Assigned to COMPS FOR
COMMITTEE
Assigned to COMPS FOR
COMMITTEE
ARIZONA STATE SENATE
Fifty-Third Legislature, Second Regular Session
stadium district; extension; Rio Nuevo
Purpose
Extends the state's General Fund (GF) contribution to the Rio Nuevo Multipurpose Facility District (District) until 2035.
Background
Laws 1990, Chapter 390 introduced the concept of a county stadium district, permitting Maricopa County to impose a 0.25 percent transaction privilege tax (TPT) for three years upon the award of a Major League Baseball franchise. These tax revenues could then be used to finance the construction of a stadium, either directly or by securing district bond obligations. Laws 1997, Chapter 297 expanded the county stadium district concept to include multipurpose facilities located in the district such as those used for sporting, entertainment, cultural, civic, meeting or convention events.
Laws 1999, Chapter 162 then increased the revenue payments to these districts by allowing them to retain the state’s share of TPT from sales of secondary businesses that are deemed “necessary or beneficial” to the development of the primary component multipurpose facility. This law also limited TPT payments to the lesser of: 1) 50 percent of collections or 2) revenues net of those received prior to the year of the election authorizing the district. This method of permitting a local area to use the state’s tax collections to finance local development projects with the expectation that future tax collections will increase as a result is known as tax increment financing (TIF). Lastly, Laws 1999, Chapter 172 required the facility’s municipality to spend a matching amount on projects by the district’s expiration date in order to receive state TPT revenues.
In 1999, Tucson voters approved Proposition 400, authorizing the creation of a development area called the Rio Nuevo Multipurpose Facility District. This district, which receives a diversion of TPT to finance the development of a multipurpose facility and supporting projects, stretches east from Downtown Tucson along the retail-intensive Broadway Corridor.
Laws 2006, Chapter 376 extended the period Rio Nuevo could receive these payments from 10 years to 25 years (to July 1, 2025).
Laws 2009, 4th S.S., Chapter 3 specified that the state’s GF contribution to the Rio Nuevo Multipurpose Facilities District (District) be discontinued on July 1, 2025, and provided that no state funds may be used for operating expenses of the District. It also required the District to maintain an official database on its website that allows users to search, aggregate and download District expenditures, and required a performance audit of the District every three years beginning in 2010.
Laws 2014, Chapter 80 required the Board to submit a report, by October 1 of each year, regarding the activities, operations, revenues and expenditures of the District for the preceding fiscal year to the President of the Senate and the Speaker of the House of Representatives. It also specified that for public funds distributed and expenditures of $500,000 or more, each Board member must provide advance notice of the consideration of the expenditure by the Board to the person who holds the office that is responsible for that Board member’s appointment.
Through FY 2016, Rio Nuevo has received a total of $138.4 million in TPT distributions from the state.
|
Fiscal Year |
Distributions |
|
2016 |
$13,088,813 |
|
2015 |
$6,958,022 |
|
2014 |
$9,486,100 |
|
2013 |
$9,755,752 |
|
2012 |
$11,957,943 |
|
2011 |
$14,099,949 |
|
2010 |
$8,727,318 |
|
2009 |
$10,399,336 |
|
2008 |
$15,456,187 |
|
2007 |
$14,974,923 |
|
2006 |
$10,968,178 |
|
2005 |
$7,469,632 |
|
2004 |
$5,081,197 |
The impact to the state GF would be the amount of TPT additionally diverted to the District in the extended timeframe of the Rio Nuevo TIF.
Provisions
1. Extends the state's GF contribution to the District until 2035.
2. Extends the allowable period for the District to use the state's GF contribution for:
a) debt service for bonds issued by the District incurred before 2025, rather than 2009;
b) contractual obligations incurred by the District incurred before 2025, rather than 2009.
3. Requires the Board, on the termination of the District, to dispose of real property and improvements as follows:
a) If the District leases property to a single lessee, the lessee has the first right to acquire title to the property at appraised value. The Board shall transmit all proceeds from the transaction to the State Treasurer for deposit in the Public Safety Personnel Retirement Fund for the purpose of paying the unfunded accrued liability.
b) If the District leases property to multiple lessees, each lessee has the right to offer a bid to purchase the entire property at fair market value, and the Board shall accept the bid that will transfer and terminate the District's title to the property. The Board shall transmit all proceeds from the transaction to the State Treasurer for deposit in the PSPRS Fund for the purpose of paying the unfunded accrued liability.
c) If neither of the above options occurs within six months after the Board offers it for disposal, but not later than the termination of the District, whichever occurs first, the property escheats to the State Land Trust for the benefit of the Permanent State School Fund.
4. Requires the Board to present to the Joint Legislative Committee on Capital Review each project for the construction or reconstruction of any facility, structure, infrastructure or other improvement to real property in an amount exceeding $500,000.
5. Contains technical and conforming changes.
6. Becomes effective on the general effective date.
House Action
WM 2/14/18 DP 7-2-0-0
3rd Read 2/22/18 38-17-5
Prepared by Senate Research
March 8, 2018
CS/lb