Assigned to COMPS FOR
COMMITTEE
Assigned to COMPS FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
taxpayer financing; sports stadiums; compact.
Purpose
Enacts the Compact Against Taxpayer Financing of Professional Sports Stadiums (Compact).
Background
Current law allows special taxing districts to be created for the provision of services in an area that might otherwise be limited from receiving those services for various reasons, including size, location, financial limitations or unavailability of other government support (A.R.S. Title 48). The formation of a special taxing district creates a funding stream to pay for the desired or needed services by placing the responsibility on those who benefit from that service. Special taxing districts may be designated as municipal corporations and political subdivisions with the same rights, powers and immunities as cities and towns. Special taxing districts are governmental entities functioning under their own separate identity and exempt from taxation on their governmental activities and property (Ariz.Const. art. 13, § 7). Tax levying public improvement districts are exempt from the gift clause and local debt limits prescribed in the Arizona Constitution (Ariz. Const. art. 9, §§ 7 and 8)
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Prohibits, in the construction, maintenance, promotion or operation of a professional sports stadium, the expending or appropriating of any money, or providing of any subsidy, from the state General Fund or public funds of a political subdivision of the state.
2. Declares that the purpose of the Compact is to prevent the use of taxpayer dollars for private professional sports stadiums and facilities by removing the ability of teams to use the threat of relocation to use taxpayer dollars to build their stadiums.
3. Stipulates that the Compact does not:
a) amend or breach any existing contract or inhibit bond financing and payment for any previously approved project; or
b) prevent a state or political subdivision of the state from building and charging reasonable fees for infrastructure related to a professional sports stadium.
4. Defines professional sports as any sporting event or competition featuring non-amateur athletes, excluding high school and college athletics funded solely by a 501(c)(3) nonprofit entity operating within their charitable purpose.
5. Defines stadium and professional sports stadium as a venue that hosts two or more professional sports events or practices in a calendar year, including practice and development facilities, office space, merchandising facilities, restaurants or lodging for either major and minor league professional sports teams.
6. Defines subsidy as any direct funding, tax credit, tax exemption, government bond, loan, loan guarantee or other funding mechanism that comes from state or local government.
7. Contains a legislative intent clause.
8. Requires the Attorney General to notify the Legislature when the requisite number of states has adopted a substantially similar measure to the Compact.
9. Becomes effective on ratification of the Compact by 24 other states, as determined by the Attorney General.
Prepared by Senate Research
February 8, 2018
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