July 29, 2020

Is it okay to force taxpayers to subsidize private real estate projects? The answer ought to be a clear “no”: These kinds of tax incentives are a clear example of government simply giving away taxpayer dollars to fund real estate developers’ projects.

The Lincoln Institute of Land Policy partnered with Northern Light Productions on a documentary project about modern municipal growth, where the Goldwater Institute was prominently featured for its work fighting back against these tax incentives, known as Government Property Leave Excise Taxes (GPLET). 

The GPLET is an arrangement where private developers convey their land to the government—thus taking it off the tax rolls—but then immediately lease the property back for private use. After many years in which property taxes are completely abated or substantially reduced, the government then conveys the property back to the developer. In the meantime, other property taxpayers are left to make up the deficiency in the form of higher taxes.

The Goldwater Institute is fighting back against this violation of taxpayers’ rights. We recently had a substantial victory challenging this tax charade, when a judge in Maricopa County struck down a major GPLET deal under the Arizona Constitution’s Gift Clause, a provision that prohibits public aid for private activities. You can read more about that case here.

In the Lincoln Institute documentary “Taxes and Towers,” Goldwater Director of National Litigation Jon Riches discusses the GPLET in Phoenix and how it is harmful to taxpayers, the broader public, and ultimately, organic and sound municipal growth. You can watch the full video above.

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