The Office of Administrative
Hearings
The Twenty Second Annual Report
To
Governor Douglas A. Ducey
Senator Steve Yarbrough, President of the Senate
Representative J.D. Mesnard, Speaker of the House
Pursuant to A.R.S. § 41-1092.01(C)(5)
and
A.R.S. § 41-1092.01(C)(9)

Greg Hanchett, Acting Director
October 26, 2017

Contents
I. Introduction and Overview ................................................................................. 1
II. Continued Development of the Office ...............................................................
1. Mediation Option for Litigants.....................................................................
2. Agency Training on Due Process ...............................................................
3. OAH adjudication of Arizona Division of Occupational Safety and Health
(ADOSH) cases. ...............................................................................................

2
2
2
2

III. Summary of Agency Use of OAH Services ....................................................... 3
1. Case Management ................................................................................... 3
a. Breakdown of Cases Filed by Agency ................................................. 3
b. Number of Cases Concluded Versus Cases Filed .............................. 4
c. Timeline of Case Management ........................................................... 5
d. Incidence of Continuance .................................................................... 6
2. Evaluation ................................................................................................. 9
a. Results of Public Evaluation ................................................................. 9
b. Incidence of Rehearing and Appeal .................................................... 10
IV. Acceptance of Administrative Law Judge Decisions by Agencies .............. 11
1. Agency Action .......................................................................................... 11
2. Agency Inaction With Subsequent OAH Certification of Finality............... 14
V. Motions for Change of Administrative Law Judge Granted Pursuant to
A.R.S. § 41-1092.07 ........................................................................................... 15
VI. Violations of A.R.S. § 41-1009 ......................................................................... 15
VII. Recommendations for Changes in the Administrative Procedures Act ..... 15
1. Establish uniform standards for appeal rights notice ................................ 15
2. Establish uniform basis for rehearing. ...................................................... 15
3. Conform rehearing and appeal rules ........................................................ 15
VIII. Recommendation for Changes or Improvements in Agency Practice
with Respect to the Administrative Procedures Act ................................... 16
Recoupment of Costs for Administrative Hearings ................................. 16

I.

Introduction and Overview

The Office of Administrative Hearings (OAH) was created pursuant to Laws 1995, Chapter 251,
adding Arizona Revised Statutes § 41-1092 et seq., and commenced operation on January 1,
1996. Administrative hearings previously provided by regulatory agencies (except those
specifically exempted) were transferred to OAH for independent proceedings. In fiscal year
2017 the agency had 13 full-time positions, including the Director, the Office Manager, 7
Administrative Law Judges, and 4 support staff. Our statutory mandate is to “ensure that the
public receives fair and independent administrative hearings.”
Responsibility:
OAH understands its responsibility to create a system that is efficient and cost effective.
OAH statistics in FY 2017 indicate agency acceptance of Administrative Law Judge
Decisions without modification was 87.66%. Agency acceptance of Findings of Fact and
Conclusions of Law without modification was 90.84%. Rehearings (.70%) and Appeals
(2.53%) were rare. Evaluations by participants continue to indicate that Administrative Law
Judges and OAH were rated excellent or good in 97.78% of all responses.
Integrity:
OAH takes its statutory mandate to provide fair, impartial and independent hearings
seriously. Although part of the executive branch, together with its client agencies, OAH
maintains a conscious detachment from political issues and the missions of those agencies.
Procedures, rulings, and case assignments are at all times kept free of outside pressures to
ensure that the parties can be assured that hearings are impartial and independent.
Commitment:
OAH views commitment as a willingness to advance its mission, including improving the
quality of decision-writing. While the Administrative Law Judges must render decisions
according to the evidence before them and using their independent judgment, OAH requires
that Administrative Law Judges review all decisions that have been modified or rejected by
an agency in order to encourage them to identify any possible incorrect citations or other
areas where quality can be improved. This commitment is in furtherance of the duty of OAH
to provide continuing education to its Administrative Law Judges.
Efficiency:
Through careful case management the completion rate for cases in FY 2017 was 98.7%.

