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RGF op-ed: Mayor’s Downtown taxing plans won’t work because they don’t address crime and vagrancy

The following appeared in The Albuquerque Journal It was co-authored by Douglas Peterson of Peterson Properties and Paul Gessing  of Rio Grande Foundation and appeared on Sep 14, 2024.

Albuquerque Mayor Tim Keller recently unveiled a plan — the latest of many such plans outlined by city officials over the years — that he believes will revitalize Downtown Albuquerque.

As the president of a think tank that offices Downtown and a major property owner Downtown, we, like all Albuquerque citizens, have a stake in improving Downtown.

The plan is based on two specific policies:

He wants to create a Downtown “tax increment financing” district, in New Mexico they’ve been called TIDDs.

Secondly, he wants to create a “Business Improvement District.”

Since neither of these are commonly understood concepts, here’s a brief primer.

A TIF or TIDD is a subsidy scheme that essentially allows tax revenues to be focused on the target area, in this case Downtown. Areas of town around the TIF are thus required to pay taxes to support basic government services for the TIF area as well. Allowing a TIF for Downtown would help Downtown, but it will hurt the rest of Albuquerque.

A business improvement district (BID) is a privately managed governance tool whereby property owners vote to agree to pay additional “taxes” in order to have some kind of private sector involvement that does things government can’t or won’t do. In Downtown this has typically meant cleaning up trash and provision of other supplemental services.

But Downtown Albuquerque’s needs are unlikely to be solved by either a TIF or a BID. Like much of the rest of the city, Downtown suffers from serious crime and vagrancy issues.

Can a BID address those issues? It is hard to say, but the market for office, retail and restaurant space in Downtown is soft to say the least. Downtown has not recovered from the COVID pandemic nor the 2020 riots and the uptick in crime and vagrancy.

Imposing new taxes on Downtown property owners without addressing crime and vagrancy is sheer folly, especially at a time when Bernalillo County Assessor Damian Lara, a former employee of Keller’s, has substantially raised property taxes on Downtown property owners by as much as 100% in some cases.

We believe that Mayor Keller could get tough on crime Downtown and elsewhere, but he has been in office for nearly eight years and hasn’t done so. Now he’s trying to foist additional costs onto Downtown without resolving to solve the problem.

Likewise, a TIF would funnel additional resources to Downtown Albuquerque, but in the absence of hiring more police and tougher enforcement of laws against public camping and vagrancy, more resources won’t really help Downtown. The former Downtown BID failed because it built a hierarchical, wasteful administration, including Keller fundraiser Brian Morris as the Executive Director, and spent more money throwing parties and holding nonsensical meetings than improving public safety.

While Downtown Albuquerque is certainly not alone in struggling to fill commercial space in a post-COVID environment, the governor and Legislature could do a great deal more to help. For starters, the Legislature and governor continue to benefit from massive oil and gas surpluses. While the state has socked away $54.7 billion for future use, Downtown Albuquerque is in crisis right now.

We don’t need a TIF or a BID. We need the Legislature and governor to get serious about diversifying New Mexico’s economy. Combined with a mayoral effort to seriously reduce crime and vagrancy, Downtown might be a more likely destination for business and economic activity.

That would increase property values and make Downtown a destination rather than a dangerous place people avoid.

We all should want a strong Downtown. Our city and state would benefit greatly from it. In any event, we stand ready to help.

Douglas Peterson is an attorney and president of Peterson Properties, the largest property owner in Downtown, as well as a two-time member of the former Downtown BID’s management agent, the “Downtown Action Team,” and the former chairman of the Albuquerque Environmental Planning Commission. Paul Gessing is president of Rio Grande Foundation, which is located Downtown.