Cave Creek approves $14.5M open space acquisition 7-0

The meeting is now called to order. This is a special town council meeting of March 31st, 2026. Um, please stand and join me in the pledge of allegiance of Americans unless something along the lines of what we're dealing with today. Uh action items. Our agenda item tonight is number one is the Arizona State Land Department will provide a detailed overview of the process involved in acquiring the state trust land.

Mayor, if I may, I just have some introductory remarks before I have um our development services director come up and he's going to be introducing the um team from the Arizona State Land Department.

You'll recall back in uh February, we had our council retreat and we had um one of the items on the agenda had to do with state trust land and the strategies and I had mentioned to the council that we'd be coming back in about 6 weeks and we're about six or seven weeks since that time with additional uh detailed information.

So, um, tonight the reason why we have a special meeting is that we have all this additional time to go through these, um, agenda items and there was some coordination also trying to have the, um, Arizona State Land Department staff be here. So, we're really very pleased to have them. And with that, I'm going to go ahead and turn it over to uh, Luke. Uh, thank you, Grady. Mayor, members of council, I'm pleased to introduce Karen data and Ruben O'Hada from the Arizona State Land Department.

Uh staff has uh worked with them at least probably the last two years is when we started uh discussing this matter and the and and broaching this subject um and and going through different uh phases talking about appraisals and and the process for auction. I know there's a lot of questions from the town council as well as the general public.

So, uh, we're very fortunate to have Karen and Ruben with us today to to kind of go through the state land department, what it does, why it does it, and then more of the nitty-gritty in terms of, uh, application process and auctions. So, with that, I will turn it over to Karen and Ruben. Thank you so much. Before we do that, I'd like to welcome you. We I don't know if your ears been burning, but we've been talking about the department, if not you in particular, for quite some time.

Well, thank you. Thank you, Mr. Mayor. Um well, good afternoon. Uh I am Karen Dada. I'm the assistant director and assistant director um over the real estate division at the state land department. Yeah, my name's Ruben O'H. I'm the also the assistant director for real estate division at the state land department as well. So I'll start with an overview just to we call it state land 101.

I know some of you are very familiar with it, but just for the benefit of the public and um to make uh just to set the set the stage, I will provide that and then Ruben um oversees our sales and leasing section. And so we'll provide an overview of the application and the sales process. So the vision of the state land department is to be a model agency for modern times um responsibly managing the trust assets for the benefit of the trust and the state.

Um this is a new vision established by commissioner seed and we have made a lot of process improvements internally um to make our agency more responsive. Our mission is to responsibly manage the assets of this perpetual trust with the interests um in alignment with the interests of the trust in the state. So um this map just gives you an idea of surface land ownership in the state.

So on this map all the blue and all the white are the land that is available for Arizona's economic and housing future. Um that is state trust land and private land. So um combined you can see it's it's about 30% of the state surface land is available for for development of any kind. So you can see how state trust land is an important component for the economic viability of the state of Arizona. Obviously, not all of that land is available um is physically able to be built upon.

Um our agency was established uh through the Arizona Enabling Act when we were a territory and um and in the Arizona State Constitution. So the operational procedures that we must follow, many of them are written in these centuries old documents um and in state statute. So while we have made a lot of process improvements internally, some of of our processes simply cannot be unwound without a literal act of Congress. And I think we can all imagine how fast that might be.

Um so our rules are that all land might granted must be held in trust. Any natural product from that land needs the use of that must be compensated to the trust. Um all lands must be appraised at fair market value. And as Ruben will discuss, we have a an appointed citizens board called the Board of Appeals that approve reviews and approves every single appraisal. And um that is one one step that needs to happen before land gets posted for auction. We cannot sell for less than fair market value.

And any land sales or leases that are longer than 10 years must go through a public auction. And then those auctions must be advertised in a local newspaper for a minimum of 10 weeks. And we cannot mortgage or encumber state trust land at all. We do have some significant court rulings that we're working within. Um we used to uh provide easements for state highways to ADAT at no cost.

that was contested by um the US Supreme Court and they told us that any use of state trust land requires compensation. And then there was um some efforts to fund our agency through revenues um from our land lease or sales and that was ruled by the state supreme court that that cannot happen. Our agency to manage about 9.2 million acres.

We have about a hundred staff and that includes everything from administrative staff to contract and title staff, people who manage our our grazing and our cultural leases, our land sales, our rights away, our planning, our audit, our legal. That's all 100 people for 9 million acres across the state of Arizona. Every single acre has an underlying beneficiary assigned to it.

Um so that was assigned uh when the state trust land came into Arizona when we became a state by far about 83% of the nine well the original 10 million acres that came to Arizona was that that beneficiary is the common school so the K12 public schools so by far they receive the largest financial benefit from the trust we also have 12 other institutional beneficiaries so that's the state universities. There's some specific schools, the school for minds at the UOVA.

There's some specific schools and programs within the university. Other beneficiaries are the school for the um deaf and blind, the pioneers home, state hospital, and some government buildings receive benefits from the trust asset. So, this is just a breakdown that blue is the common school. So you can see that primarily the beneficiary of the trust are our public schools. Every dollar we earn goes into the trust and again we are a general fund agency.

Um the a annual receipts so for leases those funds we collect those funds they go into what's called the expendable fund and they are given directly to the beneficiaries. sales go to the permanent fund which is managed by the state treasurer and that money is invested and the the revenues the income from that uh permanent fund are what fund the beneficiaries. Um, of course, there's a little bit that comes out of that principle since the last version of Prop 123.

And you can see currently, um, we have the permanent fund is approaching $10 billion in assets. Okay. Well, thank you. So, it's my turn. So, I want to just kind of go over a high level of what the application process is for a purchase. Um, so the applicant obviously would file electronically through our portal.

Um, a lot of times we like to meet with our customers prior to the filing of an application just to talk about, you know, what the project is going to entail, kind of go through some of the maybe the restrictions or some of the constraints that might be, you know, applicable to the land they're looking at.

um talk about timing, you know, what kind of funding mechanisms might they have uh you know to prepare for for the auction prior to the application because the application fee is a $2,000 fee and sometimes they would you know they want to understand what that process is before they file application.

So we call it a pre-filing meeting we typically might have with our applicants to kind of go through some of these you know discussions so they can have some expectations of what that process is timing costs and things of that sort. So once they're ready to to move forward you know they file an application online it comes through internally through our process.

Um it's first looked at by our titles and contract who is our internal you know um title section so to speak and they do all the land searching and making sure that we own the land uh see if there's any you know closed lands and looking at all the ownership and make sure it's prop before we can move that application forward. Uh it also goes through our cadastro section to ensure that you know what's being applied for is actually available.

They'll, you know, what we call scribe the land in regards to the parcel size. Uh give us a a kind of a an eloquat description of how many acres has been applied for. So they're kind of setting the the the project boundaries, you know, through that process. And typically it's preliminary in the beginning and then it gets kind of firmed up through that process. The all the applications that get filed also go through an internal review process.

It's typically made up of most of our managers in our office uh and some of the discipline expert experts in those areas. Um so the application is presented you know it's presented on the merits of the application being filed and there are some discussions that are kind of made through that process. Um some of our folks our team members might identify um applications that are in process through that area. uh constraints that might be you know applicable to that line. So it's a that that land.

So it's an opportunity for those who have been kind of you know that know the land to kind of talk about these things or grazing or agricultural or mining they bring these discussions up to ensure that there might not be any critical factors that might you know prevent the application proceeding forward. Um so that's all done through this this intern evaluation process. Once that application is accepted for processing um we go through a due diligence period.

So the application is accepted it gets assigned to one of our team members in the sales team and they would take that application through the complete process. So they would work with our applicants pretty extensively on the process timing you know what's required. Um so during that due diligence process there are certain things that are required by the agency to move that application forward. We would need some type of a legal description.

Typically, it's a it's a alta survey or boundary survey to identify what's being sold. Um, we are required to consult with the state historic preservation office. So, a cultural resource survey would be required typically. Uh, in most cases, it depends on the application and you know what's being sold in the use. Um so Shipo kind of manages that whole process as far as what would be required in regards to that consultation.

Um phase one is required to ensure that the land is free from any you know um contaminations and things of that sort. Um and then any we look at also any type of zoning that might be needed or if there's any zoning that's typically on the land so we can ensure the proper use is available for that sale. Once the D and that due diligence period can you know can that's based on our applica our applicant.

