Advertisement


Rent Increase Survey

Have you submitted your latest rent increase data to the rent increase survey?

SunCal Tax-Increment Financing Controversy in New Mexico

SunCal has indicated that they would seek tax-increment financing – commonly known as “redevelopment” here in California – to subsidize the infrastructure build-out at Alameda Point, which SunCal estimates to be $700 million. In Santa Fe, New Mexico, SunCal is embroiled in a similar controversy over $408 million of tax-increment financing to subsidize their Albuquerque West Mesa project.

The Albuquerque Journal, in a January 31 article entitled “West Side Tax Deal Clears 1st Vote” reports that SunCal is negotiating and lobbying for a special agreement with the state for a tax-increment development district (TIDD) which would issue bonds for up to $408 million to be paid back by a portion of county gross tax receipts and a portion of county property tax revenue for 28 years. SunCal failed last year to get a similar measure through the state Legislature for $620 million.

Not everyone is in favor of the bill – one state senator said “Is it [the project] appropriate for a state subsidy? It seems like it should stand on its own feet as a private investment.” Many of us here in Alameda feel the same way about Alameda Point, and this is a significant fault of tax-increment financing – if the project isn’t financially viable without government subsidy, then perhaps the project isn’t worthy to build. The Alameda multi-screen cineplex and multi-story parking garage were financed in part by tax-increment bonds, and the City has yet to show that the project has proved itself to be the promised financial boon. Our analysis of the data available so far suggests that it is not.

And just like Alameda, who has had Planning Department staff leave and work for developers – think Bruce Knopf (Catellus) and Stephen Proud (Lennar) – New Mexico has their public service servants defect to private developers. Dick Minzner is a former New Mexico state legislator who is now a lobbyist for the SunCal subsidiary driving the West Mesa project.

Proponents of the New Mexico project claim that the new businesses set up in the development will generate tax revenue to offset the diversion of taxes to subsidize SunCal via the bond issue. But as we saw in the January 24th Alameda Public Affairs Forum, multiple studies of tax-increment financing in California show that the new taxes fall far short of what is needed to make up for the tax diversion.

And finally, let’s not forget New Mexico Governor Bill Richardson is embroiled in a federal investigation over a pay-to-play government bond issue scandal involving bond bid-rigging. We have to wonder who in Alameda might benefit from several tranches of City of Alameda bonds issued to subsidize SunCal.

Comments are closed.

  • Concerns About Alameda Municipal Power's Smart Meters https://t.co/lKXzuFiHwH ,
  • Black Achievers Alliance Organizes Unity Picnic At Crab Cove https://t.co/locEpUjUYv ,
  • Workshop And Survey on City Climate Action Plan https://t.co/tVgaFx2Ty9 ,
  • Workshop And Survey on City Climate Action Plan https://t.co/ciS0z6MknZ ,
  • Concerns About Alameda Municipal Power’s Smart Meters https://t.co/9lh0yXsQPD ,

Directories