What a Butte!

Developers and anti-growth activists want a piece of Tempe's mythical mountain

"We've been calling Hayden Ferry South a linchpin," says Rod Keeling, who heads the Downtown Tempe Community, a business organization that supports the project. "It provides the connection downtown needs between the development on the lake and the rest of Mill Avenue."

Right now, that connection ends around Fourth Street, about a block from the mill. When people get there, they typically turn around.

The importance of walking and shopping can be measured in sales tax revenue. In the past decade, the number of taxable sales in the downtown redevelopment area (a few blocks east and west of Mill Avenue north of University Drive) more than doubled, from about 62 million a year to 137 million. Sales tax revenue has climbed from about $760,000 annually to more than $2.6 million. The Hayden Ferry South project could add more than $1 million a year to that total.

These fiscal matters go to the heart of the downtown development debate. While other Valley cities argue about sprawl at the edges, landlocked Tempe is wrangling over urban density and growth at the core.

"When you look at those huge developments and the density being planned downtown, you have to wonder just how they're going to pay for city services there," says Rich Bank, a businessman who ran unsuccessfully for city council this year and opposes development on the Butte. "They're really trying to turn it into a little Manhattan down there."

But Keeling and other downtown advocates contend that raising the tax base through more concentrated downtown development makes good urban sense.

"Here we are gobbling up an acre an hour at the edge, and yet if we cannot build quality infill, and these higher-density, urban developments, then how are we going to provide an alternative to growth on the edge?" says Keeling.

But he concedes that the goal of extending Mill Avenue's stores and offices to the lakefront can be accomplished without cutting into the Butte.

Opponents say they'd be willing to allow development anywhere below the railroad tracks that once serviced the mill.

Keeling says that probably wouldn't affect a developer's ability to build storefronts.

Vice Mayor Ben Arredondo says such a restriction would be a sensible option. But that option is not included in the latest draft of the Rio Salado commission's guidelines.

City officials say that because the area is part of a redevelopment zone, the city could buy back all or part of the site. But the cost -- estimated at $15 million to $25 million -- and the potential of a lawsuit make that a difficult option to carry out.

It isn't one that MCW is considering. Claassen says his firm has invested about $3 million in the project thus far. He says MCW plans to abide by the 312,000-square-foot plan the city approved in 1997 and begin development of the project's first phase next spring, which will include a historic restoration of the flour mill. MCW plans to move its offices into the top two floors and adapt the bottom floors as a restaurant incorporating a historic tribute to the mill.

Scott Burge says he'll urge that the guidelines limit Hayden Ferry South to the 312,000 square feet the city originally approved. "That would keep buildings in the area at about half the size of the mill at the highest," he says.

Claassen says MCW will live with the smaller project. "I don't think we can afford to fight that war now. If we tweak the plan at all, we'll lose," he says.

Many opponents wonder why guidelines defining the Butte's relationship to the development around it weren't drafted before the city approved the initial plans to cut into the Butte.

"I don't really have a good answer for why those guidelines weren't done before," says councilman Dennis Cahill, who is in the upcoming runoff election to retain his council seat. "It's a mistake on our part. We should have had them."

Arredondo says bluntly that the city's staff "dropped the ball."

"I thought we'd been operating under some kind of guidelines. But right now, if we're not careful, anything and everything could be developed."

Fackler says general height limits have been in place, but more specific guidelines balancing open space and development on the Butte don't exist.

Arredondo says that before further development occurs, the city needs to define more fully where its open spaces should be.

The irony of the Butte ruckus, says councilman Hallman, is that the Hayden Ferry South project is suffering from animosity that would be more accurately aimed at another big commercial development nearby known as Hayden Ferry North.

"MCW's initial plan for Hayden Ferry South was really pretty responsible," says Hallman. "The scale was right. They've shown some historical sensitivity in their past projects downtown. They've done really high-quality work. But I think part of what's happening here is they're catching hell from folks who've just realized what's happening at Hayden Ferry North."

The north project is being developed by Benton/Robb and SunCor. It would plant a 1.5 million-square-foot suburban-style complex of offices, condominiums and a hotel, with buildings as tall as 12 and 15 stories, smack up against the lake, walling off views to and from the water and the Butte. Its major architectural statement along Rio Salado Drive would be a huge parking garage.

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