ARIZONA HOUSE OF REPRESENTATIVES

HB 2126: government property; abatement; slum; blight

PRIME SPONSOR: Representative Leach, LD 11

BILL STATUS: House Engrossed

Abstract

Relating to the GPLET slum or blighted area abatement.

Provisions

1. Adjusts the maximum size of a central business district to the greatest of:

a. 960 acres;

b. 2.5% of the total land area within the exterior boundaries of the municipality; or

c. The total land area of an existing central business district as of January 1, 2018. (Sec 1)

2. Specifies a geographically compact central business district has a length that is no more than twice its width, as measured from at least four points on the exterior boundary of the district.

a. Any central business district existing prior to January 1, 2018 is deemed geographically compact, but the district must abide by the requirement above if the district expands. (Sec. 1)

3. Specifies the designation of a redevelopment project area automatically terminates after 10 years, unless the city or town formally renews or modifies all or part of the area.

a. States the termination of a redevelopment project area does not affect any existing projects for non-profit educational institutions located inside the designated area.

b. Exempts government property leases or development agreements if:

i. A corresponding resolution or ordinance for the lease or intent to lease the property was approved by the governing body of the lessor; or

ii. A proposal was submitted to the government lessor in response to a request for proposals. (Sec. 1)

4. Directs each municipality, within two years of the effective date of this Act, to review each redevelopment project area in which a central business district is located and renew, modify or terminate it, otherwise the district is immediately terminated.

a. Exempts government property leases or development agreements if:

i. A corresponding resolution or ordinance for the lease or intent to lease the property was approved by the governing body of the lessor; or

ii. A proposal was submitted to the government lessor in response to a request for proposals. (Sec 2)

Current Law

Title 42, Chapter 6, Article 5, Arizona Revised Statutes establishes the GPLET. A GPLET applies to any entity that leases property from a city, town, county or county stadium district for at least 30 consecutive days for commercial or industrial use.  The tax is based in terms of dollars per square foot, rather than the value of the property, to be calculated by each lessee. 

The GPLET may be abated for a period of eight years if the property is: 1) located in a single central business district (must be geographically compact and no larger than the greater of 5% of the land area within the exterior boundaries of the municipality or 640 acres) within a slum and blighted area and subject to a lease or development agreement entered into on or after April 1, 1985; and 2) if the improvement resulted or will result in an increase in property value of at least 100%.  Any lease with an abated GPLET is limited to eight years, at which point the property is conveyed to the lessee.

The government jurisdiction levying the tax must remit GPLET collections to the county (13%), the municipality (7%), the community college district (7%) and the school district (73% for a unified district or 36.5% for an elementary or high school district). 

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Fifty-third Legislature                  HB 2126

Second Regular Session                               Version 3: House Engrossed

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