Archive for May, 2009
Arizona Illustrated did a piece on Rosemont mine and Davidson Canyon quarry HERE. All the stops are being pulled out on this one, including getting the Santa Cruz river registered as navigable.
Incidentally the other ‘navigable’ waterway being challenged is the cement river bed in LA used for the chase scenes in the Terminator series. Terminator riverbed clip.
At what point does this insanity stop?
The comment in the AZ Illustrated piece from the Cal Portland representative says it all. Davidson Canyon has been an on and off active quarry for years. Rosemont has been a mine for over 70 years.
It reminds me of the story of the neighbor that called DM Air Force Base to complain about the loud jets flying over head. The base representative reminded the neighbor that the base has been an active facility since the 1940’s and asked when the neighbor moved into the area. The complaining resident stated that he bought the house 3 years ago because he got a great deal on it.
How about a few high paying jobs guys? How about raw materials for cement production closer than New Mexico? Call me crazy.
Join us tomorrow for an interview with Clay Frey, a local financial planner turned movie producer. Clay is talking about his B horror movie Dead On Site. We’re going to talk about the process, ups and downs and Tucson’s film industry.
At one time Tucson had vibrant film industry. It started during the popularity of the classic westerns and carried over to films into the 80’s, that I grew up with, like Can’t Buy Me Love. For a full listing HERE.
Southern Arizona had an entire industry of film trades people that movie and television production crews could tap into for the next TV miniseries or feature film. Within an hour of Tucson a production could be in saguaro forests or tall pined mountain tops. The scenic back drops are incredible.
With the arrival of film production companies came a lot of money. They hire local actors and behind the scene support personnel. They stay in area hotels and eat at local restaurants.
Even with great scenic locations, close proximity to L.A. and the creative talent needed, the film industry migrated away. New Mexico is where most of the productions and talent is now. NM went on a major buying spree for all types industries. Their plan to attract business came at a price. We are seeing now how New Mexico may have overstepped things a bit, which eventually lead to improprieties and scandals big enough to keep Gov. Richardson out of the Obama cabinet. Whether or not New Mexico’s investment will pay off remains to be seen.
We did a complete story on our local film history HERE a few months back.
The biggest hurdle facing Arizona’s film industry revolves around the structure of tax credits given to production companies to entice them to choose Arizona.
Just like spring training baseball stadiums that used to cost $28m and have now escalated to $125m, the stakes in the film industry have risen dramatically. Like many other economic incentives the community that offers the most money gets the business. Arizona has tried to implement a tax credit program but New Mexico issued a better one. Last year only $8m out of the total possible of $50m was claimed. The issue has to do with the amounts and levels of payouts as compared to competing states. It may not be the right year to sweeten the offering given our states financial mess but it’s going to take some work.
CEO, Bill Harris of Science Foundation Arizona
Commentary from this weeks Arizona Illustrated - HERE
Rio Nuevo - Convention Center Hotel
Capital Plan
I have reviewed the Capital Plan options as prepared by Garfield Traub (April 2009). Here are the major points.
Four options are reviewed and 2 are immediately dismissed as not feasible at this point in time.
It is important to note that Garfield Traub indicates that private investors are not interested at this point in time.
Here is a review of the 2 most likely financing options:
The hotel would be owned by a “Public Entity”; for all practical purposes the owner would be the City of Tucson.
The City would be required to contribute $17.7 million; $12.7 million cash would be needed during the design phase (June ‘09 - Dec ‘09 according to Development Schedule) with $5 million from sales tax, building permits and impact fees.
“Substantial City financial participation” would be required. This would include:
1) Site specific transient rental tax (6%) + site specific city sales tax (2%) + a new convention center surcharge (2%)
2) Additional pledged revenue: $1 to $4.5 million/year
3) Credit support from City
The City of Tucson would sell $189 million of Certificate of Participation (COP) bonds backed by the credit profile of the City. Under different scenarios the City might need to make annual contributions to ensure there are sufficient funds to pay debt service: this could be zero or it could be $1 million or more if the projections end up being optimistic.
The financial projections are based on various assumptions that could turn out to be optimistic or pessimistic. Also, please realize that the negative cash flows are quite large during the first few years. It costs $200 million to build and loses money for several years before it breaks even.
Potential benefits to City:
City receives net profits when hotel begins to produce profits
City may realize residual value of hotel
Ancillary benefits of visitors on lodging, retail, entertainment…
My analysis:
I want to be optimistic where possible as the rebirth of downtown would enhance my family’s quality of life and indirectly enhance the business interest of my family. However, the financial hurdles are many and high. To build the hotel, the City needs to invest $12 million cash in the next few months, commit to fill any cash flow gap for several years, and sell almost $200 million of bonds in the next 7 months.
