Confirmed with Link: All-Purpose "Days of Our Meruelo" Talk

[Coyotedroppings]

Sorry I am just catching up but can you elaborate on this? I was under the impression, there would still be revenue generated from the sales tax (sales tax comprising of state and city rates) in the district which would benefit the city? And then obviously you have the land developed around there and the infrastructure for the utilities which makes it easier for the other surrounding land to get utilities? All of this also goes to increasing the values of the surrounding land plots raising the appraisal prices of the land for the auction?

I am just trying to understand how this entertainment district works exactly without all the legalese and political verbiage.

I've read several articles in the past that explain this, a quick search just came up with this as an example: Arizona lawmaker proposes changes to laws on special taxing district Coyotes hope to tap

"These special taxing districts are exempt from state and local income and property taxes, and they can charge patrons a sales tax – revenue that can be used to help pay for the development".

The team can levy taxes up to 9% within the district, the city receives zilch. Feel free to search other articles that say the same thing.

 

[finkelsteinberg]

I've read several articles in the past that explain this, a quick search just came up with this as an example: Arizona lawmaker proposes changes to laws on special taxing district Coyotes hope to tap

"These special taxing districts are exempt from state and local income and property taxes, and they can charge patrons a sales tax – revenue that can be used to help pay for the development".

The team can levy taxes up to 9% within the district, the city receives zilch. Feel free to search other articles that say the same thing.

OK. I get the income and property taxes and I get that they can add to the sales tax for payment of the district but that still doesn't completely wipe out the sales tax for the state and city? The state sales tax is 5.6% and I believe the Phoenix city tax is 2.3%. Not sure if it gets lowered at all with the exemption? I can't imagine it does given the other breaks of property tax and income tax.

I guess my feeling on the whole thing is, both the city and state will still benefit and currently the land is doing nothing unless I am missing something else about the taxing district. Additionally, they will get the winning bid amount and the development around there including the infrastructure which all goes on to make the surrounding land more valuable. I think it would be dumb for the city/state/county or any other government parties to get in the way on that sole premise. In the tax district, the taxpayers aren't paying for anything in a sense that there is nothing currently there and no revenue is being generated. You could make the argument that maybe there is someone out there who doesn't need the tax district but given how these deals work, GPLET/Tax district etc, corporations and wealthy individuals seem to get them so it is doubtful there is any better deal out there for the city and state in my opinion.

But it sounds like your understanding is that there is no benefit at all. Absolutely 0. And so I am trying to understand, if that is true, how we get to there. Especially if you consider the fact that the city has the control of the auction and terms. Why would the land even go up for auction without some stipulation negating the ability to take advantage of the tax district with them knowing it didn't benefit the city at all?

 

[Coyotedroppings]

OK. I get the income and property taxes and I get that they can add to the sales tax for payment of the district but that still doesn't completely wipe out the sales tax for the state and city? The state sales tax is 5.6% and I believe the Phoenix city tax is 2.3%. Not sure if it gets lowered at all with the exemption? I can't imagine it does given the other breaks of property tax and income tax.

I guess my feeling on the whole thing is, both the city and state will still benefit and currently the land is doing nothing unless I am missing something else about the taxing district. Additionally, they will get the winning bid amount and the development around there including the infrastructure which all goes on to make the surrounding land more valuable. I think it would be dumb for the city/state/county or any other government parties to get in the way on that sole premise. In the tax district, the taxpayers aren't paying for anything in a sense that there is nothing currently there and no revenue is being generated. You could make the argument that maybe there is someone out there who doesn't need the tax district but given how these deals work, GPLET/Tax district etc, corporations and wealthy individuals seem to get them so it is doubtful there is any better deal out there for the city and state in my opinion.

But it sounds like your understanding is that there is no benefit at all. Absolutely 0. And so I am trying to understand, if that is true, how we get to there. Especially if you consider the fact that the city has the control of the auction and terms. Why would the land even go up for auction without some stipulation negating the ability to take advantage of the tax district with them knowing it didn't benefit the city at all?

