Since the Great Recession many developers have come to expect tax incentives. And, many Valley cities have provided them. Now, Mesa hopes to do the same and send a message that it’s serious about revitalizing the area around Fiesta Mall.
“We need to stay competitive with the communities around us like Phoenix, Tempe and Chandler who are already doing this and we’re seeing developers take their projects to those neighboring cities because of the tool that’s being offered there,” said Sara Sorensen, a project manager with Mesa.
That ‘tool’ is known as a GPLET which stands for Government Property Lease Excise Tax. It’s used in specific areas, like the Southwest Redevelopment Area that Mesa council members approved this week.
A GPLET cuts a project’s operating costs by replacing the property tax with a lower excise tax for up to 25 years. And, in some cases where a project is located in a redevelopment area and a business district, developers may not pay excise taxes for the first eight years. The excise tax varies based on the building’s size and use.
Over the next six to twelve months, Mesa city staffers will hold public meetings and gather input to create a comprehensive plan for the redevelopment area which they will present to council members.
