Glendale withdraws development incentives for planned VAI Resort to avoid referendum
The Glendale City Council voted to withdraw from a new agreement with a development that aims to be the state’s largest resort, after activist groups and residents collected enough signatures to place the issue on the ballot.
Worker Power Institute collected more than 5,500 signatures, challenging an amended development agreement that the council approved in June for the VAI Resort, which is under construction near Loop 101 and Cardinals Way.
The action taken in June was to update a 2020 approval to reflect changes in ownership and changes to the proposed project. When the agreement was approved in 2020, it offered a tax incentive, called a Government Property Lease Excise Tax, or GPLET, to the project’s previous owner. Since then, VAI Global Development purchased the property, and the updated amendment would have allowed the city to enter into the incentive with the project’s current owners.
Under a GPLET, land is deeded to the city for a given period, in this case 25 years, and the developer then leases the land, allowing the developer to pay lower property taxes on the site than if they had owned it.
GPLETs, which are a common development incentive in Arizona, have been called into question in various cities recently. Both Phoenix and Peoria have faced lawsuits over GPLETs, with opponents of the incentives generally claiming they provide benefits for private businesses but not taxpayers.
On Aug. 9, the Glendale city clerk determined enough valid signatures were received to challenge the June action, which would require the city to hold an election over the issue.
However, Glendale City Attorney Michael Bailey said the city had the option to repeal the June action, which would leave the original development agreement in place but remove the need for an election.
The 2020 agreement is too old to be challenged, Bailey said at the council meeting on Tuesday night. When that agreement was passed, there was no public opposition, he said.
Public benefit of project debated
Several members of the public spoke at the meeting on Tuesday night, all in favor of rescinding the new agreement. Many voiced concerns over a $1 billion development receiving the tax break, with what they saw as little benefit to the public.
Council members, however, said there will still be significant benefit to the public in the form of taxes, including property, sales and hotel taxes, construction fees and other funds that will go to the city.
Councilmember Joyce Clark said the project was good when it was first approved in 2020 and still is a good project for the city.
Councilmember Bart Turner also said the resort is projected to create jobs for workers of all skill levels, including housekeeping, restaurant staff, accountants, managerial jobs and other roles.
Turner also said it appeared some members of the public had been misled by the effort to repeal the amended agreement. Many members of the public said they were concerned about the planned outdoor events at the amphitheater, but Turner said the amphitheater was already allowed in the first agreement and will not be affected by the repeal.
The amphitheater and ability to host concerts have been a major focus for VAI since the company bought the project from the previous owner.
The mayor and council unanimously approved the measure to rescind the agreement and included incentives, avoiding the need for a referendum. No one from VAI spoke at Tuesday’s meeting.
“We appreciate the city of Glendale’s continued support for VAI Resort, and we are excited for the project to move forward on track with the city’s partnership,” Grant Fisher, president and CEO of VAI Global Development, said in an email on Wednesday. “Apart from the financial benefits VAI Resort will bring to the city of Glendale, VAI will be among the largest employers in the state, with hundreds of jobs created for the construction of the project and more than 1,800 full time positions for the resort. As an Arizona native, I am personally so proud to create this legacy in my home state that will positively impact the community and residents.”
Worker Power Institute was also the group to successfully campaign against the proposed Arizona Coyotes arena in a referendum in Tempe. Voters in Tempe rejected the development agreement and the attached incentives, ending the plan between the hockey team and the city.
Resort planned to open next year
VAI Resort is already under construction in Glendale, and the developer of the resort has previously announced plans to open in late 2024.
The 60-acre property is planned to include about 1,100 hotel rooms across four towers, a large white sand beach “swimming oasis,” a $40 million outdoor concert venue, pool, 12 restaurants and a party island. A Mattel-themed amusement park is also under construction at the development.
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Reach the reporter at cvanek@arizonarepublic.com. Follow her on X, formerly Twitter, @CorinaVanek.
This article originally appeared on Arizona Republic: Glendale repeals VAI Resort project's incentives to avoid referendum