1

II. Continued Development of the Office
1. Mediation Option for Litigants
OAH has developed and implemented a voluntary mediation program to provide litigants with
alternative dispute resolution in certain cases. As of November, 2017, all administrative law
judges have become trained mediators. In addition, OAH has access to two additional law
trained mediators who are available to assist OAH with mediation needs. OAH offers mediation
services to litigants in Registrar of Contractors cases and Arizona Division of Occupational
Safety and Health (ADOSH) cases and is actively seeking to expand mediation to other types of
disputes that come before OAH (such as Mobile Home Landlord/Tenant cases). Mediation
services will continue to offer litigants the option of substantially reducing or even eliminating the
costly process of contested case hearing litigation. When cases are successfully mediated,
there will be a concomitant reduction in demands on state resources.
2. Agency Training on Due Process
OAH has now implemented annual training for requesting agencies and state bar affiliated
lawyer sections regarding due process considerations under the Uniform Administrative
Procedures Act, Title 41, Chapter 6, Article 10. Training has been presented to a diverse range
of agencies and private sector entities including the Registrar of Contractors, the Structural Pest
Control Board, and Animal Services Division of the Department of Agriculture, the Department
of Real Estate and the Department of Child Safety as well as sections of the Arizona State Bar
(such as the administrative law section and construction law section). The seminars are
designed to provide useful information and instruction to agency personnel and various state
bar sections of lawyers about providing due process to citizens at all stages of administrative
adjudications in order to enhance the quality of the appeal and hearing processes for our state’s
citizens. Seminars focus on topics such as statutory notice requirements to parties and appeal
and hearing procedures under the Uniform Administrative Procedures Act. OAH will continue to
reach out to agencies and private sector entities to offer them updated training on due process.
3. OAH adjudication of Arizona Division of Occupational Safety and Health (ADOSH) cases.
Effective July 1, 2016, OAH assumed adjudication responsibilities for cases arising under Title
23, Chapter 2, Article 10. OAH has successfully completed the transition and is providing timely
and efficient mediation and adjudication of these cases. During the transition process, OAH
worked closely with both industry and agency representatives and their legal counsel to ensure
the efficacy of the process. In addition, OAH’s already ongoing efforts to implement mediation
worked to speed the transition of ADOSH cases as litigants in these matters frequently resort to
mediation for dispute resolution. Going forward, OAH will continue to work closely with industry
and agency representatives to ensure fair, impartial and expeditious dispute resolution of
ADOSH cases and will continue to seek ways to promote adjudication and resolution
efficiencies.

2

III. Summary of Agency Use of OAH Services
1. Case Management
a. Breakdown of Cases Filed by Agency (FY 2017):
5,426 cases were filed with OAH in FY 2017. The distribution among the agencies, boards,
commissions, or political subdivisions (Agencies) are as follows (in descending order by number
of cases filed):
Arizona Health Care Cost Containment System
Registrar of Contractors
Department of Child Safety
Department of Health Services
Arizona Division of Occupational Safety and Health
Department of Insurance
Department of Economic Security
Department of Education - Special Ed
Department of Real Estate
State Board of Nursing
Arizona Department of Revenue
Department of Real Estate - H/C
Arizona Health Care Cost Containment System
State Board of Accountancy
Department of Gaming
Peace Officers Standards and Training
Arizona State Department of Housing - LTA
Arizona Medical Board
Department of Public Safety - Student Transportation
Department of Education
Arizona State Retirement System
State Land Department
Arizona State Department of Housing
Department of Administration
Liquor Licenses and Control
Department of Environmental Quality
City of Phoenix (NOV)
Board of Technical Registration
Arizona Game and Fish Department
Arizona Board of Osteopathic Examiners In Medicine and Surgery
Water Quality Appeals Board
Division of Real Estate Appraisal
Board of Psychologist Examiners
Arizona Lottery

3

3739
664
195
121
118
91
79
76
75
58
49
31
12
11
11
9
9
8
6
6
6
5
5
4
3
3
3
3
3
3
2
2
2
2

Arizona Department of Financial Institutions
State Board for Charter Schools
Rio Rico Fire District
Pinetop Fire District
Physical Therapy
Funeral Directors and Embalmers Board
Division of Racing
Department of Public Safety - Criminal History Records
City of Phoenix
Arizona State Board of Podiatry Examiners
Arizona Commerce Authority
Total

2
1
1
1
1
1
1
1
1
1
1
5426

b. Number of Cases Concluded Versus Cases Filed:
In FY 2017, the conclusion rate (defined as cases concluded divided by new cases filed)
was 98.67%.

