Arizona Republic from Phoenix, Arizona • Page 12

FINAL CHASER A10 THE ARIZONA REPUBLIC SUNDAY, AUGUST 17, 1886 El SRP seeking to reroute 2 roads to meander through its property to the Southern railroad, tracks. Krigers said the proposed realignment of Washington primarily would benefit the utility because the current alignment of Washington cuts SRP's property into three sections, making it difficult to develop. By moving Washington next to the tracks, the property only would be dissected into two sections. Crittenden said SRP officials hope 56th Street can be realigned by November 1988 and Washington between the years 1991 and 2000. ning Commission and City Council and possibly the same groups in Phoenix.

Phoenix planning and transportation officials had no com-ment Friday. SRP planners want to move 56th -Street to the east, thereby routing motorists through SRP property. -The proposed road would link up with Galvin Parkway, rather than ending at Van Buren. The proposed Washington Street realignment calls for the street toL be moved south between 56th -Street and Curry Road to run next the Salt River between 56th Street and Mill. The SRP plans to use 37 acres for five new buildings that will become its new corporate headquarters and sell or lease the remaining acreage for use as corporate offices, research and development facilities, a hotel with shops and possibly a condominium-type residential area.

Neither Crittenden nor Krigers had any cost estimates on the new roads. Before the roads could be built, the SRP would have to obtain the approval of the Tempe Plan- tive. A Tempe planner, Atis Krigers, said Friday that Tempe officials generally support the plans but haven't had any discussions with SRP officials as to who will pay for the roads. He said such discussions "are a long ways down the road." Krigers said the proposed realignments wouldn't "make a lot of. difference" to motorists.

The proposed roads are designed to serve the utility's business and industrial park, the Papago Park Center. It is on the northern side of. officials said Friday that it could end up being a combination of sources, including taxpayers, the utility and any businesses that buy or lease the SRP's land. The new roads, as envisioned by SRP planners, would meander through the heart of the utility's 478-acre tract. "We consider the new alignments to be the best arrangement for traffic flow in that area, but they are subject to change based on input from the cities of Tempe and Phoenix and the public," said Larry Crittenden, SRP press represena- By SUSAN LEONARD Th Arizona Republic Salt River Project officials hope to reroute two major roads that cross their property in northwest Tempe as part of a multimillion- dollar development plan.

Utility officials said they would like to see the alignments of Washington and 56th streets changed to benefit the public, the utility and the private businesses that they hope to lure to the property. It hasn't been determined who would pay for the roads, but utility Bridge Continued from Al mmfflmmmmmmmmm An artist's rendering of what the proposed Phoenix Tower, at 1,692 feet and 114 stories, would look like against the downtown skyline Tower Pastor said. "They didn't seek us." Like the supervisors, County Manager Robert Mautiey and Art Dickson, who served as a liaison between the bond committee and county officials, also said they can't remember Lassen, Gibbs or Howlett telling them about the SRP's large landholdings or development plans. Mauney and Dickson said they weren't upset, however, and believe the SRP executives did a good job. Construction of the six-lane bridge is expected to start late next year.

It will bring traffic through or along the SRP's property, 438 acres of which the utility plans to sell or lease to private companies. The SRP's headquarters occupy some of the land, but most of it is vacant. Part of the property used to be the site of the Legend City amusement park. SRP officials acknowledge the bridge is going to be a benefit to the utility. Lassen said Howlett, Gibbs and he talked about the bridge when it came up about, midway through their stint on the bond committee and agreed to "keep out of it." "I did not want to get involved in that bridge whatsoever because we owned a substantial amount of land in that area and had a possible conflict," Lassen said.

"I'm sure I made my position clear (to county officials). "I think the Board of Supervisors was well-aware that we owned land on the north 6ide of the Salt River and controlled land (160 acres) on the south side." Lassen said he couldn't recall telling county officials that the SRP had development plans for the land but figured that just the location of the current headquarters posed a conflict. Howlett said he couldn't remember which county officials or bond-committee members he told about SRP development plans but added that he certainly told many county officials and bond-pommittee members that he had a conflict. "The point is that we declared the conflict," he said. "We took the initiative to be open and up front and candid about our conflict of interest.

