HomeMy WebLinkAbout04/03/2007 Blue Sheet Legislative Update
TOWN COUNCIL
MEETING
INFORMATION
TOWN OF MARANA
MEETING DATE:
April 3, 2007
AGENDA ITEM: L,t
TO: MAYOR AND COUNCIL
FROM: Michael A. Reuwsaat, Town Manager
SUBJECT: State Lee:islative Issues: Discussion/Direction/Action regarding all
pending bills before the Legislature
DISCUSSION
This item is scheduled for each regular council Meeting in order to provide an opportunity to
discuss any legislative item that might arise during the current session of the State Legislature.
Periodically, an oral report may be given to supplement the Legislative Bulletins.
ATTACHMENTS
Legislative Bulletin, Issuesll and 12.
RECOMMENDATION
Upon the request of Council, staff will be pleased to provide recommendations on specific
legislative issues.
SUGGESTED MOTION
Mayor and Council's pleasure.
JCB/03/26/2007/9: 16 AM
League of Arizona
Cities AND Towns
IN THIS
ISSUE
Municipal Tax Incentives
Preempetions To Be
Heard... ........................1
Fire Service Mandate Awaits House
Action .......................... ...1
Deadly Weapons
Storage ............................ 2
Construction Sales Tax Bill Coming
Back................................. 2
Water Bill, Water Ills ......2
Liquor Bill Remains A
Concern........................... 3
Water Service Providers,
Overlapping Districts....... 3
Sign Bill In The Senate.... 3
Pay Day Loan Crackdown Gets
Hearing ............................3
Contractor Verification.... 4
Session Update.................4
Fixed BiIls........................4
The Weekly Spotlight ......5
Legislative Balletin is published by the
League of Arizona Cities and Towns.
Forward your comments or suggestions to:
League of Arizona Cities & Towns
1820 West Washington Street
Phoenix, Arizona 85007
Phone: 602-258-5786
Fax: 602-253-3874
Email: league@azleague.org
Internet: www.azleague.org
Issue 11 March 16,2007
MUNICIPAL TAX INCENTIVES PREEMPTIONS TO BE
HEARD
Two strike everything amendments will be heard next week that impact local
ability to provide incentives for economic development in their communities,
While the language is not available yet for review, we do know that the
amendments will be heard on Wednesday morning in House Commerce on
Senate Bill 1350 and on Wednesday afternoon in the Senate Finance
Committee on House Bill 2515. The League will be sending out an alert via
email to all cities and towns with a fact sheet and information on these bills
early next week. In the meantime, please contact all of your legislators and
ask them to oppose this preemption of your local control.
FIRE SERVICE MANDATE AWAITS HOUSE ACTION
House Bill 2780, the bill that will mandate that cities provide fire protection
services to county islands, is on the House Committee of the Whole agenda
on March 19th. Representative John McComish, the House Majority Whip,
will offer an amendment which stipulates that if a county island cannot get a
city or a private provider to provide fire service to the area, then the
surrounding municipality must provide fire service. It also authorizes a
three-person panel-made up of a fire district representative, a city
representative and a third person they choose-to set the secondary property
tax rate, but leaves in place the statutory limit of $3.15 per hundred dollars of
valuation. The language of the amendment says this applies only to areas that
do not have fire service as of January 1,2007. The provisions of the bill still
apply only in Maricopa County, but this bad precedent could become
statewide in the future. Conversely, Representative Tom Prezelski will
offer an amendment removing the mandate on the cities. Please call your
Representatives and ask them to vote against the mandate!
March 16, 2007
DEADLY WEAPONS STORAGE
Senate Bill 1251, which places additional
restrictions on how municipalities store
weapons in public buildings, passed out of
the House Government Committee this
week with a 5-4 vote in spite of strong
opposition from many cities, towns, state
agencies and law enforcement groups. This
bill will be heard in the House Judiciary
Committee on Thursday. This bill is a huge
public safety concern; please contact your
Representatives and ask them to oppose
this bill when it goes to the floor. For
further information, please contact
Cheyenne Walsh at 602-258-5786.