Comparison of Cases Filed v. Cases Concluded
5440
Cases Concluded

5420

5,426

Cases

5400

Cases Filed
(Docketed)

5380
5360
5340

5,354

5320
5300

4

The following diagram illustrates the proportion of cases that proceeded to full hearing:
Disposition of Concluded Cases FY 2017

Vacated by Agency
3%
Hearings
34%

Vacated by ALJ
63%

c. Timeline of Case Management:
A.R.S. § 41-1092.05(A) and § 41-1092.08(A) and (B) contemplate a rigorous timeline to
expedite hearings and final agency actions. “Appealable agency actions” (defined as
actions taken by an agency without a prior hearing) are required to be set for hearing within
60 days of a request by a party. “Contested cases” (defined as proposed actions for which
a hearing is required) are required to be set within 60 days of an agency request.
Administrative Law Judge Decisions must be transmitted to the agencies within 20 days of
the conclusion of the hearing. The agency heads are required to take final action within 30
days of receipt. Boards and Commissions generally must take final action within 5 days of
their next scheduled meeting.
The following diagram illustrates the average timelines:

5

Average Days Between Selected Events - Appealable Agency Actions
v. Contested Cases
60.00

52.35 50.03

50.00
40.00
AAA

30.00
17.86

20.00
10.00

10.93 13.56
1.64

9.61

1.07

0.00
Request for Hearing to
Scheduling

Scheduling to First
Hearing Date

Conclusion of Hearing
to ALJ Decision

ALJ Decision to
Agency Action

d. Incidence of Continuance:
A single continuance in FY 2017 added an average of 43.39 days to the total length of a
case. Although 89.17% of all continuance requests were granted in FY 2017, OAH has
developed a well-deserved reputation for discouraging “convenience” continuances in favor
of those based on “good cause.” The frequency of continuances, defined as the number of
continuances granted (1,186) divided by the total number of cases first scheduled (5,426),
was 21.9%.
The following diagram illustrates the source of continuances:

Continuance upon motion of
agency
12%

Continuance upon motion of nonagency party
88%

6

CC

The following chart is a breakdown of cases actually set for a continued hearing date on the
FY 2017 calendar and their sources, by agency. (Note: the numbers in fig. 1, below, differ
from those in fig. 2, page 7, because a motion for continuance granted in one fiscal year
may result in the continued date being set in the following fiscal year.)
................................................................................................................................................
fig. 1
AGENCY

Continued Motion by nonagency party

Arizona Board of Osteopathic Examiners In Medicine and
Surgery
Arizona Department of Financial Institutions
Arizona Department of Revenue
Arizona Division of Occupational Safety and Health
Arizona Health Care Cost Containment System
Arizona Medical Board
Arizona State Board of Podiatry Examiners
Arizona State Department of Housing - LTA
Arizona State Retirement System
Board of Psychologist Examiners
Board of Technical Registration
Department of Administration
Department of Child Safety
Department of Economic Security
Department of Environmental Quality
Department of Education
Department of Education - Special Ed
Department of Fire Building and Life Safety
Department of Fire Building and Life Safety - H/C
Department of Health Services
Department of Insurance
Division of Racing
Department of Real Estate
Department of Real Estate - H/C
Department of Water Resources
Funeral Directors and Embalmers Board
Liquor Licenses and Control
Peace Officers Standards and Training
Physical Therapy
Pinetop Fire District
Registrar of Contractors
State Board for Charter Schools
State Board of Accountancy
State Board of Nursing
Total

7

2
2
23
8
263
5
1
1
1
1
2
7
52
21
3
18
1
1
31
6
17
14
2
2
2
4
2
276
1
2
15
786

Continued Motion by
agency party

2
2
2
36
1
7
6
2
12
2
1
1
1
1
14
6
7
103

The following chart reflects the number of motions to continue that were entertained in FY 2017 and the
percentage granted:

