AAED Governmental Affairs Committee Agenda 

December 21, 2017 1:30‐3:00 PM 2017/18 GAC Leadership: Keyvan Ghahreman, Chair  Jaye O’Donnell, Vice Chair  

Karla Moran, Vice Chair Richard Wilke, Board Liaison 

 

I. Welcome and Introductions – Keyvan Ghahreman  

II. Legislative Recap – Eric Emmert a. Pre‐Session Updates:  Digital Goods, Prop. 301 Renewal, ACA Sunset, Transportation Funding, Repeal/Replace 

Affordable Care Act, Property Taxation (Sen. Leach Bill) b. HB 2005:  Disposition of Property for Economic Development Purposes (see attached)  ‐ Sen. Leach Meeting c. Committee Feedback 

 

III. ADOT Tentative Long‐Range Transportation Plan  

IV. Committees Collaboration: a. PR Committee: AZRE Articles – 2017 Schedule 

i. January / February – focus on education / qualified workforce – Thank You Athavan & Joyce! ii. March / April – access to capital? 

b. PR Committee – Ideas for PR?  AZ Town Hall? c. AAED Newsletter Articles:  – email to Sara Wheatcroft (deadlines?) 

i. Legislation – DPG d. Updates from other Committees/Southern/Northern 

 

V. Other Discussion: a. January Phoenix Luncheon:  Preparing for the Policy Impact Dinner – Confirmed Panel: 

i. Eric Emmert, Dorn Policy Group ii. Cheryl Lombard, CEO of Valley Partnership iii. Senator Karen Fann iv. Senator Sean Bowie 

b. Policy Impact Dinner Planning (Karla Moran) i. Awards – Sen. Sean Bowie and Rep. Jeff Weninger ii. Other possible? 

 

VI. Administrative Items – Joyce Grossman  a. Upcoming Events b. Next GAC Meeting – Tuesday, January 23 

 

VII. Board Items for Liaison  

VIII. Adjournment 

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PREFILED NOV 17 2017 REFERENCE TITLE: municipal economic development; sale; lease

State of Arizona House of Representatives Fifty-third Legislature Second Regular Session 2018

HB 2005

Introduced by Representative Leach

AN ACT AMENDING TITLE 9, CHAPTER 4, ARTICLE 1, ARIZONA REVISED STATUTES, BY ADDING SECTION 9-403.01; RELATING TO THE SALE OR LEASE OF MUNICIPAL PROPERTY.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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HB 2005

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Be it enacted by the Legislature of the State of Arizona: 1 Section 1. Title 9, chapter 4, article 1, Arizona Revised Statutes, 2

is amended by adding section 9-403.01, to read: 3 9-403.01. Sale or lease of property for economic development4

activities; notice; exceptions; definition 5 A. NOTWITHSTANDING ANY OTHER LAW, THE GOVERNING BODY OF A CITY OR6

TOWN MAY SELL OR LEASE FOR ECONOMIC DEVELOPMENT ACTIVITIES LAND OR 7 BUILDINGS OWNED BY OR UNDER THE CONTROL OF THE CITY OR TOWN ONLY PURSUANT 8 TO THE REQUIREMENTS OF THIS SECTION. 9

B. THE TERM OF A LEASE FOR ECONOMIC DEVELOPMENT ACTIVITIES MAY NOT10 EXCEED TWENTY-FIVE YEARS. 11

C. THE GOVERNING BODY OF THE CITY OR TOWN SHALL APPOINT AN12 EXPERIENCED APPRAISER TO DETERMINE THE SALE OR LEASE VALUATION OF THE LAND 13 OR BUILDING, EXCEPT THAT THE APPOINTMENT OF AN APPRAISER IS NOT REQUIRED 14 FOR THE SALE OR LEASE OF ANY LAND OR BUILDING THAT IS VALUED AT FIFTY 15 THOUSAND DOLLARS OR LESS IF THE VALUE OF THE LAND OR BUILDING HAS BEEN 16 ESTIMATED AND JUSTIFIED BY A MARKET ANALYSIS THAT IS BASED ON COMPARABLE 17 SALES. 18

