Jerry's World

Jerry Colangelo and his pals have gobbled up the lion’s share of public development dollars. If downtown’s to be saved, City Hall’s got to share the wealth.

"We were certainly an advocate for the stadium," Kearney admits.

Not only would the stadium have negative impact on the biotechnology center that was planned immediately to the south, the area it was to be built in was where artists had once again begun creating a series of small galleries and living-working spaces.

The threat of still another sports facility disrupting another emerging arts district -- and one that was attracting thousands of mostly young people to downtown for the monthly art walks -- ignited the often-disjointed arts community to take action.

After reaping $300 million in public subsidies for his downtown edifices, Phoenix's sports mogul's poised to direct  the next wave of downtown development: infill.
Jackie Mercandetti
After reaping $300 million in public subsidies for his downtown edifices, Phoenix's sports mogul's poised to direct the next wave of downtown development: infill.
Under the direction of outgoing Mayor Skip Rimsza, the city has dutifully implemented Colangelo's downtown developments.
Jackie Mercandetti
Under the direction of outgoing Mayor Skip Rimsza, the city has dutifully implemented Colangelo's downtown developments.

Despite vehement public opposition to the stadium plan, the Partnership successfully lobbied City Council members to approve a rezoning plan that cleared the way for the project. Mayor Rimsza cast the deciding 4-3 vote in favor of the zoning change.

The stadium project was later derailed after the Cardinals, the city and the Partnership couldn't reach an agreement on how big the facility would be and how much parking it needed.

The Cardinals decided to trundle off to Glendale, but smoke from the stadium battle still lingers. Opponents were angered that the Partnership played a crucial role in trying to put the Cardinals on top of the arts district even though the location was outside the DPP's geographic boundaries.

Kearney explains, "We felt that it was going to be a significant benefit to the Copper Square area."

The Partnership not only lobbied City Council members, it got directly involved in acquiring land from private property owners through a non-profit subsidiary it created called the Downtown Phoenix Community Development Corporation.

The Partnership's CDC hired a real estate broker who tried to strong-arm property owners by telling them the city would condemn their land if they didn't agree to sell. This would mean they wouldn't get moving expenses. What the CDC was offering -- $27 a square foot for much of the property -- was ridiculously low.

"The land was worth a lot more than that," says Thaddeus Matson who owns a 14-room Victorian home on Seventh Street just south of Garfield. Matson refused to sell his land, but most of the property owners in the area agreed to the deal.

The CDC continued to seek purchase options for the property even after the Cardinals Stadium deal collapsed. Last summer, the city exercised the purchase options collected by the CDC, agreeing to pay up to $14 million to owners.

The CDC's real estate broker was Mike Lieb, who at the time was chairman of the Phoenix Board of Adjustment, a powerful panel appointed by the city to resolve development and zoning disputes. Lieb was also a member of the CDC's board of directors.

Lieb stood to pocket as much as $700,000 on the land play based on his five percent commission working as a salesman for Cherokee Development. Lieb declined to discuss his involvement in the land purchases, saying only that his commissions were "far less" than $700,000. He said further questions about his role should be directed to the DPP's Kearney.

The Partnership's executive director refused to disclose how much Lieb earned on commissions. Kearney says Lieb did not vote as a CDC board member on stadium issues and subsequently resigned from the CDC board.

(The city is now considering how to develop the property in conjunction with the biotechnology project now under construction at Seventh Street and Van Buren. There is speculation that the property could become part of ASU's downtown campus.)

The DPP's stadium proposal also presented a direct conflict of interest for one of its board members, the Arizona Public Service Company.

An APS affiliate, Northwind Phoenix, owns and operates a water-chilling plant used to cool downtown buildings, including Bank One Ballpark and the county's new jail. Northwind stood to land a lucrative contract to cool the stadium worth more than $60 million over 30 years if the Cardinals Stadium went downtown.

The heavy-handed real estate play had made residents and the arts community angry, but learning that a Partnership board member stood to gain royally if the stadium located downtown made them apoplectic.

The experience further exacerbated the widespread belief that -- despite what Colangelo and Kearney now say -- the Partnership is only interested in developing mega-projects that benefit big shots. That unless the city wises up and stops letting the DPP run the show downtown, stops giving most all the money to a select few, stops letting Jerry Colangelo call the shots, it will be a long time before a diverse downtown flourishes.

Comments Kimber Manning of Modified Arts, "When we were trying to save ourselves from the wrecking ball, there wasn't a person down [at the Partnership] who cared about us,"

The Downtown Phoenix Partnership's board of directors is a virtual Who's Who of Valley powerbrokers.

The appointed board includes executives from major financial institutions, including Bank One, Bank of America and Wells Fargo; developers representing Opus West Corporation and the Ryan Companies; a utility kingpin from APS; a media mogul in the form of Arizona Republic publisher Sue Clark-Johnnson; and the director of the biotechnology center now under construction.

The DPP board also includes powerful city and county bureaucrats, including Maricopa County administrator David Smith, Phoenix city manager Frank Fairbanks and assistant city manager Sheryl Sculley.

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