CONSTRUCTION SALES TAX
BILL COMING BACK
The House Government Committee will also
utilize the controversial strike-everything
amendment on Senate Bill 1544, to put on
the provisions of Senate Bill 1366. The bill
was brought earlier in the session by the
Homebuilders Association of Central
Arizona.
The bill mandates that cItIes and towns
dedicate HALF of ALL construction sales
tax revenue to new development
infrastructure if that city or town levies a
construction sales tax rate that is higher than
the average rate imposed on the other sales
tax classifications.
We need YOU to keep up the pressure on
the House Government Committee for this
bill as well.
Please let them know that:
· Sales taxes constitute the main
source of general fund revenue for
many small communities.
· This bill could jeopardize essential
services such as:
o Public safety
o Transportation
o Trash collection.
· This bill allows special interest
groups to dictate the expenditures of
local revenues instead of the locally
elected officials.
Please call Jeff Kros at the League (602-
258-5786) if you have any questions. Your
input is essential.
WATER BILL. WATER ILLS
Senate Bill 1359 (municipal utilities; tenant
nonpayment), sponsored by Senator Chuck
Gray would prohibit a municipality from
requiring payment by a property owner of
unpaid user fees before providing new
service or restoring service to a lessee of that
property. Statute establishes the right of a
municipality to file a lien on a property for
the nonpayment of fees if the payment is
more than 90 days delinquent.
Currently some of our cities and towns
contract with rental property owners for
utilities; some contract with tenants. When
an account is delinquent, it is often harder to
track down tenants than the property
owners. This bill would make all
municipalities contract with tenants, which
is particularly onerous on smaller cities and
towns that do not have the resources for
collection of these debts. Besides the
logistical issues of going after delinquent
tenant accounts, this bill is another attempt
at usurping local control. It failed in House
Government last week, but will return this
next week on what is known as
"reconsideration," where a legislator who
was on the prevailing side of a vote can have
the bill brought back to a subsequent hearing
or floor session. Senate Bill 1359 is on
House Government on Tuesday, March 20th
at I :30 p.m. Contact the members below
to urge their "NO" vote on this bill.
2
March 16, 2007
House Government Committee
Representative Phone Email
Kirk Adams, Chair 602-926-5495 kadams@azleg.{Jov
Jonathan Paton, VC 602-926-3235 ioaton(i!'azleg.gov
Tom Boone 602-926-3297 tboone@azleg.gov
Ray Barnes 602-926-5503 rbarnes@azleo.oov
Rich Crandall 602-926-3020 rcrandall @azle!!.!!ov
Warde Nichols 602-926-5168 wnichols@azlel.!.l.!ov
Mark A. Desimone 602-926- 303 7 mdesimone@azleg.gov
Steve Farley 602-926-3022 sfarley@azleo.gov
Martha Garcia 602-926-5830 mgarcia@azle{J.l!ov
Lena Saradnik 602-926-3398 I saradni k@azJeu.(yov
LIQUOR BILL REMAINS A
CONCERN
House Bill 2391, the spmtuous liquor
omnibus bill, passed Senate Commerce this
week, with only one "no" vote. There was
heated testimony from both sides and little
agreement as to the actual content of this
bill. We still have major problems as to the
diminishment of the Liquor Department's
powers and the ability of liquor
establishments to escape liability by having
a safe harbor when it comes to under-age
patrons. We will pursue floor action to fix
this poor piece of legislation. The Arizona
Trial Lawyers Association and Mothers
Against Drunk Drivers (MADD), along with
the cities and towns, oppose this bill in its
current form because of its threat to public
safety.
WATER SERVICE PROVIDERS.
OVERLAPPING DISTRICTS
Senate Bill 1119 exempts irrigation districts
from complying with local ordinances and
negatively impacts water conservation
efforts. It will be heard in the House Water
and Agriculture Committee next Thursday,
March 22nd. Please contact your
Representatives and ask them to oppose this
bill.
