Cre­ation of West Side tax district ques­tioned

Econ­o­mists say state taxes would be eroded

Albuquerque Journal - - METRO & NM - BY DAN MCKAY

SANTA FE — Econ­o­mists for two state agen­cies on Tues­day ques­tioned the idea of cre­at­ing a new tax district on Al­bu­querque’s West Side, ar­gu­ing that it could erode state tax rev­enue.

Sup­port­ers of the tax district, in turn, de­scribed much of the anal­y­sis as prej­u­diced and in­com­plete.

The de­bate sur­faced be­fore the state Board of Fi­nance — where board mem­bers spent nearly five hours go­ing over an ap­pli­ca­tion to es­tab­lish a tax in­cre­ment de­vel­op­ment district in Al­bu­querque. The district would al­low a share of fu­ture tax rev­enue gen­er­ated there to be di­verted to re­im­burse the de­vel­oper for build­ing streets and other pub­lic in­fra­struc­ture.

The board held off on mak­ing a fi­nal de­ci­sion.

But in re­ports to the board, econ­o­mists work­ing sep­a­rately for the De­part­ment of Fi­nance and Ad­min­is­tra­tion and the Leg­isla­tive Fi­nance Com­mit­tee said the ap­pli­cant, West­ern Al­bu­querque Land Hold­ings LLC, hadn’t proved to their sat­is­fac­tion that ap­proval of the district would be in the state’s best in­ter­est.

Cre­ation of the district, they said, would di­vert some tax rev­enue for use within the district — rather than mak­ing it avail­able for ba­sic gov­ern­ment ser­vices in gen­eral — and it might not bring new jobs to New Mex­ico from out­side the state.

But sup­port­ers of the pro­posal as­sailed the eco­nomic anal­y­sis — the

one con­ducted by DFA, in par­tic­u­lar — as bi­ased and one-sided. The re­port by leg­isla­tive an­a­lysts wasn’t dis­cussed at the meet­ing.

At stake, sup­port­ers said, is a push to lay the ground­work for a ma­jor med­i­cal cen­ter and other job op­por­tu­ni­ties where they’re des­per­ately needed — west of the Rio Grande in Al­bu­querque.

Board mem­ber Robert Aragon in­tensely ques­tioned Clin­ton Turner, chief econ­o­mist for the De­part­ment of Fi­nance and Ad­min­is­tra­tion, about his agency’s eval­u­a­tion of the pro­posal.

“I think the anal­y­sis is skewed by bias,” Aragon said.

He said the pro­posed de­vel­op­ment is likely to cre­ate jobs and bring needed ser­vices to the West Side.

Aragon, an Al­bu­querque lawyer, also dis­puted some of the le­gal anal­y­sis of­fered by the board’s own at­tor­ney, Sally Malave, an as­sis­tant at­tor­ney gen­eral.

As for the eco­nomic anal­y­sis, staffers for the De­part­ment of Fi­nance and Ad­min­is­tra­tion — part of Gov. Su­sana Mar­tinez’s ad­min­is­tra­tion — and the Leg­isla­tive Fi­nance Com­mit­tee, which an­a­lyzes pol­icy pro­pos­als for the Leg­is­la­ture, of­fered sim­i­lar con­clu­sions.

The DFA anal­y­sis said the re­quested tax district wasn’t “clearly jus­ti­fied.” In other words, Turner said, it wasn’t clear the project would cre­ate jobs that wouldn’t be cre­ated oth­er­wise.

In a sep­a­rate let­ter, two econ­o­mists for the LFC said the re­quested district “is not in the best in­ter­est of the state.”

Pat Rogers, an at­tor­ney rep­re­sent­ing West­ern Al­bu­querque Land Hold­ings, said the com­pany had re­vised its ap­pli­ca­tions to ad­dress the con­cerns raised by the econ­o­mists.

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