This is on top of many existing cash flow needs: balance the ‘structurally imbalanced budget’ (Standard and Poor’s); AND build the unreserved general fund balance by an additional $20 - $50 million ‘promptly’ or face a downgrade from Fitch and Moody’s.
The financial feasibility of the hotel is very sensitive to Tucson’s credit rating. If the rating were to deteriorate, the annual cash contribution from the City increases. In fact, the financial scenarios from Garfield Traub are based on Tucson’s credit rating before the recent downgrade from Standard and Poor’s (dated 5/18/2009).
The City’s ‘debt burden’ is already higher than other cities with the current credit rating (Moody’s). Issuing another $200 million of new bonds would seem to aggravate this factor.
It is possible that the City could accomplish all this. However, it would require rather significant spending cuts &/or revenue increases - significantly larger than currently being considered.
Please note that this is an analysis of the options presented by Garfield Traub. There may be other options not discussed. The figures presented by Garfield Traub are assumed to be accurate.
Capital Plan begins on page 45:
http://www.tucsonaz.gov/rionuevo/docs/HotelReport_final_4.17.09.pdf
Court orders Multnomah County to pay $1.15 million to Dorothy English estate
by Eric Mortenson, The Oregonian
Thursday April 16, 2009, 8:16 PM
Dorothy English on her property west of Portland, overlooking the Columbia River, in 2003.
Property rights advocates called it a bittersweet win. The Oregon Court of Appeals ordered Multnomah County to pay a $1.15 million judgment to the estate of Dorothy English, but the “poster girl” of the state’s land-use argument isn’t around to enjoy it.
English, who died in 2008 at age 95, fought the county in court for four years in an attempt to develop her property off Northwest Skyline Boulevard outside of Portland. She ultimately won a judgment for compensation, but the county maintained it had discretion whether to pay or not. A Circuit Court judge sided with the county, but the appeals court emphatically reversed that decision and ordered the county to pay.
Still to come is a separate decision on more than $440,000 in legal fees, which are not included in $1.15 million. The Court of Appeals is expected to rule soon.
“I’m very relieved, and yet like everybody else I’m saddened she wasn’t here to see this,” said English’s attorney, Joe Willis. “This is the result that should have happened. The next step is what the county will do. I suspect strongly they will petition the (appeals) court to rehear it or ask the Oregon Supreme Court to review it.”
Multnomah County Counsel Agnes Sowle said her office is reviewing the ruling. She declined to evaluate the legal reasoning applied by the appeals court.
Others weren’t so reticent.
“It’s a great ruling,” said Dave Hunnicutt, president of the property rights group Oregonians in Action. “The Court of Appeals was very clear. Final means final, is what they were saying.”
Oregonians in Action sponsored Measure 37 in 2004 and portrayed English as a victim of unfair land-use rules: an elderly widow and longtime property owner not allowed to develop her land.
Voters approved the measure, which gave property owners the right to develop their land in a way that was permitted when they bought it. English, alternately wry and profane, endorsed Measure 37 in campaign ads.
About 6,500 property owners filed development claims after Measure 37 passed, many with the stated intent to build large rural subdivisions. The prospect of such development was a major factor in voters passing Measure 49 in 2007. It rolled back development rights, and most of the claimants settled for a process that will allow them to build one to three homes.
But English was not among them. She wanted to split her 20 acres into eight homesites for her family. But that wasn’t permitted because the county had rezoned the property after English and her late husband bought it in 1953.
English filed a Measure 37 claim, and the county agreed to let her develop eight lots in lieu of paying compensation. But the county loaded its approval with conditions. English’s attorney responded that such standards and procedural rules didn’t exist when English bought the property.
That touched off a rolling legal fight that English and her attorney thought ended when she won a judgment in 2007. The county argued it didn’t have to pay, a position that confounded attorney Willis.
“If a case is fully litigated, you don’t get to go back and try something else,” he said. “It’s nonsense to argue a judgment doesn’t mean anything.”
– Eric Mortenson; ericmortenson@news.oregonian.com
Tucson Values Teachers Announces Teacher Discount Program
TUCSON, Ariz. (May 19, 2009) – Tucson Values Teachers, a regional initiative to help recruit, retain and reward K-12 teachers in Pima County, has formed a partnership with local businesses to provide significant educator discounts.
More than 10,000 public, private and charter schoolteachers will receive a “Summer Breaks for Teachers” card in their school mailboxes. By presenting the card with a valid teacher ID or a recent pay stub at a participating business, they can immediately get discounts on goods and services such as cars, furniture, food, hotel services and gym memberships.
