"Phoenix weighs Sky Harbor Airport land deal"

Thursday, October 13, 2011

Phoenix weighs Sky Harbor Airport land deal
Property deal carries $4.9 mil price tag
By Emily Gersema
The Arizona Republic


Phoenix aviation officials are offering to buy a piece of property near Sky
Harbor Airport for as much as $4.9 million, more than triple what the land
sold for a year ago.
 
Maricopa County records show the current owner, JSF Airpark LLC in Laveen,
paid $1.4 million in a trustee sale in December to buy the property at 115
S. 40th Place that city officials said was once home to a fertilizer plant.
 
"Oh my goodness," Councilman Bill Gates said when he learned of the trustee
sale price in an interview with The Arizona Republic. "We need to take some
time and not rush into this thing. This reconfirms why (renegotiating) it
was the right decision."
 
Aviation Department officials said in a statement that the land "is being
sold at market value and we have negotiated what we feel is a reasonable
price based on the long-term needs of the airport and this community."
 
Last week, Phoenix staff had asked the City Council to allow Phoenix Sky
Harbor International Airport to buy the 11.58-acre property near Washington
and 40th streets for an amount "not to exceed $4.9 million" for a future
employee parking lot.
 
The land is roughly the size of nine football fields and is near the PHX Sky
Train platform that is under construction near Washington Street, north of
the airport.
 
Currently, employees who work at the airport can park in the East Economy
Lot or in the Terminal 2 garage. Aviation Department officials said the
arrangement is temporary and doesn't displace passengers who park at the
airport. But they believe that, eventually, demand for parking will increase
and another parking lot will be needed.
 
Sky Harbor would pay for the land with capital improvement funds. Aviation
officials said money for those funds is raised through airport user fees,
such as passenger fees, so it uses no taxpayer money.
 
But the City Council declined to approve the land purchase, and voted 8-1 to
order staff to renegotiate the deal.
 
Mayor Phil Gordon was the sole vote of opposition. He said the airport is an
important economic engine for the state, is seeing a significant increase in
passengers flying to and from Phoenix, and needs the property to support its
growth.
 
Council members disagreed.
 
"It just seems to me that we're overpaying for a damaged piece of property,"
said Councilman Jim Waring, who represents residents in northeast Phoenix.
 
Gates said he is concerned the land could be contaminated with chemicals
from the former fertilizer plant, and he wants to ensure the city won't end
up paying for chemical cleanup or some health liability.
 
"We have to require some type of indemnity clause," said Gates, who
represents north Phoenix residents. "I think the environmental issue is
significant."
 
Aviation Director Danny Murphy said officials would try to persuade the
property owner to agree to indemnity in some form, "but I expect we would
not be able to do that."
 
JSF Airpark is registered to two Valley landowners, John Silva and Lucille
Kacer, who are involved in at least six other limited-liability companies in
the Valley, according to Arizona Corporation Commission records. Attorneys
for JSF Airpark declined to comment because the deal is pending.

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