................................................................................................................................................
fig. 2
Agency

Continuance
Granted

Continuance
Denied

Total
Motions

%
Granted

Arizona Board of Osteopathic Examiners In
Medicine and Surgery
Arizona Commerce Authority
Arizona Department of Financial Institutions
Arizona Department of Revenue
Arizona Division of Occupational Safety and
Health
Arizona Health Care Cost Containment System
Arizona Medical Board
Arizona State Board of Podiatry Examiners
Arizona State Department of Housing
Board of Psychologist Examiners
Board of Technical Registration
Department of Administration
Department of Child Safety
Department of Economic Security
Department of Education
Department of Education - Special Ed
Department of Environmental Quality
Department of Fire Building and Life Safety H/C
Department of Health Services
Department of Insurance
Department of Real Estate
Department of Real Estate - H/C
Division of Racing
Division of Real Estate Appraisal
Funeral Directors and Embalmers Board
Liquor Licenses and Control
Peace Officers Standards and Training
Physical Therapy
Pinetop Fire District
Registrar of Contractors
Rio Rico Fire District
State Board for Charter Schools
State Board of Accountancy
State Board of Nursing
State Land Department
Arizona State Department of Housing
Total

3

-

3

100

1
2
26
37

1
1
1

1
3
27
38

100
67
96
97

477
6
2
1
2
3
3
60
35
2
46
3
2

66
1
10
4
6
1

543
6
2
1
2
4
3
70
39
2
52
3
3

88
100
100
100
100
75
100
86
90
100
88
100
67

66
17
16
19
1
1
2
4
4
2
1
297
1
2
9
28
5
0
1186

1
2
3
38
8
1
144

67
17
18
22
1
1
2
4
4
2
1
335
1
2
9
36
5
1
1330

99
100
89
86
100
100
100
100
100
100
100
89
100
100
100
78
100
0
89%

8

2. Evaluation
a. Results of Public Evaluation:
Since November 1996, OAH has administered an evaluation procedure. A copy of the evaluation is
provided to all participants before the hearing. The results are not disclosed to the Administrative
Law Judge. Hearing participants place completed evaluations in locked boxes located near the
hearing rooms.

Those responding are asked to rate the following categories, on a scale of excellent, good,
satisfactory, or poor:

1. Attentiveness of the Administrative Law Judge
2. Effectiveness in explaining the hearing process
3. Administrative Law Judge’s use of clear and neutral language
4. Impartiality
5. Effectiveness in dealing with the issues of the case
6. Sufficient space
7. Freedom from distractions
8. Questions responded to promptly and completely
9. Treated courteously
The results indicate that satisfaction is high among all groups, with those responding rating
OAH excellent to good in 88.01% to 95.37% of responses.

All Responses July 1, 2016 - June 30, 2017

120.00%
100.00% 92.36%

93.04%

93.09%

89.34%

88.01%

92.54%

95.37%

90.84%

93.90%

80.00%
60.00%
40.00%
20.00%
0.00%

3.27%
4.36%

2.56%
4.40%

2.55%
4.36%

3.00%
8.99%

2.57%
8.09%

6.34%
1.12%

3.47%
1.16%

4.78%
4.38%

3.66%
2.44%

Question 1 Question 2 Question 3 Question 4 Question 5 Question 6 Question 7 Question 8 Question 9
Excellent/Good

Average

9

Poor

An analysis of the unrepresented parties indicates that even among the most vunerable group,
OAH is seen to be functioning extremely well.

