The quest for an Arizona State University campus in Payson looks more and more like an episode of the TV spy series “24” — with the beautiful woman strapped to the bomb, and Jack Bauer nearly out of time.
Now, the effort to link the campus to a $65 million solar energy project that would include a $15 million roof on the Payson Event Center has set the bomb ticking.
Payson Mayor Kenny Evans on Thursday conceded that the solar energy part of the project has to start construction by August to take advantage of crucial tax breaks — which means the town must cut a deal with ASU or some other college soon.
Town officials have struck a deal with private investors to cover the event center and its parking lot with cutting edge solar panels, which would generate 10 megawatts of power. That solar field array would generate enough power to supply 20 percent of the energy needs in all of northern Gila County.
Not only would it make the college campus energy self-sufficient, but it would provide Payson with the long-coveted, covered arena and event center to stage not only the annual rodeos but a year-round lineup of events, concerts and trade shows.
However, the details negotiated with the private investors so far depend on both federal tax incentives that will expire later this year and on a signed deal to build a college campus here.
Unfortunately, the nearly completed deal with ASU has now gotten tangled in the Arizona State Senate’s just-adopted proposed budget, which would cut university funding by $65 million on top of the $170 million cut included in Gov. Jan Brewer’s budget proposal. Those cuts would nearly double the $250 million in state cuts imposed on the universities in the past two years.
ASU officials have said that if the state Senate version passes, ASU will have to cut its budget by $107 million. That would require such deep layoffs, the university would no longer have the resources to complete the plan to build a low-cost, undergraduate campus for up to 6,000 students in Payson, with the doors opening in 2013 or 2014. Moreover, such deep cuts will likely force all three state universities to limit enrollment of qualified students for the first time in state history.
Even without the extra $65 million in cuts, ASU has proposed boosting its tuition next year to $9,200 annually. Tuition at Arizona’s three public universities has gone from among the lowest in the nation to among the highest in about four years.
Evans said the glittering prospect of solar energy production and a covered event center has made the often-missed deadlines for doing a deal terribly urgent. Town officials say that the combination of a proposed convention hotel next to the campus and the year-round capacity of a covered event center would allow the town to compete for conventions and trade shows, transforming the tourist economy here.
“Short of an earthquake in Yuma or some other disaster, those timelines are the number one reason we’re feeling all the pressure,” said Evans.
Right now, the state Senate’s budget poses the chief hazard to the plan. After a week of furious lobbying by local officials and school districts throughout the state, Evans said it seems likely the Arizona House will adopt a budget closer to Gov. Jan Brewer’s proposal. In that case, the ASU Payson plan could likely go forward — providing a nearly completed marketing plan shows the campus would draw enough students.
Should the House adopt the Senate plan and Gov. Jan Brewer back off her threats to veto it, Payson will have to turn to one of the private universities that have also expressed interest in building a campus here, said Evans.
In that case, the town would still hope to sign an agreement quickly enough that work on the solar project would start before the third week in August.
Evans said such a shift in partners would be difficult, but not impossible — although the town’s agreement to negotiate exclusively with ASU has cut off the conversation until now.
“Our discussions (with the other universities) were fairly advanced three years ago. They looked at it and have been on the site and know that we’re talking about a boutique campus that’s looking at very high tech solutions. Will it be tough? Sure. But not any tougher than the last three months.”
Evans said the proposed solar project will cost $65 million, but various grants and tax breaks will reduce the effective cost to about $22 million for the investors. That amounts to about $2,000 per megawatt of generating capacity, a cost much lower than replacing a conventional power plant.
Various state and federal rules designed to increase the development of alternative energy would allow the investors to depreciate 100 percent of the cost of the facility in just one year. In addition, Arizona Public Service has incentives to buy the output of the solar power facility at relatively high rates.
The plans for the Payson campus have already made several, hair-raising, last-minute, Jack Bauer escapes in the endless plot twists of Payson’s economic melodrama.
At one point, it looked like the Forest Service’s frustrating, often-incomprehensible delay in clearing a 300-acre piece of land for sale would doom the plan. But then backers of the campus struck a deal to buy a 67-acre parcel next door to Gila Community College, with plans to add the Forest Service parcel later.