So it typically is around 30 to 60 to 90 days for that due diligence to be completed and sent into the office. It's reviewed by our internal folks uh at the you know in the agency based on what those things are and then we prepare for an appraisal. uh our agency, you know, we have two we have an appraisal staff that really prepares the application, but we're required to have an outdoor third-party appraisal um complete that work.

So, there's a list by the Department of Administration that kind of allows us to, you know, contract for that appraisal. So, our appraisal staff would prepare it, get out the bids, and get that work done. It's typically about a 90-day process to get the application into the appraiser's hand, get the bids, get the drafts in, and get the value of that land. So, appraisals are, you know, are done based on the land that's being applied for. So, there's many methodologies that the appraiser may use.

So, in regards to what the what the town is looking to purchase from the state land department, it's dependent upon the application. So if you're looking at purchasing, you know, the whole 4,000, the application might be the methodology might be, you know, approached differently than buying, you know, pieces of that, like maybe in four different, you know, parcels as opposed to one application for the 4,000 acres.

So depending on how the application's filed, the appraisal would take into account what the methodology on that appraisal could be. So the value could could vary on you know on the appraisal based on the size of the parcel the you know the land uses that are that the comparables will be used against. So you know making that point just wanted to make sure that we don't really know what that value is.

So I know the town has had some valuation of this land so that everybody's aware that we you know the final value of that land through the appraisal is what the commissioner would proceed forward. Now she has the right you know to um establish that minimum value. Um but that's part of our process.

So again, typically about 90 days after it goes in, we'll get that value, share that value with our customers, and if they're, you know, ready to move forward and the funding is available, we'll proceed forward to preparing for our board of appeals. As Karen mentioned, that's a five member panel that's appointed by the governor's office. And their sole responsibility is to ensure that we are selling land at the minimum value.

They're mostly appraisers, so they're looking at strictly the land value. They're not looking at the use. to not look at anything other than the land value itself. So the board we meet monthly on the board um so it takes about you know 30 days to prepare it for the board's um presentation. So after the board assuming that it gets approved by the board and haven't really had a lot that have not been approved um but we then start prepare for the auction.

All sales as Karen mentioned do go to a public auction. Um it's not you know identified as the use. whatever the property can be used for is what it is sold for. So depending on the zoning, depending on its use, you know, the the land becomes available. Um it's a very archaic type, you know, auction. It's the old paddle. Raise your hand in front of the county steps.

Um make your minimum bid and if there's other applicants that are interested, they'll also have the paddle and it'll just be back and forth until someone doesn't want to pay the next price. So after the auction is is you know the final bid is has been said the cavl goes down literally and uh that that concedes or you know completes the auction process.

Um auction after the auction there is a lot of work to be done paperwork you know um and you know post auction information that is part of that process. So that's a very high level of that sales process and be certainly open to ask any question answer any questions you might have in more detail. Um but that's our sales application process. Any questions? Yeah. Yeah. From start to finish, what's a typical timeline? So typically it's about 12 to 18 months.

You know we've done them in nine months and we've done them in five years.

been working on projects for many many years that very complex but depending on the complexity the size you know an appraisal of this size could take several months uh to complete so it depends on you know the application and mayor and council member roads it a lot of it is is a anything in orange here is in the applicant's hands so that would be sometimes applicants take a little bit longer for their due diligence It just depends on, you know, their consulting team and how much land we're discussing.

If the town were pursuing the 4,000 acres, it's going to take a little bit longer, right, to get through some of a the title work because we're having to do title research on all historic state trust land uses on all of that land. So, that could add to the time.

Um and then you know just getting the alta survey and the the phase one and the cultural it the growth size of the land could add to the typical 9 to 12 month time frame and any changes also I should say you know between when the application is filed and when we actually go to appraisal because appraal kind the appraisal process kind of draws a line is okay this is the final footprint because the appraiser needs that that final acreage and footprint to evaluate.

So any changes prior to that will could delay that process because we might need a revised alt or things might change. So as we're processing the application, you know, if any changes are made, it could possibly delay that process. But like Karen mentioned, a lot of that's on, you know, our applicants. The due diligence is really, you know, provided by the applicants. So depending how long it takes to get the information to us. Hope that helps answer your question.

So, if we chose the four to purchase all 405, we're probably looking at about an 18month time frame at least. Correct. Okay. Other questions? Okay. U the next item. Appreciate you. Are you welcome to stay or Thank you very much. We appreciate you being here. So, Mayor and Council, um the development services director um will be um leading the next item. Um and uh Luke, I I'm sure everybody knows who we have. the distinguished uh R.J.

Carden is with us, but uh he is our consultant, former um parks director of Maricopa County Parks and uh very pleased to have him uh on our team. With that, I'll turn it over to Mr. Cman. Thank you, Grady. Uh mayor, members of council, um uh R.J. and I conducted a field trip with a member from the Arizona State uh parks and trails.

Um, and I I found myself kind of going back to the same theme that I think Cave Creek has been fortunate more often than not to be lucky rather than, you know, good at what we do. Uh, we've been we've been extremely lucky and fortunate to kind of have this community that we have. Um, and R.J. is no exception to that. U, probably one of the best things that's happened for Cave Creek is is R.J. retiring from Maricopa County and needing something to keep him busy.

So, uh, right away we we brought him on as a consultant for a whole scope, um, a whole stable of of different things. Um, and really as this has evolved, the state land discussion has evolved, this is really kind of tailor suited for what he does and and what he's led his organization through in the past. So, um, with that, what we wanted to talk about today, give you a general briefing on. I know Sherry's got a pretty exhaustive report of different financing means and options for you.

Um, one thing that the ad hoc committee uh went through in their work was looking at um different uh funding mechanisms, stakeholders, grants. Uh so what I wanted to start with was just that that uh you know the town council appointed this 15 resident member uh committee to look at uh the ASLD open space, provide recommendations to the town outlining options to proceed.

This this map actually our planner uh Eric Baker um provided and this gives us really a snapshot of what's going on in our backyard and and I think Karen and um Ruben have left but this shows the state land holdings really in our immediate vicinity. Um you can see the town of Cave Creek town limits up there in the right corner. Uh Axon is noted down there in the right corner. That's Scottsdale uh 101. Then you've got the the Monster uh TSMC plant out there off of the I17.

And that blue land illustrates all the state land, like I said, just in our immediate vicinity, uh, that is developable. You know, you see Phoenix ranging, uh, I believe 5 to 10 dwelling units per acre. You have a bunch of mixed use, a bunch of commercial. Um, just that blue land detailed on this map. And once again, Eric and I looked at it and kind of just did a rough number, that's at least uh, representative of 100,000 acres that the state land has holdings of um, just in this area.

adjacent to us. Um, so it kind of gives you some context of the different applications and and why some applications take longer than others because not only is it a complexity of an application, they didn't allude to this, but I I will for them since they're not here to defend themselves, but there's also a line um of when an application was made. It's kind of first come first serve in a lot of ways, even though it is applicant driven. Ahead here, did I do that?

So the task force um wanted to uh look at again the multiple stakeholders which could support the acquisition of the open space uh ranging from government agencies, nonprofits or private commercial donorship. We're continuing to meet with Maricopa County officials. Um R.J. and I actually met with um his successor at parks and recreation last month and had a very good uh promising meeting about our shared interests um along this and many other fronts.

Uh the town and DFL are are working to finalize our agreement uh to assist with fundraising and then once that mechanism is in place then donors would be able to to be solicited and and um start raising private capital funding in that regard. And then this is where it gets interesting. R.J. contacted me a few weeks ago and uh well last month as well and said um hey I'm going to go out and look at some different grant opportunities for this effort.

There's a lot of money out there that um that might be readily available to the town for this express purpose. And with that I mean namely the land and water conservation fund and that's administered through the Arizona State Parks and Trails. It's actually a federal endowment that AZ Parks administers. Um, and I'll let kind of R.J.

get into the to the details of what that is and and kind of share his takeaways from our tour with their with their grant um I think it's not their grant manager, but one of their grant um um administrators there. So, well, with that, I'll turn it over to R.J., Mayor, members of the council. Um, I guess you can call me a land and water conservation fund nerd because it's where I started my career with Arizona State Parks in in 1990.

I started as a planner for Arizona State Parks and I was doing planning for the Land and Water Conservation Fund and the Heritage Fund. At that time, the heritage fund was a new program. So, I helped start up the heritage fund grant program. Um, as a planner for the land and water conservation fund with state parks, I uh designed the grant priorities and the scoring system for that grant program and consulted with local governments on uh developing grant applications for that.

