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Innovate ABQ still paying property tax

Innovate ABQ sued Bernalillo County in 2017, arguing that its Downtown headquarters should not be subject to property taxation. The corporation moved to dismiss the suit last year. (Jim Thompson/Albuquerque Journal)

Innovate ABQ sued Bernalillo County in 2017, arguing that its Downtown headquarters should not be subject to property taxation. The corporation moved to dismiss the suit last year. (Jim Thompson/Albuquerque Journal)

Copyright © 2020 Albuquerque Journal

Bernalillo County is still taxing Innovate ABQ.

And Innovate ABQ is still paying.

Innovate’s two-year legal battle over property taxes ended quietly last year when it moved to dismiss its lawsuit against Bernalillo County Assessor Tanya Giddings and other county officials.

Innovate paid its approximately $121,000 bill for 2018 and is already halfway done with its current year obligation of about $124,000, online records show.

Innovate, a research park corporation formed by the University of New Mexico Board of Regents and bolstered by investments from the city of Albuquerque, Bernallio County and the private sector, had in 2017 sued the county arguing that its Downtown Albuquerque headquarters should not be subject to property taxation. The suit contended Innovate’s campus at Broadway and Central is state property and is used for educational or charitable purposes – reasons for tax exemptions under the New Mexico Constitution.

The case was slated to go to trial in state District Court in Albuquerque last fall, but ended before then.

According to Giddings’ office, Innovate proposed dismissal and the county stipulated to it.

“We were happy to see a resolution in the legal matter for Innovate ABQ and for Bernalillo County,” Clyde Ward, the assessor administrator, said in a written statement to the Journal.

He said the tax exemption issues are complex because of the property’s varying uses.

“The owners ultimately agreed that the uses were such as to be subject to taxation, and I believe that both parties were satisfied with the outcome,” Ward wrote. “The Assessor’s duty is to apply fair and uniform assessments under the law, and that is what we achieved in this matter.”

Innovate ABQ Executive Director John Freisinger said the corporation ended the suit for many reasons.

“I think the essential one was just the length (of time) that fight was likely going to take,” he said.

Freisinger said he did not know how much Innovate spent on the lawsuit, nor would the corporation likely disclose the amount since it considers its financial information private.

“We’re not subject to IPRA requirements,” Freisinger said, referring to New Mexico’s public records law, the Inspection of Public Records Act. “It’s internal to our organization.”

But UNM itself spent at least $20,000 on the Innovate suit, according to four legal bills it provided the Journal in response to a public records request. Spokeswoman Cinnamon Blair said that legal spending was to “represent the interest of the regents of the university for current and future issues that may be related to taxation on real property.”

But UNM does not hold documents on behalf of Innovate, which is separate from the university.

In its suit, Innovate asked the court to stop the county from taxing its real estate and for a judge to declare that its headquarters is state property and used for educational or charitable purposes. It also sought a refund of $230,000 in taxes it had already paid.

“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 corporation’s complaint said.

District Judge Shannon Bacon denied Innovate’s motion for summary judgment on the state property argument in 2018, but the corporation continued the legal fight.

It argued in part that student dormitories at Innovate’s Rainforest Building qualified it for the “educational” tax exemption, and also that Innovate’s larger mission to foster economic development through high-tech research and development qualified as a “charitable” endeavor, according to court records.

The county argued that the dormitories are controlled primarily by Innovate, a separate legal entity from UNM, records show, and also that the building’s ground level office space houses several tenants, including some for-profit entities.

In August, the parties filed a motion to dismiss the case.

District Judge Joshua Allison subsequently granted it.

Innovate cannot return to court to seek a property tax refund for its 2016, 2017 or 2018 payments, according to the agreement. But it does not prevent the corporation from filing future claims challenging of taxes for years 2019 and beyond.

But Freisinger said he does not anticipate a future lawsuit.

“I’m currently not under the direction of my board to do that,” he said. “I don’t foresee that being something we’d resurrect in the future, but things change, assessors change, who knows?”

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