A delegation of BOMA Tucson and BOMA Phoenix members represented member issues as part of Arizona BOMA Advocacy Day in Phoenix last week. The group included Arizona BOMA President and Cushman & Wakefield | PICOR Property Manager, Mona Deane, who offers this summary of the Arizona legislative office visits.
Building Owners and Managers Association (BOMA) International is a 16,500+ member federation of local associations, including BOMA Greater Tucson and BOMA Phoenix whose members own or manage over nine billion square feet of commercial properties. Industry advocacy is a cornerstone of member benefit.
Among those with whom we met to discuss state level issues of interest to the commercial building industry were Representative Steve Farley (District 28), Representative Ted Vogt (District 30), Assistant to Sen. Frank Antenori (District 30) and aide to Sen. Al Melvin (District 26). It was an enlightening and positive trip where the BOMA delegation met new people and reconnected with some we have met in previous years.
Arizona BOMA talking points
The mission of Arizona BOMA is to encourage and advance a political, social and economic environment within the state of Arizona beneficial to the progression and interests of commercial real property and its ownership and operation.
Yes on HB2395 Scrap Metal Dealers; prohibited transactions (amended)
This bill is important to the industry to help combat the rampant and costly copper theft impacting owners of Arizona commercial property. In addition to supporting the bill, we requested that two words “residential or” be added to commercial, as it is very difficult to determine whether scrap parts were removed from a large residential or small commercial unit.
No on SCR1025 Property Tax Assessed Valuation, Limitation
SCR 1025 proposes a constitutional amendment, subject to voter approval, to limit the annual growth in the limited property value of locally assessed properties, beginning in Tax Year 2015.
- It is the position of Arizona BOMA that SCR1025 will cause tax inequities. Under SCR 1025, property value increases will be constrained. If a property in Glendale goes up in value by 5% a year and property in Scottsdale goes up in value by 10%, even though the Scottsdale property will have a 20% greater value than the Glendale property in just four years, under SCR 1025 both properties will have the same taxable value. This causes a shift in the property tax burden to property with less appreciation or economically depressed areas, thereby providing protection to parcels most affected by value appreciation.
- SCR 1025 does not provide meaningful tax relief. It only limits the property value (allows the limited value to only increase by 5% each year). Without limiting both property value and tax rate, no meaningful tax relief will result.
- Inability of property owners to protest the property value upon which the tax is computed. The taxes will be computed on a limited value. This will reduce uniformity and equity, moving the property tax away from the ad valorem system it was originally designed to be. SCR 1025 increases the complexity and lessens the understandability of our property tax system.
It is vital for such a common issue to be clarified in order for businesses to know where they stand on their tax liability. It should be made clear that computers and their operating system software (such as Windows) are a legitimate tangible personal property, and application software should be considered intangible and therefore exempt from inclusion as personal property subject to tax.
SCR1012/HCR2009 Personal property tax exemption amount
This measure would amend the Arizona Constitution, upon voter approval, by increasing the exemption for commercial and agricultural business personal property initially acquired during or after Tax Year 2013 from $68,079 to an amount equal to the annual earnings of 50 workers in the state, based on a designated national measure.
Arizona BOMA requested that SCR1012/HCR2009 be moved to the ballot for Arizona voters to decide the issue. We are in favor of the increase in the personal property tax exemption and believe that the change will make Arizona’s small business climate friendlier and have positive economic effects for the state.
Mona Deane is a former Property Manager with PICOR and is Past President of BOMA of Greater Tucson and current President of Arizona BOMA. She has over twenty years experience in the commercial real estate industry managing office, industrial and retail properties for asset and fee property management. Significant clients include Rockefeller Group, GE Capital and the University of Central Florida.