Here and Now - CityNorth, Development, Retail and the Recession

22 July
2009

Here and Now - CityNorth, Development, Retail and the Recession

[Economy] [Environment] [Tax Policy] [Growth & Development]

Sometimes there are times when you tackle an issue or a topic that can go in a couple of directions. This is one of those times. Our goal is to profile the dilemma facing CityNorth, a new development in northeast Phoenix that is feeling the effects of the recession and a challenge to public-private development partnerships in form of keeping sales tax.

Despite its worthiness as a new kind of development--one that focuses on higher density offering places to live, work and shop -- CityNorth has gotten more attention because of an agreement with the city of Phoenix to allow it to recapture half of all city sales tax generated up to $97.4 million dollars. The amount offsets the price of adding parking garages, which are much more expensive than a simple paved parking lot. The reasoning behind the deal works like this: by letting the developer keep a certain amount of sales tax, the city is able to attract large retailers and their tax revenue that might have gone to neighboring Scottsdale.

Host Steve Goldstein talks with attorney Clint Bolick, who is challenging the quid pro quo. Development attorney, Grady Gammage, who is representing CityNorth and the city, will provide his perspective. We'll also talk to Grady a bit more about CityNorth and how the recession is affecting retail and other forms of new development. We'll also learn more about how the recession is hurting retailers by checking in with Melinda Burke, Director of the Lundgren Center for Retailing at the University of Arizona.

Finally, a man that knows a tremendous amount about Arizona's weather joins Steve. Tony Haffer recently retired after countless years (19) at the helm of the Phoenix office of the National Weather Service. He'll talk about some of the more unusual weather abnormalities he's witnessed as well as the role technological innovations play in weather forecasting.

Your comments, questions and general observations are welcome!

Posted by Paul Atkinson - Here and Now Producer at 11:00 | Comments (4) | Trackbacks (191)

Comments

Re: Here and Now - CityNorth, Development, Retail and the Recession

A simple fact of business: tax breaks encourage businesses to locate to a specific area. Challengers to the plan fail to realize that these developments will generate significant revenue for decades. Would they rather have 50% of something or 100% of nothing if the development locates in another jurisdiction.

Developments and these type of tax breaks only add to the bottom line, while legal challenges cost the taxpayer directly.

Posted by: Greg at July 22,2009 08:28

Re: Here and Now - CityNorth, Development, Retail and the Recession

I think the Goldwater Institute (GWI) is setting a dangerous precedent. Why shouldn't elected officials be allowed to incentivize development/ business it wants to lure into it's community? Tax breaks/ rebates happen all across this country it's just the reality that we live in, is the GWI being naive here? I fear the GWI is going to handcuff City/ State leaders, moving forward to lure more white collar and hi tech jobs that our local economies desperately need to help better insulate Arizona from the dramatic boom-bust cycles that we are painfully experienceing right now.

Posted by: John G at July 22,2009 09:50

Re: Here and Now - CityNorth, Development, Retail and the Recession

Richard Florida proved to us five years ago that luring businesses to the area with subsidies is the wrong approach, citing failed city plans across the country. You never get what you pay for.

He argued in Rise Of The Creative Class that "creative people" develop the economy, governments and big businesses dont. Look at Silicone Valley, Austin, etc.

The role of government is to attract and enable these creative people. Suburban sprawl doesnt do that. We need infill, dense, transit oriented, sustainable, interesting development.

CityNorth isnt the answer, its targeted to high-end uses and requires subsidies. We should be able to build creative, interesting communities that attract and foster creativity without the snare of subsidies.

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