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Lowe’s contests assessor’s valuation
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Like they say – you can’t fight city hall.

Or the county assessor.

Especially when there’s money on the line.

The Lowe’s supercenter in Show Low went to battle with the county last week, hoping to reduce its tax bill by convincing the Navajo County Board of Supervisors to overturn the assessor’s value for the huge building and 10 acres of surrounding property fronting on White Mountain Road.

The assessor put the full cash value at $8.8 million. That included two parcels, a base value of $55 a square foot for the building, plus something for the sprinkler system, the garden center, the parking lot — the whole ball of wax. Throw in a 16% depreciation rate and you arrive at they assessor’s estimate — from which you figure the property taxes owed.

Lowe’s filed an objection.

The company used some different assumptions, which got little hard to follow considering the building sprawled across two separate parcels. Suffice to say that the company figures the base value of the building was about $39 per square foot and applied a depreciation rate of 29%.

So the company figured the center should be valued at more like $5.8 million — at least in the original appeal filed before the meeting.

Cammy Darris, with the assessor’s office, said an assessor went out to inspect the building after the company filed an appeal. The inspector made some measurements, which prompted the assessor’s office to bring the value down by $100,000.

Kim Ward did her best to explain the company’s version of the value – although she was filling in for the original company representative — who apparently called in sick

“There were mistakes on our behalf, I’m hoping you will look at our side of things in good faith,” she said in the Zoom meeting.

Ward admitted that the base value for the nearly 20,000 square foot building should have been $55 per square foot rather than $39.

“And I do agree there were some extra features left out — a couple of mistakes in there.”

Board Chairman Daryl Seymore challenged the depreciation rate the company claimed. “Can you explain that difference: 29% vs.16%?”

“It’s the life expectancy of the building based on…”

“Do you believe building costs have increased or decreased?” asked Seymore.

“I believe they’ve increased,” said Ward.

“This building is in very good repair,” said Seymore. “Sales are very strong. The valuation of the land, if anything, is low. So I recommended we keep the valuation assessed by the county assessor.”

The board unanimously agreed.

So, the assessor wins again.

Unless you count the $100,000 decrease to $8.8 million.

So maybe you can’t fight city hall.

But sometimes, you get an itty bitty concession.

PTLS approves increase for town manager
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PINETOP-LAKESIDE — Following the Sept. 19 council approval of the $2 premium increase for all town employees deemed as essential workers, another agenda item requested a 5% increase for Town Manager Keith Johnson which was unanimously approved.

Johnson stated that council recently completed his performance evaluation. That was done in executive session on Aug. 19. Johnson said his current contract expires in July 2022 and his request was for a 5% hourly increase.

Johnson said he should have given that agenda item to Finance Director/Assistant Town Manager Kevin Rodolph.

“I do not mind asking for other people,” said Johnson, “but it’s hard when it is for me.”

Surprised that the request asked for a per hour increase, Councilor Lynn Krigbaum, stated, “I did not understand that the town manager was an hourly employee. I thought that the 5% was on his whole salary which I think is appropriate, but the motion does not say hourly.”

“That’s a good point,” said Johnson. “When we fill out our personal action forms, we break it down to an hourly rate, and so that’s what was in my mind. It equals the same thing. When all of us that are exempt employees receive our pay stubs, it shows that we have 80 hours at whatever dollar amount that hourly rate is.”

Mayor Stephanie Irwin commented that she knows that Johnson works more than 80 hours.

Councilor Sterling Beus asked Johnson if he would also receive the $2 increase the other employees will receive on top of the 5% increase, and Johnson confirmed that he will.

Johnson had advised the council on Sept. 16 that, according to the definition provided by the American Rescue Plan Act (ARPA), all of PTLS’s town employees qualify as essential workers because they regularly performed in person work, not remotely, and either interacted with others at work or physically handled items handled by others in order to protect the health and well being of residents.

Beus also asked Johnson when they were considering the $2 increase who the lowest paid person was for the town. Johnson had replied that he wasn’t sure, but thought it was in the public works department where the starting pay rate is $13.65 per hour. He added that after one year, providing the employee in that position got their CDL, there pay would increase by $1.