We acted appropriately and took every effort to make sure we were squeaky clean. "The bridge would have benefited the land if we didn't do anything except sell it," Howlett Continued from A 1 and some city officials also see the project as linking downtown and midtown high-rise districts. The centerpiece skyscraper, at 1,692 feet and 114 stories, would compete with a Donald Trump project planned in New York and a recently announced project in Newark, N.J., for the title of the world's tallest building, now held by Chicago's Sears Tower. Schriqui envisions a project so dramatic that it will spark joint business ventures between Europeans with money to invest and Arizona entrepreneurs in search of capital. The idea was enthusiastically received by Phoenix's old -guard business leaders and by the new establishment led by Mayor Terry Goddard when it was unveiled last year.

They saw the project creating jobs, generating taxes, drawing tourists and giving the city a symbol to match St. Louis' arch. French businessmen brought to Phoenix by Schriqui in April 1985 were treated to four days of meetings with local dignitaries, including Goddard and Gov. Bruce Babbitt. Schriqui also met with officials of The Republic and The Gazette.

Schriqui's plan is "bold and imaginative," The Republic editorialized that spring under the headline "Standing Tall in Phoenix." The Gazette called it "the right building in the right place" that would "fit right in with Valley efforts to create new business ties." And then-Publisher Darrow "Duke" Tully helped Schriqui lobby civic leaders. In December, council members extolled the henefita the world's tallest buildine would SRP officials announced July 14, two months after the bridge was approved by voters, that they plan to develop the property into a multimillion-dollar business park. The SRP executives who served on the committees, John Lassen, Christine Gibbs and C.A. Howlett, say that they believe they did nothing wrong and that neither they nor the SRP conceived of the bridge or lobbied for it. Lassen and Howlett said they told members of Maricopa County.

Board of Supervisors, county officials and fellow bond-committee members that they had a conflict of interest on the bridge issue. They also claim their roles in getting approval for the bridge were strictly minimal and coincidental. However, a review by The Arizona Republic indicates that: The supervisors, who placed the bond issue, including the bridge, before voters on the advice of the bond committee, said the three SRP executives did not tell them that SRP owned 478 acres near the bridge site or that the' utility planned to develop it into a business and industrial park. Key county staff members, including the county manager and the man who served as the bond committee's liaison to county officials said they were not told of the SRP's development plans. Three citizens who served on a subcommittee of the bond panel that recommended the bridge said that they can't recall any of the SRP executives telling them about the utility's development plans.

But Howlett, an assistant general manager at SRP who was head of the subcommittee, did not attend a subcommittee meeting in which the bridge was discussed and told the bond committee that he had a conflict on the bridge issue. The conflict was not specified in the minutes of the meeting, and Howlett said he can't recall whether he was specific. While serving on the bond committee, Gibbs, the SRP's senior government-relations representative, voted to recommend that the supervisors place the bridge and other items on the ballot. Howlett and Lassen, who is president of the SRP, didn't vote. Howlett said he didn't because he left the meeting early.

Lassen said he didn't because he was the committee's chairman and didn't think it appropriate for him to vote. All county supervisors George Campbell, Ed Pastor, Tom Freestone, Carole Carpenter and Fred Koory said they knew the SRP's headquarters were near the site of the bridge, but not about the total acreage involved or the development plans. All of the supervisors except Campbell, who wouldn't give an opinion, said they would have approved putting the bridge on the ballot even if the SRP had disclosed its plans. However, Carpenter said she would have felt more comfortable if the executives had disclosed their conflict. "If I had realized there was that much land, I would probably have asked the county staff to take a closer look at the bridge and assure me it was a good use of funds," Carpenter said.

"I also would have requested that their land holdings and development plans be disclosed so that there was no appearance of a conflict of interest. I'm not saying they did anything wrong, but it's always better to avoid even the appearance of a conflict by full disclosure." Freestone said he is willing to give the SRP executives the benefit of the doubt but also believes it would have been wiser for them to have disclosed information about the size of their landholdings and development plans. "Maybe it didn't enter their minds, but it's always better to make those kind of disclosures," Freestone said. "It's an obvious oversight, and probably an accidental one, but I wouldn't question their integrity, particularly John Lassen's, and I'm not upset about it." Freestone, Carpenter and the other supervisors said they find it difficult to be critical of the three SRP executives because they were asked to serve on the county committee by the supervisors. "Remember, we sought them," shower upon Phoenix in voting 8-1 to open Because of their conflict, Howlett and Lassen said, they did not take part in discussions about the bridge.