SIGN BILL IN THE SENATE
House Bill 2369 the temporary sign bill
pushed by Representative Bob Robson,
will be heard in the Senate Government
Committee on Monday, March 19th at 1:30.
As you may recall, this bill overrides local
control over temporary signs, designates
exactly how much a city or town can charge
for the permits, and the collected money has
to be spent on-clean-up and plants. Yes, this
bill dictates that municipalities have to use
the money collected for clean-up of the
signs, and "the planting of flora endemic to
the Southwest." Let's call our Senators and
let them know that sign regulation and city
landscapes are a matter of local control.
PAY DAY LOAN CRACKDOWN
GETS HEARING
Representative Marian McClure will
sponsor an amendment in her House Public
Institutions and Retirement Committee
(Monday, I :30 p.m.) that puts new
restrictions on the controversial Pay Day
Loan industry. The amendment will
include:
· A ban on internet loans
· Limiting loans to two weeks with no
rollovers
· A 48-hour cooling-off period
3
March 16, 2007
Pay Day Loan Crackdown Gets
Hearing Contd.
.
The borrower's ability to request a
payment plan with interest and
payment caps
A registry for borrowers III the
payment plan
No new loans for those III the
payment plan registry
A 15 percent interest cap for 105
days for loans
Subjects the industry to regulation
by the Department of Financial
Institutions
An auditor position III the
Department
.
.
.
.
.
One controversial provision is the removal
of the sunset date under current law. Rep.
McClure conceded that the removal of the
sunset date was necessary to put the more
restrictive provisions on the industry in
place. Pursuant to the League's Resolution,
we will support this measure as a good step
toward reining in this industry.
CONTRACTOR VERIFICATION
Senate Bill 1483, the contractor verification
bill, passed House Commerce this last week.
It still needs to be heard in House
Government. The bill contains a provision
that cities and towns (really all public
entities) must verify a contractor's license
information with the Registrar of
Contractors before issuing a building permit.
Although some cities already verify this
information, others fear that if the
Registrar's information is wrong: 1) the city
could be liable if a project goes wrong and
someone gets hurt; or 2) if the town denies
that permit, the town could be sued by the
contractor.
There are also concerns with the cost of
compliance and the potential of logjams of
red tape. Fortunately, the sponsor of the bill,
Senator Tom O'Halleran, wants to meet
with the stakeholders and iron out our
differences.
SESSION UPDATE
The 2007 legislative session is moving along
quickly. Final deadlines for bills to be heard
in committees are fast approaching. Next
week is the final week of committee
meetings (other than Appropriations) in the
House. The Senate committees will meet
one additional week, ending the week of the
30th.
We have heard that the budget process is
moving along and both houses are close to
reaching an agreement with the Governor's
Office on a budget. Details about such an
agreement have not been released and
League staff anxiously awaits such reports.
League staff will continue closely
monitoring legislation and updating our
members on the issues. We appreciate all of
the cities and towns that talk to their
legislators on issues that impact their
communities and look forward to continuing
to work with you.
FIXED BILLS
The cities and towns have managed to
alleviate some problems this session in an
effort to make sure policy decisions
affecting us remain sound. Some examples:
House Bill 2065 - This bill is a compromise
in response to the onerous Title 34
legislation proposed by the Associated
General Contractors that allows for
information on local road maintenance
practices to be collected and the issue to be
addressed in an educated manner if needed.
House Bill 2066 - This bill mandated
municipalities to locate sewer laterals upon
request of a utility digging in the rights of
way. After months of discussions, this bill
4
March 16, 2007
Fixed Bills Contd.
will not move forward while we wait for an
Attorney General's Opinion on the issue.
House Bill 2091 - This bill prevented
municipalities from splitting parcels in
annexations and special taxing district
boundaries. The Association of Counties
worked with the League to address our
concerns and agreed to an amendment to
remove the annexation preemption.