Now with the $2 premium increase the starting rate for that employee will be $15.65, making the lowest paid town employee the part time employees in the Visitor Center who, with the increase, now makes $15 per hour.

According to Rodolph, the highest paid employee is the town manager. His pay was $106,000 before the 5% increase which brought it to $112,000, and with the $2.00 per hour premium increase his pay is $116,000 per year. Rodolph named himself as a close second at $114,000 per year.

The $2 per hour premium increase which council approved for all essential employees comes from the Coronavirus State and Local Fiscal Responsibility Funds which were established by the ARPA. The increase was approved to begin Sept. 19.

The 5% increase for Johnson comes from the town’s General Fund which is all of the town’s operating revenue from the state’s Transaction Privilege Tax (TPT), more commonly known by some as sales tax.

Johnson is an Arizona native who spent his summers growing up at his grandparents' cabin near Woodland Lake and is now a resident of Show Low. He  was selected as town manager in June 2015. He is currently in the middle of his second, three year contract with the town.

Meet NPC’s ninth President Dr. Chato Hazelbaker
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You are encouraged to meet and have a casual conversation with Northland Pioneer College’s (NPC’s), new president Dr. Chato Hazelbaker, over coffee and treats at two upcoming community events.

NPC’s Show Low campus will host a meet-n-greet event Tuesday morning Oct. 12 from 8 a.m. to 9 a.m. outdoors, on the Aspen Center’s lawn. A second opportunity to meet and converse with Dr. Hazelbaker will be held at the same time, Wednesday morning Oct. 20 at NPC’s Snowflake campus in the Performing Arts Center’s veranda.

These events will offer everyone an informal opportunity to meet with Dr. Hazelbaker, who took the reins as NPC’s ninth president this past July. “I’m excited to hear from you,” he says. “I want to get to know our community members, local business leaders, current and past NPC students and potential students. I encourage you to share your ideas for helping NPC advance its mission of providing educational excellence, that is affordable and accessible for the communities we serve,” said Hazelbaker.

Hazelbaker comes to NPC with a wealth of experience working with and for community colleges. Prior to landing at NPC, he served as Vice President of Enrollment Management and Marketing at Carroll College in Helena, Montana. He also held the previous Chief Communications Officer position at Clark College in Vancouver, Washington and earned is Doctor of Education in Organization Development from the University of St. Thomas in Saint Paul, Minnesota. In addition, Hazelbaker holds a Master of Arts in Leadership from Crown College in St. Bonifacius, Minnesota, and a Bachelor of Arts in English from Rocky Mountain College in Billings, Montana.

NPC’s presidential meet-n-greet events are free and open to everyone. The Show Low event is brought to you by the City of Show Low, Show Low Chamber of Commerce, NPC’s Small Business Development Center and NPC Friends and Family, Inc. The Snowflake meet-n-greet is being sponsored by the Snowflake Chamber of Commerce, NPC’s Small Business Development Center and NPC Friends and Family, Inc.

For more information please contact NPC’s Small Business Development Center Director Rich Chanick, at 928-532-6706 or email him at richard.chanick@npc.edu.

Defunct Springerville cannabis farm wants $6M from town
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SPRINGERVILLE — White Mountain Flowers, LLC (WMF) has demanded $6 million from the Town of Springerville in damages from the ill-fated marijuana grow operation the WMF began near Springerville’s airport which is now defunct.

During its Nov. 12, 2020 council meeting the town approved a lease of 19.5 acres of land to WMF which intended to operate a cannabis growing and an infusing operation at the site. Infusing means to infuse non-cannabis products products with cannabis oil, like baked goods, candy or anything that can receive infusion.

The seemingly well-intentioned exercise was fraught with difficulties and some of the town’s residents loudly opposed it, claiming there was conflict of interest issues, that the operation was not well studied for water use and traffic, and claimed irregularities by the Town Council in zoning and ordinance changes. The Federal Aviation Commission got involved and threatened to pull federal funding for the airport and hinted at criminal charges against the town because although possession, use and cultivation of marijuana can be legal under Arizona law, it is still illegal under federal law.

