The Tucson City Council signed off 6-1 on a $2.5 million annual incentive to help some businesses pay for new water lines.

Mayor Jonathan Rothschild kicked off the council discussion Wednesday by saying that he asked for the city staff to develop the water infrastructure incentive package despite some views that it is seen as a major departure from city policies requiring that growth pay for itself.

Under the proposal, the city would pay up to $2.5 million a year to build water pipelines and other projects helping out new nonretail employers. The incentives would go only to developers who build projects in areas that city government has targeted for future industrial, office and warehouse development

Rothschild said there were several areas along Interstates 10 and 19 that lack water infrastructure that would be ideal for industrial, office and warehouse development. Companies wanting to build in these areas could qualify for reimbursement for their water infrastructure needs under this program.

He added the new incentives set the bar high for companies, saying they would have to meet several criteria, including conservation and sustainability measures, in addition to creating high-paying, nonretail positions and that each request for money would go before the council for approval.

One example is a company wanting the water money would have to qualify for the primary jobs incentive, which offers construction-sales tax credits and building permit fee waivers to new businesses that create at least 25 jobs paying $52,400 or more a year and invest at least $5 million in new facilities or equipment.

But Councilwoman Regina Romero was not swayed by Rothschild’s argument, voting against the measure.

Romero referred to a rate overview offered by Tucson Water officials as part of her reasoning, noting the city-run utility was planning on small rate hikes for all users over the next four years.

She argued the city’s working poor should not be asked to pay more at the same time that the city would be offering incentives to companies.

“I just don’t think that this is a fair proposal,” Romero said.

Contact reporter Joe Ferguson at jferguson@tucson.com or 573-4197. On Twitter: @JoeFerguson

Reporter

Reporter with the Arizona Daily Star. I cover politics as well as the city of Tucson and other municipalities in Southern Arizona.