Senate Bill 1286 - The victims' rights
omnibus bill was the subject of a
stakeholders meeting and a series of emails
and now appears to have support across the
board. The efforts of this workgroup, of
which the League was a member, addressed
our concerns.
Senate Bill 1311 - The initial version
stripped cities and towns of any power over
channelization districts. Peoria and Buckeye
worked with stakeholders to reach a
compromise on notice and retained
municipal authority over these districts.
Senate Bill 1555 - The sex offender
residency restrictions bill, a League
resolution, was amended in House Human
Services on March 15th to alleviate concerns
that the legislation was too punitive. The
amended bill passed the committee
unanimously.
THE WEEKLY SPOTLIGHT-
REPRESENTATIVE
STEVE FARLEY
This week we feature
Representative Steve Farley,
Legislative District 28. In
his first session, he has been
a strong voice for the rights
of municipalities. Born in
Upland, California, Representative Farley is
a small-business owner of a public art and
graphic design company. He has a Bachelor
of Arts degree in political science from
Williams College in Massachusetts. He and
his wife Regina Kelly have two daughters,
Amelia and Genevieve.
How do you see local government impacting
people's lives?
Local government is the level of government
that is closest to our citizens, and therefore
is much more in tune with the thoughts and
desires of the people of Arizona. Cities and
towns provide the services that most directly
affect our lives, and are the first places
where we turn to resolve a problem. For that
reason, we at the state level should stop
micromanaging local governments and let
them do what they do best, informed by
their close contact with local citizens.
What is one issue you see as particularly
important to local government this session?
We need to protect state revenue sharing
which is currently under threat due to a
series of income tax cuts that have recently
passed and are currently proposed. Without
revenue sharing, public safety departments
would suffer greatly. We must make sure
that our towns and cities maintain and
increase these funds, regardless of how the
Legislature deals with tax policy.
Tell us something about your family and
friends (favorite things to do with children,
friends, etc.)
My daughters and I love to fly kites in
Himmel Park, go hiking all over Southern
Arizona, and enjoy "Freaky Fridays"
together with a picnic dinner in front of a
DVD movie from Tucson's legendary Cas a
Video. And we do love riding Tucson's
excellent public transit system SunTran
together!
What is a favorite vacation spot?
The Weekly Spotlight-Representative
Steve Farley Contd.
5
March 16, 2007
League of Arizona
Cities AND Towns
IN THIS
ISSUE
Fire Service Mandate Passes
Out Of House. ................. .......1
Good News On A League
Resolution..................... ...........1
Progress On Liquor Bill.... .... .......2
Deadly Weapons Storage......... ....2
Construction Sales Tax Bill
Passes Committee......... ........ .....2
Water Service Preemption
Passes Committee......... ....... .......2
Title 34 Compromise
Passes Senate Government....... ....3
Utility Bill Comes Up Again........ 3
Sign Walkers..........................3
Contractor Verification. . . . . . .. . ... . . .3
Tax Incentives Penalty
Bills Passes Easily........... ........3
Amateur Radio Bill Moving.........4
The Weekly Spotlight............. ....4
The League of Arizona Cities &
Towns Apposes The Strike
Everything Amendment To
HB2515 & HB350....... ... .......6
Legislative Bul/etin is published by the
League of Arizona Cities and Towns.
Forward your comments or suggestions to:
League of Arizona Cities & Towns
1820 West Washington Street
Phoenix, Arizona 85007
Phone: 602-258-5786
Fax: 602-253-3874
Email: league@azleague.org
Internet: www.azleague.org
Issue 12 March 23, 2007
FIRE SERVICE MANDATE PASSES OUT OF
HOUSE
House Bill 2780, the bill that includes a mandate that CItIes provide fire
protection services to county islands, passed out of the House twice this week.