You're not from around here are you?

The city does not control the auction, it's state land and the state controls it, gets the income etc. Now, that income does go to schools etc., that benefits the communities within the state, yes. You're hearing "sounds" that aren't there my friend, as I've stated many times before, I believe there are many benefits, not the least of which is the new infrastructure that will make it easier, more economical for and thus encourage future development nearby. You could be right regarding Phoenix still getting their sales tax and while I believe I've read otherwise, I'll leave that research to you.

Addressing your second paragraph, I agree, with the caveat that citizens that are not fans will look at this and determine that someone will purchase this land that will pay income and property taxes.

I'm merely pointing out how and why this could go sideways, all the while wanting it to happen as much and most likely more than most.

 

[TheLegend]

I've read several articles in the past that explain this, a quick search just came up with this as an example: Arizona lawmaker proposes changes to laws on special taxing district Coyotes hope to tap

"These special taxing districts are exempt from state and local income and property taxes, and they can charge patrons a sales tax – revenue that can be used to help pay for the development".

The team can levy taxes up to 9% within the district, the city receives zilch. Feel free to search other articles that say the same thing.

I've read the actual proposed amendment to the bill and not everything is tax exempt.

https://www.azleg.gov/legtext/56leg/2R/adopted/S.2274GOV.pdf

It specifies any hotel building occupying less that 20 acres or less than 1 million square feet is not tax exempt. I would preclude this is in regards to bed taxes.

 

[TheLegend]

You're not from around here are you?

The city does not control the auction, it's state land and the state controls it, gets the income etc. Now, that income does go to schools etc., that benefits the communities within the state, yes. You're hearing "sounds" that aren't there my friend, as I've stated many times before, I believe there are many benefits, not the least of which is the new infrastructure that will make it easier, more economical for and thus encourage future development nearby. You could be right regarding Phoenix still getting their sales tax and while I believe I've read otherwise, I'll leave that research to you.

Addressing your second paragraph, I agree, with the caveat that citizens that are not fans will look at this and determine that someone will purchase this land that will pay income and property taxes.

I'm merely pointing out how and why this could go sideways, all the while wanting it to happen as much and most likely more than most.

As far as property taxes go, those are exempt, with the one exception I list above (page two of the document, section D)

Meruelo would get a permanent GPLET.

 

[MayDayMayDay]

Oh?

Will new Arizona State athletic director be able to save the Coyotes with new arena?

Graham Rossini has a chance to save basketball at Arizona State and hockey in the Valley.

www.azcentral.com

 

[Coyotedroppings]

As far as property taxes go, those are exempt, with the one exception I list above (page two of the document, section D)

Meruelo would get a permanent GPLET.

You mean this?

"A hotel building that is located in a district that is less than twenty acres and contains less than one million square feet of building or other improvements is not exempt from state and local property taxation."

Reads to me like this addresses district size, as opposed to hotel size.
It would be nice though, if there was at least some miniscule amount of taxes being paid. Thing is, it's like throwing a hush puppy to a dog, they just wolf it down and bark for more.... arena naysayer's are the dogs in this scenario.

 

[Edenjung]

Oh?

Will new Arizona State athletic director be able to save the Coyotes with new arena?

Graham Rossini has a chance to save basketball at Arizona State and hockey in the Valley.

www.azcentral.com

Not gonna happen.
First of all i doubt that ASU wants to work with AM ever again.
And second he would still need his district. Of course he could do the smart thing and get an arena in one place and offset the losses with a development in another spot, but I doubt he wants to do that.

 

[Coyotedroppings]

Not gonna happen.
First of all i doubt that ASU wants to work with AM ever again.
And second he would still need his district. Of course he could do the smart thing and get an arena in one place and offset the losses with a development in another spot, but I doubt he wants to do that.

Agreed, not gonna happen, but was there a rift between ASU and AM that I am not aware of?

