As reported in The Explorer, the owners of the Oracle Crossing Shopping Center have sued Oro Valley as a result of the town holding sales tax "kick-back" money in an escrow account pending the outcome of the Supreme Court ruling on the Turken vs. Gordon lawsuit brought on by The Goldwater Institute.
Hopefully, after hearing the case on Sept 30, 2009, the Court will rule soon on this critical issue. We can only hope the 5 Justices will uphold the Az Constitution which forbids governments from offering special concessions that favor one business while not providing discernible benefits to the community.
Here's The Explorer article.
http://www.explorernews.com/articles/2010/01/13/news/doc4b4d019b7728c305454741.txt
17 comments:
My gut tells me that unfortunately Oro Valley will still end up sharing our tax revenue with the developers, etc.
But hopefully the voters remember who supported and voted for these agreements.
Also let's not forget what politician would love to have a primary property tax.
Government will never ever have enough of our money to spend.
Our job is to control our own money and control the politicians, not the other way around
Why would Oracle Crossing sue us (the taxpayers) when the court has not ruled on the Phoenix case?
If the court finds against the PHOENIX, will not the present case here in OV be moot?
Will Oracle Crossing then have to pay the costs for the suit which has been declared moot?
W
Nombe--- No action will take place PRIOR to the Supreme Court ruling.
Quoting from The Explorer--
In fact, Oro Valley Town Attorney Tobin Rosen and Richard Rollman, attorney for Oracle Crossings have agreed to let the case remain on the court's inactive schedule until the Supreme Court rules.
Most likely they had to file suit to avoid running up against the statute of limitations which would have begun running last January when the Coucil stopped paying out on the contract. You'll note from the article that everyone has agreed to keep the case on the inactive calendar until the AZSC issues their decision.
Sorry Art - didn't see your comment until after mine posted - didn't mean to repeat information.
Thanks, got it.
-Nombe
Of course I'm going to focus on the Vestar lawsuit portion of this:
If Vestar stood to collect $23 million in sales tax revenues, why then are they planning to sue Oro Valley for $45 million? Yes, they always have OUR best interest at heart!
Vestar also claims that WE'VE enjoyed "public benefits" including traffic lights (doubt we would have needed the traffic lights if we didn't have the junk mall to begin with).
They originally made it sound like the police substation was going to be used as a public safety tool, but then it turned out that it was just going to be used as office space for police to do paperwork (or something to that effect.) So if it's purpose isn't for public safety, how are WE benefiting?
I also seem to remember reading that LEGALLY they were REQUIRED to restore the riparian area and it wasn't done out of the goodness of their heart as they would like us to believe.
Then, after Vestar promised us one thing and then delivered another, they have the audacity to assert..."It is fundamentally unfair...to renege on the sales tax sharing set forth in the Development Agreement."
I say, "We're simply showing Vestar the same amount of respect that they showed us."
Excellent points, VC! Somehow, certain developers (not all) seem to think that it is they who are doing towns big favors by shoving their inherently and ill conceived weak projects down the throats of the citizen public and then doing end runs in order to cover for the conniving 'deals' they may make in order to get tenants and cover their 'you know whats' for the 'risk' they take. What ever happened to the old axiom 'find a need and fill it', a basic tenet in the fulfillment of unsubsidized return on investment? Look at City North, the so far failed project which became the basis for the 'gift clause' legal action; their anchors have pulled out, their condos aren't selling and, in my opinion, the design might have been okay for Chicago where the developer is from but is a far cry from the 'personality' that is most of Arizona. In short,
they ain't doing what someone's wild imagination thought they might, a risk that could only have been 'covered' by the $97,000,000 in question that they demanded from the City of Phoenix. Guess what - they thought they could put a super high end utility in the midst of a mid-income area ONLY taking the risk because of the 'front money'. Whew-it might have worked in Scottsdale but next door to Desert Ridge? Did they really think, all those 'experts', that people from Paradise Valley and Scottsdale, et al, would travel the hell that is the 101 loop or hwy 51 just to go eat at one of their 4 star restaurants or shop at Neiman Marcus or commute from one of their overpriced (and boring) condos to live in a part of town where the traffic is absolutely horrendous? The whole thing was idiocy, doomed from the beginning, and now a foreclosure process appears to be in force.