I also reviewed and scored grant applications over a period of about seven years with Arizona State Parks and also developed the statewide comprehensive outdoor recreation plan which is a requirement of the federal government who provides the funds for the land and water conservation fund.

The Land and Water Conservation Fund over the years, just to take a step back, the Land Water Conservation Fund derives its money not from the federal general fund, but from offshore, primarily from offshore drilling leases. So, there's a dedicated source of funding for the Land and Water Conservation Fund.

And in 2020, the Great American Outdoor Act um was passed and that mandated that $900 million be available to the federal and state side of that grant program, which is a very good thing for those of us that uh are looking for grant uh money at the state level in particular because this fund used to although it was a dedicated source, it had to be annually appropriated by Congress. Now, it does not have to be annually appropriated by Congress.

That $900,000 is there automatically every year and can be added, too. But, um, so when Luke and I met with Arizona State Parks and Trails, uh, we found out that in 204 there was $6 million available for grants. In 25, there was $6 million available for grants. And then this last year there was $9 million available through the land and water conservation fund program. They're estimating that over the next two years there will be another 9 million per year available in that fund.

Um over the last three years they have awarded all of that money. Um roughly 21 million over three years. And the good news for Cave Creek or others that may apply for that money is that all eligible applications over the last three years that have submitted grant applications to the Land and Water Conservation Fund have been awarded funding. Very rare for for any sort of grant program.

One of the things that that prohibits a lot of communities um and counties, however, from applying for that money is it's a onetoone cash match. So, a community or county has to provide 50% of the funding in cash. It can't be an inind match, which uh some other grant programs allow, which makes it easier for cities and towns and counties to do that. The other thing about the federal program is once this money has been expended on a project, that land is is tied in perpetuity.

It can no longer be used for any other purpose. That tends to make other city and counties a little wary of using this fund. When you're using the fund to conserve open space for perpetuity, like you were talking about with this 4,000 acres, it doesn't become such an issue for you. Um, so the land and water conservation fund for for my money is is a great opportunity for this community to look at. Um, Luke has on the the screen here that there's $1.5 million available per grant application.

I just found out yesterday from Arizona State Parks, they have raised that to $2 million per grant application. And they are not one-time grant applications. you can go back year after year after year and apply each year for up to $2 million in grant funding.

Um so oops right so I mean once again R.J.'s being um modest which is which is very nice but um we're talking to someone that really started how this pro how this is administered the checklist that they're looking at um the different things. So this is something that um R.J. you know through our through our contract with him uh our professional services contract would be able to um get an application uh prepared to at least go after it for this year.

Um, we think that there was one more slide, but that's Oh, sorry. Um the um and based on again going back to state lands presentation, if it is an 18-month process, there might be an ability to go back to the well a second time and and almost leverage our ability to to raise almost 4 million uh towards this where 2 million would be or or 4 million would be through the grant and our expenditure would be 4 million because there is the onetoone match and you know R.J.

you mentioned the string being attached that that scares a lot of other communities away. Um, their administrator basically said that this is this type of project, an acquisition project for open space and recreation and conservation is a is typically looked at as a top priority project for them when they're administering these um because the the string is this has to be open for recreation to the general public in perpetuity.

can't um you can't build on it, you can't reszone it, you can't develop it in any other capacity. It's got to be open for for public recreational use, which is something that we're talking about doing anyway. So, those strings actually work in our favor and and the ability to match the funds. Um the last slide and and it's, you know, forward thinking. I know staff's priority um is the acquisition.

Um, but I also wanted to put these out here because these are some really really other good grant opportunities administered through this uh agency. Um, and it's the ability to go after I know once acquisition occurs, we'll have some initial startup cost. We'll have to restore and reveg Wildcat trails that we don't want people on. We'll have to improve trails that we do want people on.

We'll have to close off um non-motorized, you know, ATV, off-road vehicle use uh to the lands and and eliminate trespass in that regard. We'll have to mitigate and clean up some different dump sites that have occurred have occurred over time. Um all of these funds and and grant opportunities fit into that and their match is even less. I think it was like a 5.7% match. So, it's a lot more bang for the buck on these kinds of things, but they're smaller dollar amounts.

Obviously, it's commensurate with the dollar amount that's awarded, but these are things that are really exciting. Um, the last thing I'll say about the land and water conservation is there is an ability to partner with a Maricopa County and they could submit an application um separate even of our own, even if it's for the same general area and land area. And that would be administered.

We could do that through an IGA with Maricopa County if they did have funding um that they would be able to provide a dollar to dollar match with this fund. So we could we could actually leverage even even more outside funding in that regard. So it's it was really exciting. It was really refreshing to to have someone from their agency come up. We toured the area as I'm sure you know many of you have seen.

Um and yeah I mean the after the first stop he was like yeah this is this is tailor made for what we do and why we do it. So um he kind of went through the application process. Applications uh open October 1st. um we could submit uh even before that but the general application opening is October 1st.

So we'd be in line to get that next funding and I think it runs October through May is when they try to exhaust and award all that funding and then we could reapply again the following October which once again if we're looking at ASLD's timeline. It at least gives us two bites at the apple if we wanted to be um moving towards the all at once takedown.

So with that I don't know if you had anything to add R.J today or the only other thing I would add is obviously it is a a program that is a federal grant so it will be it will take some time to put together um but again with the likelihood the possibility of getting that funding I think it's it's well worth going after once twice or three times how many ever times that um that you want to do that and as I mentioned I've been on the grant side of it but then I've also written grant applications through the land and water conservation fund program for s two different cities in Maricopa County as well.

So I I'm comfortable that I know what I'm doing, but it it it is a lengthy process, but uh far less lengthy than the Arizona State Land Department process. Um so I I think it's well worth giving some consideration to. So what what kind of timeline with what we just heard from state land department, what kind of t how does how do these two thing two paths converge? Where do they come together and where do they diverge? Sure. Um that you've got a pending action on your agenda remaining today.

Um, and should should there be a motion to move forward with an application based on that agenda item, uh, staff would kind of backtrack, go if if we recall the u the orange type on the ASLDs that talked about um the ALTA survey, the phase one cultural, the class one environmental, all those different studies. Staff will begin uh we've already reached out to contractors to to get pricing on what those studies are going to cost.

um we would get going on those and submit an application to the state land department as soon as possible. This the Arizona uh land and water conservation fund that is something that they don't review open up the application process until October 1st and they like to have all of those awarded I think January and paid out by May because they're looking fiscally um so that's that's their timeline.

But if you look at maybe an 18-month process to get through ASLD from application to auction and the way that this is more of a fiscal year, this grant opportunity, there might be an opportunity to come back in October of 27 and reapply again and get that same match. And I'm, you know, to to know that they've already increased that from 1.5 to 2 million. That was something that they were going to let us know next week. So, it looks like they're they're looking to increase that threshold.

And a part of that is because the dollar for-dollar match and the strings attached that we've kind of explained to you, they're not awarding this 100% each year. They've got this large pot of money that they can't give out enough to um to fully exhaust that account each year. So, for them to increase it to 2 million puts us even in an even better driver's seat to get more money. So, Yeah. Good. Yeah. Thank you, mayor.

Um Luke, you had referred to uh some allowed uses uh under this grant opportunity because it does have federal guidelines attached to it. Would they apply those allowed uses to a portion that they are funding or would it apply to the entire 4,000 acre project? It's what they're funding, right? Mayor, council member, it would be what they that what they're funding. So you would submit a map for whatever you are applying for.

So if you wanted to say do an application for a thousand acres, you would submit that on the map and that becomes a thousand acres. That's subject to the federal rules. Um if you wanted to do it larger, you could do it larger, but it it's parcel by parcel. The other thing I would mention is it has to be open for public recreation. Uh Luke mentioned no development, but any recreation development would be allowed.

So, if you wanted to put a trail head in a certain location, put some parking, restrooms, and do trail improvements, that kind of thing would be allowed um within the land land water conservation fund grant. Okay. Mayor followup. Uh and would other uses uh that currently exist under state trust land, say grazing permits, would that be considered uh ongoing conservation use? Uh, Mayor, Council Member Driscoll, that's a question I wish uh I would have thought to to cue uh Ruben and Karen about.

That is something we need to talk about. That's part of the the due process and due diligence that we're going to do is through the application process is they're going to look and verify what um what grazing leases and different land aotments that they have. And then I wouldn't from here right now I wouldn't begin to be able to to answer that and say this is how we go to either extinguish those or carry on as the town is the the holder of that.

