Is Arizona State University A Tax Shelter?

Colleges and universities are playing fast and loose with their non-profit status in so many ways. “In Arizona, the university system has a cavalier attitude regarding the use of its tax-exempt status,” Sean McCarthy writes in an essay distributed by the James C. Martin Center for Academic Renewal. “In one glaring example, the state’s largest commercial office development, built in 2016 and anchored by State Farm Insurance, pays no property taxes and will not for 99 years, thanks to a tax avoidance scheme developed by Arizona State University (ASU).”

“The 2.2 million-square-foot glass complex in Tempe is technically owned by the Arizona Board of Regents (ABOR) and resides on their land; however, the effective owner is Transwestern Investment Group, which leases it to State Farm. The state of Arizona and ABOR are exempt from property taxes, meaning the entire property and the land underneath it are exempt as long as ABOR holds the deed to the property.”

Related Topics