By Phil Riske | Managing Editor
(Editor’s note: Second in a series of articles reviewing the 2014 news stories published by Rose Law Group Reporter that were most read and gained momentum during the rest of the year.)
FEBRUARY 2014
February spawned what is still a battle between the solar power industry and utilities, as well as two potential major economic engines that would die on the vine before year’s end.
Solar Energy
The Edison Electric Institute on February 18 filed official comments with regulators in Arizona on the subject of valuing distributed generation renewables, including rooftop solar. The institute wants a fair and balanced evaluation of distributed renewable generation, which specifically excludes both the distributed and the renewable values.
Meanwhile, the solar industry was fighting a bill introduced by Rep. John Allen, R-Scottsdale that would tax solar panels that are leased by homeowners. Arizona property tax law states that rooftop solar panels used to generate electricity on site for a home or business are not assessed property tax. But the Department of Revenue in 2013 issued a determination that leased solar panels, the fastest growing segment of the industry by far, should be assessed property tax.
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Apple and Tesla
A story from Bloomberg revealed Apple was lured to Mesa by a series of concessions made by the city.
The city, in Maricopa County “offered tax breaks, built power lines, fast-tracked building permits and got the state to declare a vacant 1.3 million-square-foot facility that Apple was exploring a foreign trade zone”.
While that doesn’t all sound legitimate, it’s certainly testament not only to the prestige that Apple’s business can bring to a location, but also the desperate nature of Mesa’s economy, which was severely rocked by the 2007 housing crash.
Two Arizona bills that would give Apple Inc. tax breaks for its new Mesa plant were facing some resistance at the State Capitol.
One of the bills was running into opposition after Republican lawmakers added language to the measure extending manufacturing energy use tax breaks for Apple to copper and other mining smelters. Senate Bill 1413 eliminates sales taxes paid by manufacturers for energy and utility use.
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Tesla Motors, the maker of the high-end electric vehicle, released plans Feb 26 about its “Gigafactory” where it intend to build advanced electric batteries for the next generations of cars. In the Tesla blog post, “The Gigafactory is designed to reduce cell costs…by 30 percent…and, by 2020, produce more lithium ion batteries annually than were produced worldwide in 2013.”
According to Yahoo “Elon Musk said [Tesla] has not selected a final site for the facility, but ‘we currently expect that it will be located in one of the following states: Arizona, Nevada, New Mexico or Texas.’”
Economy/Real Estate
An economic update from BMO Capital Markets saw Arizona’s economy growing 3.2 percent this year and 3.5 percent next. Both results would beat the nation’s economy, which BMO expects to expand 2.9 percent in 2014 and 3 percent in 2015.
“Arizona’s economic recovery continues, with home prices rising at a brisk pace and population growth turning up,” said the early February report.
New home sales came in at an annualized rate of 468,000 units in January, according to the Census Bureau, an unexpectedly large increase. That’s 9.6 percent more than during December, 2.2 percent higher than during January 2013, and in fact the highest sales rate since 2008.
Big home price increases, however, weren’t expected to continue in most parts of metro Phoenix, and some neighborhoods might see a dip in values. Arizona State University’s W.P. Carey School of Business forecasted home price gains woud stall in 2014.
All this reported, Arizona’s housing crisis was over, according to numbers released by RealtyTrac.
Elsewhere, Gilbert cash reserves swelled as homebuilding surged, the former Motorola campus in Chandler sold for nearly $52 million, Taylor Morrison planned to top $1 billion in spending on land acquisition, development this year, and demolition underway at Mountain Shadows Resort in Paradise Valley
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Politics
Responding to howls from the state’s economic interests, Gov. Jan Brewer vetoed a bill that would have permitted businesses to discriminate against gay people on the grounds of religious conviction.
It would have been hard to ignore the pressure from the bill’s opponents. American Airlines, Apple and the real estate industry said the bill was a terrible idea. So did the Arizona Chamber of Commerce. The list went on and on.
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A federal court dismissed a claim by the Legislature’s GOP leaders that only they have the authority to draw congressional boundaries. The decision meant there would be no change to the configuration of Arizona’s nine congressional districts, at least for the time being.
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In a move that sent Democrats into a mad scramble, U.S. Rep. Ed Pastor, 70, announced he is retiring from office at the end of the current term, when he completes his 23rd year in Congress.
Pastor is the first Hispanic from Arizona to get elected to Congress. He represented Congressional District 7, which covers south and central Phoenix and stretches into Glendale, Tolleson and Guadalupe.
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State Treasurer Doug Ducey officially announced his candidacy. “I’m here to announce that I will seek, and with your help, we will win, the office of governor for the state of Arizona.”
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Water
Sen. Barbara McGuire, D-Kearny, and Rep. Steve Smith, R-Maricopa introduced nearly identical bills that would prevent the Arizona Department of Water Resources from implementing a rule that would systematically phase out agricultural extinguishment credits in the Pinal Active Management Area.
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Other February Highlights
Rose Law Group became the first law firm in nation to accept bitcoins .
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The Rocky Mountain poll from the Behavior Research Center surveyed 700 Arizonans asking, “Do you think the sale of marijuana should be made legal or not?” Arizonans were in favor 51 to 41 percent.
