09/20/2010 Town Council Special Meeting Summary

 “$43 Million Land Deal? Try $90 Million”

Remember the recent Arizona Republic news articles that reported on the January 2009 Town Council approval of the purchase of parcels of land for the exorbitant price of $43 million? Tonight’s 9/20/2010 meeting, a Public Hearing, was the “knee-jerk response” (as stated by Gilbert resident Tim Berger) to make everything right going forward, so this never happens again. This meeting was to discuss an amendment to the Code that would “require” appraisals on certain land purchases. Not satisfied that this will solve the problem of a lack of common sense, Mr. Berger and other Gilbert residents are demanding answers. They want a full and transparent investigation into what happened with this particular land deal. What about other expensive deals? The word “transparency” came up again and again.

Even after Council Member Linda Abbott presented the “Investment for Future Recreational Needs and Youth Sports” statement to which she, Dave Crozier, and Les Presmyk attached their names, for the purpose of explaining everything, the questions are not going away.

So, where does the $90 million come in? William D. Cleaveland, a Mesa attorney, provided me with a copy of an 8-page letter that he sent to the Council in which he lists not only the $43 million land deal, but additional deals amounting to “a roughly $90 million debt-fueled spending spree” that the Gilbert Town Council approved in a series of meetings held in January and February 2009. “This was only 4 months after the banking collapse in September of 2008, and at a time when municipal revenues were plummeting.” See Mr. Cleaveland’s letter.

Yet, Linda Abbott, Dave Crozier, and Les Presmyk (and other Council members no longer on the Council, including Steve Urie) rubber stamped project after project, putting the Town deeper and deeper into debt.

Also beginning in early 2009, these same Council members began building a case for tax increases. After all, how were they going to pay for all this debt? In his letter, Mr. Cleaveland called this behavior the “spend-then-tax government philosophy at work.”

These same 3 Council members (actually 5 if you count Ben Cooper and John Sentz) have grand plans for us, and those plans do not involve spending cuts. If reelected this Spring 2011, can you guess what the Abbott-Crozier-Presmyk-Cooper majority will do?

This is how the meeting went:

Before allowing 3 citizens to speak, Council Member Linda Abbott requested that the chronology and history of the purchase of the $43 million parcels be presented. Town Manager Collin Dewitt provided an overview about the purpose of tonight’s meeting, and the news articles that led up to this Hearing. Basically, he advised that the negotiations at the time involved an “unwilling seller and a willing buyer.” He referred to a Chronology of the Zinke Land Acquisitions.

Linda Abbott stressed that the newspaper accounts were sparse, and that this was a long, complicated process that began in March 2006 and culminated with the approval of the purchase in January 2009. She advised that the Town wanted to avoid the additional legal costs to condemn the property for purposes Eminent Domain. (Susan Goodwin, Town Attorney, advised that this might have cost the Town about $50k.) Ms. Abbott presented a statement titled “Investment for Future Recreational Needs and Youth Sports” outlining the need for land to provide for organized youth and adult sports programming in the underserved southern part of Gilbert. She stated that she assumed the appraisal had been obtained. She referred to the “Chronology of Zinke Land Acquisitions” beginning March 2006 and continuing until June 2011 when Zinke is scheduled to vacate the dairy and Gilbert will auction improvements, and demolish remaining residence and structures. Zinke is to remediate the site and sell remaining land.

There was a discussion relating to appraisals, and Ms. Goodwin advised that it has always been customary for the Town to obtain them, and this is stillthe practice. A discussion ensued relating to improvements and other benefits that were included in the deal that wouldn’t have shown up in an appraisal.

CITIZEN COMMUNICATION

Tim Berger, a Gilbert resident, stated that while it is fine for the Town to require an appraisal for future land purchases,that is not adequate. “Would you require a current appraisal or one done 3 years ago? Were Phase 1 and Phase 2 inspections done? It’s obvious this is being done in kneejerk reaction so it looks like the Council is doing something to protect taxpayers in Gilbert. What needs to be done is a full and transparent investigation on how we spent $43 million for this piece of land. Everyone in this room knows that land was not worth $300k per acre! Also, the Attorney is wrong. Easements do show up on an appraisal. What went to terribly wrong with this?” He insisted that there needs to be an open investigation. “You don’t need an amendment that requires you to have an appraisal. Common sense says you need to have an appraisal.”

Mary Ellen Fresquez, a Gilbert resident, stated her disappointment in reading about this land deal in the Arizona Republic. “I would expect that members of the Council would have asked, ’Where is the appraisal?’” She noted that the Council is always asking what other surrounding communities are doing, “so to me that’s similar to asking, ‘What are the comps?’ We won’t know for another 17 years if this was a good move, that’s not adequate to the taxpayers. This points to an important issue: Transparency. Did it come through the Consent Calendar? Every Council Member should have explained why they were voting for this. Lately we’ve had commissions that have melded together, commissions that have undone themselves. I believe the onus is on you to increase transparency.”

Jerry McBee, a Gilbert resident, asked about those “improvements”? “Did we buy those cows or give them back to him? Do we know that? We paid for infrastructure and improvements? Do we need to require an appraisal. Yes, we should have had it. But it’s important to keep the public informed about these deals. You need to help the citizens know what’s going on. There is a lack of transparency. No item should be placed on the Consent Calendar that exceeds a certain dollar limit. A $42 million purchase on the Consent Calendar?” He demanded a full investigation of this land deal.

COUNCIL DISCUSSION

Council member Jenn Daniels suggested not voting on this tonight, and stated that Mr. Berger had good suggestions that we should have appraisals that are current and have an inspection of the properties. She also suggested obtaining and studying the ordinances from other municipalities that require appraisals, and gaining a better understanding of these ordinances.

Ms. Abbott asked Susan if she had looked at other ordinances first? Susan advised, no, the amendment had been put together very quickly. She stated that she is happy to review the ordinances of other municipalities.

Council member Dave Crozier suggested that maybe the League of Cities might have a model.

The Council voted 7-0 to postpone the adoption of the ordinance pending more research and discussion.

It is obvious that the Town Council used very poor judgment relating to the purchase of this parcel of land. Nothing seemed to matter to them, certainly not the cost, except to grab the land in order to secure space for organized youth and adult sports programming for the underserved southern portion of Gilbert.

But, if something as simple as an appraisal was disregarded, what about the fact that this is a dairy farm which will be converted to a park where children will play. What does a herd of dairy cattle produce besides milk for 50 years? Hazardous waste? Will the soil need to be dug down 50 feet and replaced? Does the farm have a gasoline reservoir of some kind from which the farmer could easily refuel his equipment? Was the land ever farmed? If so, were pesticides stored and disposed of? Does anybody know? Did anybody ask?

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