The Arizona Attorney General's Office has signed an agreement to resolve a lawsuit against the city of Tempe over its use of tax breaks to private developments.
The agreement announced Tuesday settles the dispute related to Tempe's use of government property lease excise tax rates that were effectively eliminated by the state Legislature in 2010.
Tempe now can no longer use its prohibited tax loophole scheme on new leases.
The AG's Office filed the suit in May after conducting an investigation.
The settlement agreement resolves the state's claims against Tempe and ends the Arizona Supreme Court's challenge.