A wide range of businesses has offered to reduce costs, including Jim Click Automotives, Maynards Market & Kitchen, Loews Ventana Canyon Resort and YMCA of Southern Arizona. Others such as Magpies Gourmet Pizza, Metro Restaurants and El Charro Café are offering free entrées and rounds of golf.
Jacquelyn Jackson, executive director of Tucson Values Teachers, said the Summer Breaks card is her organization’s “thank-you” card for all teachers do in educating our region’s youth.
“This has been a hard year on everybody involved in K-12 education with looming budget cuts and increases in class sizes.” Jackson said. “With teachers being asked to do more with less, Tucson Values Teachers and the participating businesses wanted to give each teacher a token of our gratitude.”
At the Summer Breaks for Teachers unveiling ceremony held earlier today at Prince Elementary School in Tucson, Mayor Robert Walkup noted that the discounts program reveals the strength of the region when the community comes together.
“Without the community’s help to ensure we are providing the best education for students and the best working and living environment for teachers, this effort will not be able to succeed.” Walkup said. “It will take everybody’s help to assure the growth of the Tucson Values Teachers campaign.”
Jackson said at the conference that expanded industry internships, housing assistance partnerships and solutions to provide adequate school supplies and materials are all upcoming projects Tucson Values Teachers is working on and plans to announce by the end of 2009.
“Tucson Values Teachers has solid successes, thanks to the community’s efforts,” Jackson said. “We hope to provide additional benefits to teachers to reflect the enormous benefits they provide to our community and its future.”
For a full list of participating businesses and discount details, visit www.tucsonvaluesteachers.org.
ABOUT TUCSON VALUES TEACHERS
Tucson Values Teachers is a regional initiative determined to prove that we should not just talk about the importance of improving education, but must unify in action to retain, recruit and reward our K-12 teachers. The actions TVT takes recognize the critical role of teachers in our region and value the vital influence they have on Tucson’s future. For more information, visit www.tucsonvaluesteachers.org or call (520) 327-7619.
I met Mark Harris on my journey of trying to make sense of how Tucson got to this dysfunctional place. During the months of endless meetings I ran across Mark. I was immediately taken by his passion and vision for creating a better Tucson. We were on parallel paths working for the same goal. I invited him to events and value his input. For Mark, getting our community back on track is a mission, both religious and personal.
I relate to Mark’s business acumen (he’s the owner of two Intelligent Office locations in Pima County and Institute For Better Edcuation) I relate to Mark’s passion to make this community a better place and I relate to the uphill battle we are both facing. Meeting after meeting and group after group, Mark is there. He shows up, adds intelligent points and quietly leaves and keeps working in his own special way to call for change, point out where we’ve derailed and roll up his sleeves to do something about it.
A CHURCH THAT IS TRULY BUILT ON EVANGELISM
By Glenn Smith
This article is a reprint from October 2003.
One of our early church plants was the Oasis Church in Tucson, led by pastor Mark Harris. In December 1993 Mark, his wife Debbie, and their 3 children (the youngest just born) left Houston to plant in a fast growing, eclectic and extremely unchurched city. Mark’s vision was not to be the “biggest” church in town but to be a “reproducing, sending” church, one that would multiply itself many times over! He also had a vision to not only see individual transformation but to also see his city transformed. Mark is the GlocalNet lead pastor for Tucson, Arizona. This weekend I had the privilege to be with him at the Oasis Church - what I saw was incredible.
The Oasis Church has 2 Sunday services meeting in an elementary school. Before the first service I talked to numerous people and asked about their stories. I was overwhelmed by what I heard! Almost every person I spoke with shared how they had come to know Jesus through the ministry of this church - one this past year, some 3 years ago, some 5 years ago, and some from the very first year of the church! I don’t recall speaking to a single person who was a “transfer” from another church.
After a very worshipful experience in the 1st service I went out to talk to more people. Again, it was just one story after another of not only conversions & transformation, but also unique ministry and service! As I worshipped again in the 2nd service I was in awe of what God had done through this young church! Practically every person was a relatively new Christian and was engaged in ministry! Three of the businessmen that I met were preparing to plant new churches themselves! In fact, in the past 9 years the Oasis Church has planted 17 churches and sent out over 200 “missionaries” from their congregation to other parts of the city! Another man that I met was the chairman of the Old Pueblo Foundation, which Mark created to meet social needs and to help transform the city! Their congregation was truly an eclectic, indigenous church!