Back to our 'center' - why couldn't the 'brains' that had a hand in this conceive of another type of shopping experience - a plaza type entity like St. Phillips which could have included a small hotel type arrangement, boutiques, art galleries or an indoor 'mall' where people could walk instead of drive from one entity to another. Yes, at least for now the restaurants are doing well, but more are coming and what will be the dilution effect; that remains to be seen.
Back to the favors that Vestar has bestowed upon us - let's take just one which you already have mentioned. At least a year ago I predicted that they would use the riparian restoration as one of the 'cause celebres' to justify their 'gift'; you are right, they HAD to do this as this MUST was apparently a requirement originally to be executed by Vistoso Partners written into an agreement (PAD stipulations) THEY had with the Town which was penned long ago. How this matter ended up in Vestar's lap one can only guess (and I have mine). So much for Vestar's generosity.
Big problem, for me, with this one is that the people of Oro Valley approved the givebacks. I lost all respect for the town's collective brains when the results came in on that referendum vote.
Freedom Fighters
Problem is, there are those business 'experts' still out there that are still conning the town as to what constitutes good business practice and worse yet is that there are those who are still falling for it. Poor business - it's because we have a lit sign ordinance, a real estate open house sign ordinance, building code regulations, food prep regs, architectural regulations, building placement regulations, set back regulations, yada, yada, yada. That's all they can offer up. I say it's proper product, management, lack of realistic advertising, employees, and location, location, location. The tails continue to wag the dog, the dog is tail happy, and THEY just don't get it!!!
Above should read 'lack of proper product'.
To all those that may not know it---sure you can blame the OV populace, enough of whom got snookered by Vestar & David Malin their Project Manager, but let's give a LARGE portion of the blame where it belongs----in the lap of Mayor Paul Loomis.
Loomis allowed an inept Economic Development Administrator, Jeff Weir to negotiate the contracts with the developers, including Vestar, and we ended up with that ugly Marketplace and its Walmart for our $23.2 million obligation
We hope all the voters will remember Loomis's legacy when the ballots arrive in about 3 weeks, and VOTE FOR MIKE ZINKIN FOR MAYOR.
Good point, Artmart; Loomis is a snake and must go!
Correct me if I'm wrong, but I seem to remember that the Mayor did not vote in favor of the Vestar economic development agreement.
Even if the CityNorth agreement is thrown out by the court, it's hard to say what will happen with the scores of other agreements in place around the state.
I think it's unlikely that the decision will be applied retroactively to those agreements. Furthermore, courts usually take a hands-off approach to issues that have been approved by the voters, so the initiative on the Vestar agreement might actually mean that it's on more solid ground. (I'm not a lawyer, but I've played one on stage!).
It's wise for communities to put those funds into escrow awaiting the outcome of the court decision.
And, if I were advising the property developers, I'd tell them to sue, just the way they are, if for no other reason than to have some legal standing should the decision be applied retroactively.
Nothing that I wrote, above, reflects my personal opinion about such agreements--it's just commentary on the process.
Freedom Fighters,
Regarding your comment, "I lost all respect for the town's collective brains when the results came in on that referendum vote." Ditto! I often wonder if the people of OV are worth the effort that some of us have put into protecting this town.
Zev,
Your analogy of what constitutes good business practice vs. poor business practice is spot on. The businesses I continue to patronize are the ones that have...
Quality products, good management, smart, well-trained employees (a result of good management!) and a convenient location with adequate parking. And for me, they also need to have good air-conditioning.
The businesses I do NOT return to are the ones who offer the opposite of the above. I have no respect for a business owner who is cavalier with customer service who then blames the town for their lack of customers.
Boobie--- Loomis did not vote for the Vestar giveaway. It did not have to. He knew it would pass, as it did, with Johnson, Rochman & Wolff voting for it.
Those of us that have been following the council for some years, know that Loomis is shrewd enough in his votes. He did however vote for the other giveaways, and was the ONLY vote AGAINST putting the sales tax money in escrow while awaiting the Supreme Court ruling.
For whatever it's worth, I recently saw you on stage right here in Tucson.
Your acting generally is superior to many of your positions concerning OV.
boobie.
You are one scary person. You are right, each stupid agreement - state wide - may have to go through due process. Thanks for making my day stink!
R
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