D. THE GOVERNING BODY OF THE CITY OR TOWN SHALL SELL OR LEASE LAND19 OR BUILDINGS AT A PUBLIC AUCTION TO THE HIGHEST RESPONSIBLE BIDDER, IF THE 20 AMOUNT OF THE BID IS AT LEAST NINETY PERCENT OF THE VALUATION AS 21 DETERMINED BY THE APPRAISER OR THE MARKET ANALYSIS AND SUBJECT TO SUCH 22 OTHER TERMS AND CONDITIONS AS THE GOVERNING BODY OF THE CITY OR TOWN 23 PRESCRIBES. 24

E. THE GOVERNING BODY OF THE CITY OR TOWN SHALL GIVE NOTICE OF A25 PROPOSED SALE OR LEASE BY PUBLICATION, ONCE EACH WEEK FOR FOUR CONSECUTIVE 26 WEEKS, IN A NEWSPAPER OF GENERAL CIRCULATION IN THE CITY OR TOWN. THE 27 NOTICE SHALL STATE ALL MATERIAL CONDITIONS OF THE PROPOSED SALE OR LEASE 28 AND THE DAY ON WHICH THE AUCTION WILL BE HELD, WHICH SHALL BE NOT FEWER 29 THAN THIRTY DAYS AFTER THE LAST PUBLICATION OF THE NOTICE. 30

F. SUBSECTIONS D AND E OF THIS SECTION DO NOT APPLY TO LEASES THAT31 GRANT A LEASEHOLD INTEREST TO A PERSON OR ENTITY THAT OWNED, LEASED OR 32 OTHERWISE POSSESSED THE PROPERTY TO BE LEASED IMMEDIATELY BEFORE PURCHASE 33 OR ACQUISITION BY THE CITY OR TOWN OR TO OTHER PERSONS OR ENTITIES LEASING 34 PROPERTY FOR A TERM THAT WOULD EXPIRE WITHIN FOUR YEARS AFTER THE PURCHASE 35 OR ACQUISITION BY THE CITY OR TOWN. A LEASE ENTERED INTO PURSUANT TO THIS 36 SUBSECTION SHALL BE FOR AT LEAST NINETY PERCENT OF, BUT NOT MORE THAN, THE 37 APPRAISED LEASE VALUATION OR MARKET ANALYSIS DETERMINED PURSUANT TO 38 SUBSECTION C OF THIS SECTION. 39

G. FOR THE PURPOSES OF THIS SECTION, "ECONOMIC DEVELOPMENT40 ACTIVITIES" HAS THE SAME MEANING PRESCRIBED IN SECTION 9-500.11, 41 SUBSECTION M, PARAGRAPH 1. 42

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HB 2005

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Sec. 2. Purpose; applicability 1 A. This act is intended to enforce article IX, section 7,2

Constitution of Arizona. It is the intent of the legislature to clarify 3 existing law relating to the state's preemption of economic development 4 activities in this state. Economic development is regulated by the 5 Constitution of Arizona and is of statewide concern. Therefore, the 6 legislature intends to limit the ability of any city or town to engage in 7 economic development activities in violation of article IX, section 7, 8 Constitution of Arizona. 9

B. This act applies to any agreement made on and after the10 effective date of this act. 11

9-403 deals with how cities and towns dispose of property. Economic development activities are undersection 9.500. The proposed language would prohibit cities form leasing property they own for economicdevelopment purposes for more than 25 years. Also they must lease the space at 90-100% of the value butnot less or more as determined by an appraisal. Finally a city must auction off a lease.

