Renaissance Towers. CityScape. Roosevelt Point. Maybe soon, The Stewart.
Amidst a whirlwind of development in past years, the Downtown Voices Coalition is considering taking a much-needed stance on a constant flashpoint for the drama: the use of Government Property Lease Excise Tax agreements.
In my four years here in downtown Phoenix, a lot has changed. The debates about the future of our beloved neighborhoods are becoming more frequent and far more fierce. That is why I support the proposed DVC statement, which is expected to be voted on this Saturday. This is about GPLET agreements, ensuring that the city is responsible for their residents and any concerns that may come up.
For those who don’t know, under a GPLET agreement, city government has the rights for the land being developed and leases it back to the developers, who then don’t pay property taxes for up to the first eight years of the lease.
After that, the developer pays a reduced excise tax based off of the size and type of building, rather than the property value of the specific building. Unfortunately, while the developer’s tax burden is reduced, other nearby property owners make up for the reduction because the entire tax district is still taxed at the value of all of the property in the district including those under GPLET agreements.
This shifted tax burden helps reduce the costs and risk of infill development — the process of developing vacant or under-used parcels within existing urban areas that are already largely developed — which can be crucial in a time where prominent economists such as Elliott D. Pollack report to the Arizona Legislature’s Finance Advisory Committee that the world has changed from the booming periods before the Great Recession.
But what is missing from this conversation that is frequently clouded in competing rhetoric of small institutions against large ones and preservation against economic development, has been a clear understanding of what a GPLET agreement actually does and why it has been awarded.
While we all genuinely want a thriving downtown Phoenix, our varied interests in building something new while maintaining what made this place special will always be in conflict.
Goal setting is not the problem. Downtown residents have accomplished much in helping establish the Phoenix General Plan of 2015, the Downtown Phoenix Urban Form Project of 2008, the Creative Sector Task Force Vision of 2013-2018 and the Historic Preservation Plan for Phoenix of 2015.
We now need consistency in pursuit of these goals as the cold war between developers and activists is sparking more and more radical actions, seen in the partial destruction of and heavy reparations for the Circles Records and Tapes Building and future Stewart development.
Improvements such as ensuring that GPLET agreements are judged off of the Phoenix General Plan and other downtown codes, setting a yearly meeting to establish what community goals neighborhoods want to see, and more information through a one-page impact analysis before votes are common-sense changes that only the city can truly enforce.
Accomplishing just these goals would dramatically level the playing field between developers and community members alike in creating a much-needed common understanding that GPLET agreements are not “easy” but also can be beneficial to the community.
However, just as I support the steps above toward an informed consensus, I must raise my concerns toward the recommendation that investment of the Downtown Community Reinvestment Fund, which is comprised of the collection of rental fees from GPLET properties, in large institutions be arbitrarily capped at one-third of the fund.
Small details do matter in the creation of a sense of place, and there are a lot of projects that should be completed, from supporting local murals to improving the streetscape in downtown Phoenix. However, those projects should be weighed against larger initiatives that seek to bring in major improvements to downtown on a case-by-case basis.
An arbitrary cap goes against the idea of discussion and reduces the conversation back to the rhetoric of small versus large when the conversation should be about how small and large institutions together should create a downtown worth living in.
It may be a while before we have all the data we need to make an informed decision on the effectiveness of GPLET and issues like preservation, and we still have our problems here.
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But what we have here is so unique to me, and it is far more democratic and welcoming than most anywhere I’ve seen.
I come from the sprawling north Phoenix where desert still stretches out for miles along the Interstate 17. I know the value of placemaking because, quite honestly, it was accidental where I’m from and it was only something those with cars could afford in those stretched suburbs.
So let’s work together to support future development that lights the way for progress as downtown Phoenix continues to emerge and thrive, and continue to cultivate the creative, compassionate culture we call our own.
Contact the columnist at ryan.boyd@asu.edu