Um but that's something that is a bridge that we're going to need to cross um at some point in the next Thank you for bringing the grant opportunity to our attention. Very interesting. Better lucky than good. Yeah. I just kind of have a comment. Um, I'm thinking that the off-road vehicles probably are motorized vehicles are probably not a good thing for any of this land. Uh, I believe that that uh uh we would get significant push back from most of the citizens in our town over that.

So, uh, the one you had on the upper leftand corner, I I don't think we want that one. Uh and the one in the bottom right I the trail should be for non-motorized and and mayor council member roads one of the things we we did discuss that and the need to actually prevent and mitigate some of the damage caused by OV and the fund that that we had put on the screen actually has a program to mitigate OV.

So we could use actually that funding to put in fencing um where OVs may be encroaching on this conservation land. So there's a whole bunch of them up there. Yep. So this that funding could be used for that rather than improving OV actually preventing it, right? It's it's two-way. They just call it the OV fund for simplicity, I guess.

But when we discussed that with with the administrator, that's one thing they said is a lot of communities use this grant not to improve off-road vehicle access, but actually to limit and mitigate it with fencing and and trail barricades and different barriers to reduce that that use. So, okay. Thanks. Y other questions from council with regard to partnership with the county. Uh is the county all on board with this? Um would can they proceed at the speed that we would like to proceed?

That remains to be seen. Uh mayor un unfortunately they have a very important ballot measure on their upcoming agenda or on their upcoming general agenda general election um which if it is not passed would would severely hamper their ability to um have discretionary funding for things like this for programs like this. So so not in November then is that on the general ballot? Correct. Yeah, we'll know by November.

Um, but once again, their their application window is October 1st, I think, through January 1st, and then they start cutting checks from January to May um out of that fund. So, it's an there is an opportunity um I don't know did you and this is probably something for more offline. So, the town has a a general fund account for open space acquisition. Did county parks and wreck have a similar type? No. Okay. It's got to be a supplemental budget request in each fiscal year. Yes.

All of the county's park funding over the years has come from general all 18 years that I was there all came from general fund appropriations. So something at the very least would be in ne in next fiscal year's budget for county out out beyond ours. Would the C so the county if the uh application period starts in October how long does the application period last? So would they be able to move after they find out how the bond issue? Can they move that quickly or January 1st?

Yeah, it's a it's an October 1st, January 1st window and then they start um paying out that fund in January through May. RJ, you were going to say something? No, I was just going to say, uh, mayor, that and that January 1st deadline, if there are still funds available in the land and water conservation fund after that, they would still take, um, grant applications through about the 1st of May.

So, if they don't get all of those funds expended, you know, say the county wanted to come back and say, "Well, we we've got 500,000 in discretionary funds that we can put in that can be matched with 500 from the land and water, and there's still 500,000 left in the land and water." Hypothetically, um, they could apply for that anytime between January and May. Are they excited enough about this to to proceed like that on that on that kind of time frame?

Mayor, I I and members of council, I don't know about that for sure. I think they are very hesitant to make any sort of forward movement until they are secure that that that uh bond in November passes. That's the jail bond. Yeah. They're very reluctant to um to even look at how funds might be allocated in the future. I think come November, you know, come election time, we as now myself too as Cave Creek need to then immediately start having conversations with them.

Um, and as Luke mentioned, we did go meet with the parks director. I think she is certainly in favor of additional open space acquisition. Um but until that bond election happens that they are just really hamstrung and and I've heard they have an interest uh around where the current park is. Um would these funds be available for a use like that? These grants is that appropriate to these grants? Absolutely. Yeah. But beyond a commitment, I mean they're they've got a financial restraint.

I mean their their response is oh this is great these are all great things and you know but the other shoe to drop is that that bond question in November unfortunately we don't know what the future of that is any other from council here we are okay thank you very much very it's great news free money is my kind of money yeah free money So, Mayor, um next up we have um our chief financial officer, Sheri White. Um we'll be introducing the team from uh Stifle.

Stifle is the financial advising firm um that assisted Sherry with um analyzing and coming up with several um different funding options and analyzing um different scenarios. So with that, I'm going to turn it over to the chief financial officer. Good evening, Mayor, Vice Mayor, Council. So I have have with me here today um from Stifl Nicholas.

So we have Mark Reer who is um one of he's the managing director and um we have Jack Leaper who is a director and they have both put a lot of time into um looking at what we're trying to do, listening to some of the meetings um coming up with some ideas for us on um the funding.

And so um they will be going through um talking about the um funding options that they have come up with and then I will go through uh summarize all of that for you and um provide um our thoughts as far as a staff recommendation. So we'll start off and so thank you Sherry. Uh Mr. Mayor, members of the council, good good afternoon. Thank you for having us. Um, we uh look forward to going through the presentation here.

Um, we're going to talk to you really about a couple different options that the town has. I think you're probably familiar with them. Well, we're going to focus on a couple options uh that are available to the town down the road as you consider the acquisition of your of your land. And before I get started, what a phenomenal opportunity the town has to acquire 4,000 acres for your community. Um, I was very blessed to work with the town in 2000 when you had a bond election to purchase Spurcross.

It's been 26 years. Um, I've made it this long. I don't know how sometimes, but um, and so, you know, cities and towns certainly have an option, as you know, and Jack's going to walk you through that option of having a a a bond election. uh you know sometimes those aren't always as popular as the other option I'm going to talk to you about in a moment but nevertheless we want to share it with you just as for your consideration.

Um, I was very blessed to work with the city of Scottsdale in in the 90s when the city of Scottsdale uh considered similar uh acquisition of the Mcdow Mountain Preserve property as you all are probably aware that was in 1996. I think they had an election in that case to raise their local sales tax as a revenue source to issue bonds to acquire state land for for their purposes. And that, I'm sure you would agree, certainly turned out to be an incredible decision by the city of Scottsdale.

So, I just wanted to give you that background and then we'll go ahead and and get into some analysis for your city. Uh, got some good things going for you. Um, we started really kind of with a land acquisition price. We know this is subject to an appraisal and these numbers are not final by any means, but if you look on our little budget sheet here, if you go down below where it says land acquisition, we're assuming that number would be around 14.5 million.

And so that number, as you know, will change over time and we'll update all the numbers. Um the good news is you got um a lot of revenue sources kind of already in place to help with the land acquisition including some of the grant funds that the gentlemen were sharing with you and you've got some time uh in which to try to access more of that.

So up on top you can see we got about $4.1 million currently of available kind of sources of funds we call it that would be available potentially for the for the town to use towards the acquisition. So it's about 30% of the 14 million rounded numbers that you have available that you could use for this purpose. So, you know, good job on that and uh and some good revenue streams uh in place to help facilitate the acquisition of this land if if you end up going forward.

So, I wanted to share this with you. When we take into account the 4.1 million of equity uh and we and if we were to pay the 14.5 and the town had to come up with about $10.4 $4 million for the difference to buy the land. We ran some scenarios in here in which the town of Cave Creek would issue revenue bonds. Okay. Very common.

And I, as I think the council is aware, or cities, towns, and even counties across Arizona, without voter approval, for the most for the most part, unless you're a charter city, which you're not, to go out and pledge some general fund revenues, which you've done before over the years, and go out into the bond market and sell bonds. um that would be secured by your local revenues and then repaid back from a variety of re of of revenues I'm going to share with you.

Okay, so that's our scenario number one on the revenue bonds. So, um we're we're kind of in budget season here. Sorry about this. There's about 10 columns here. And this is a scenario where we would issue sometime in 28. It was kind of the time frame because it take us a couple years to do all this. Sometime in 2028, the town would issue roughly $10.4 million in the revenue bonds. As you can see in column 4, that's the principal payments there.

In talking with Sherry and working with Jack, we ran a scenario of a 20-year amortization and a 25-year amortization. Um, some cities will do 30. Really depends on the economics of the city and the revenue source. Let's start with two scenarios. One, just like a mortgage, a 20-year bond, and the other one, a 25-year bond. In column two, those would be the revenues, about 17 million that the town would pledge to to get the highest credit rating and you're in extremely good credit.

Good job on that. We're estimating somewhere around 17.5 million there if we were to do a transaction. In column three is some of your current outstanding debt, okay, that you have uh pledged uh I think primarily for utility related project as council is aware. And as you can see in column three, the good news there is we got a lot of debt coming off the books here in the next few years. So good news there.

Um so in column four, five, and six, our 20-year amortization at about 4.4% interest rate. Okay, bear with us on that. That changes as you know. They're a little elevated now as a result of what's going on with the global situation as you as you're aware. but you're of extremely good credit and we were estimating roughly call it four four and a half percent interest rate if you were going to the bond market.

