State’s $1 Billion Investment In Water Security Expected To Be Game Changer

State’s $1 Billion Investment In Water Security Expected To Be Game Changer

By Terri Jo Neff |

In January, Gov. Doug Ducey pledged that securing Arizona’s water future would be a priority during his last year in office, and on Wednesday he delivered a $1 billion investment toward projects that will bring additional water to the state on a long-term basis and change Arizona’s future.

Ducey signed Senate Bill 1740 during a ceremony attended by several lawmakers and stakeholders. The bill, which the governor’s office called “historic legislation,” will allow Arizona to make significant strides in water conservation and innovative technologies such as desalination. It will also provide state officials the opportunity to identify and develop new innovative long-term water sources.

“This legislation is crucial for our continued growth and prosperity,” Ducey said. “As we’ve done over the past seven and a half years, we came together, brought everyone to the table and delivered for the people of this great state. And by doing so, we are leaving Arizona better and stronger than we found it

SB1740 appropriates more than $1 billion over three years to the Water Infrastructure Finance Authority (WIFA) while expanding the agency’s responsibilities to provide loans and grants to water providers and entities. The funding is earmarked to support importation of water into Arizona, conservation, efficiency and reuses, and new technologies.

During the signing ceremony, Ducey recognized Sen. Sine Kerr (R- Buckeye) and  Rep. Gail Griffin (R-Hereford) for chairing their respective chamber’s natural resources committee this session.

The governor also lauded Senate President Karen Fann, House Speaker Rusty Bowers, and minority leaders Rep. Reginald Bolding and Sen. Rebecca Rios for ensuring strong bipartisan support, as only two nay votes were cast against SB1740.

Fann noted that Arizona already had a strong commitment to obtaining water security, but acknowledged the state needed to step up its water conservation, efficiency, and reuse projects.

“Arizona’s economy is booming and in order to sustain that growth, we need to look ahead,” she said after the signing. “This water package does just that.”

Sine, who sponsored SB170, sees the signing of the bill as setting in motion a pathway toward reliable future water sources. “Today we celebrate our action to address the water issues our great state faces,” Kerr said.  “All Arizonans now and in the future will benefit from this legislation.”

Water legislation has been a longtime priority for Griffin, who saw passage of SB170 as a collaborative effort among multiple stakeholders. “This critical legislation just makes sense. It’s fair and forward-looking,” Griffin said. “I’m glad we’ve come together to find a solution for our water future.”

One of those vital stakeholders was Arizona Farm Bureau.

“More than most, Arizona’s farmers and ranchers know the value of water,” said AFB President Stefanie Smallhouse. “This forward-thinking legislation will be counted among Arizona’s other great successes in water management, and the Arizona Farm Bureau is thankful to the Governor, leadership and staff in the House and Senate, and all those who came together to make this bipartisan bill a reality.”

Another key stakeholder who supported SB1740 was the Arizona Municipal Water Users Association, which has been outspoken about the worsening conditions on the Colorado River which supplies water to much of Arizona.

“This is an important starting point to ensure continual planning and financing of water augmentation, reuse, and conservation,” said Warren Tenney, AMWUA’s executive directors. “Now, we must work together to maximize this historic investment in the wisest ways possible to benefit Arizona now and in the future.”

Ducey Vetoes Maricopa County Transportation Tax Measure

Ducey Vetoes Maricopa County Transportation Tax Measure

By Terri Jo Neff |

Gov. Doug Ducey vetoed a bill Wednesday which would have allowed Maricopa County voters to decide next year whether to extend a 2004 voter approved one-half cent transportation tax for another 25 years.

Ducey explained in his veto notice that his action was not about whether the 20-year voter approved Proposition 400 tax set to expire in December 2025 should be extended. Instead, he determined lawmakers approved House Bill 2685 with ballot language that was not responsible nor transparent.

“The language is not only biased, but it fails to include any mention of the increase of 20 to 25 years nor the changes to distribution for state highways, local roads and public transit,” Ducey wrote, pointing out the proposed ballot measure also does not take into consideration passage of the Investment in Infrastructure and Jobs Act.

As a result, Ducey noted that what voters would have been asked to approve “does not properly account for the opportunity to properly leverage state dollars for federal transportation infrastructure funding.”

HB2685 passed the State Senate with only 7 aye votes from the 16 members of its Republican caucus, while the bill received support of only 10 of the 31 House Republicans on the final vote. It was introduced in March to replace Senate Bill 1356 which did not make it out of the House Rules Committee.

Ducey’s veto notice did not have much good to say about HB2685, but he gave a shout out to Sen. Michelle Ugenti-Rita for introducing various amendments to both bills to address several concerns the majority of Republican lawmakers had with the language of the ballot measure.

The amendments offered by Ugenti-Rita (R-Scottsdale) would have ensured a fairer ballot description narrative, Ducey explained, as well as provide more strategic insight into how the transportation and infrastructure tax dollars would be spent.

“Unfortunately, none of these amendments were adopted,” Ducey wrote, adding that asking voters to approve the extension as proposed “is not the way to address the needs of our growing state.”

Reaction to Ducey’s veto was swift, including a statement from the Arizona Free Enterprise Club which called the veto “well-deserved” to avoid allocating transportation dollars for bike lanes, trollies, and “little used transit” at the expense of critical freeway maintenance. 

