Proposed Legislative Bill Threatens City Funds

I want to make you aware of a legislative bill that is currently making its rounds at the State Capitol that, if approved, will negatively impact Surprise’s ability to provide services to residents at current levels.

The Municipal Tax Exemption – Residential Lease (HB2026) bill would prohibit all cities in Arizona, including Surprise, from collecting tax on some rental properties.

Passage of HB2026 in its current version would have the direct impact of reducing up to an estimated $300,000 annually from the city’s operating budget. A previous version of the bill had Surprise losing $2.1 million annually!

State Representative Darin Mitchell (R-13), who is sponsoring the bill, has clearly stated his intention, in time, is to totally eliminate this revenue source for municipalities altogether. Collectively, this would represent a $90+ million hit to all cities across Arizona.

This bill infringes on Surprise’s ability to make decisions that help raise local revenue, which allows us to provide core critical services that our residents depend upon each day, from public safety to accessible streets.

Furthermore, rental properties typically place a higher demand on the services provided by our public safety agencies when the number of service requests is compared to non-rental properties. The additional revenue generated through this mechanism helps offset the cost of the additional service demands.

There is no empirical evidence to suggest the elimination of this tax will reduce rental prices and, just as important, this bill ties the hands of your City Council to make decisions that affect you, our residents.

For these reasons, I’m sure you’ll agree this is a harmful bill with negative local impacts.

CALL TO ACTION – Please call or email your state representatives today and let them know that you oppose this potentially devastating legislation to our community. For your convenience, you can find contact information for your state representatives by visiting www.surpriseaz.gov/889/State-Representatives.