A Maricopa County Superior Court judge has rejected Phoenix’s attempt to sidestep an Arizona lawthat negates efforts to turn Roosevelt Row into a branded district downtown.
The ruling issued this week follows about a year-and-a-half of controversy over a proposal to tax property owners in the growing area of shops, galleries and restaurants. The money would pay for extra services like beautification and marketing.
Judge Daniel Kiley sided with the state in a lawsuit filed by the city that sought to determine whether a new law changing how business-improvement districts are formed statewide applied to Roosevelt Row.
Phoenix Spokeswoman Julie Watters said in an email that the city is disappointed by the ruling and is evaluating next steps.
The decision “undoes the hard work and undercuts the enthusiasm and investment of the people who live and work in the area” who spent years planning the Roosevelt district, she said.
Law targets Roosevelt Row, isn’t special legislation
Phoenix leaders are asking a judge to rule that a district intended to fund the downtown Roosevelt Row arts corridor is unaffected by a new Arizona law.
Some landowners concerned about the changing face of Roosevelt Row led the effort to make it an established district, paid for by a new property tax within its boundaries. Those opposed argued the process was unfair and successfully sought help from the state Legislature.
The resulting law requires cities to prove support for districts, instead of a lack of opposition. That change applies to the Roosevelt district, Kiley ruled.
The legal argument at a hearing earlier this month focused mainly on what counts as a map. The law was retroactive to Jan. 1, 2016, and applies to districts that didn’t approve a boundary map before then.
Phoenix argued it met that deadline with early City Council decisions and could move forward under the old rules.
Kiley, though, agreed with the state that Phoenix didn’t approve the type of map required by law. He wrote the law meant to target the Roosevelt district, and the court should not interpret the definition of a map “in a manner that would defeat the Legislature’s intention.”
Challenges moving forward with district
The court also rejected Phoenix’s argument that the law is special legislation that unconstitutionally targets Roosevelt Row. Kiley said the law will first be applied to the Roosevelt district, but that it’s not a unique burden.
Property owners said earlier this month that there’s still interest in moving forward with a business-improvement district. However, gaining enough support will be difficult — if not impossible — using the original boundaries.
Some City Council members also opposed the district and the fight to save it.
Councilman Sal DiCiccio said in a statement that the ruling was a “huge loss for politicians pushing big taxes on small business owners.”
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