On Tuesday, the bill passed 38-19-3, enough to pass but without the 40 votes
needed to enact the Emergency Clause. However, the House reconsidered the
bill the next day where it passed out 55-2-3. Many of those who voted with
the cities the first time changed their votes to emphasize a "spirit of
bipartisanship," according to statements made during the reconsideration.
The bill now goes to the Senate where the League will continue to work with
members. However, the League continues to support the language of Senate
Bill 1556, which passed the full Senate earlier and does not have any mandate
on cities that they provide fire service outside of their boundaries.
GOOD NEWS ON A LEAGUE RESOLUTION
A House Concurrent Memorial (HCM) is often used to send a message to
Congress to act on Arizona's behalf HeM 2002, Community Development
Block Grant (CDBG), a League resolution, urges Congress to fully fund the
Community Development Block Grant (CDBG). Representative John
Nelson is the sponsor. This program provides for housing, redevelopment,
infrastructure and many other projects that improve communities all over the
country. Arizona has benefited greatly from the CDBG program. Senator
Jack Harper chairs the Senate Government committee and placed HeM
2002 on next Monday's agenda.
PROGRESS ON LIQUOR
BILL
League staff and cities continue to work with the
state and the liquor industry to alleviate our
concerns on the liquor omnibus bili, House Bill
2391. Last week the bill passed Senate
Commerce committee and now awaits action in
Rules and then the Senate floor.
During a recent meeting with the industry and
the Department of Liquor Licenses and Control
(DLLC) and representatives from the liquor and
hospitality industries, we were heartened to learn
that DLLC also has major concerns with the
notion that bars and taverns do not have to
exercise "reasonable care" when examining
patrons' IDs before admitting them into the
establishment. This has been a sticking point for
us since the bill was drafted. Now that we have
the DLLC's support, we expect to have a lot
more leverage in crafting language that ensures
that bars and taverns take great care to make
sure minors do not get served alcohol.
DEADL Y WEAPONS
STORAGE
Senate Bill 1251, which places additional
restrictions on how municipalities store weapons
in public buildings, was held in the House
Judiciary Committee this week and is expected
to be heard in that committee next week. The
bill further defines the requirements in last
year's law by specifying that the storage must be
within 200 feet of each building's entrance. For
example, a person cannot be sent to the police
department to store a weapon but must be able to
store it at the building he is entering. Also, the
bill places restrictions on the type of storage,
specifying that the storage method must be
individual lockers that are numbered and keyed.
The owner of the weapon must be allowed to
keep the key and have immediate access to the
weapon for retrieval.
The League is concerned with the additional
costs associated with the implementation of
- 2 -
these new requirements just 6 months after last
year's requirements were complied with. Law
enforcement strongly opposes this bill as a huge
public safety concern. Please contact members
of the House Judiciary Committee to express
your opposition to this bill.
CONSTRUCTION SALES
TAX BILL PASSES
COMMITTEE
The House Government Committee passed a
strike-everything amendment to Senate Bill
1544 on Wednesday with a 5-2 vote. The
amendment mandates that cities and towns
charging a higher construction sales tax rate to
dedicate that increment amount to new
development. The bill also now links the
construction sales taxes directly to development
fees by requiring it to be used to build only
infrastructure included in your infrastructure
improvements plan as created in Senate Bill
1423. For those communities that don't charge
development fees but do charge a higher
construction sales tax, this is a huge problem.
Most, if not all, communities with a higher
construction sales tax rate already dedicate at
least a portion of this local tax to infrastructure
costs. This bill, brought forward by the
Homebuilders Association of Central Arizona is
an attempt by a special interest group to legisl~te
that your local tax revenues be spent on their
interests.
Please contact your Representatives and ask
them to oppose this bill on the House floor.
WATER SERVICE
PREEMPTION PASSES
COMMITTEE
Senate Bill 1119 exempts Imgation districts
from complying with ANY local ordinances that
restrict their water use and negatively impacts
water conservation efforts. It passed the House
March 23, 2007
Water Service Preemption Passes Committee
Contd.