The impacts could be wide ranging: Spring Training and other athletic facilities, chambers of commerce buildings, incubators and potentially special events. When the next lease for a spring training, Diamondback, or Suns facility comes up for lease renewal they would have to pay rent based upon the value. Many small and not so small cities, lease old city buildings to Chambers’ of Commerce and fraternal organizations for a token amount. Other cities have used city space for incubators (Surprise, Tempe and Chandler) would hinder their ability to offer discounted rates. Community colleges and universities also engage in this practice as well. CEI at Gateway Community College has a strong life science program. Since universities are not considered political subdivisions they could be exempt. Existing tenants would not be impacted but future tenants could be severally harmed as wet lab space is very expensive. Plus finding tenants is a slow and ongoing process. If for each tenant they must print notification and advertise for 4 weeks before you can sign a lease do not exactly signal business friendly. Also, most appraisals are only good for 6 months so you would be constantly reappraising the building for a multi-tenant building. There could an impact on special events.

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Comment today on ADOT's Tentative Long-Range Transportation PlanDeadline for comments is Dec. 21; Plan outlines investment choices for bridges, highways out to 2040

The public and agencies across the state have until Dec. 21 to comment on the Arizona Department of Transportation’s Tentative Long-Range Transportation Plan. The plan, which is updated every five years, outlines strategies for meeting the state’s highway and bridge needs over the next 25 years. It can be reviewed at azdot.gov/WhatMovesYouArizona. The CiviComment online tool, which is also available on the project website, allows users to comment on the full report or comment on individual pages pulled from the document. The direct link to CiviComment is whatmovesyouarizona.civicomment.org. ADOT spent the past two years drafting this update to the Long-Range Transportation Plan, which looks through 2040. The project team conducted stakeholder outreach, gathered extensive public comment across the state and worked through months of technical analysis. During the 25-year period of this draft plan, about $923 million in annual highway capital funding will be available from state and federal sources. On average, the Phoenix and Tucson regions are expected to receive $512 million annually. Of that, $223 million comes from voter-approved regional programs in those two metropolitan areas dedicated largely to highway expansion. ADOT’s Recommended Investment Choice calls for all of the remaining annual average of $411 million to go toward preserving and modernizing highways in Greater Arizona. The recommendation outlined in the Tentative Long-Range Transportation Plan is in line with public and stakeholder outreach, in which most participants listed preservation, safety and modernization projects as their highest priorities for Greater Arizona. The Long-Range Transportation Plan is expected to be finalized in early 2018. Comments can also be sent to:

ADOT Project Information Line: 1.855.712.8530 Mail:

Long-Range Transportation Plan c/o ADOT Communications 1655 W. Jackson St., Mail Drop 126F Phoenix, AZ 85007

 

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AAED Governmental Affairs Committee Agenda

November 28, 2017 1:30-3:00 PM 2017/18 GAC Leadership: Keyvan Ghahreman, Chair Jaye O’Donnell, Vice Chair

Karla Moran, Vice Chair Richard Wilke, Board Liaison

I. Welcome and Introductions – Keyvan Ghahreman a. Call for scribe volunteer

II. Legislative Recap – Eric Emmert a. Election Aftermath . . . .

i. Regional transportation plan in Pinal County passed ii. Public works and education bonds throughout Maricopa County passed

b. “Bubbling” Issues Updates: Digital Goods, Prop. 301 Renewal, ACA Sunset, Transportation Funding, Repeal/Replace Affordable Care Act, Property Taxation (Sen. Leach Bill)

i. Digital Goods: two meetings by ad hoc committee. Message from constituents and affected parties is provide clarity. Provide definition of “tangible property.” Not much appetite to tax what hasn’t been taxed in the past. Expect in legislation in spring.

ii. Prop 301: Will happen after 2018 gubernatorial election. iii. ACA Sunset: Not hearing issues raised two years ago. Don’t see issues with re-authorizing. Question is how

long will next charter last? iv. Transportation Business Partners looking at funding issues. Focusing on vehicle license tax (VLT) for alt fuel

vehicles and bringing up to parity with gas vehicles. Will likely see legislation this year on this issue. Appropriations looking at ways for DPS to secure own funding instead of HURF sweeps.