Gibbs said she didn't tell the supervisors or county officials specifically about the SRP's development plans because she didn't feel -u. i i 1 i Li Cardon said he would like to propose that the council extend negotiations, relaxing communication lines among city departments so that he can work with aviation and redevelopment officials to come up with a package of proposals to mitigate the building's effect on the airport. The council should see those numbers before it discards the idea of a 1 14-story building, the attorney said. "So far, people are just pulling numbers out of the air," he said. City staff members have had the same uneasy feeling about the developer's presentations.

They have asked Cardon to submit more information if there is to be further review of the project. The information includes: A consultant's study on the project's economic impact. Details, in writing, on the "unique funding mechanism" proposed, which involves European export credits, and of the level of financial commitment by Schriqui and the two major French organizations the developer says will be involved. Descriptions, in writing, and references for Schriqui's involvement in other development projects. A "strategy paper" describing how the developer proposes to deal with the building's negative effect on the airport.

"All costs associated with this effort would be paid by the developer," the city's redevelopment executive, Robert K. Logan, said in a June letter to Cardon. Despite the long list of unanswered questions, city officials say they do not question Schriqui's ability to develop the $80 million Phoenix Tower project. Goddard took advantage of his "loaned executive" program to tap Stephen Taylor, a former Valley National Bank vice president and manager of its Latin American group, to check on Schriqui. "I found nothing that was negative," Taylor said.

"I felt uncomfortable, like there was an expectation that, 'He's going to tell us (Schriqui) is an overlord of But he's a perfectly legitimate businessman who was well known in the upper echelons of society in Europe." Taylor also said that, financially, Schriqui "could do this project on his own." The city has on file a letter from Raoul Biancheri, Monaco's counselor of government for finance and economics, confirming that Schriqui was involved in the Fontvieille project in Monte Carlo, a $1 billion office, residential and recreational complex built in conjunction with the Monaco government on 54 acres reclaimed from the Mediterranean Sea. Biancheri said Schriqui "was respectful to all of his commitments, both written and oral, technically, financially and morally." Cardon, citing the letter, said Schriqui has sold Phoenix to Europe but has failed to sell "I Phoenix on the "European concept." The attorney and Schriqui balk at both the $50,000 deposit and the "blank check" expected for airport modifications that they say the city ultimately will need to make anyway as the city grows. In addition, they object to some of the paper work requested because, they say, it duplicates some information already presented in talks with the city or is not available because the project is not a conventional one. "My reaction is not about the money, but about the principle," Schriqui said. "I can understand the city's position, but what I do not like is a policy made especially for my project.

I want people to be fair." The 58-year-old Frenchman is flabbergasted that his commitment to the project is being questioned after he spent seven years as a part-time resident of Paradise Valley, four years acquainting European and Arizona leaders with his idea and more than a year waiting for a go-ahead from the council. But Schriqui shrugs off suggestions the project is in trouble. "We have problems because of the airport," he said. "But a project of this magnitude cannot be built just like that without a lot of problems. People here sooner or later will appreciate my perseverance." nothing that can't be worked out "if we sit a few folks around a table and talk." A key question is whether the council is willing to go out on a political limb to get the FAA to outline conditions under which the airport and skyscraper could co-exist and then pay the costs both in dollars and in complaints from a disgruntled aviation community of making changes at the airport to accommodate the building.

The council hears varying interpretations of the extent of the problems posed for the airport by the skyscraper. Phillip Lindberg, a consultant hired by the city to study the issue, said the problems are political ones, not technical ones, and the trade-offs would be in the airport's efficiency rather than its safety. "If you proposed to build Camelback Mountain, the FAA would declare it a hazard, but we have procedures to accommodate the mountain," Lindberg' said. Although acknowledging that the FAA "has really dug its heels in on this one" and appears unwilling to explore avenues of accomodating the skyscraper, Lindberg said, "That can be a different story if you have the right political, atmosphere and right people." Lindberg said Sky Harbor, if altered to accommodate the building, would live with constraints similar to those imposed on airports in San Franciso and Seattle-Tacoma, Wash. The city's aviation director, Neilson "Dutch" Bertholf argues, however, that if Phoenix doesn't guard against reductions in Sky Harbor's capacity, it risks creating situations similar to those at Hartsfield International Airport in Atlanta or at Washington National Airport, where passengers often sit on the ground for long periods waiting for airspace to open up.

