Oro Valley eyes annexing Casas Adobes shopping centers

People who shop, dine or own property around Ina Road and Oracle Road could see a new town boundary and a higher sales tax if Oro Valley moves ahead with a proposed annexation of 227 acres in Casas Adobes. The area includes three busy shopping centers and part of a residential neighborhood that are currently in unincorporated Pima County. Oro Valley is beginning the process with community outreach, but the boundaries and the annexation itself are not yet settled.

Town officials have invited business owners and 159 nearby property owners to an informational meeting from 6 to 8 p.m. Tuesday, Nov. 9, at the Tohono Chul Outdoor Pavilion. Assistant Town Manager Karl Shaddock is expected to explain the proposal and answer questions from people who could be affected. The meeting is an early step, intended to gather feedback before the town determines whether the proposed map can move forward.

The proposed area reaches across all four corners of the Ina and Oracle intersection. It includes Cottonwood Plaza on the northeast corner, La Toscana Village on the southeast corner and Casas Adobes Plaza on the southwest corner. The map also includes part of the neighborhood south of Ina Road. The commercial properties contain a Safeway and a Whole Foods, as well as restaurants such as Wildflower, Tap & Bottle North, Truland Grassfed Burgers and Guadalajara Original Grill.

The financial incentive for Oro Valley is sales tax revenue. Shoppers in the area currently pay state and county sales taxes because the properties are outside any incorporated city or town. Annexation would add Oro Valley’s 2.5% sales tax, resulting in a combined rate of 8.6%. Town spokesman Phillip Cantrell said bringing the shopping centers into Oro Valley would increase municipal tax revenue.

A staff analysis described by Tucson Local Media estimated that the three major retail parcels could generate about $1.57 million in annual sales tax revenue for Oro Valley. A broader scenario that also included nearby residential properties was projected to produce a positive annual net impact of $1.19 million after costs. The town’s 2.5% levy would be added to Pima County’s 6.1% rate, according to that analysis. For shoppers, the increase would apply to taxable purchases made within the annexed commercial area.

The town’s interest is part of a larger annexation strategy, but adopting that strategy does not automatically launch or guarantee an annexation. Each proposed annexation, agreement and related land use action would need to return to the Oro Valley Town Council for separate consideration. The major practical challenge is creating a boundary that meets state law and wins enough support from property owners, rather than determining whether the area could provide a financial benefit.

Under the process outlined by Shaddock, approval requires more than half of the property owners in the proposed area to sign on, with those owners also representing at least half of the area’s assessed property value. Arizona law sets similar requirements, calling for signatures from more than half of the people who own taxable property and from owners representing at least half of the property value. Because the map is still preliminary, residents’ and business owners’ responses could lead the town to change the area under consideration.

Oro Valley has encountered the difficulty of meeting those requirements before. The town’s most recent annexation added 36 acres near La Cañada Drive and Moore Road in 2023. The Westward Look area was annexed in 2021. A separate 107 acre annexation near the northwest area of Ina and Oracle roads took three years to complete and required support from more than half of the property owners and more than half of the assessed property value. In the 36 acre case, the council voted unanimously to accept the land, followed by a protest period, and the annexation became final after 30 days.

The Ina and Oracle intersection now has the council’s highest annexation priority, designated as a Tier 1 opportunity. The council’s broader strategy divides potential expansions into active opportunities with commercial interest and longer term possibilities that do not require immediate town resources. During discussions of the plan, Vice Mayor Melanie Barrett urged the council to give more attention to other long term items and suggested adding a third tier. The town originally adopted its annexation strategy in 2020, and the revised approach identifies commercial areas near existing town limits as the most immediate focus.

Other shopping destinations are also on Oro Valley’s long range list, including Foothills Mall and La Encantada. Those properties are not adjacent to the town’s current borders, however. Reaching them would require annexing the neighborhoods between the commercial centers and Oro Valley, making those proposals more complicated and less immediate. Officials have described them as areas to monitor and study over time. Residents can follow the Ina and Oracle proposal through information posted on Oro Valley’s annexation website, while the upcoming meeting offers the first public opportunity to weigh in on how the boundary could affect the Casas Adobes community.