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Innovate ABQ files suit over taxes

Copyright © 2017 Albuquerque Journal

Innovate ABQ has gone to court in an effort to keep the tax man at bay.

The research park corporation – owned by the University of New Mexico and formed in partnership with the city of Albuquerque, Bernalillo County and private sector partners – is suing Bernalillo County Assessor Tanya Giddings and others, contending that it is being assessed property taxes on its Downtown site when it should be exempted from those taxes.

The corporation paid a little more than $40,000 in property taxes in 2016, but those taxes are expected to skyrocket when the property is reassessed next year due to millions of dollars in improvements that are under construction.

State institutions like UNM are typically exempt from property taxes, although the Innovate ABQ campus includes private investments.

“We have tried to work closely with Innovate ABQ, but based on the New Mexico property tax code, Innovate ABQ is subject to property taxation,” Giddings said through a spokeswoman on Tuesday. “Being that this is a pending legal case, we cannot comment any further other than to say that we look forward to resolving this matter.”

Albuquerque attorney Randall McDonald filed the lawsuit on Innovate ABQ’s behalf on May 30. The lawsuit seeks an injunction barring the county from assessing property taxes on the site, a determination that the property is exempt from property taxes, and reimbursement from the county in the amount of $40,365 – the property taxes that Innovate ABQ paid in 2016.

“We’ve set forth on a bold project to change the economic situation of Albuquerque and New Mexico, and we need to make certain there’s no obstacles to our achieving that goal,” said Terry Laudick, Innovate ABQ Inc.’s board chairman. He said money spent on property taxes is money taken away from Innovate ABQ’s economic development efforts.

Innovate ABQ is transforming the old 7-acre First Baptist Church property at Central and Broadway into a technology research and development hub.

The corporation broke ground on its first building last July. The $35 million, 160,000-square-foot facility will house UNM’s tech-transfer office and Innovation Academy, along with startups and partners striving to create a high-tech business zone in the heart of Albuquerque. The six-story building will also feature 155 student apartments.

“This project is incredibly important for economic development and job creation,” said Gilbert Montaño, Mayor Richard Berry’s chief of staff. He said the city has invested more than $2 million in the project and has been involved from the beginning.

“This project has been celebrated as a cornerstone for Downtown redevelopment and economic vitality, so we were very surprised to see an assessment as a private structure when this is state-owned land, it’s public dollars, it has an educational purpose coupled with a charitable contribution – all key terms that would demonstrate why it would be a tax-exempt property,” Montaño said.

In its lawsuit, Innovate ABQ argues that the state Constitution makes state properties and property used for educational or charitable purposes exempt from taxation. The complaint goes on to say that Innovate ABQ real estate is property of the state; that Innovate ABQ is a governmental entity for financial reporting purposes; and that the property is used for educational or charitable purposes.

The lawsuit also contends that other research park corporations formed by UNM are not assessed property taxes.

“In determining that the Innovate ABQ real estate is not being used for educational and economic development purposes, the assessor substitutes her judgment for that of the city of Albuquerque, the county of Bernalillo and the Regents of the University of New Mexico who have granted millions of dollars to Innovate ABQ expressly because of the educational and economic development endeavors of Innovate ABQ,” the suit says.

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