Water and Agriculture Committee this week
with a 7-2 vote, with Rep. Manny Alvarez and
Rep. Trish Groe opposing. This bill is now
heading for the House floor. Please contact your
Representatives and ask them to oppose this bill.
TITLE 34 COMPROMISE
PASSES SENATE
GOVERNMENT
House Bill 2065 passed out of the Senate
Government Committee on Monday with a 4-0
vote. This bill is the compromise reached
between the League, the County Supervisor's
Association and the Associated General
Contractors (AGe) to study local road
maintenance practices and how those projects
are bid out. AGC has selected 15 cities to
participate and Matt Lore from the League will
be contacting those cities to explain further and
answer any questions.
UTILITY BILL COMES UP
AGAIN
Senate Bill 1359, municipal utilities; tenant
nonpayment, sponsored by Senator Chuck
Gray, is back. This bill prohibits a municipality
from requiring payment by a property owner of
unpaid user fees before providing new service or
restoring service to a lessee of that property.
The House Government committee decided to
hear it next Tuesday on "reconsideration," where
a prevailing vote on the committee can bring
back a failed bill. We are looking to either
amend or otherwise derail this bill, as it is once
again the state telling a city or town how to
manage local issues.
- 3 -
SIGN-WALKERS
House Bill 2369, temporary signage, continues
to make its way through the process. On
Monday, March 19th the Senate Government
committee voted 4-0, with three members
absent, to pass it. Its next stop is the Rules
Committee before going to the caucuses and
then the floor. We still need to make efforts to
stop this bill, as it totally voids local ordinances
in the area of temporary signage and tells us
what kinds of flora to plant. Simply stated, this
bill is ridiculous.
CONTRACTOR
VERIFICATION
Senate Bill 1483, the contractor verification bill
that we told you about in the last issue' of the
Bulletin, will not be heard in House Government
next week and is most likely done for this
session. The bill was problematic for us because
it may have shifted liability onto the cities for
verifying whether contractors were registered
with the Registrar of Contractors.
TAX INCENTIVES
PENAL TY BILLS ADVANCE
EASIL Y
Two bills that will have a strong deterrent effect
on cities' ability to offer sales tax incentives to
retailers easily passed out of their respective
committees Wednesday. House Bill 2515 and
Senate Bill 1350, which are identical Tax
Incentives Penalty Bills, penalize a city or
town within 25 miles of the Greater Phoenix
area for providing a tax incentive to attract retail
businesses. The penalty is equal to the amount
of the incentive realized by the taxpayer and
comes out of that city's state shared sales tax
revenues over a 5-year period.
March 23, 2007
Tax Incentives Penalty Bills Advance Easily
Contd.
The League opposes taking away this good
economic development tool for cIties,
particularly our fast-growing cities. A copy of
our fact sheet on this topic is at the end of this
Bulletin. Please let the legislative members
from your district know that you oppose the
bills.
AMATEUR RADIO BILL
MOVING
The Hon. Dan Brown, Mayor of Page, Arizona,
continues to push a bill that is both personally
and professionally important to him. House Bill
2595 requires cities, counties and home owners'
associations to accommodate "reasonable
heights and dimensions" of amateur radio station
emergency service communications antennae.
Mayor Brown sees the amateur radio operators
as an important public safety component,
particularly during emergencies. During
committee testimony earlier this year, Mayor
Brown stressed the role of the amateur radio
operators during the Rodeo-Chedeski fire as the
only operating communication service available
at the time. Quite simply, he said, the amateur
radio operators saved lives and assisted public
safety personnel during a time of crisis.
The bill passed out of the House by a vote of 56-
2-2. It is scheduled for a hearing in the Senate
Government committee on Monday, March 26th
at 1 :30 p.m.
