Landfills and solid waste disposal facilities
In short
Operating a landfill is outside prime contracting; building roads to one or cells within it may not be. The statute draws the line and then carves two construction activities back in.
In full
A.R.S. § 42-5075(M) provides that operating a landfill or a solid waste disposal facility is not subject to taxation under the prime contracting section — including filling, compacting, and creating vehicle access to and from cell sites within the landfill.
That list is the part worth reading twice. Filling and compacting are earthmoving, and § 42-5075(S)(6) defines Modification to include grading and leveling ground without qualification. Left alone, the same activity performed anywhere else would be Modification. Inside a landfill the statute expressly assigns it to operation instead.
The subsection then carves back in the other direction. Constructing roads to a landfill or solid waste disposal facility, and constructing cells within one, **may be deemed** prime contracting.
The verb is weaker than the rest of the subsection, which says flatly that operating is not subject to tax. "May be deemed" leaves the carve-in conditional without stating the condition, and a contractor building a cell has no test in the statute for which side of the line the work is on.
The operative distinction is between operating the facility and building it. Creating vehicle access to a cell site within the landfill is operation; constructing the road to the facility may be prime contracting. Those two sentences describe work that looks identical on the ground and differ on where it is performed relative to the facility boundary.
A.R.S. § 42-5075(M); A.R.S. § 42-5075(S)(6)