Sealed Bid

Downtown's New Business Improvement District Is Free To Operate In Secret.

By Margaret Regan

THE CITY OF Tucson is giving the Tucson Downtown Alliance BID a start-up fund of $200,000, repayable without interest in five years.

The city also will act as an unpaid tax collector for the BID, adding the new BID assessment fees to the regular property tax bills of 132 downtown properties each November and May, and handing over the cash--approximately $412,000 a year --to the BID.

Currents Any downtown property owners who refuse to ante up the new fee could have a lien slapped on their property, just as though they've refused to pay their taxes.

Three branches of government--city, state and federal--have agreed to be "fair share partners" of the BID and pay fees on their own downtown properties. (Pima County opted out.) These taxpayer-funded contributions add up to about $266,000, more than a third of the BID budget.

But if you thought the taxpayers shoveling out all this money to the BID had any say over its use, you would be wrong.

Given a seal of approval by the Tucson City Council in April, the BID has accrued quasi-governmental powers of taxing and punishing. Nevertheless, it's classified as a private, nonprofit corporation. Taxpayers had no opportunity to elect its board. Its 29 voting members are volunteers, a self-selected group of downtown "stakeholders"--heavy on corporate types, real-estate executives, big property owners and Chamber of Commerce reps, somewhat balanced out by some small-business owners, arts people, non-profit heads and even a couple of government officials, such as Mayor George Miller.

"The steering committee members were meeting over the last couple of years ad hoc," said attorney Thomas Laursen, BID member and member of the organizing committee. "Sheila (King, a real-estate broker) and I involved others. As we got closer to making a presentation to mayor and council, we picked people suggested to us."

The BID members, whose organizations mostly would benefit from an increase in downtown real-estate values, will use the money to spruce up the downtown, market it and hire uniformed street "ambassadors" to patrol it, and formulate long-range plans. But though much of their money comes from the taxpayers, taxpayers have no legal right to attend their meetings. Nor has the BID advertised the time and place of the meetings.

"We are not bound by the open meeting laws," said Laursen. "We can do this however we want. (However) as policy, it makes sense to follow the spirit of the law."

But the BID did not follow the spirit of the open-meeting law at its July 15 session. The big item on the agenda was the hiring of a new executive director. The candidacy of Carol Carpenter, a city staffer, had already sparked some criticism. (See accompanying story.) Three citizens attending the meeting--Julia Latané and James Graham, owners of the Grill on Congress, and David Wright, their partner in the proposed Museum of Contemporary Art--were asked to leave so BID members could discuss the hiring privately.

The open-meeting law allows such private discussions of personnel matters, and the three left. But the law forbids voting in secret. The BID members went ahead and voted on the hiring behind closed doors. When the BID members opened the doors again to the press and public, Carpenter already had the job.

Asked why the vote was taken during the private period, called an executive session, Laursen replied, "There was no conscious plan to do it. One thing followed another. It's hard to run a meeting."

Under the state's open-meeting laws, which were designed to shed light on formerly secret governmental decision-making, any vote taken during executive session would be null and void. But Tobin Rosen, a staff attorney in the City Attorney's Office, agreed with Laursen that "technically, they are not subject to the public-meeting law.... They are not a city organization."

Rosen noted that other private groups, such as the Tucson Museum of Art, get city money and still operate as private entities with a right to hold private meetings. But at least one city council member argues that the BID is an entirely different animal from an art museum.

"They (the BID) have lots of public money," said Councilman Steve Leal, who had proposed that the BID board be required to hold open elections. "The subject is downtown. The downtown is supposed to be everybody's neighborhood. To operate in secret is wrong. Both these reasons require that the affairs of this entity should be conducted in public."

Up in Phoenix, a group similar to the BID has been operating since 1990 as the Downtown Phoenix Partnership. They're not bound by the public-meeting laws either, said executive assistant Lois Miller, but, "We do conduct our meetings as such, as though we were covered."

The same goes for the five-year-old Downtown Tempe Community, another BID variant. "Even though we are a private nonprofit, our meetings are open and all our records are open," said marketing director Theresa Striegel.

And while the Phoenix board members elect other board members, the Tempe model is more democratic. Any district "stakeholder" large or small, from a resident to an ice-cream clerk to a corporate exec, has the right to come to the annual meeting and vote for candidates to the board, Striegel said.

Several board members in the Tucson BID pleaded for understanding as the new group makes its way. Many of the business-oriented members aren't used to public scrutiny, said board member Sarah Clements, but, "As the group goes forward it's going to have to make sure it realizes it has a public responsibility."

Added board member Larry Paul, "It's sort of a start-up business. It will take us an hour or two to get up to speed. We're trying to get things done."

The next BID meeting is scheduled for 7:30 a.m., Tuesday, August 18, in the downstairs meeting room of the Temple of Music and Art, 330 S. Scott Ave. Subsequent meetings are scheduled at the same time and place on September 15 and October 20. TW

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