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.

The partnership's monthly meetings are also attended by elected officials who serve as nonvoting "advisory" members: County Supervisor Mary Rose Wilcox, Phoenix Councilman Michael Johnson and Rimsza.

The board is chaired by Phoenix lawyer R. Neil Irwin, but there is no doubt that founder and current vice president Jerry Colangelo's the group's thousand-pound gorilla.

Meeting dates and locations are not widely publicized and, in the past, the Partnership refused to provide information on upcoming meetings to New Times, claiming that the organization is exempt from the Arizona Open Meetings law.

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.

Kearney has since softened the Partnership's stance, and now says the public is welcome to watch the board in action. The next meeting is scheduled for 11:45 a.m., October 28, in the Yuma Room at the Phoenix Civic Plaza.

The Partnership has also taken a strident stance against releasing its financial records. As with the open meetings law, it maintains it isn't subject to the state's public records law either.

This despite the fact that its annual budget and duties are approved by the Phoenix City Council -- which definitely is subject to both statutes -- and that the aforementioned publisher of Arizona's largest newspaper (who presumably has some interest in the public's constitutional right to know) sits on its board.

The Partnership's quest for secrecy even led it to refuse to produce copies of its federal tax returns when New Times first sought the documents in February 2002. "Our attorney has indicated that we do not need to provide the [tax returns] you are requesting," Kearney said at the time.

The Partnership's lawyer was wrong. The IRS requires nonprofit organizations to make their tax returns available to any member of the public. Soon after New Times informed the IRS that the Partnership was refusing to produce its tax returns, the DPP relented and made the documents available.

Such stonewalling only reinforces the widespread perception that the Partnership is an elitist enterprise that prefers to keep details of its cozy and lucrative relationship with elected officials secret.

Incorporated as a nonprofit organization 13 years ago, the Partnership was officially created to contract with the city to provide additional services to the downtown business community, including security guards, marketing, streetscape improvements, shuttle bus operations and parking services.

To fund the Partnership's contract, the city created the "downtown enhanced municipal services district" in 1990, which allowed a special property tax assessment to be imposed on private-property owners between Seventh Street and Third Avenue, the railroad tracks to Fillmore.

The assessments are collected by Maricopa County and forwarded to the city. Each year, the City Council approves an operating budget for the Partnership that has risen from $900,000 in 1991 to a proposed $2.1 million in 2004.

About half of the Partnership's funding is voluntarily provided by the various governments operating within its district. The city provides 35 percent, followed by Maricopa County at five percent and ASU and federal facilities at 2 percent each.

Bank One Ballpark contributes 10 percent of the partnership's budget through an assessment paid by the Diamondbacks. Assessments on private downtown businesses and surface parking lots within the district make up the remaining 46 percent of the partnership's budget.

The bulk of its money is spent on providing additional security and marketing for downtown events. The Partnership plans to spend $726,000 next year on such personnel -- called Downtown Ambassadors -- who patrol the area on bicycles wearing badges that say, "Ask Me".

The next biggest line item is $573,000 set aside for marketing, business development and arts-and-cultural activities.

Of this amount, a measly $3,000 is earmarked to directly support arts activities.

The bulk of the Partnership's marketing activities is devoted to promoting upcoming events in Copper Square, most of which are hosted in one of Colangelo's three big venues. "Bank One Ballpark is one of the big beneficiaries" of the partnership's promotional campaign, admits Rimsza.

Administrative expenses, including executive director Brian Kearney's $130,000-a-year salary, total another $500,000. Another $150,000 will be spent on the DASH shuttle buses and $150,000 on street-improvement projects.

Providing these downtown services is the Partnership's official role, but what the organization is really about is influencing elected officials to spend money on projects that benefit downtown businesses. Especially those of its board members.

It engages in lobbying, even though its incorporating papers state "that no substantial part of the activities of the organization shall be . . . attempting to influence legislation."

The DPP doesn't lobby by wining and dining public officials, however. Extensive accounting records would have to be maintained in that event. Pressure is applied more subtly through board members' personal contacts with elected officials.

The DPP's cozy relationship with city bureaucrats makes it difficult to determine where City Hall stops and the Partnership begins. Kearney was formerly a city bureaucrat who worked directly with former Partnership Director Margaret Mullen. He joined the Partnership after Mullen resigned several years ago.

With Kearney at the helm, there has been the appearance that the Partnership sometimes directs city operations.

According to a 1999 city audit of the Partnership's financial operations -- the last time the city audited the DPP -- city staff provided more than $127,000 in services to the organization. The audit concluded that state law requires that all such administrative costs be repaid to the city from the assessments. The city attorney rejected that assessment, and the money was never repaid.

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