalty and interest on delinquent rent

A. If a lessee of a lease in excess of ten years defaults in a payment of rent, as provided in the lease, or fails to comply with a condition, covenant or requirement of the lease, the lease and the lessee's rights under the lease are subject to forfeiture and cancellation as provided by this section and section 37-289. Within sixty days after default or failure the department shall notify the lessee of the default or failure by certified mail to the lessee's last known address of record with the department.

B. On the written request of a lessee of a lease in excess of ten years, the commissioner may extend the time for payment of the delinquent amount for a period of not more than five years on terms that the commissioner considers to be appropriate as follows:

1. The commissioner may grant an extension in response to a request made within sixty days before the due date of the payment. An extension under this paragraph begins on the date the payment was due and continues for the period stated in a written notice to the lessee.

2. The commissioner may grant an extension in response to a request made within sixty days after the date of the default or failure notice provided in subsection A of this section. An extension under this paragraph begins on the date of the notice and continues for the period stated in a written notice to the lessee.

3. If the department does not act on a request for extension within thirty days after receiving the request, the request is considered to be denied.

4. If the lessee fails during the period of the extension to complete all delinquent payments of rent, penalty and interest, the lease is subject to default and cancellation as provided by this section and section 37-289, except that if the last day of the last period of extension expires on the last day of the five-year period and all delinquent payments have not been paid by the last day of the five-year period, the lease is automatically canceled on the last day of the five-year period and shall be so noted on the records of the department.

5. If a payment of rent is made after the due date, payments must be made according to the extension granted by the commissioner under this subsection.

C. There shall be added to the delinquent rental a penalty and delinquent interest. The rate of interest on delinquent rent shall be set by the state treasurer. The penalty shall be the greater of a minimum processing cost as determined by the commissioner or five per cent. The delinquent rent, penalty and interest shall be a lien on the improvements, crops and property on the land.