v. Affordable Care Act repeal/replace has been killed five times. Focus now on federal tax package. Senate may vote as early as this Friday. AZ senators are remaining silent.

vi. Property Taxation: will redefine “slum and blight.” c. HB 2005: Disposition of Property for Economic Development Purposes (see attached)

i. Scott Powell provided overview of this bill. Would alter how cities and towns use public property for EcD purposes. Discussed specific potential impacts to city leases. Also would affect how tax abatements are figured, basically replacing abatement with a market rate lease. Could impact universities significantly. Value of leases are not always determined strictly by value of building.

ii. Eric Emmert recommended we put together a team of 3-4 people to open up a dialogue with Sen. Leach, making sure there’s urban and rural representation. Go in with the attitude of “How can we help?” vs. coming out of the gate in direct opposition. Joan Krueger volunteered. David volunteered. Jaye will participate if needed. Richard to represent Pinal County.

d. Committee Feedback: None

III. GAC 2018 Policy Priorities: Approved by Board (Final version attached) a. No comments 2018 Policy Priorities. b. Verify if posted to website.

IV. Arizona Town Hall: Focus on preK-12 Education (Rebecca Timmer) a. Keyvan gave an overview of the event. b. AZ has not updated its school funding formula since 1980. c. Jaye recommended that the Monday evening speaker be considered for an AAED Conference. Follow up with Rebecca

to put us in contact. Michael Griffith with Education Commission of the States, School Finance Strategist. d. Keyvan offered to email the recommendation document.

V. Committees Collaboration: a. PR Committee: AZRE Articles – 2017 Schedule

i. November / December Due Sep. 28 – Keyvan G. – formation of 2018 Policy Priorities ii. January / February – focus on education / qualified workforce

iii. March / April – access to capital? b. PR Committee – Ideas for PR? AZ Town Hall?

Meeting Attendees Richard Wilkie Eric Emmert Athavan Rajasundaram Greg Arrington Joyce Grossman Joan Krueger Kurt Woody Jaye O’Donnell David Carranza Dedrick Denton Michael Jansen Karla Moran Scott Powell Taylor Gillings Chuck Reynolds Tom Pitts Wendy Bridges Karla Scott Mary Tieman

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c. AAED Newsletter Articles: – email to Sara Wheatcroft (deadlines?): Next letter will go out around Dec. 12.i. Legislation – DPG

d. Updates from other Committees/Southern/Northerni. Rural Committee emphasis has been on connecting with representatives around the state on a personal level.

Invite to policy impact dinner and make sure there’s an avenue for priorities.ii. David Carraza: Dec. 6 visit from Gov. Ducey in Douglas. Putting together targeted industry study with SEAGO.

Port of Entry moving forward.

VI. Other Discussion:a. January Phoenix Luncheon: Preparing for the Policy Impact Dinner – Confirmed Panel:

i. Eric Emmert, Dorn Policy Groupii. Cheryl Lombard, CEO of Valley Partnership

iii. Senator Karen Fanniv. Senator Sean Bowie

b. Policy Impact Dinner Planning (Karla Moran)1. Requests for silent auction have been sent.2. Still looking for sponsorships3. Registration is open on the website.

ii. Awards – Sen. Sean Bowie and Rep. Jeff Weningeriii. Other possible?

VII. Administrative Items – Joyce Grossmana. Upcoming Events

i. Dec. lunch deadline is this Thursday, Nov. 30ii. Early Bird rate on crash course in EcD deadline is also this Thursday. Event is Jan. 22 – 26.

iii. EDDE Awards are coming out next week.b. Next GAC Meeting – In lieu of Tuesday, Dec. 26 as scheduled, propose Thursday, Dec. 21 or Thursday, Dec. 28

VIII. Board Items for Liaison:i. Next board meeting on Dec. 15.

IX. Adjournment

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