The Pipers of Los Arcos

Mark Poutenis

I'd never tasted Creamsicle punch until the City of Scottsdale served it to me during a recent forum on the Los Arcos redevelopment project. Orange juice mixed with 7-Up and vanilla ice cream is a lot easier to swallow than the sugary half-truths developers ladled out. Their caldron of crap seemed bottomless.

About 200 souls gathered in Scottsdale's municipal chambers last Tuesday. The five-hour discussion was also broadcast live on a community access channel. I watched the first two hours from inside Los Arcos Mall -- ground zero for a proposed $530 million, 92-acre sports, retail and entertainment district that will live or die by the results of a November 2 vote.

Situated near the intersection of Scottsdale and McDowell roads, just north of a Humvee dealership, Los Arcos is a dying mall. The tile is chipped inside, the air foul. Except unlike the Scottsdale Galleria, a fellow pink blemish on Scottsdale's Lancôme-scrubbed face, Los Arcos is still open for business. Especially when the business is winning the upcoming election.

Campaign headquarters for pro-development "Vote YES Scottsdale!" is housed inside the mall. Scores of yellow-and-black propaganda signs decorate otherwise empty benches and security gates that never rise: "Revitalize Los Arcos, Vote Yes Nov. 2."

One of the ghost mall's few other occupants is the City of Scottsdale's Citizen Services Center. The night of the forum, I found a dozen senior citizens there, seated in folding chairs around a monitor. On screen, men wearing power ties spoke of the need for a "public-private partnership" and told us why Scottsdale voters should give them at least $150 million in diverted tax money, and possibly much more.

This money would help pay for the demolition of the building in which my new pals and I munched cookies. Developers will also raze about 70 private homes to make way for new retail spaces, a 500-room hotel, a conference center, a multiplex cinema, parking lots, garages and -- the project's centerpiece -- a new 18,000-seat hockey arena for the Phoenix Coyotes.

The deal on the table is this: The developers, locally based Ellman Companies, will front all the money for the project. In return, they would "recapture" tax revenue generated within the project's boundaries. They're asking for half the state sales tax and 100 percent of the city sales tax for 30 years following the project's completion, plus all property tax revenue for 10 years.

For the Ellman Companies and its allies in Scottsdale City Hall, the result of a recent poll on a similar project must have felt like doubling down on 11, then drawing a two. Their hand's not looking nearly as good as it did last month, before voters spiked the Canals of Scottsdale.

That plan would have converted the Galleria into a complex of six museums and created a Venice-esque system of canals through downtown Scottsdale, complete with gondola rides. One-third of the construction costs would have been paid for with similarly "recaptured" sales tax.

Canals developers hemorrhaged $800,000 on a failed campaign. The smell of blood is in the water.

Fearing a repeat of an earlier forum on the Los Arcos issue, where opponents behaved like antiwar protesters, the City of Scottsdale tried to impose order upon last week's public discussion. It paid a professional moderator $1,500 to keep the peace and make sure developers got their say.

Lance Decker, who looked and acted like Captain Kangaroo on crystal meth, donned a photon torpedo-blue lab coat for the occasion. Decker used a choo-choo whistle to call the meeting to order, and ran the forum like a late-night infomercial host, pimping the Los Arcos project. The back of his lab coat should have read "Paid Shill."

"So what you're saying," Decker asked an Ellman Companies spokesman early in the evening, "is that [the project] is totally self-sufficient?"

"That's right."

A chorus of disbelieving groans sounded throughout the meeting hall. Decker, who maintained a tight grip on his cordless microphone at all times, quickly hushed them.

"I'm hearing a lot of moans over here. I don't want you to do that. You can whine, okay? But no moaning."

Two hours after the forum started, the audience inside the City Services Center had dwindled to me and an old lady wearing a silver and mauve jumpsuit and Terminator shades.

"We need more than ice cream in that punch," she said.

I left the mall, and drove to the heart of the action.

"These people are millionaires," I heard as I entered Scottsdale City Hall. The voice belonged to a woman who spoke in a trembling voice. "They're going to get richer with your money. There's something for everyone to hate in this project."

She took her seat.

"Now you can applaud," announced Decker, who had earlier outlawed clapping.

"You're not applauding her position, now, you're applauding her courage. . . . We're here to educate ourselves, not to pontificate."

The forum moved into a Q&A session. It quickly devolved into a game of rhetorical dodge ball, as pissed-off citizens who'd waited three hours to have their say hurled bruising questions at spokesmen for the Ellman Companies and the City of Scottsdale. They ducked, sidestepped and twisted away from straight answers.

Disgusted city councilman George Zracket left the dais, where he'd been sitting with Mayor Sam Campana and the rest of the council. He joined opponents in the audience.

Every answer developers gave meandered back to their pivotal concept: that the Los Arcos project is a no-risk, win-win prospect, since the only money developers will get is tax money the project generates.

"The only public money being used in financing is public money created inside the project," said Ellman Companies vice president Bob Kaufman. "We're talking about money that doesn't exist right now."

Are we? I'm not so sure.

Stick with me a minute and I'll explain why:

On my way from Los Arcos Mall to Scottsdale City Hall, I stopped at AZ88 and had a spinach salad with Buffalo chicken, for which I paid $9.66, including 77 cents in sales tax.

Most of that sales tax went to the State of Arizona. A small amount went to the City of Scottsdale.

Now, let's say the Los Arcos development is constructed, and, two years from now, I find myself covering a voter's forum in Scottsdale, and, instead of going to AZ88, I go to a new restaurant located inside the development's boundaries.

This time, the sales tax money I spend will not go to the State of Arizona or the City of Scottsdale. It will go into a developer's bank account.

My point is this: When you wave away the smoke, what remains of the argument in favor of the financing for the Los Arcos project is the highly questionable assumption that money spent inside the project's boundaries would otherwise not get spent. That thousands upon thousands of people are not going out to dinner tonight, not going out to a movie, not shopping, not going to see a sporting event, because they're waiting for developers to build something like the Los Arcos stadium district.

Right. And millions of people would have traveled to the desert to ride in gondolas.

Contact David Holthouse at his online address:

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