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Friday, February 27, 2009
Senate OKs SunCal, Mall TIDDs
By Deborah Baker
The Associated Press
SANTA FE — The Senate on Thursday gave the go-ahead for a new development on the West Side of Albuquerque and the redevelopment of a mall within the city over fierce objections from lawmakers who said the state is giving away too much to developers.
The Legislature's approval is required for the issuance of $408 million in bonds for SunCal's largely industrial development on Albuquerque's West Side, and $164 million in bonds to redevelop the Winrock Mall area into retail, residential and office space.
The Winrock TIDDs bill is SB 467, and the SunCal TIDDs bill is SB 249.
The projects are being done under a 2006 law that allows the formation of tax increment development districts — TIDDs — that can issue bonds to pay for roads, water and sewer systems and other on-site infrastructure.
Under a TIDD, up to 75 percent of future tax revenue generated at the site is set aside to pay off the bonds.
Supporters of TIDDs say the state benefits in the long run, because the projects would create jobs and generate taxes that otherwise wouldn't exist.
“We will realize more revenue than if we don't approve this,” said Sen. Gerald Ortiz y Pino, D-Albuquerque, who sponsored the Winrock measure.
Critics said the projects would attract existing businesses from other areas — perhaps just blocks away, in the case of Winrock. That would simply shift jobs around, not create them, they argued.
And some of the taxes those relocating businesses now pay would be diverted to subsidizing the developers, they said.
Sen. Eric Griego, D-Albuquerque, called it “cannibalism.”
“It's terrible policy. ... Why are we giving this money away?” Griego said. He said developers historically have underwritten the cost of the on-site infrastructure for their projects.
Griego said SunCal — whose Westland DevCo is the developer — had a “sketchy track record” in other states that included multiple bankruptcies.
Opponents also said financial projections for the projects were overly optimistic.
“What we are doing here is giving away our future gross receipts tax revenues,” said Sen. Cisco McSorley, D-Albuquerque.
If the SunCal and Winrock TIDDs and other similar, pending proposals are passed, lawmakers will have promised $1.5 billion in future taxes, he said.
The SunCal measure passed on a vote of 29-9 and the Winrock bill on a vote of 35-7.
They now go to the House.
Copyright ©2009 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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