As I sit here on a plane flying back to Houston I can’t help but reflect on what I experienced today! I have the priviege of being in some great churches on a regular basis. But tears fill my eyes and emotion overwhelms me as I write this article (I hope no one on the plane sees me!) The Oasis Church may never be one of the largest churches in America, but I can’t help but think that this church may be more like the New Testament church than any U.S. church I’ve ever seen! I know God is smiling because their impact for the Kingdom is beyond measure!
From Goldwater Institute.org - Phoenix–Maricopa County Superior Court Judge Robert H. Oberbillig gave Tom and Elizabeth Preston an opening round victory in their battle to open a tattoo studio in Tempe.
The court ruled that the Tempe City Council unlawfully revoked their special use permit to open a studio called Body Accents in a vacant storefront in a strip mall at 1524 N. Scottsdale Rd. in Tempe. The permit was awarded by a city hearing examiner and upheld by the city’s Development Review Commission before the City Council voted on August 28, 2007 to revoke the permit due to what Mayor Hugh Hallman called a “perception” that the studio would contribute to neighborhood deterioration. In the meantime, the Prestons had signed a five-year lease and invested between $25,000-$30,000 preparing the studio to open in reliance on the permit.
The court ruled, “Even the City’s own ordinances and rules reflect that this permit is valid,” and that the Council may revoke it only on a showing of “good cause or public necessity.”
The Prestons own and operate a tattoo studio in Mesa called Virtual Reality, which has not received a single complaint in over 15 years of continuous operation.
“The Council’s action was a travesty,” remarked Clint Bolick, director of the Goldwater Institute Scharf-Norton Center for Constitutional Litigation, which represented the Prestons. “The Prestons followed the city’s rules and made a significant investment, only to be sent packing by the City Council on the basis of crude, outdated stereotypes.”
The court sent the matter back to the City Council to reconsider in light of its ruling. Meanwhile, the storefront remains vacant, and the Prestons still would like to open a studio there.
“This ruling is a victory for the rule of law,” declared Bolick. “If the City can lawfully treat the Prestons this way, then every small business owner in Arizona is at risk of arbitrary government action.”
The Goldwater Institute is a nonprofit public policy research and litigation organization whose work is made possible by the generosity of its supporters.
Dear Editor, Your headlines seemed like a dream come true: “Lower tax, few cuts in county budget” [Arizona Daily Star 4-28-09], declaring a “drop in property taxes” for a “total budget … down $6 million…”
Not explained is that the $6 million dollar “reduction” is offset by an increase of almost $22 million in the total property tax levy amount, from $399 million in 2008-09 to $421 million in 2009-10. A more accurate headline could have read “County to collect over $15 Million more from the taxpayers!”
This is because increase assessed values counters any real reduction in taxes. This year’s current tax rate is based on $746 Million in increased primary property assessments for 2007 — figures derived before the recession hit. Our property is being over-valued and over-taxed. Last year, Supervisor Ann Day and I submitted an alternative budget to the Board majority. In our introduction we explained:
“[W]hile the Primary tax rate decreased from $4.072 to $3.602 between 2002 to 2007, the amount of revenue collected by the county increased by over $70 million dollars…”
Your newspaper had clarified this in an article [10/22/08] with the headline: “Though tax rate dips, we’re all paying more.” The article explained how, even with the drop in tax rates:” taxpayers are paying twice as much in property taxes as they did a decade ago.”
Equally ominous is the hidden long term and ever increasing debt. Our debt service has jumped this year by $10 million to a total of $110 million dollars, which currently makes up over 37% of our primary property taxes. And Pima County’s debt is going up with non-voter approved debt through “Certificate’s of Participation.” In fact, Pima County’s current outstanding principal debt is almost twice as large as all other Arizona counties debt combined ($757.6 million vs. $339.7 million). Next year the county wants a $500 million dollar bond sale next year for our Wastewater Department. Who do you think gets to pay these debts?
And speaking of other debt obligations, University Physicians at Kino Hospital is now asking for an extra $30 Million dollar subsidy, with up to $39 Million in each of the next five years (even though the original agreement assured decreased payments and self-sufficiency). But as the county reduces support for the cost of health screenings, the County Administration increases its budget by $2.7 million. While we increase fees for our children to play in county parks, this same budget increases Economic Development subsidies by an extra $14 million.
This raises the question of “sustainability” – a term used often with regards to the environment, but which should apply to our taxpaying citizens.
Because as we continue to bleed our taxpayers dry by continuing to raise taxes and fees on everything without a mandatory cap, the number of homeowner’s facing foreclosure remains at record levels in Pima County. We need to learn to live within our means rather than attempting to instill false impressions about “rate reductions.” But to do so, we need to have an honest accounting of our revenues and expenses.
