Phoenix, state make arguments on new Roosevelt Row district
Phoenix’s effort to create a special district to beautify and brand Roosevelt Row — an effort that was blocked last year by the state Legislature — focused on one question in Maricopa County Superior Court on Thursday: What counts as a map?
The answer will help decide whether a new law forces a do-over of the downtown district, which would tax property owners in the rapidly developing collection of local shops, restaurants and galleries. Judge Daniel Kiley heard about a half-hour of oral arguments in the lawsuit Phoenix filed against Arizona in September.
The city seeks a ruling that says the Roosevelt Row district is unaffected by a law, signed by Gov. Doug Ducey last March, that changes how business-improvement districts are formed throughout the state.
The state is asking for the complaint to be dismissed.
Creating the Roosevelt Row district as originally proposed would be difficult, if not impossible, under the changed rules.
Kiley took the issue under advisement and said he would rule as soon as possible.
The court arguments stem from a controversy that started in 2015.
Phoenix approved early steps to form a business-improvement district that would collect taxes from landowners between roughly Moreland and Fillmore streets on the north and south, and Seventh Street to Seventh Avenue on the east and west, to fund services such as beautification and event management.
Some property owners led the creation of the proposal and said they were willing to pay the extra money to guide the area’s future.
Opponents said they didn’t get a fair say in the process and sought help from the Legislature.
The resulting law requires support from property owners, as opposed to the previous system, which required only an absence of opposition. A retroactivity clause applies to districts that hadn’t approved a boundary map by Jan. 1, 2016 the primary issue in dispute Thursday.
Phoenix had approved a map by that point, Colin Campbell, an attorney representing the city, argued Thursday.
But Rusty Crandell, representing the state, said the law clearly applies to the Roosevelt Row district.
Phoenix’s lawsuit also argues that the law is special legislation, because it targets only the Roosevelt Row district. The state disputes that claim.
The Roosevelt Row district was the only one underway when the Legislature changed how business-improvement districts are formed.
But Campbell said Thursday the new law doesn’t apply because Phoenix established boundaries before the retroactivity date. The City Council approved the district’s borders, but not the diagram, showing each property, that’s eventually required under the process.
The borders are enough to avoid falling under the new law, Campbell said. “We think this is really an easy case,” he said.
Crandell, though, said it’s clear from City Council and legislative discussions that the law was intended to apply to the Roosevelt Row district. What Phoenix approved was only a preliminary step, he said.
“They did not think they were adopting a boundary map,” Crandell said.
The district proposal and resulting lawsuit have divided property owners and council members. Supporters said last year they were still working to implement the proposal.
But some council members opposed the district’s formation.
One of them, Councilman Jim Waring, called the city’s decision to go to court a waste of taxpayer money.