So fair to Midland on that um that would be about $800,000 a year simple math in column six. Okay so that would be the the ongoing budgetary impact of a $10.4 $4 million revenue bond advertised over 20 years at a 44 440 450 cost of money. Okay. So, um the good news that you all have going for you too is you have your open space tax. It's my understanding you're getting about $500,000 a year that is available off that tax that could be utilized towards a bond debt service payment.

So, as you can see in column 9 in working with with shaft with staff, we netted the 500,000 out of the $800,000 in column six. So, the net difference in terms of what the town would have to come up with is roughly $300,000 out of the budget. Okay. So, we have a couple of options there. Number one, the budget absorbs it. Uh, and we know you have a lot of demands on your budget. Um, or if the town would like and the council would like, you could adjust your local TPT, your local sales tax rate.

Uh, Jack's coming up with here about .08%. So, call it, you know, minimal uh a minimal local sales tax rate adjustment that would generate roughly about 300,000 of additional revenues to make this a neutral kind of a debt service payment for purposes of the land acquisition. So, I'm going to pause there. I know that was uh we threw a lot at you there. I know you're familiar with a lot of what I just shared with you, but before I go on to the second scenario, I hope that was helpful.

And and you have any questions on kind of how we laid that out. Questions? You laid out very well. I understand it first time through. So, Well, thank you, Mayor. I appreciate that. We appreciate that. We're trying to make it, you know, kind of a global and global economics here for you and we can tighten everything up as we as we work together in the coming years. Okay.

So, this slide here on page five is the same scenario except uh all Jack did here, my my good colleague Jack next to me who's done a lot of heavy lifting on it. Really, the only thing that changed on this is we stretched it out 5 years. So naturally, our bond payment goes down to about 710,000. Okay. So the other one was about $800. I'm rounding. We go out another five years, another $100,000 per year in savings to the budget. And in that case, you're a $200,000 shortfall in column 10 roughly.

And uh that would be a a 0.05% kind of a sales tax/TPT adjustment if you wanted to make up the difference u for the debt service payment versus a 08. So both the 0.08 and the 0.05 are I would say minimal uh not that any taxes should be taken for granted. We all understand that. But we wanted to kind of give you kind of a perspective if you had to raise the TPT up kind of what we're thinking. Okay. Okay.

Ironically, I was just looking in the Scottsdale election that they had way back in the 90s and theirs was 2%. Uh that was their local TPT and they ended up raising that later to go buy more land. It's a pretty interesting kind of story there in Scottsdale. A question for Sherry. Re refresh me on the limitation our ability to raise TPT taxes from the last legislative session that goes through. So limitations are related to like food tax.

Um and then um bed tax we can only increase it a certain amount before it has to start being dedicated. But as far as just a limitation on on how much in general that our TPT is, there is not one. But we have a significant amount of our TPT is food. A a fair amount. Yes. Okay. So that portion we would not be able to increase. I have one quick question. So Sher, if we were to decide to move ahead with a an an increase in the sales taxes, that would not have to go to a voter initiative. Correct.

We're since we are not a charter city, um that that is something that council can approve. Thank you. Now, as you're probably aware, there is a bill in the legislature as we speak that would have an impact on this. So, let's see how things go with regard to that. It's it's a very draconian bill that would have severe impacts around the state. So, you guys are all council and staff is aware of. This time of year, there's always a bill in the legislature.

Hope hopefully just one instead of multiple. True. This year, there are multiple. I think there's,200 bills this year. Somebody told me the other day and we're dealing with about four of them that has been somewhat problematic as well. Okay. Yes, sir. So, if this bill were to pass, um, would we lose about 3% roughly of our tax base? Sherry, they they were talking about a moratorum on increases to any taxes, any fees.

Um and they were talking about for a four-year period and it was yes for four years. It it really started with um concerns over some municipalities that had waited for a very very long time before increasing their utility rates and then had to do significant increases in utility rates. And so they're looking at it of like well we should stop them from being able to do something like that.

But when you do a 4-year moratorum where you're not keeping up with inflation and things like really what is going to build in is that if that went through everyone would have some increases after that four-year period trying to catch up. Okay. Very good. So, I'm I'm done with the revenue bonding uh option and now I'm going to turn it over to my colleague Jack who's going to walk you through consideration of a general obligation bond kind of like what you did back in Spurcross back in 2020.

And so with that, I'll turn it over to Jack and he'll walk you through that scenario. There you go, Jack. Thank you. All right. Thank you. Uh Mr. Mayor, members of the council, uh, scenarios three and four are going to be for a general obligation bond election. And before we get into the specific numbers there, just a pref brief overview of the very complicated Arizona property tax system. I'll try and simplify it and not go into too much detail, but you can see two bars on this bar chart here.

One set of bars is the red bar. That's your net limited assessed value. This would effectively be your true taxable assessed value, your tax base. So you can see that's been growing nicely over the past decade, 3, five, 6, 7% each year. The blue bar is your net full cash assessed value. So this is not your tax base, but it is closer to what u the county assessor would would call the market value of properties within the town.

So again, we're mostly concerned with the red bar because that determines tax rates and tax bills for the residents. Uh you can see in the top right there, the 10-year average for the net limited assessed value is 5.45%. So under the uh statutes that govern what needs to go into a voter pamphlet, the town would be limited to projecting uh assessed value growth for the next 5 years at about 5 a.5% and then 20% uh thereafter.

The thinking there is you don't want to project too much growth because then that shows voters what could be too low a tax rate. So moving on to the next slide. This is the breakout by property classification of the property tax base. So, I'm sure it's no surprise to you about 77% of the tax base is residential owner and rental occupied with about 14% commercial and industrial and then the remaining amount uh 9% of is agricultural and vacant.

Real quick, the actual constitutional debt limit uh for a municipality in Arizona, a long story short, it's 26% of that blue bar that we showed you on the first page. And for fiscal 27, that's 363 million. 26% of that is 94.6 million. And certainly, we're not getting anywhere uh near that amount with this theoretical financing. And according to the state, we could borrow $94 million. That's correct. that that's incredible amount of money for anyone. Okay.

Uh similar sources and uses to what Mark shared all the assumed um grant funds and and various available cash. Uh same as last scenario. So we'll skip to the next slide. Uh more very small tax. Got 10 columns here. Your tax base column two. That's what I discussed on that first slide. And so you're at about 203 million right now. The county assessor estimates you're going up 6.4% to 216 million for fiscal 27. And then we project 5 1.5% for 5 years and 20% of that thereafter.

So columns 4, five, and six is the 10.4 million that you would theoretically be financing with these assumptions. We're assuming an interest rate of 4.25% 25% or about 800 it's called 790,000 per year in principal and interest payments. Column 7 would be the uh projected bond tax rate to pay that debt service each year. And at the very bottom of column 7, you can see the average annual tax rate of this election to be about let's call it 27 cents.

So this average will be um displayed in the voter information pamphlet. It'll be used to calculate um the estimated taxpayer impacts that we'll show you on the next slide. Column 8 would be that $500,000 of available open space tax that you could use to offset the debt service and theoretically reduce your property tax levy uh to pay those bonds off. So column 9 would be the net debt service amount about 290,000 per year.

And in that case, I'd say an average of about 10 to 11 cents uh per 100 of assessed value. That 27 cents uh I showed you the average impact of a $10.4 million election. Got a lot of numbers on this page, but maybe the most important one is in the boxes on the left under residential property. we have what is the average limited assessed value of a residential property in Cave Creek and that's the 591,283 number.

So if you take that number and you multiply it by the average uh tax rate of 27 that works out to be about $157 $158 per year or $13 per month for the average residential property taxpayer in the town. We also have estimates for the average commercial property and agricultural properties.

And then the information on the right is the statutoily required language that needs to be included in a voter pamphlet where they require you estimate you use a uh at least for the residential properties you use a $250,000 value. So that in that case that's about less than half the the true average in Cave Creek about $76 per year or $1,500 total cost over the life of the bond. Then real quick, we had a scenario four.

Uh the only difference here is um the contribution of available cash of about 6.2 million slated potentially for um expansions to the town hall. So all that does is drives down the amount of bonds that you would need to issue from 10.4 to 4.2. You can see that number at the top there. So same same set of numbers, maybe even smaller text this time. Uh columns four, five, and six would be the debt service on this smaller amount of 4.2 million of about $320,000 per year.