The reduction in capacity would result from the building's blocking the approach currently used by light aircraft, Bertholf and Lindberg said. That would force light aircraft and airliners to share the same flight path, causing delays, they added. Lindberg said part of the loss could be made up by adding a third runway to the south, as called for in the airport's master plan, and by extending runways to the west. The new runway would require rechanneling the Salt River, and runway extensions would require relocating 24th Street or tunneling it under the runway. Bertholf said those are multimillion-dollar projects that, with the1 constraints posed by the Phoenix Tower, would reduce Sky Harbor's capacity.

Six months of study and negotiations between the city and Schriqui have yielded no firm price tags on the costs of the changes, no, definitive estimate of the loss of airport capacity and no agreement on who would pay for the airport changes. The council-authorized negotiating period has run out, so city staff members suggested that the council seek some financial commitment, including $50,000 in earnest money, before extending talks with the developer. A city staff member, who did not want to be identified, said there is concern that $118,000 in public funds already has been spent on traffic and aviation studies for the project while the developer's expenses so far have appeared to be limited to the costs of his architectural drawings. Schriqui's attorney, Marriner Cardon, confirmed that he is working without fees because he has a partnership agreement on the project with Schriqui. The council never took action to extend negotiations because Schriqui was out of town and requested more time to consider city demands.

But five of the nine council members said in interviews that they think a request for "good-faith" money is appropriate. "Unless negotiations are carried out so that we get a clear picture of what we're going to get, there's no basis for saying yea or nay," District 7 Councilwoman Mary Rose Wilcox said. "If (Schriqui) doesn't want to go ahead with the $50,000 deposit, I would question whether hejs serious about the project" all knew, anyway. "I personally take great umbrage at any inference that we did something wrong," Gibbs said. "I agreed to serve on the bond committee, as I know John Lassen agreed to serve, before we had any idea that the bridge was going to be raised or come through the process.

"I had informed the supervisors before the time of the bond committee that SRP owned a lot of land. They knew that. It was in the papers back in 1983 when we bought Legend City. It was com-, mon knowledge that SRP had purchased the land. "I didn't reaffirm it as part of the bond-committee process because it didn't occur to me that it was necessary to reaffirm something that was already Common knowledge." Gibbs also said she didn't consider the development plans "relev-ent." "We already have facilities on both sides of the river." she said.

negotiations for a redevelopment contract witn Schriqui. 1 That has changed. The Republic, under a new publisher, this month called the Schriqui proposal a "pipe dream." The Gazette editorialized that the building would be "wholly out of character with the community." Phil Sunkel, editor of The Republic's editorial pages, said the project is no longer favored because it could "disrupt operations" at Sky Harbor Airport and add further space to the city's already overbuilt office space market. He said the change in editorial policy has nothing to do with the change in publishers from Tully to Pat Murphy. In fact, Sunkel said, Murphy was editor of The Republic editorial pages when the paper first came out in support of the skyscraper.

Some council members, while still wanting to encourage Schriqui to pursue some kind of project downtown, are not as enamored of the "world's tallest" title because of the problems the building would bring Sky Harbor. 1 "We knew when we gave the original encouragement to the project that there would be a lot of pitfalls," District 5 Councilman Howard Adams said. "I think we knew some of them could be resolved only through modification and compromise. It could be the world's most unusual building or the most i interesting. There are a lot of records you can set, a lot of ways to create an international monument." Vice Mayor Duane Pell, who represents District 2 and was the lone council member voting against the proposal, said recently, "I don't like to say, 'I told you But that was my statement before: There are just too many obstacles." The difficulties that have emerged in negotiations between the city and Schriqui, some council members say, might be attributed simply to cultural differences.

"Here, we want everything spelled out and reviewed by an attorney," said Adams, who years ago traveled in 40 countries as an export manager. "That's not the case in Europe. Something is agreed to, (and) it's done. District 4 Councilman John Nelson said he believes the current impasse in negotiations is "Why would the master-planning effort make any difference in the way we viewed the bridge? I don't understand the logic." Like Gibbs, Lassen and Howlett said that when they agreed to serve on the bond committee, they did not know that the bridge was going to be brought up. They said it was suggested by Tempe officials, Tempe Chamber of Commerce officials and a state legislator, Rep.

Doug Todd, R-Tempe. Lassen said officials with the. SRP never talked to any of the Tempe bridge proponents and had nothing to do with their push for the bridge. 1.