The Notice of Claim

It might be noted that a Notice of Claim is not a lawsuit. It is a notice to a “pubic agency, public school or public employee” required by Arizona law to be served or filed within six months of the injury or damage. Some consider the requirement as a fair way of alerting a public agency of a claim so that the agency can evaluate it and possibly resolve it. Others see it as a way to sharply abbreviate the years-long statute of limitations in such matters and to unfairly shield the government from lawsuits: if a plaintiff misses the six-month deadline for a notice of claim, the plaintiff is not allowed to bring an actual lawsuit against the alleged wrongdoer.

The Notice of Claim by WMF is dated August 26 and WMF’s lawyers, Zwillinger Wulkan PLC, a law firm in Phoenix, filed it with the town clerk by process server. The claim does not mention any of the circumstances stated above; rather WMF urges that Springerville told WMF that the town owned the land that it leased to WMF, but the town actually did not own the land. That, says WMF is a “material misrepresentation “ and caused WMF damages.

The claim insists the Dec. 10, 2020 development agreement between the town and WMF specifically required the town to provide “title to the land,” which it turns out, the town didn’t have. In lawyer-speak, that was a default of the agreement and that the town didn’t even try to cure that rather glaring default, its failure to cure it was yet another breach of the deal. Finally, WMF points out that Arizona law implies in any contract (whether written in a contract or not) a “covenant of good faith and fair dealing,” and the town breached that as well, urges WMF.

Damages claimed

WMF has since set up shop in Eden, Arizona, according to the claim. Eden is an unincorporated community in Graham County near Safford, founded in 1881. Legends of America wrote that it was named after the Garden of Eden in the Hebrew Bible and called it the “Mormon Ghost Town.” Eden had a population by zip code that was estimated to be 150 persons in the year 2000, according to Wikipedia.

The Notice of Claim stated that in Eden, WMF’s “net annual rent is $500,000.” By contrast the agreement with Springerville called for $9,600 per year for 25 years, meaning that the difference “will cost White Mountain Flowers $12,500,000, before 40-year extension are exercised,” stated claim. Not only that, says the claim, in Eden, WMF “was required to give certain percentage rent concessions to its new landlord, beginning with White Mountain Flower’s (sic) first harvest, that may amount to approximately $1,000,000 a year for 25 years, totaling a loss of approximately $25,000,000, plus 40 years of extension and inflation.”

In short, WMF is demanding the town pay part of the LLC’s “benefit of the bargain” damages meaning the amount they now have to pay for rent ($500,000 per year) as opposed to the amount they bargained for ($9,600 per year) if the Town of Springerville had not breached the agreement.

WMF also claims that relying on its agreement with Springerville, the LLC “expended no less that $3,500,000,” to advance Springerville operation, which WMF considers lost.

Finally, The Notice of Claim demands $6 million at this point in time, but warns that, “If a lawsuit is filed, White Mountain Flowers will seek damages substantially exceeding that amount. (Emphasis in original.) The claim stated that WMF just wants to put the matter behind it and get on with its business. On the other hand, typically, identifying the owner of real property is easily accomplished with a simple check of county records, or by consulting a title company. Whether a lessee is permitted by law to merely take a lessor’s word in that regard involving a long term business lease might raise a legal issue regarding due dilligence on the lessee’s part.

Springerville’s insurance

There is an insurance company of sorts for municipalities to cover losses the municipality may incur in legal disputes. The Arizona Municipal Risk Retention Pool covers 77 of Arizona’s 91 towns, said Sheri Reintjes, the Branch Vice President of AMRRP. She told the Independent during a phone call that Springerville is indeed one of the Pool’s members. The details of Springerville’s specific policy with AMRRP are unknown, but damages sought for breach of contract (as opposed to officer shootings or slip and fall cases in public buildings) are common enough that they may be covered. If so, typically Springerville will “tender the defense” of any lawsuit to AMRRP attorneys or defense attorneys the Pool contracts with.

It might be noted that a recent Springerville Town Council action bolstered the town’s legal resources by $50,000. Town Clerk Kelsi Miller told the Independent by email that “the Town prefers to make no comment at this time.”

The Independent will update this story as it develops.

Appearing on radio, representing the Tribe in one of his many board roles on or off of the reservation, or while participating in the Harry Potter Fan Club, Derrick Leslie, the eternal optimist, is always smiling.