 

[TheLegend]

You mean this?

"A hotel building that is located in a district that is less than twenty acres and contains less than one million square feet of building or other improvements is not exempt from state and local property taxation."

Reads to me like this addresses district size, as opposed to hotel size.
It would be nice though, if there was at least some miniscule amount of taxes being paid. Thing is, it's like throwing a hush puppy to a dog, they just wolf it down and bark for more.... arena naysayer's are the dogs in this scenario.

I agree. When I first heard about this district designation I thought it would only allow for them to add surcharges.

The more I look at it now though it’s much more than that, and that makes it highly suspect.

But it was originally written for the Diamondbacks to use and they don’t pay property taxes to begin with (because Chase Field is county property).

Nor do the Suns for that matter (because Footprint is Phoenix property).

People are never going to realize how good the TED proposal actually was.

 

[TheLegend]

Agreed, not gonna happen, but was there a rift between ASU and AM that I am not aware of?

Craig Morgan told me straight up OVG officials expressed to him that they’re not keen on dealing with the Meruelos.

Don’t think it’s Meruelo’s personality as much as the baggage he brings with him.

 

[MayDayMayDay]

Not gonna happen.
First of all i doubt that ASU wants to work with AM ever again.
And second he would still need his district. Of course he could do the smart thing and get an arena in one place and offset the losses with a development in another spot, but I doubt he wants to do that.

I think the implication here in the article is that it would be with a different ownership group.

 

[Edenjung]

@MayDayMayDay
That would be the only option. But would kick the can 10 years+ down the road.

 

[MayDayMayDay]

@MayDayMayDay
That would be the only option. But would kick the can 10 years+ down the road.

I don't disagree, but I'm a little more optimistic that if/when Meruelo bows out, we'll see another ownership group emerge sooner rather than later.

 

[finkelsteinberg]

You're not from around here are you?

The city does not control the auction, it's state land and the state controls it, gets the income etc. Now, that income does go to schools etc., that benefits the communities within the state, yes. You're hearing "sounds" that aren't there my friend, as I've stated many times before, I believe there are many benefits, not the least of which is the new infrastructure that will make it easier, more economical for and thus encourage future development nearby. You could be right regarding Phoenix still getting their sales tax and while I believe I've read otherwise, I'll leave that research to you.

Addressing your second paragraph, I agree, with the caveat that citizens that are not fans will look at this and determine that someone will purchase this land that will pay income and property taxes.

I'm merely pointing out how and why this could go sideways, all the while wanting it to happen as much and most likely more than most.

Born and raised, 2nd generation Phoenician. I poorly phrased what I was saying as I realize the state is selling the land and they receive that particular benefit of the auction. But I really don't understand the link between where I grew up/lived and understanding a complicated entertainment district tax structure.

The "sounds" were from you when you said:

Boys, the problem is that Phoenix will not receive any taxes from the district whatsoever. No property tax, no sales tax, the only benefactor will be the Meruelo group.

You are saying that as an overarching statement, which I held out the possibility of being true. Which I was I inquired further. I have seen nothing supporting this statement and was only trying get that particular information. It doesn't pass the smell test to me that they would not receive any sales tax. Hence why I asked you to elaborate.

I have now read the PDF that TheLegend (thanks for actually contributing) has posted and it seems that the taxing district only provides exemption for income and property tax.

 

[Bondurant]

Born and raised, 2nd generation Phoenician. I poorly phrased what I was saying as I realize the state is selling the land and they receive that particular benefit of the auction. But I really don't understand the link between where I grew up/lived and understanding a complicated entertainment district tax structure.

I poorly phrased what I was saying I guess. I realize the state is selling the land get that particular benefit of the auction.

The "sounds" were from you when you said:


You are saying that as an overarching statement, which I held out the possibility of being true. Which I was I inquired further. I have seen nothing supporting this statement and was only trying get that particular information. It doesn't pass the smell test to me that they would not receive any sales tax. Hence why I asked you to elaborate.

