The core of downtown Mesa could change, soon, if Mesa voters approve an increase in the sales tax rate in the Nov. 8 general election.
If the tax hike is approved, it will pay for the construction of four multi-story buildings in the block around the Mesa City Plaza which would house Arizona State University classrooms, students and instructors.
It’s not all about ASU, though. Much of the new money would be directed specifically to the city’s fire and police departments, Mayor John Giles said.
And, the city won’t forget about its other partners in higher education. Money is earmarked for expansion projects to help Benedictine University and Wilkes University, both of which already operate in downtown Mesa.
The ballot question asks voters to approve a 0.4 of a percent increase in the city’s sales tax rate. The current tax rate of 1.75 percent would increase by four-tenths of 1 percent to 2.15 percent. That means on a $100 purchase, the buyer would pay $2.15 in city sales taxes. It has no effect on sales taxes charged by the state and county. Giles reminds voters that the city doesn’t tax groceries.
City officials expect the tax to generate an additional $38.4 million a year. Of that $23 million would be earmarked for public safety — fire and police. Another $15 million would go to higher education.
If voters approve the hike, the increase would go into effect March 1, 2017.
Much of the buzz about the tax increase seems to be associated with ASU, Mesa City Manager Chris Brady said.
But, “public safety really became the drive behind this,” he said.
Budget meetings about the needs of the fire and police departments showed fire stations are pretty far away from new housing developments, he said.
“The tremendous housing growth in the southeast and northeast parts of the city puts pressure on response times for the fire and police departments,” Brady said. “We know we need to build more fire stations.”
Revenue from the increased tax rate would pay for a new fire station in southeast Mesa, 27 additional fire department employees, 58 police officers and four civilian police employees, plus equipment for both departments.
“Mesa is growing fast, we have to catch up with public safety,” Giles said.
“Our staffing has gotten behind,” Brady said. “We need more officers and technology.”
The approximate $102 million needed to build the 200,000-square-foot or so ASU campus would come from the sale of revenue bonds. Those bonds come with the pledge to pay the bond holders with the new sales tax revenue. That’s how the city paid for the stadium for the Chicago Cubs.
“This is kind of the Mesa way. It works,” Brady said.
Giles appreciates the massive presence ASU already has in Mesa, with its Polytechnic campus near Gateway airport. But, he’d like an even bigger presence by “the most innovative university in the country.”
The mayor realizes the ASU project will alter downtown Mesa in what he refers to as “permanent change in a positive way.
“Downtown Mesa is walkable, with cool shops,” the mayor said. “Every store has a different story. I don’t think this will change that.” Rather, he’s convinced ASU will be a magnet to bring new business and people downtown, making vacant downtown properties more attractive.
The addition of tall buildings in the neighborhood doesn’t cause Mesa Arts Center Executive Director Cindy Ornstein to worry.
Preliminary drawings show the building next door to the arts center as being somewhat transparent, she said, with lots of glass, allowing passers-by to see in and students to see out.
“They are really being sensitive to the area,” Ornstein said. “It should fit into the area nicely.”
The arts center and ASU have a long tradition of collaboration, she said, and that could grow with a campus next door. ASU art and theater projects are regular features at the arts center.
“We stand ready to make sure that we maximize the opportunities citizens have if they so decide,” Ornstein said. “We’ll take advantage of the opportunities it presents.”
The type of programs planned to be housed in Mesa are another plus, she said. ASU officials have said they plan to offer art, music, film, dance and a media engineering program at the new campus.
The intergovernmental agreement already entered into by the city and the Arizona Board of Regents states an early childhood education program and facility will be part of the Mesa program.
The ASU buildings would be owned by the city and leased to the university for 99 years. ASU would be responsible for the buildings — maintenance, repairs, furnishings, Giles said. Construction would be finished by fall 2018.
Early discussions call for retail shops and restaurants on the ground floors of the buildings.
Benedictine has grown faster than college officials anticipated, Giles said, and already has more students than its Main Street buildings could accommodate. So, earlier this fall, some offices and classrooms were relocated to the Mesa Higher Education Center, where Wilkes is based. That means the Higher Education Center must be expanded, the mayor said. And, the city plans to build out the 26,000-square-foot second floor of Benedictine’s building. Terms of the leases between the city and the universities call for such expansions as needed.
Another 300 to 500 new parking spaces would be created downtown as part of the overall project, Giles said. And, about 10 acres of new public space is planned.
If voters don’t approve the tax increase, city officials will figure out a way to provide more space for Wilkes and Benedictine, Giles said. But, ASU won’t happen, nor will the fire and police projects occur without the new tax.
Increasing the sales tax is one of few ways Mesa officials can generate additional tax revenue for city projects.
The city does not have a primary property tax. The secondary property tax can only be used to pay for capital projects and to improve infrastructure, so a sales tax increase is what city officials consider the best option to secure new money.