You can see there at the bottom, instead of a 27 cent average taxpayer impact, we're at about 10 11 cents. So that drives that down. Uh the open space tax of $500,000 uh would effectively uh negate the need to levy for that that prop that principal and interest payments. So you you can see in column 9 we're at you know a negative debt service amount. The drawback to this scenario would be that you've you've used that 6.2 million uh as a source of re source of cash for this project.

So, you would need to finance uh that 6.2 million. We we did an example revenue bond here at about 4.4% over 20 years. So, that would be about a $480,000 per year uh financing for that $6.2 2 million uh dollars, I believe. Oh, here's the taxpayer impact for that that lower 10 cent impact. So, the average property taxpayer here uh would only be paying $64 per year or about $5.30 per month. Got a bunch of footnotes here. And that concludes our part of the presentation.

Any questions on the election numbers? Well, one question is we have to go that would require a a vote, wouldn't it? Uh, Sherry, for the property tax. Yes. So, in those situations, so those are referred to as general obligation bonds or geo bonds. That does require going to to the voters.

And so what Jack was going through was showing what would have to be in the pamphlet when you do the um the general obligation bonds without the netting of that half million of the amount we allocated from from the spur cross to go to open space. Um so it would be the gross amount prior to that um is what he did. Um and so um I don't know if I I missed it but just when you do a go bond a general obligation bond you do get better rates.

So what they were looking at in the scenario was four and a and a quarter instead of instead of the 4.4%. Um so we wanted to look at all options um of what we could come up with not necessarily every every permutation of those op options but at least um a variety of what possible options um could be. So I do have a question. So, if you went with a regular revenue bond and say you got four or five years down the line, the uh the uh rate goes down, you can always refinance at that point, correct?

Yes. Yes. We and we would look at call options um when we're actually at that point. Okay. Questions from council. Okay. So, I have um a short presentation to just kind of do a consolidated look at all of that. So, here I have a summary of um those options that were presented.

So looking at uh the revenue bonds where we're basically pledging our our excise taxes um but does not require going to the voters or um the general obligation bonds or the combination of general obligation bonds and using the cash that we have set aside for the town hall uh remodel expansion and issuing revenue bonds for that instead. So um the second column there I have like the terms. So there was the one revenue bonds where we're looking at 25 years.

The others we for comparison purposes we were looking at 20 years the average debt service amounts. So the 20-year bonds 302,000 after that net of the half million of the allocation from spur cross for open space. Um the 25-year scenario average net debt service 210. The U general obligation bond scenario would be 292.

General obligation bonds and the town hall revenue bonds would essentially be a net of zero for the general obligation bonds for um uh the open space but 478 for the revenue bonds. The property tax rate. So then what the net impact is of the property tax rate. So they when they were looking at it gross before the half million each year was about 27 cents. The net equates to about 10 cents um on the TPT tax rate.

So the the scenario with the 20-year bonds revenue bonds was 08% the 25-year bonds would point be 05%. And I did a calculation for um the financial impact of doing revenue bonds for a comparison for the town hall would be uh 0.12%. Um the and then the last column there is what the um average annual net impact is to each one of the households. Um so uh $19 per household for the revenue bonds.

Um I spoke with uh Jim Rounds who is has done a lot of our um economic um analysis and forecasting um to get what the average uh TPT um is paid per household within Cave Creek. And so he provided that information um to be able to identify how much that was. So per household the 08 would be approximately $19, the 0.05 would be approximately $12. um when you're looking at geo bonds as far as like the property tax impact.

So that net impact per household about $59 or uh the last one where it's really the TPT rate of looking at that financial impact of the 0.12% would be about $28. So um really like we're any of these scenarios we're looking at small dollar impacts to the households. that's really more of of which way um works best for us and what we would want to do.

So, if council does decide to proceed um down this path, so what we're recommending is going with the excise tax revenue bond um option and um it would have the lowest impact to the average household. Um, part of the reason for that is because of how much of our TBT revenue is generated by non-residents. So, sometimes it's events, sometimes it's just people coming um to Cave Creek and spending their money here.

Um, the other thing too is just in consideration of a general obligation bond, there's a lot of effort that goes into that and cost for the election. So, um it's not as much um effort that it would take in doing the excise tax bond. Um and you can council can issue that debt and adjust the TPT rate um if they so choose at the timing of when the um transaction would be actually occurring. Whereas, if we did general obligation bonds, that would have to be in November.

um whether it's even year, odd year, um it either way, but it's November is the time frame of when that would have to be voted on. Um and um so we're really looking for some direction of what path um that you think that you want to go down on this if you um choose to move forward.

Um we would identify terms, call dates, what TPT rate if we need to um go down that path of increasing the TPT rate um at that time of when it's actually identified of what the um final cost of the land's going to be and the final amounts of how much of those other funding sources that we would have available. Any questions there? Questions? Yeah, Cynthia. Uh, thank you, Mayor. Uh, Sher, do we have any historical or comparative data on the impact for businesses if TPT tax is increased?

I know right now at 3% with TPT, we're kind of one of the highest in Maricopa County and the Valley area. Even though outlying cities may be higher, they have a different economic base and a different rationale. But do we have any of that impact on business uh and how an increase, even a small increase in tax could impact revenues coming to the town? Um, I I don't have calculations for you on what that might be, but businesses tend to pass that along to the customers.

So, they're charging whatever they would end up paying as an additional cost to the customer to be able to pay the TPT. So, it really is the consumer who who primarily pays that tax. Question. Quick one. uh if we raised enough TPT revenue before the 20 or 25 years were up um then we could make arrangements to reduce it or end it alto together. Absolutely. Yes. So the TPT amount is so low, less than a tenth of a percent. It's almost a roundoff error.

But if we needed to later on, we could always do that later, presuming that the legislature hadn't uh hasn't done something to us in the meantime. Exactly. Uh but it seems trivial to increase it by 0.08, for example. Correct. Correct. Okay.

So, um, part part of why I was including that in there was because of what we were looking at during the retreat of the general fund balances and the direction that it was headed, you know, and and so just if that was something that we wanted to say that part, we would make sure that we cover so that you know what that would be. Would you think it's necessary to increase the TPT 008%.

what would you it depends a on a whole lot of other um whatifs you know and what what may or may not happen in the in the future with the forecast. So uh the forecast that we looked at during the retreat was based off of a um an assumption of of status quo basically. Okay. Uh any other mayor I have a public comment. Okay. Kathleen Bay. Hi, Mayor and members of the council. Um, first off, I just want to say thank you so much for bringing this to us.

Um, I know all of us appreciate it and you're doing it before the summer. So, that's really awesome. I appreciate your insight in and your your timing and and and do and listening to the citizens. Um I kind of wondered if you would talk about TPT increase and I I think it's I don't like to increase tax and I agree that we are already one of the higher ones in the area.

So it is a concern and it may or may not impact some of the businesses for some of the customers that would come from outside areas. But I think it's a much better way to go than to do a property tax.

But regardless of which way you go and I don't know legislatively if you can state language in it that whatever increase you do that you sunset it once we buy this land once it's paid just totally sunset it so we can come back down to the normal level of our sales tax and also if it can be in the language dedicated just for the acquisition and not diverted into different areas. I know the town has costs. I know things are happening.

There's more moving parts, but for this aspect, if we could sunset it and we could just dedicate it for the acquisition of the land. That's it. Thank you. David, did you want to speak on this item? Was that this item or the next item? David Phelps. David Phelps, Cape Creek resident. Thank Thank you for allowing me to speak. Um, there is a initiative petition going around town today that's gaining traction.

Should that petition make it to the ballot, and we think it will, um, speaking for the Grubs initiative, uh, Jim Jim and Jonathan Grubs initiative, um, the voters would have their say. And if the voters agree to the 0.25 that is in the initiative, what you could simply do as a council is commit to lowering the overall tax rate to the current tax rate. The math would be right.

We estimate that there would be uh over a million dollars a year collected by that tax and it would by your numbers only needing the $10 million. we would probably have the whole debt exhausted in less than the 20 years on the smallest funding mechanism that you showed on the bonding schedule. The other thing is uh sitting out in the audience hearing uh R.J. and Luke um provide us information.

question would be uh could we have the county as the applicant with the land and water fund and be the money provider? In other words, not count on the county for the money, but we would do it as a partnership. We would provide the money to get the land and water fund grant that gives us a 100% markup in our value.

