TAYLOR — The lawsuit against the Town of Taylor by residents over what they claimed was a number of improprieties by town officials over the so-called Taylor Business Park near its airport, has been dismissed. According to a stipulation by both sides filed with the Navajo County Superior Court in February, they asked the court to dismiss the case with prejudice with each side to bear their own legal fees and costs. “With prejudice” means that the same parties cannot urge the same points again in the future. In March, the court returned to the plaintiffs the $12,000 bond that they had posted in support of an injunction against the town from taking any action on the project until the matter was settled. Now it has been settled by the court’s dismissal of the suit.
The master plan for Taylor Airport, sometimes called the Taylor Business Park was put into action in October 2002, when the Taylor Town Council approved the capital improvement program for the endeavor.
It wouldn’t be “an industrial park, but a business technical park,” said then-Airport Manager Richard Prior about plans to develop the 100-plus acres southeast of the airport which the town bought from the Palmer Family Trust in 2003. “We want to bring in clean industries that offer higher salaries. It would really help our economy,” he told the council. Planners envisioned green spaces, recreation areas, daycare centers and even a movie theater. The runway would be strengthened to accommodate Lear jets; new hangars and taxiway lights would be built. Best of all, the federal government would pay for 91% of the $2.5 million cost, with the town paying only $115,000, believed the planners.
Now, almost 19 years later, there is no business park, and on May 4, 2020, Taylor residents, property owners and taxpayers sued the town. The plaintiffs were Aaron and Gary Solomon, Marion Hatch and Richard and Alice Franco; the defendant is Town of Taylor Municipal Property Corporation. Plaintiffs alleged in the suit that the town made illegal, unconstitutional gifts to insiders, had an impermissible conflict of interest, and used illegal parliamentary maneuvers to move things along, including violating Arizona’s open meeting law. The Arizona attorney general in May 2019 produced written findings that the town had indeed violated the open meetings law in two out of three alleged incidents with regard to the business park.
Plaintiffs also asked for an injunction to stop the town from taking further action on the project until a court could sort it all out, and piece by piece, the court did.
At the heart of the dispute is Hatch Development LLC (“Hatch”), reportedly owned by Jason and Shannon Hatch. In September 2018, Hatch offered to sell to the town land for its business park, divided into two parcels, A and B, about 150 acres, for $750,000. Right off the bat, plaintiffs thought that was curious because, as stated above, the town had already bought the property once in 2003, or at least 100-plus acres of it. The tangled machinations of how the town ended up not owning it anymore and how Hatch ended up with the property at various times still is unclear and outside the scope of this report. Suffice it to say that on Nov. 20, 2018, the town signed a purchase agreement with Hatch and the very next day, paid the seller $292,000 for Parcel A.
That was illegal, say plaintiffs, because Arizona law requires a 30-day waiting period between the time a municipality agrees to such a transaction and when it actually goes through with it. In this case, the town forked over the cash in less than 24 hours after the deal was approved by the town. Plaintiffs also allege that the town didn’t get an accurate appraisal and plaintiffs say the town didn’t assure that the title was clear, which it wasn’t, and it cost the town a year’s worth of legal work to get the title cleared, they urged.
Regarding conflicts of interest, plaintiffs say that Councilmember Fay Hatch, who voted for the agreement, is related to Jason Hatch, and the law required Fay to disclose the connection and to recuse himself from the vote, neither of which he did.
Then there is what the plaintiffs characterize as “gifts.” First, the Arizona Constitution forbids governments of all shapes and sizes in the state from making sweetheart deals with private commercial interests, the so-called “Gift Clause,” or more accurately, the Anti-Gift Clause. Plaintiffs claim that pieces of Parcel B, under contract to be sold to the town for an agreed upon price, already have been peeled off and sold or given to others. For example, the complaint alleges that in October 2019, “Jason Hatch gave 0.38 acres of land to Marchell J. Williamson III and Sara A. Williamson,” who happen to be Taylor Mayor Smith’s daughter and son-in-law, at no cost to them. As stated, Mayor Smith said that is simply not true.
In an email to the Independent on May 14, 2020 Smith stated that the allegations “are completely unfounded,” and that the plaintiffs are “asserting facts that are both wrong and of which they have no first hand knowledge.” Smith says that two of the plaintiffs “are not even Taylor residents,” and some “have sued the Town before without merit.”
In June 2020 the town attempted to have the suit thrown out without having a trial, a device known under the rules of court as a judgment on the pleadings. To get a judgment on the pleadings, the court must find that even if everything that one side alleges is true, that the other side is still “clearly entitled to judgment,” according to the rule.
Among the grounds that the town said favored their side was the issue of standing. It’s well-settled law that if a person seeks relief from a court, that person must have some kind of standing to bring it, meaning that the event complained about will have an effect on the claimant’s “rights, status or legal relations,” as the court put it. Regarding standing to sue, defendant says that just because persons reside in a town, or own property there, and pay taxes there, does not mean that they have “automatic standing” to sue the town.
Plaintiffs have no such interest here, the town argued. The parties appeared for argument on July 20, 2020 in the courtroom of Judge Michaela Ruechel and the judge issued her ruling on August 31, 2020. The case was not thrown out, but the judge agreed with the Town of Taylor that Plaintiffs Solomon, Marion Hatch and Alice Franco do not have standing to sue the town, but that Richard Franco does.
Citing statutes and case law, the judge ruled that just because a person pays taxes in a town, or is a resident thereof, does not give the resident automatic standing to sue the town. The idea goes back to the notion that political differences about decisions made by town leaders are best resolved at the ballot box. Judge Ruechel observed that in order to involve the court in such things, to have standing to sue, a person must show that tax revenue taken from residents was used by the town for the action complained about, in this case, the purchase of part of the land city leaders want for the business park. The judge said that the plaintiffs in their complaint didn’t even allege that happened, so they don’t have standing.
But Franco did have standing to sue said the judge because his rights were indeed affected when he was given only 30 seconds to address the town council on this matter during a meeting on Jan. 3, 2019 — an abbreviated span of time that other presenters were not restricted to. That was a violation of his “right to be heard,” stated the judge.
Other grounds that the town raised included the fact that plaintiffs waited too long to bring suit, that the statute of limitations on such actions are time-barred after one year, and the events the plaintiffs complain about happened over a year before they filed the suit. The court could not find for either side on that issue, because there are still details to be determined at a trial about that.
But now there will be no trial. Franco wrote to the Independent on April 29. “(We) could see nothing but large legal bills to prove our point so we pulled the plug...we can think of no better victory at this point than to allow Taylor and Mayor Smith to forge ahead and cement their legacy as the owners of the biggest and costliest failure in the town’s history. It’s truly poetic justice for one of the worst financial transactions...I’ve ever seen...”
Franco also reports that the town has already closed on the deal, that “Taylor citizens get stuck with the bills, both past and future… a pipe dream of a ‘if you buy it, they will come’ so-called business park that will never be,” he wrote.
For the town’s part, in his email to the Independent in May, 2020, the mayor stated, “The Town is confident that in the end the Court will allow the transaction to proceed.” Looks like he was right. In his final comment on this matter, the mayor wrote Monday “We are glad to be moving forward for a positive impact on the Town, which is to be able to have a location for small and new business to have a place to locate in Taylor. Our flood control project that has been on hold is now underway and our road paving project is currently being designed and plan to bid this summer. We are moving forward and just in time as we are experiencing unprecedented growth in Taylor.”
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