August 4, 2004
Arizona State University has been quietly setting the stage to develop nearly 100 acres of land it owns in Tempe, most of it prime commercial real estate on the edge of the campus and near Tempe Town Lake.
This major deal between ASU and the city has been in the works about six months with little public airing and is scheduled to go through the Tempe City Council on Thursday on a voice vote with no debate.
The proposal would allow commercial uses on state-owned property controlled by the university. The land includes about 40 acres near the lake, a large area on the southeast corner of University Drive and Mill Avenue, and a 150-foot strip along major streets including Apache Boulevard, Rural Road, Mill Avenue and University Drive.
Uses allowed under the plan include bakeries, bed and breakfast operations, child day care centers, housing, hotels, offices, churches, restaurants, group homes, shopping, banks without drive-up tellers, and government buildings. Permits would be needed for drive-through restaurants, kennels and nurseries. Bars, mobile home parks, pawn shops and certain other uses would be banned.
ASU would benefit through rents it would charge or profit sharing, that money going to pay for new academic facilities. The city would reap sales and property taxes from commercial development on university land, which isn't being taxed now.
Mernoy Harrison, ASU's executive vice president for administration and finance, acknowledged that this is a major step for the university.
Ohio State University, the University of Pennsylvania, Georgia Tech, and the Massachusetts Institute of Technology and other universities have undertaken similar projects, Harrison said.
The plan is similar to what ASU has done downtown at the Brickyard on Mill, a building shared by retail and academic ventures.
"We're trying to leverage land assets to grow our campus," Harrison said.
Thursday's vote is the first step. The council still needs to approve zoning and change the general plan, the city's blueprint for growth, which doesn't allow for commercial development on university property. The city is creating a new zoning category to accommodate the plan.
No one reached Thursday could explain why the proposal hasn't received more attention. City officials said they have discussed it at three public meetings and ASU said it is widely known that the school is planning commercial uses for some of its projects. However, few details have been revealed until now.
Mayor Hugh Hallman said Tuesday he favors the proposal because it would generate tax revenue for the city.
"This is the first step in getting these properties on the city's tax rolls," Hallman said. Tempe stands to benefit from any commercial properties built on the edge of campus.
However, Councilman Ben Arredondo, a high school teacher and former member of the Tempe Elementary School District governing board, said he needs reassurances that education will not suffer.
"I always thought they were an educational institution," said Arredondo. "But I'm a little concerned that they are straying away from their mission." "So far, I'm not convinced," he said.
The agreement between ASU and Tempe would create a seven-member committee overseeing development in the new district. ASU President Michael Crow will appoint four members to the Joint Review Committee. Hallman will appoint the remaining three, according to city documents. Hallman said the committee offers residents a stronger voice in what will be built around campus.
But according to city documents, the committee would only hear from neighborhood and ASU representatives, downtown property owners and tenants, and business representatives. Hallman said the proposal was not intended to restrict anyone from the process. He added that he would work on changes that would not exclude anyone from being heard.
Under the agreement, the city and ASU would decide whether to offer sales tax rebates and other incentives to entice developers.
The university's land would be designated as a special district under the oversight of the new board. Except for a few areas near homes, development in the district would be subject to very few restrictions. There would be no height restrictions on buildings, no landscaping requirements, and no criteria for spacing between buildings — elements usually strictly governed under modern urban planning practices. Harrison noted that ASU isn't subject to those development restrictions now.
ASU is nearly finished with a long-range plan for the university. School officials are expected to reveal details soon, possibly as early as this week.
Stan Nicpon, owner of Pizzeria Uno, said the agreement does not pose a threat to existing businesses in the downtown.
Nicpon, also president of the Downtown Tempe Community, said the proposed projects in the newly created district would serve the university and not compete against his pizza shop. "I think this makes us a whole community," he said.