Downtown developers fight to roll back property tax breaks

Arizona Center[Source: Mike Sunnucks, Business Journal of Phoenix] — Real estate developers, city governments, and heavyweight business interests have come out in force against a state measure that would restrict special property tax breaks for development projects and certain businesses.  State Sen. Ken Cheuvront, D-Phoenix, wants to restrict cities from doling out Government Property Lease Excise Tax deals.  GPLETs involve cities leasing their land to developers and businesses, allowing the latter to pay lower property taxes than if they owned the land.

Several downtown Phoenix office projects (including the Colliers Center and Arizona Center), Cabela’s sporting good store in Glendale, a planned private hospital in Goodyear, and Arizona State University’s SkySong tech center in Scottsdale are GPLETs.

Cheuvront contends GPLETs are “corporate welfare” and wants the state to impose new rules restricting their use under Senate Bill 1360.  But the idea faces a host of business, real estate, and local government critics who say the tax breaks help economic development.  They prefer a less strident bill put forward by state Rep. John Nelson, R-Glendale, which would establish standard procedures for handing out GPLETs.  Backers of the Nelson measure, House Bill 2803, include several Arizona cities, a number of chambers of commerce, and a host of real estate interests, including the International Council of Shopping Centers, Westcor, DMB Associates, Valley Partnership, Suncor Development Co., and RED Development.  Cheuvront said city governments and real estate developers are trying to stall his bill in the Legislature.

[Note: Click here to read related Arizona Republic column by Laurie Roberts.]

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