Unrepresented Responses
100.00% 91.37%

92.86%

91.49%

85.82%

86.43%

94.62%

93.33%

90.48%

88.98%

80.00%
60.00%
40.00%
20.00%
0.00%

4.32%
4.32%

2.14%
5.00%

3.55%
4.96%

2.24%
11.94%

2.86%
10.71%

4.44%
2.22%

3.08%
2.31%

5.51%
5.51%

5.56%
3.97%

Question 1 Question 2 Question 3 Question 4 Question 5 Question 6 Question 7 Question 8 Question 9
Excellent/Good

Average

Poor

b. Incidence of Rehearing and Appeal:
Rehearings are permitted pursuant to A.R.S. § 41-1092.09 under certain conditions. In FY
2017, the rehearing rate (defined as rehearings scheduled divided by cases heard) was
.70%.
Appeals to Superior Court are provided for pursuant to A.R.S. § 41-1092.08(H). In FY 2017,
the judicial appeal rate (defined as judicial appeals taken divided by cases decided on the
merits) was 2.53%. As reflected in the following diagram, rehearings and judicial appeals in
FY 2017 were relatively rare.

Arizona Health Care Cost Containment System
Department of Real Estate
Department of Real Estate - H/C
Registrar of Contractors
Arizona State Retirement
Department of Child Safety
Department of Economic Security - APS
Department of Environmental Quality
Department of Health Services
Department of Water Resources
Funeral Board

10

Rehearings

Appeals

3
1
2
4
-

2
2
2
10
1
2
1
1
8
1
1

Special Education
State Board of Nursing

Totals

-

2
3

10

36

IV. Acceptance of Administrative Law Judge
Decisions by Agencies
1. Agency Action
Agency acceptance of the Administrative Law Judge Decisions is high. 87.66% of all decisions acted
upon by the agencies were accepted without modification. Agency acceptance was 90.84% if viewed
from the vantage point of acceptance of Findings of Fact and Conclusions of Law, the core function of
the Administrative Law Judge. 31.85% of modifications made by the agencies were in the
Recommended Order (penalty portion).
Amended
Findings/Conclusions of
Law only
6.80%

Rejected
2.37%

Amended Order
only
3.18%

Accepted without
Modification
87.66%

11

The following chart reports the number of cases in the various categories of agency response.

1,400

1,186

1,200
1,000
800
600
400
92

200

43

32

0
Accepted without
Modification

Amended Order only

Amended
Findings/Conclusions of Law
only

Rejected

The following chart reports the breakdown of agency response by agency. This list further illustrates
that amendments and rejections are few relative to the decisions accepted.

Accept

Amend
Order

Amend
Findings

Reject

Total

Accountancy
Department of Education
Department of Housing
AHCCCS
Adult Protective Services
Arizona Retirement Board
State Board for Charter Schools
Building Fire Life and Safety
Board of Appraisal
Board of Technical Registration
Department of Public Safety
Department of Child Safety
Environmental Quality
Department of Health Services

1
2
670
17
2
1
1
3
2
13
1
48

1
1
8
1
3

59
1
1
5
17

18
2
1

2
0
3
755
19
2
1
1
1
5
2
18
1
69

Water Resources
Funeral Board
Gaming
Game and Fish
Insurance
Medical Board
Nursing
Osteopathic Examiners

4
1
28
2
20
3

1
-

1
1
2
1

1
2
-

1
2
4
1
31
2
22
4

12

Medical Board
City of Phoenix
Real Estate

1
56

-

-

2

1
0
58

Department of Revenue
Registrar of Contractors

310

28

4

6

0
348

Total

1186

43

92

32

1353

In FY 2017, Administrative Law Judges rendered decisions that were contrary in whole or
contrary in part to agencies’ original positions in 14.06% of cases.

Recommendations Contrary to Original Agency Action FY 2017

ALJ Recommendation
Contrary in Whole or in
Part
14.06%

ALJ Recommendation
Affirms
85.94%

Agency acceptance of contrary decisions was high at 91.94%.
Agency Response to Contrary Recommendations FY 2017
160
140
120
100
80
60
40
20
0

149

Agency Accepts Contrary
Recommendation 80.11%

9

13

15

Agency Amends Findings
Accepts Order 4.84%

Agency Amends Order
Accepts Findings of Fact/Law
6.99%

Agency Rejects Contrary
Recommendation 8.06%

13

The following chart reports the breakdown of agency responses to contrary decisions.

