Land swap by TUSD is raising eyebrows
Foothills acreage exchanged for a school site on SW Side
By Rhonda Bodfield
ARIZONA DAILY STAR
Tucson, Arizona | Published: 12.14.2008


The Tucson Unified School District is swapping land in the prime lower Foothills area for a Southwest Side site adjacent to a mobile home park, a trade site that the district's own appraisal shows is worth three times less.
Urged to move quickly to find a spot for a new school to relieve overcrowding in the Southwest Side corridor, the TUSD Governing Board agreed to give developer Jerry DeGrazia an 18-acre parcel at Kolb and Sabino Canyon roads, along with 10 acres near River and Wilmot roads.
In exchange, the district will get the deed to roughly 20 usable acres along Mission Road between Irvington Road and Ajo Way.
Two appraisals, one ordered by the district and the other by the developer, found widely varying values for the properties.
The district's appraisal valued the Sabino Canyon parcel at $1.6 million. The Wilmot parcel was valued at $860,000.
Together, that's about $2.4 million, while the district's appraisal assessed the Southwest Side trade site at $700,000.
The developer's appraisal, however, pegged the trade parcel at $1.9 million — considerably more than the value he gave the Sabino Canyon parcel.

The Pima County Assessor's Office shows government appraisers think the Foothills-area land is worth more.
The Sabino Canyon parcel has a full cash value of $1.1 million, with the Wilmot parcel hovering around $422,000. The Southwest Side property? About $620,000.
Appraiser Michael J. Naifeh, who performed the work-up for DeGrazia, said ethical rules prohibit him from getting into specifics about his client's property. And since he didn't look at the district's appraisal, he couldn't comment on the differences between them.
But generally, he said, while it's true that sites in an affluent area will have a higher per-unit price, a developer can put more units on an affordable, urban lot. The Sabino Canyon parcel has the potential for a rezoning of one home per acre. The Southwest Side parcel, conversely, is zoned for manufactured housing, which allows up to eight units per acre.
Rudy Flores, the district's facilities director, conceded the offer was not "remarkable," but called it fair given the topsy-turvy real estate market.
TUSD staff also said they were constrained by a number of factors. The district can't sell its properties outright without going to a vote — something not required with a trade. A swap also means the district won't have to pony up for land costs — a boon considering that the bond money voters approved in 2004 for a new school won't stretch enough to complete construction, let alone buy land.
The decision to go for a trade clamped down on competition. Rather than identify key sites and go straight to the owners of those properties — since most of those people would just want to sell their parcels — the district instead solicited brokers and developers to find someone interested in a swap. In the end, the district didn't negotiate with anyone except DeGrazia.
The developer dictated a tight timeline, reportedly telling staff it would be off the table in mid-December because of concerns that the new federal administration might make changes in the way capital gains are taxed.
Judy Burns, the sole board member opposed to the trade, argued that the district was on the losing end of the deal. "Some of that property is prime, and some-one's going to make an awful lot of money off of it. And we're just giving it away," she protested.
Mark Stegeman, an associate professor in economics at the University of Arizona's Eller College of Management and incoming Governing Board member who will be seated in January, told board members that he, too, had considerable reservations about the deal.
A third appraisal should have been ordered, he said, to resolve the discrepancy between the two wildly fluctuating values for the trade property. Instead, he said, he feared the district rushed through the negotiations "and a private party will get a lot of benefit at the district's expense."
Although TUSD is losing enrollment generally, that's not so on the Southwest Side, where property values are appealing to young families and where schools are bursting at the seams.
Lynn/Urquides Elementary School was built for 550 students and has 900, many of them in portable units.
By 2011, Grijalva Elementary School is expected to have 300 more students than it was built to handle. Maldonado and White elementary schools each are expected to have excess enrollment of about 150 students.
Board members supporting the trade were less focused on financial concerns than whether it was the right site. The land would put the new school about half a mile from Lynn/Urquides.
But district planner Bryant Nodine said there are few vacant parcels in that rapidly growing area that wouldn't be close to an existing school. And a preferred site farther away from an existing school was considerably more expensive, he said.
Superintendent Elizabeth Celania-Fagen said she would not choose to send her own child to an elementary school of 900. She plans to hold community meetings to reassure parents at the surrounding schools that the new school is not intended to bleed away their students. She said the district may consider a magnet school so that local students would have the choice to leave their existing schools.
The district has about $7 million in funding available from the 2004 bonds. The going rate for a school with 550 students is about $9 million, Nodine said.
The deal approved by the Governing Board could help close that gap.
In a separate part of the swap, DeGrazia is offering $1 million for a 20-acre site south of Harrison and Snyder roads on the Northeast Side, and another $500,000 for a roughly 9-acre site near Houghton Road and Snyder. The district's appraisal put those values closer to $1.8 million and $900,000.
The district will put those parcels back on the market for six months, starting in January. If the district doesn't get a better deal, the district will go to DeGrazia for his offering price.
Board member Adelita Grijalva, who said she did have concerns that the district was not getting the appropriate value for the parcels that it owns, said she was glad that the district is trying to at least get more money for the other two sites. She said she was swayed because families in the depressed area deserve more choices.
● Contact reporter Rhonda Bodfield at 806-7754 or at

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