Business owner, councilman react to approval of new downtown high rise project

Posted at 9:04 PM, Apr 20, 2017
and last updated 2017-04-21 00:04:27-04

"It's just a different kind of haircut," explains Erika Clary, showing us her scissor skills at her salon, Arcane Hair Parlor, which just opened last fall south of Roosevelt Row near 3rd St. and Pierce.

"I saw the neighborhood changing and growing and I see a lot of value Downtown," she said.

She'll have some new neighbors soon - new high-rises are going in, featuring retail and residential space.

"I think it will give Downtown a real heartbeat and put it on the map," Clary explained.

Clary says overall, she's thrilled there could be more people, maybe most customers at her salon, but there are a few things that concern her.

"I didn't get a tax break to move here," she said.

But the developers of the new project did, to the tune of $9 million.

"It's fundamentally unfair and I think that's what it comes down to," explains Phoenix City Councilmember Jim Waring.

That's why Waring voted against the project at Wednesday's meeting. But it's moving forward without his vote and with that $9 million tax break.

Here's how it will work:  The city will own the land and lease it to the developers to use over 20 years. The developers will not pay property taxes, but will pay what's called an "excise" tax. A spokesperson for the city says this kind of agreement would actually generate more tax income for the city than say a regular apartment building. It also allows developers to come and revitalize Downtown.

The project will take part over three phases. In the first phase, the developers get the tax break for 20 years; in the second and third phases, that window shrinks to 8 years.