The Weeklv SvotliJ!ht - Senator
Jav Tibshraenv
For many of you, Senator
Jay Tibshraeny, District 21,
needs little introduction. A
native of Chandler and an
Arizona State University
- 4-
graduate, Senator Tibshraeny has had a long and
distinguished career in local and state
government.The youngest person to be elected
mayor in Chandler, Senator Tibshraeny served
on numerous municipal, county and state boards
and councils, including The League's Executive
Committee. He has been a state senator since
2003. He and his wife Karen have a daughter,
Lauren.
How do you see local government impacting
people's lives?
At the state level, my fellow legislators and I
deal with people's most immediate needs that
impact almost every aspect of their lives.
Whether it is the highways on which they drive,
the taxes they payor the safety and education of
their children, the state Legislature is involved.
When I was Mayor of Chandler, I was very
close to my constituents, interacting daily with
citizens on issues affecting their lives. We rely
on local government to help improve the quality
of our lives, ensure our safety with police and
fire services, provide parks and recreational
activities for our families and so much more.
Local government will always be the level of
government that is closest to our citizens.
What is one issue you see as particularly
important to local government this session?
Unfortunately, we are hearing more and more
tragic endings to Amber Alert cases and I am
proud to be sponsoring a bill the League of
Arizona Cities and Towns and the City of Mesa
brought to me to help keep our children safe
from sexual predators. Senate Bill 1555
prohibits Level 3 sex offenders who have
committed crimes against children from living
within 700 feet of a school or daycare center.
This bill has passed the Senate and is now being
heard in the House. As of 2004, 13 states have
enacted some form of residency restrictions
applicable to sex offenders. I hope Arizona can
be next.
Tell us something about your family and friends
(favorite things to do with children, friends, etc.)
March 23,2007
The Weekly Spotli2ht - Senator Jav
Tibshraenv Contd
My daughter Lauren plays volleyball at
Chandler High School as well as club ball. It is a
joy to watch her play.
What is afavorite vacation spot?
One of my favorite vacation spots is San Diego.
My family vacations there each summer and I
really look forward to this time away with them.
What is afavorite hobby?
Some favorite hobbies of mine are Joggmg,
gardening and watching sports.
Thanks for your time.
Thank you.
League of Arizona
.~
CitiesANDTowns
The Lea2:ue of Arizona Cities and Towns Opposes the
Strike Evervthin2: Amendment to HB2515 & SB1350
Background
The strike-everything amendment penalizes a city or town within 25 miles of the Greater Phoenix area for
providing a tax incentive to attract retail businesses. The penalty is equal to the amount of the incentive realized
by the taxpayer and comes out of that city's state shared sales tax revenues over a 5-year period.
Tax incentives excluded from the provisions are:
. City services or benefits generally afforded to all new business in the municipality.
. Incentives afforded to all retail business in the municipality.
. Tax incentives to businesses in redevelopment areas.
. Incentives for off-site public infrastructure furnished and owned by the municipality (sewer, water, roads,
etc.).
. Incentives to preserve historical buildings or other structures.
. Incentives for clean up of brown field sites.
Key Points
1. Arizona's economic vitality is not happening by accident; it is because of the concentrated efforts of the
sate and local governments. There is no guarantee that businesses and jobs will locate in Arizona.
2. The amendment diminishes Arizona's business-friendly reputation and removes a key tool for Arizona's
cities and towns to compete regionally, nationally and internationally.
3. Cities must use good financial judgment before going forward with an incentive program. Under current
law, an independent, third party verifies that the projected revenue will be greater than the investment,
which benefits the state as well as the city. Why would the state turn away a solid revenue source.
4. Under current law, cities must also demonstrate that retailers would not locate without the incentives
before the program can go forward.
5. Small, fast-growing municipalities within the covered area will not be able to compete to bring
key retail anchors to their cities. Retailers that have a wide radius for customers will locate in
California, Nevada or New Mexico.
6. Retail incentive programs generate revenue on-site. Those sites usually generate nothing or very little
before the retailer moves in.
7. Incentives also work to locate retailers in high-density areas, which better serves the residents.
6
March 23,2007