Saturday, February 26, 2011

Gilbert land buy facing scrutiny

Arizona Attorney General Tom Horne on Friday said that his office will likely examine a Gilbert land deal worth $50.2 million in search of any criminal wrongdoing.

For months, Gilbert officials have faced pressure and criticism from land experts and residents who say the town vastly overpaid for the property.

The Gilbert Town Council on Thursday called on the Attorney General's Office to investigate the transaction, but Horne said he'll wait for a formal request before pursuing the case. Once contacted, Horne said he'll assign an investigator to search for evidence of a crime.

"I think there would have to be some kind of improper motive," Horne said. "Just mere negligence is not a crime; it's a reason to not elect someone again."

Gilbert purchased the property in February 2009, acquiring 142.5 acres of undeveloped farmland, several right-of-way strips for road improvements, and dairy infrastructure from farmer Bernard Zinke.

Two large parcels are intended for future parks in an underserved area of south Gilbert, officials have said. Although officials expressed urgency in acquiring the land, there is no timetable for development, and funding for construction has not been allocated.

The Arizona Republic in September cited land experts who said the town's cost of $300,000 per acre was well over market value and came at a time when land values were sinking amid the recession.

The council's call for an outside investigation followed The Republic's disclosures this week that the town had a 2007 appraisal for a significant portion of the land that put its worth at $67,000 an acre, far less than the $300,000-per-acre price the council unanimously approved at the request of former Town Manager George Pettit.

No appraisal of the entire 142.5-acre site had been commissioned before the sale was approved, and the existence of the 2007 appraisal had never been disclosed by town officials.

Two of the primary negotiators on the Zinke land deal are no longer with the town: Pettit was forced into retirement last year, and former capital-projects coordinator Paul Mood took a job with Fountain Hills.

Senior program manager Jeff Kramer told The Republic that officials were aware of the existing appraisals - other appraisals were made in 2008 - while conducting negotiations but that other factors drove the deal.

During cost negotiations, "Zinke told me and Paul Mood what he wanted," Kramer said. "We then took that to the former town manager (Pettit)."

The council on Thursday directed current Town Manager Collin DeWitt to find an independent firm to conduct a forensic audit, which would attempt to "follow the money."

"Let them find out once and for all if there is any wrongdoing or if it was just bad business practice, poor negotiations or whatever it is," Councilman John Sentz said.

Councilwoman Jenn Daniels asked that any town documents related to the Zinke deal be made available to the public on the town's website.

"Sunlight is the best disinfectant," Daniels said. "I really don't feel satisfied at this time, and I don't think the public does, either."

by Parker Leavitt The Arizona Republic Feb. 26, 2011 12:00 AM

Gilbert land buy facing scrutiny

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