There are three steps that could be taken immediately to help in the process:
1. We need the majority on the Board to stop refusing to appoint their representatives to the outside Citizen’s Budget Advisory Committee. Other people without a vested interest in the growth of government need to make an objective review of the Pima County budget. Since 1997, the Board has never allowed this committee to have a quorum.
2. There needs to be at least three public meetings on the budget, preferably at night – not just one meeting, scheduled for Tuesday morning, May 19th, when most working people can’t attend, in which all departments are superficially reviewed and a tentative budget is quickly adopted.
3. Finally, the county budget should be posted in both the Arizona Daily Star and the Tucson Citizen for the general public to be able to review. We paid TNI over $600,000 last year; we can afford to have their readers see our budget.
There are no legitimate reasons why Pima County government can’t be more transparent with the use of taxpayer funds. Perhaps, with a more informed public, deceitful declarations regarding property taxes will be subjected to a bit more scrutiny. One can only hope.
Ray Carroll
Pima County Supervisor
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Garfield Traub Proposal Not In Tucson’s Best Interest
In another apparent attempt to show the Legislature in Phoenix that there is some positive movement in Rio Nuevo, the Tucson City Council has voted to approve the development agreement presented by Garfield Traub. The Counsel has a history of taking precipitous steps which unnecessarily cost taxpayers money. The bond sale last year that took an extra $18 million in interest debt from citizens’ pocketbooks is a prime example. Now they have voted to guarantee a $240 million debt without a final guaranteed maximum price (GMP) or a funding model that will be in effect once that GMP has been determined. Fiscal prudence, especially while wrestling with a significant budget shortfall, would indicate the wisdom in deferring this decision until Garfield Traub was in a position to better identify the true cost of the project, identify a specific funding model and allow the City to assess whether gambling on the proposal with taxpayer guaranteed debt made sense.
In April 2007 the City Council received completed studies and endorsed a redevelopment plan as a new energy for a new place. Greg Shelko (downtown development director) described the committment. “The mayor and council have bought into building these buildings (the arena, hotel and TCC expansion). The issue now is not revisiting the projects, but how to finance them.” (May 2008)
That plan involved a process that included prestigious consultants, local business input and neighborhood involvement. It clearly laid out a concrete vision and method to achieve the “Big Three” - hotel, arena and convention center. Years (and millions of taxpayer dollars) later that plan has been pushed aside in favor of a new idea. No new energy and no new place.
What makes this vote even more curious is that it is taken while there is a “shovel ready” project sitting, ready to go, that would put the taxpayers at no financial risk. That is the remodeling of the Hotel Arizona. It is anticipated that that project would be profitable to the City nearly immediately, would not force the City to guarantee long term debt on behalf of the taxpayers, would provide remodeled rooms under a major hotel name brand at approximately 1/2 the room rate the Garfield Traub project is requiring, and would have those rooms remodeled in time for next spring’s Gem & Mineral show.
The Garfield Traub proposal admits to the need for “additional revenues” in order to make their own projected debt service (the comfort of a 1 1/2x debt service level of support). Those additional revenues will come from a 6% transient tax and a 2% surcharge on guests at the Sheraton. That money would otherwise be available to the City to fund core priorities such as public safety, road maintenance and transit needs. In a time of tight fiscal constraints, giving away general fund money on a real estate deal that is based on uncertain final costs is unsound financial management. This proposal may make sense in the future but with current market conditions it is doomed to failure.
Unlike the plan presented three years ago, the Council is now relying on quick, one-shot successes. To revitalize downtown the leadership of Tucson needs the entire downtown region needs to be viewed in a holistic plan going forward. We sit atop ancient water and sewer lines. We have no plan upon which to base the eventual capacity requirements. We have no plan upon which to determine where and to what extent we will need power, telephone service, fiber optic, water, sewer - where will there exist aesthetic water elements that will call upon more capacity, where will we build the wide, well-lit walkways with drought resistant foliage to provide shade and to support artisans, and families who will visit such a well thought out entertainment district? Will we install the modern street car tracks on top of our present infrastructure and later be required to tear out those tracks in order to upgrade the systems now in place?
If presented with such an holistic plan, the Legislature in Phoenix would see that the City is finally moving forward with a plan, phased appropriately, has taken the mid-stream step of remodeling a moderately sized hotel to anchor further business development in the downtown area, and on that basis provide sales tax revenue to fund the cultural elements of Rio Nuevo going forward.
It is not too late to rebuild downtown Tucson. Now more than ever Tucson needs Leadership. The Council vote to embrace a risky, poorly-financed hotel deal is a step in the wrong direction.
Steve Kozachik, Ward 6 City Council candidate.
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