I do not know who will be making a decision on your criminal background check, yet, I know that you do not have a criminal conviction with a successful completion of a diversion class and the only criminal issue remaining is an arrest (provided you were arrested).
Please discuss that further with a local criminal defense counsel for a better opinion.
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It depends on the criteria the agency doing the background checks employs. For some a past due bill will result in a "fail" if that is what you call it. Others a misdemeanor conviction will not result in a "fail." My guess, and that is all it is, would be your school will be less stringent than the FBI.
I do know this - DISCLOSE EVERYTHING! A fail to disclose these types of things WILL be used as a defect in moral character. Everyone makes mistakes - and evaluators know this. However, if you try to hide or omit things - that will be treated as a dishonest act will almost always function as an automatic "fail"
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In Arizona, you cannot have your record expunged, so although your case was ultimately dismissed, a routine background check will show that you were arrested, charged and that the case was dismissed. It would be impossible to advise whether or not your school would view that as a "fail" as you say. Good luck.
Kaitlin S. Verdura, Esq.
Verdura Law Group PLLC