I have now read the PDF that TheLegend (thanks for actually contributing) has posted and it seems that the taxing district only provides exemption for income and property tax.

You didn't phrase anything poorly.

 

[Baby Doaner]

One month to go!

 

[Coyotedroppings]

Born and raised, 2nd generation Phoenician. I poorly phrased what I was saying as I realize the state is selling the land and they receive that particular benefit of the auction. But I really don't understand the link between where I grew up/lived and understanding a complicated entertainment district tax structure.

I poorly phrased what I was saying I guess. I realize the state is selling the land get that particular benefit of the auction.

The "sounds" were from you when you said:


You are saying that as an overarching statement, which I held out the possibility of being true. Which I was I inquired further. I have seen nothing supporting this statement and was only trying get that particular information. It doesn't pass the smell test to me that they would not receive any sales tax. Hence why I asked you to elaborate.

I have now read the PDF that TheLegend (thanks for actually contributing) has posted and it seems that the taxing district only provides exemption for income and property tax.

Please show us just what taxes will be levied, collected, by whom and who will be the benefactor of any such taxation.

Anything other than potentially collecting taxes on the hotel, that it appears they could easily avert.

 

[Coyotedroppings]

You didn't phrase anything poorly.

HIs final two sentences would state otherwise:

" Especially if you consider the fact that the city has the control of the auction and terms. Why would the land even go up for auction without some stipulation negating the ability to take advantage of the tax district with them knowing it didn't benefit the city at all?"

 

[TheLegend]

Meanwhile in Salt Lake City….. dissent is upon us.

Opinion: If Ryan Smith can’t afford his own entertainment district, I have no choice but to assume he is poor

“We’re all facing challenges in these hard economic times, Ryan, whether that means figuring out where our next rent check is coming from or how to use public money to create an enormous new income stream that will fundamentally change downtown SLC.”

www.sltrib.com

 

[rt]

Meanwhile in Salt Lake City….. dissent is upon us.

Opinion: If Ryan Smith can’t afford his own entertainment district, I have no choice but to assume he is poor

“We’re all facing challenges in these hard economic times, Ryan, whether that means figuring out where our next rent check is coming from or how to use public money to create an enormous new income stream that will fundamentally change downtown SLC.”

www.sltrib.com

That’s just poorly done satire, right? That’s the most braindead thing I’ve ever read, otherwise.

 

[RemoAZ]

Meanwhile in Salt Lake City….. dissent is upon us.

Opinion: If Ryan Smith can’t afford his own entertainment district, I have no choice but to assume he is poor

“We’re all facing challenges in these hard economic times, Ryan, whether that means figuring out where our next rent check is coming from or how to use public money to create an enormous new income stream that will fundamentally change downtown SLC.”

www.sltrib.com

Welcome to our world Utah.

 

[rt]

Welcome to our world Utah.

It’s an op-ed and it’s written by an unhinged theater kid.

 

[TheLegend]

That’s just poorly done satire, right? That’s the most braindead thing I’ve ever read, otherwise.

Oh it’s satirical all right. But it drives home the author’s point that some billionaires are going to fleece the public where they can.

 

[finkelsteinberg]

HIs final two sentences would state otherwise:

" Especially if you consider the fact that the city has the control of the auction and terms. Why would the land even go up for auction without some stipulation negating the ability to take advantage of the tax district with them knowing it didn't benefit the city at all?"

You are right. I was busy at work and didn't have time to proof-read. I should have said state. I admit to not putting my thoughts in to the words that were typed correctly and that I messed up.

Please show us just what taxes will be levied, collected, by whom and who will be the benefactor of any such taxation.

Anything other than potentially collecting taxes on the hotel, that it appears they could easily avert.

You show us what taxes will be levied, collected, and by whom. I didn't post that the city would get zilch. I then went on to ask you to show me it. To which, and to no surprise, you still haven't.