And what we would say to them is we would have an agreement that they would manage the land around the park that would be a good fit for what the land and water fund wants to do according to the testimony given earlier. And I'm just wondering, it almost sounds like we can get $8 million pretty quick with 4 million. So, and we have 4 million shown in the example. So, it looks like we're in the cat bird seat going into the land and water fund. All we need to do is structure the application.

So, we're on one application, the county's on the other application, but we provide the money that the county needs for the 100% match. Okay. Thank you, Scott Dean. Mayor and Council Scott Dan, Cape Creek resident. Um, I did not come expecting to speak today because I thought there was an informational meeting. Typically, I'll go through and analyze it and stand up, you know, how it work. But couple things.

First of all, was all I do to hold in laughter when I think it was a vice mayor said, "Can we get rid of this TPT at some point in the future if we don't need it?" You know, I've been around a long time and I've never seen any tax taken back, okay? Ever, no matter what anybody says. Okay, so um just a couple things on here and if if I'm looking at them wrong, somebody please please tell me.

But I'm looking on page four where it says for the 10.42 million revenue bonds, 20-year amortization, the debt service of $300,000 a year. So, I thought I read recently that we have 30 million in reserves in the town. Anybody shake a head and tell me if I'm close? Anyhow, uh that's 1% on an annual basis of interest on $30 million. You know, I think there's enough in reserves to generate that way. If not, trying to find $200 or $300,000 in our town's budget on annual basis should be pretty easy.

If the town finance people can't do it, I'll certainly come in and help them find it. But to raise TPT by 08%, which will never go away, does not seem like the right thing to do. The other thing I'll say is when I look at the optional page 13 of the $6.2 million town hall money, before anybody in this town council wants to go in and increase taxes, they should look at the fact that whether or not we really want to spend $6.2 $2 million to increase the size of the Cave Creek government.

Now, in this case, it's increasing the actual land size by building a new building or increasing building or whatever, but I would think that that'll be the first thing to come off the books when we do this. So, probably got a lot more to say, but I'll go home and analyze this and come back at the next meeting. Thank you. Thank you. No additional speakers. Okay. So, um, Joe, is this the one that you wanted to make your mo make a motion? Yeah.

Are we going to discuss the different options before we get Well, we got to have a motion first. Yeah. Motion. Yeah. So, again, congratulations to everybody who worked on this from the council to the staff to the citizens. I'm going to make a motion that we move to provide staff with council preferred funding options related to the acquisition of open space from the Arizona State Land Department. Which one? Look at look at page if you want. Maybe on the wrong one here. No, you're on number four.

I That's what I'm trying. I thought it was on Oh, it's three. It's on number three on the uh on number three. That's what I thought. I was like sorry about that. There it is. Okay. No, I have it here. If you I got it. Yeah, I just have my tablet here. Okay, here's the motion. Move to approve proceeding in filing an application with the Arizona State Land Department to initiate an auction of the 4,5 acres. Joe, how um you're you're ahead of that's item number four. Thank you.

That was what Katherine gave me. Okay. Got it. Got it. Got it. Got it. Got it. Got it. Here we go. Here we go. Move to provide staff. But we haven't got Joe. We haven't gone to item number four. No, we're on item. We're on three right now. Three is not right. Yeah. No, no, no. This is three. Sorry about the confusion. No. Four. Four is the one that I spoke to the mayor about. I'm not on three. Go ahead and provide it. Yeah. I'm going to do four.

Four move to provide staff with council preferred funding option number two for the relating to the acquisition of open space for Arizona State Land Department was was that your recommendation number two number two was one number two was one of the revenue bond options and it was the one that was the 25-year I had said one of the revenue bond options whether and we can figure out terms later. I think the 25 years as we as we've discussed numerous times.

We're not going to be around on the screen. Other people who are going to enjoy this need to need to cough up some money to pay for it, too. Yeah. So, we're going to pop that up on the screen so you you can look at all of them. Make sure you're understanding what is being um moved. Yeah. The reason I I look at that, it's it's the minimal impact on our Well, I we need a second before we can discuss.

Um Sherry, while we're getting there, um so this option assumes the entire the purchase of the entire 4,05 acres, correct? Yes, that that was what we were assuming that the the total amount of that 14.5 million would be able to cover that uh cost. So it it it was just an assumption of the amount. Numbers aren't final yet. I just wanted for the record. Yes. That it's for the entire 4,05 acres. Yes. So we're u is this is this the one we're second option down revenue bond 25 years to 110k. Yeah.

That's great. Okay. I'll second the motion. Um would would you consider do you want the 0.05% property uh TPT or are you willing to accept a fair friendly amendment to I would be more than happy to see a a friendly amendment to table of 05. I don't see that it's necessary. I I agree. Yeah. I mean Okay. So motion um any objection to the No objection. Okay. So, um, who who had the second on that? Cynthia. Cynthia. Okay. So, we need to buy all 45 acres.

Um, the way that I see it, talking with some people in the state legislature, talking with some people um that are friendly with the governor's office. They're looking at revamping the procedures. If we're in the queue to get this, they're not going to change it midterm, but it will affect anybody if we don't get in the queue. So, what they're looking at doing is revamping the procedures to make it much easier to develop land. In other words, more less open space, uh, more development space.

So, I think it it in our case, it makes sense to go after the full 4,05 acres. It's not going to break the piggy bank. we already have set aside half a million dollars a year. Finding an extra $1500 to $200,000 a year should not be a problem in our budget. Um, so my preference is to do a 25-y year simply because we're not the only people who are going to benefit from this land.

And the longer that we can keep the the bonding on um and people who will be using this land 10, 15, 20, 25 years from now ought to pay part of the freight. Cynthia, thank you, mayor. Uh, I support the motion. I think the the excise tax revenue bond is uh a favorable way to go with less impact on residents. Um we are not the only uh source of tax increase that residents are going to have to deal with. So if we can move forward without an adjustment to TPT tax, I think even more in our favor.

We have other revenue sources, the grant funds we heard about this evening, uh as well as still working on private funds to come along with that. Uh so we're buying some time by moving now uh and looking at options and trying to make it favorable for the current town budget as well as future budgets. Thank you. Okay. Um other comments on the to my left, other comments to my right? No. Okay. So with that, uh all those in favor I posted. Motion carry 70. So now we're down to number four.

Well, then I want to give a motion on FYI. This is the one I told you about. Yeah, you guys are killing me, too. Joe, I'm just saying. Look it up now. I have it already on my phone. All right. Um, you're standing here like you know what you're doing, Luke. Okay.

Council discussion possible direction on following an application of the Arizona State Land Department to initiate an auction to acquire 4,05 acres of open space recreation, open space conservation zone lands from the Arizona State Land Department and authorizing the town manager to approve studies, plans, surveys necessary to complete the requirements of the application process. Yes. Thank you, mayor, members of council. Um, we have order, please. So, really, uh, this has been a a long process.

um you know starting here over 20 or 20 years ago uh we've been going through this with the state land department even preceding um my time on staff here goes back to basically the ink drawing on the agreements with spurcross ranch conservation area when this discussion began so we're really at a moment now and I I don't need to go back and and lay everything out again um really what staff is looking at based on everything that's been presented today and the different options as a result of the task force recommendations all the way through staff's homework and staff's consultants help to get to this point.

Uh really all staff is asking council to do is give us formal direction to proceed with filing an application with the state land department and initiating the auction of uh 4,5 acres understanding that those applications can be changed adjusted uh up until the date that the auction set. So it gives us the flexibility. Um I think Mr. Phelps said it best when when he referred to us being in the old metaphor of of the catbird seat.

Um we've negotiated extensions with the state land department that run out to 2039.

Um we've done a fair amount of um behind the scenes work and appraisals and kind of knowing where the target is um with with some certainty and really all we need now from from council is the ability to go forward and prepare those reports uh surveys um cultural uh resource identification native plant inventories all those studies um that go into an application for the state land department so that we can begin the due diligence process and also start working on grants and and everything else to supplement and grow war chest to u move quickly and expeditiously to take down 4,000 acres.

With that, I'll answer any questions questions. Seeing none, we have any We do. Bas, Mr. Mayor, Vice Mayor, members of the council, I want you to know I've spent three days thinking about this speech I was going to give you, trying to beg you to buy all 4,05 acres, and you've already done it. So, you kind of cut me off at the past there.

But I do have one new thing I want to introduce, something for you to think about, and that is to create some sort of foundation that going forward might exist to collect donations to help us maintain and I don't like to use the word develop when we're talking about conservation, but to be able to do those kinds of things and then maybe add to this in the future. This is really good, but we may not be done.