“We commend the Governor for this wise decision and for hearing the concerns brought up by opponents throughout the process as well as thousands of Arizona taxpayers who expressed deep concerns over the poorly drafted legislation,” the AFEC statement reads. “The real victors of course are the taxpayers themselves who deserve common sense transportation policy and accountability for their tax dollars.”

Also complimenting Ducey’s veto was the Arizona Chapter of the Republican Liberty Caucus.

However, Phoenix Mayor Kate Gallego tweeted that she was profoundly disappointed by what she called Ducey’s shortsighted, anti-economic development, and “out of touch” veto.

One thing Gallego’s six-part missive did not mention is there is nothing in Ducey’s veto to prevent legislators from drafting a sounder bill next session and get it before voters in plenty of time to be decided before the one-half cent tax expires.

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Arizona Democrats Invite Members To “F–k The Fourth” Event

Arizona Democrats Invite Members To “F–k The Fourth” Event

By Terri Jo Neff |

Most Arizonans will spend July 4 watching fireworks after spending the day with family and friends appreciating the many freedoms they enjoy compared to citizens of every other country.

But the Tucson Women’s March has announced a “F**k The 4th” event for attendees to “bring their anger” to Reid Park at 7 p.m. The event was promoted Friday morning on Twitter by the Pima County Democratic Party, who quickly deleted the tweet and accompanied flyer.   

The tweet, however, was seen and saved by many people, including leaders of the Arizona Democratic Party. And while party leaders insisted they did not agree with the language used to publicize the event, they did not reject the intent behind it.

In another tweet, the Arizona Democratic Party also supported the event’s “let’s mourn” theme even though attendees are set to arrive at the popular park at 7 p.m. while it will be full of families celebrating the holiday.

By Friday afternoon the Pima County Dems returned to Twitter in a series of tweets which vacillated between an apology and a statement of defiance in support of the “F**k the 4th” event. 

“The event was organized to help women in our community grieve for the loss of their bodily autonomy, which we consider an elemental right,” one of the group’s tweets read, while another conceded the graphic nature of the flyer advertising the event “was in poor taste.”

But a third tweet on the subject appeared to take a “the end justifies the means” position.

State Senator Michelle Ugenti-Rita expressed disgust at the event being held in conjunction with Independence Day celebrations.

And Ben Petersen of the Republican National Committee used Twitter to ask if several Democratic Party leaders in Arizona planned to attend the event or intended to denounce it. 

Rio Nuevo Contract Dispute Pits Low Income Housing Developers Against Each Other

Rio Nuevo Contract Dispute Pits Low Income Housing Developers Against Each Other

By Terri Jo Neff |

A contract dispute between two companies involved in co-developing a low-income housing project to support Tucson’s Rio Nuevo redevelopment effort will be argued before the Arizona Court of Appeals next month.

The appeal stems from a 2021 ruling by a Pima County judge who dismissed two breach of contract related claims against Gorman & Company Inc. after the company announced it was not paying any of a nearly $1.9 million development fee to The Gadsden Company LLC, even though Gadsden performed the services required in the companies’ contract.   

Gadsden argued that the contract called for Gadsden to receive “up to 40 percent” of a guaranteed $1,879,252 development fee paid by the Investor Fund which financed the project. However, a Pima County judge dismissed the lawsuit in 2021, ruling Gadsden did not have a proper claim to any of the fee money.  

Oral arguments will be heard by a three judge appellate panel on July 13.

Court records show the Investor Fund managed by the non-profit Enterprise Community Investment pledged more than $16 million for a 99.99 percent stake in the Tucson project built on land owned by Mission District Partners LLC, a Gadsden affiliate. The developers kept a 0.01 percent interest.

Gorman & Company regularly develops affordable housing properties through the

federal Low Income Housing Tax Credit program. It was contracted by West End Station LLC for architectural and construction services for the planned project.  

The legal dispute centers on a provision of a June 2017 contract between Gorman and Gadsden which states Gorman is entitled to the “first” 60 percent of the development fee. Of that, $1,281,218 was to be earned at four milestones related to the progress of the project.

The contract also includes language furthering defining the split between the two companies. It also allows Gorman to defer some of the development fees and have it applied instead to cost overruns which Gorman was responsible for in its contract with the Investor Fund.  

Various milestones were achieved in June 2017, March 2019, and February 2020. Some of the fees was deferred by Gorman, which reported about 43 percent was deferred and only 57 percent taken in cash. None of it went to Gadsden.

“Gorman was free to receive those dollars in cash, defer them, or both,” Gadsden’s attorneys argue. “But once Gorman receives or defers sixty percent its entitlement is satisfied.”

Gorman’s attorneys disagree, arguing in a brief filed with the Arizona Court of Appeals that financial issues with the housing project prevented Gorman from hitting the 60 percent threshold and keeping Gadsden from receiving any share.

“The agreement clearly and unambiguously places two conditions on Gadsden’s receipt of any share of the development fee,” Gorman argued. “When cost overruns prevented those conditions’ fulfillment by requiring cash payments of the fee to be deferred to keep the project solvent, there was simply no cash paid, non-deferred portion of the fee left for Gadsden to receive.”

The Pima County judge dismissed the breach of contract claim as well as Gadsden’s claim of breach of the covenant of good faith and fair dealing. To prove such a claim, Gadsden argued all it must show is the existence of a contract and that Gorman manipulated the cash and deferred fee split to “impair the right of the other to receive the benefits which flow from their agreement or contractual relationship.”

Mission District was paid $1.75 million for the property. Gadsden was also paid $470,000 at closing for development costs expended before the deal.