Artificial separation
In short
Splitting project elements out of a contract to get alteration under the threshold. Prohibited by statute — and ADOR carries the burden of proving it happened.
In full
Each contract is independent of any other contract, so genuinely separate contracts are separately classified. The statute sets one limit on that independence, and the limit is narrow.
Project elements may not be artificially separated from a contract to cause a project to qualify as an alteration. That is the entire prohibition.
The next sentence is the one worth knowing at a bid. The department has the burden of proof that project elements have been artificially separated from a contract. A contractor does not have to prove that a separation was genuine; ADOR has to prove that it was not.
The scope is narrow in both directions. The rule reaches separation aimed at qualifying a project as an alteration, which is the case where splitting pays — alteration is the only MRRA activity with a threshold. It says nothing about separation aimed at anything else, and outside the alteration context the statute states no anti-splitting rule at all. Silence is not permission; it means the question would be argued on other grounds.
A.R.S. § 42-5075(P)(2), (S)(1)(c)