I have heard even from members of the council about, you know, I wish this piece of land was included in that. So, I want to thank you very much. I also want to I see several members of of your committee that were involved from this that put a hellacious number of I probably shouldn't have said that hours into this. Would you mind standing up or at least waving and since you're here? Oh, I'd have to say this is mission accomplished and I I I know you did this, so I I wouldn't talk very long.

Thank you all. Thank you. Thank you. David Acriman, mayor, vice mayor, council, uh David Aman, 38500 North Schoolhouse Road, Cape Creek. I'm wearing this hat in honor of this guy. Thank you. Uh you have a rock star um that's helping out the city, the town, excuse me. Um love it. So, just want to say awesome motion, Dusty. Um I like the direction. I agree with it and uh you know I love the all-in on the 405. I hope um I'm not just saying this because I was on the ad hoc open space committee.

I hope that you uh submit the application and we do it expeditiously and we don't mess around uh given time. So thank you. Thank you Bruce Arland. Thank you, Mayor and Council. Um, good news all around. Uh, I there's so much information, so much more than I really could take in, frankly, that what I wanted to say initially is, uh, muddled at this point. But I will say the grant I uh, opportunity that R.J. has brought to the table sounds unbelievably brilliant for us. Unbelievable situation.

Um Mr. from Stifle, I can't remember his name was saying good job. Good job. Good job all around. So I guess we're in really good shape. However, I have a couple of thoughts comments about stakeholders was mentioned. Uh partnerships was mentioned. What I want to make sure happens is Cave Creek does not lose control once we acquire the land, which is the number one thing.

That we have some sort of real control over the land, not just what the zoning says and not what we say we're going to do, but actual control, and that we do not have other entities come in, other influences, if you will. And I don't know if this is if I'm being naive, frankly, and saying things that are not real, but it's a an intuition there. Um the other thing I wanted to mention was um there is an effort somebody mentioned it today. Oh, David Phelps.

Uh uh the grubs do they have a uh signature campaign right now for a bond measure a proposition for the next big election which would pay apparently I'm I'm going to paraphrase I think it would pay it would raise through a $10 tax for every $4,000 spent in town. that would raise approximately 1.1 or $1.2 million a year and would be not felt by anybody because they're at that are at they're at our establishments and uh I think that might be something and I hope you seriously look at it.

You must have heard about it. If you have heard about it, maybe you're going to support it right now. I support it and I hope it's I think it's a great idea. signatures are being gathered right now. That means there will be a bond if it passes the people will vote for that. How does that collaborate with uh any of the other propositions right now for a bonding something to consider and it may maybe both can operate at the same time maybe not. So I'm throwing things out off the top of my head.

Uh thanks for listening. Thank you. Thank you. Lisa Greenman Erland. Good evening. It's Lisa Greenman Arland and I um was actually going to go for clarification on what are you exactly buying and it's I'm pleased to know that we're actually buying the whole kitten kaboodleoodle which is what we needed to do. Um, and there I was at a a different meeting for something completely differently, but water and land were part of that meeting.

And one of the things that I think that we all have to be completely aware of is that we're surrounded by development just creeping its way up the 17 and around. So, what we can do here in Cave Creek to keep our open space, keep our trails. That was the other thing. I was at another meeting and they were like flabbergasted at the trails that we have in this town. They didn't even know. Um, and also this land will also help us. And he didn't say it, but I will. We need to keep our dark skies.

And at another meeting, somebody came up to me and said, I always think of Cave Creek as a dark sky town. And we should actually be a dark sky town because we are that last bastion when we're going to be that little special place that's surrounded with land with trails and dark skies. And the rest of the the people to the south of us, they think of us that way even though we don't think about that. And they ask that we do all that we can to preserve that.

So this is a terrific step in that direction. Thanks. Thanks a lot. Thank you. No additional speakers. Okay. Um so Joe. Okay. The moment is here. There's no confusion. So anyway, here's the motion. Move to approve proceeding filing an application with the Arizona State Land Department to initiate an auction of the 40,05 acres of open space recreation and open space conservation zoned lands and authorize the town manager to administratively approve studies, plans, surveys, etc.

necessary to complete the requirements of the state land department application process. Second. Okay. Comment. Comment. My comments are is this has been a long time coming as Luke said, 20 years or more. It was thought about even probably way before then. Um there's been a lot of hard work. A lot of folks in the audience have done a lot of folks preceding them before. It's been going on for a long time. We finally got it up to the plate. This council right here um has performed incredibly.

our staff, everybody. I mean, this is a win-win for the entire community, period. End of story, you know. So, little golfers clap here. Well, I had the second. So, uh it's an incredible privilege to be on a council that uh and associate and and have a staff that has been able to put this together. It it uh died for years, decades almost, at least one decade.

And uh it really is a privilege to be on on a council and be able to vote for this something as as significant as our signature piece which is Spur Cross. Now we'll have another one. And I'm just glad I was around to to be able to uh participate in this one. And uh I I just can't say enough good about R.J. the work you've done for us and Luke staff Sherry with the with the financial plans. Bill Sim sitting there quietly has a lot of work to do on on legal and of course greetings.

So, I want to congratulate all of our staff and the council and the people in town. This is quite an achievement, I think, for the town to get this ball rolling. It looks like it's rolling downhill fast. So, other comments. So, with Spur Cross, the acquisition of the 4,05 acres, and Cave Creek Regional Park, we are the last bastion of native sonor and desert in Maricopa County. The other county parks are far smaller. The other areas are far smaller. We are unique.

Um, and there's a tremendous opportunity uh for the town to take a look at this and and it will help the town in the long term uh because it will make sure it's a desirable area where people can come and enjoy nature. It's one of the last places you'll see it in Maricopa County. So, I think this is a wonderful opportunity and I agree with the with Joe and the mayor. Long time in coming and I'm glad we're doing it. I am grateful for today. There we go.

Uh grateful for today and for everybody's hard work uh that they put into making it happen. I never had a doubt. I'm not sure why anybody did. I knew that this is what we all wanted and that we would make it happen and that this was the council to do it. So, um I'm proud of us and I'm proud of everybody in this room for your energy and enthusiasm for it. Um and now away we go with the hard work. Just proceed around the corner here. Yeah, this is too great an opportunity to uh ignore this.

This is wonderful. It's something wonderful for a wonderful community and uh Cave Creek did it. Cave Creek deserves it and uh we will do it well. Thank you, Mayor. This is our gift to the future and it's a fun one to give. Uh with our actions moving forward this year, we can double the amount of open space for preservation from 4,500 acres to 9,000 acres. For a small community, that's an excellent excellent um progress. and a gift uh for our future creers. Tom, hey, mayor.

Um when we get done after we vote, can I just ask a question? Um will we still be in session where I can ask a question? As long as it's not related to new item. It's related to this. We can't be agendaized for a new new subject. I just have a question on testimony from Bruce Arland about the signature petition passing. If it were to pass, and this is I guess a question for staff. I shouldn't be doing this right now. You're saying? Yeah, I think. Okay. Can we do it after we had the vote on this?

Uh, we can't have it as part of the meeting, I don't believe. On the agenda. Oh, okay. All right. You can informally ask right after we get out of the after we journed. Um, the only thing else I'd like to ask the staff maybe is if I think of former mayor Vince Francia as kind of being the the origin of this effort and if we could just find who was on the council at that time along with the mayor Francia and then uh he had a citizens committee, blue ribbon committee back then.

Steve Lamar was one he was. Yeah, some of those folks are still here and breathing and actually still active. just as a bookmark, we might want to just put together a list of people who were the ones who did the density transfer and and that type of thing. I think it acknowledges the criticality of volunteerism in this community. At the end of the day, we're still a barn raiser group and uh the barns only get up when everybody comes with their hammer.

But of all the things like everybody has said here already, uh to me, this is not just about open space. It's about lifestyle preservation. uh these types of actions taken by the volunteers whether they're elected, appointed or in between um will do more to protect the lifestyle of the town of Cave Creek as it goes into the new century. So, I thank everybody. I'll ask my question offline. I do need to know some info about Oh, by the way, I've already looked it up. Oh, okay.

Uh it included Tom Magcguire. Wow. 2008. They're still breathing. Steve Lamar and Ernie Bunch were three of them that are mentioned in this article. Okay. So, if everybody's ready, we'll one more thing. When history judges us 100 years from tomorrow, we're all dead and nobody knows we are. They'll just say that was the get it done council. Okay. All those in favor say I. I. I. Opposed. Motion carries. 70. With no further business, unless there's an eviction