Accepted

Amended
Order

Amended
Finding

Rejected

Certfied

Total

Department of Housing
AHCCCS
DES-APS
Fire, Bldg, Life Safety
Techinical Registration
DPS-Bus
Department of Child
S
f t Services
Health
Funeral Board
Insurance
Arizona Medical Board
Real Estate
Nursing
Registrar of Contractors

1
15
4
2
1
3
2
2
1
8
93

1
3
1
1
3

12
1

6
1
1
2
1
4

1
8
3
3
2

2
36
4
3
1
1
11
6
1
6
1
10
1
103

Total

132

9

13

15

17

186

2. Agency Inaction With Subsequent OAH Certification of Finality
Beginning August 21, 1998, OAH was required to certify the Administrative Law Judge
Decision as the final administrative decision if OAH had not received the agency, board or
commission’s action accepting, modifying or rejecting the recommended decision within 30
days of transmission. Special rules apply if the board or commission meets monthly or less
frequently. A.R.S. § 41-1092.08(D). In FY 2017, 46 Administrative Law Judge Decisions
were certified by OAH as final administrative decisions.
Agency
Arizona Health Care Cost Containment System - 19
Department of Child Safety
Department of Education
Department of Fire Building and Life Safety - H/C
Department of Health Services
Department of Insurance
Department of Public Safety - Student Transportation
Department of Real Estate - H/C
Division of Real Estate Appraisal
Total

Certified
6
23
1
6
3
4
1
1
1
46

14

V. Motions for Change of Administrative Law
Judge Granted Pursuant to A.R.S. § 41-1092.07
A.R.S. § 41-1092.01(C)(9)(b) requires that the OAH report the number of motions for change of
Administrative Law Judge for bias, prejudice, personal interest or lack of necessary expertise
which were filed and the number granted. In FY 2017, 4 motions were filed and none were
granted.

VI. Violations of A.R.S. § 41-1009
Pursuant to A.R.S. § 41-1092.01(C)(9)(c), OAH reports that it has no knowledge of violations of
A.R.S. § 41-1009 by any agency.

VII. Recommendations for Changes in the
Administrative Procedures Act
The regulated community has long complained about inconsistent procedures among the
various agencies. The following recommendations point to the areas where uniformity or
greater consistency can be accomplished:
1. Establish uniform standards for appeal rights notice.
Currently there are no standards for how, and with what degree of specificity, appeal
rights to Superior Court should be communicated to parties once the agency has
acted.
2. Establish uniform basis for rehearing.
Parties must research the specific rules of each agency, board or commission to
determine the bases for rehearing since there is little uniformity. Standardizing and
recapitulating possible bases in Title 41 would make the process easier, particularly
for the unrepresented.
3. Conform rehearing and appeal rules.
Currently parties have 30 days from service of an agency’s final action, which is
presumed after 5 days of mailing to the party’s last known address, to request a
rehearing under A.R.S. § 41-1092.09(A)(1) and (C). However, under A.R.S. § 12904(A), parties have 35 days to file an appeal to Superior Court upon service,
presumed after 5 days of mailing to the party’s last known address. Conforming the
time limits for requesting rehearings and filing appeals will simplify the process by
eliminating varying time limits for parties to act on final orders and will allow agencies
to frame the effective dates of their final orders to a single date.

15

VIII. Recommendation for Changes or
Improvements in Agency Practice with Respect to the
Administrative Procedures Act
Recoupment of Costs for Administrative Hearings:
Billed costs to non-General Fund supported agencies, boards and commissions (ISA
agencies), pursuant to A.R.S. § 41-1092.01(E) and (K), could be recouped by them by
extending the statutory authority found in isolated statutes to all such ISA agencies.
An example of statutory authority for recoupment is found in A.R.S. § 32-128(H), which
permits the Board of Technical Registration to recoup certain costs:
H. On its determination that a registrant or a home inspector has violated this chapter or
a rule adopted pursuant to this chapter, the board may assess the registrant or the home
inspector with its reasonable costs and expenses incurred in conducting the
investigation and administrative hearing. All monies collected pursuant to this subsection
shall be deposited, pursuant to sections 35-146 and 35-147, in the technical registration
fund established by section 32-109 and shall only be used by the board to defray its
expenses in connection with disciplinary investigations and hearings. Notwithstanding
section 35-143.01, these monies may be spent without legislative appropriation.

16