Backers of the plan to build a university in campus in Payson held a town hall meeting Wednesday, hoping to shore up public support and raise money needed to pay the steep costs of getting the Forest Service to agree to sell a 300-acre chunk of land.
Payson Mayor Kenny Evans said campus advocates would meet in Payson with representatives for Arizona State University next week in hopes of salvaging an agreement to build an ASU campus here. ASU had proposed a deal that the Rim Country Educational Alliance (SLE) has rejected based on finances.
But if ASU and the Alliance can’t come to terms “within months,” backers of a four-year campus here will seek a deal with another university, said Evans.
“If everything falls into place” backers hope to have a campus open by the fall of 2013. But then, nothing about this project has just fallen into place, said Evans, so he predicted the first students would not arrive until the fall of 2014.
The Volunteer Committee for a University Campus in Payson sponsored the town hall meeting on Wednesday and plans another in the Senior Center on Main Street at 10 a.m., Thursday, June 21. The Committee has also launched a Web site to enlist support and provide updates at universityinpayson. com.
Backers face the immediate problem of raising roughly $375,000 to complete an environmental assessment needed before the U.S. Forest Service can agree to a direct sale of some 300 acres for the campus. Congress earmarked the land for sale 12 years ago, but the Forest Service won’t agree to the sale until after backers complete a $375,000 environmental assessment. So far, backers have raised $50,000.
Evans said the work on the environmental assessment has been halted until backers can raise a big chunk of the cost, which means the projected October completion of the assessment could slip into December.
About 40 people attended the 90-minute town hall session in the Payson High School auditorium and peppered Evans with mostly friendly, but often frustrated questions about the years-long struggle to convince ASU or some other university to lease a high-tech, forested campus for as many as 6,000 students.
The project would turn the whole town into a wireless Internet hot spot, interject more than $100 million annually into the local economy and perhaps offer tuition substantially lower than on ASU’s main campus.
However, a series of setbacks that included Gov. Jan Brewer’s veto of a bill that would have allowed ASU to partner with the Alliance and guaranteed a low interest rate for some $500 million in financing from National Standard Finance, part of the Jeffrey’s Group.
The governor’s veto upended the timeline, which resulted in a near doubling of the interest rate and therefore a $370 million increase in costs over a 25-year period.
In addition, the Legislature cut ASU’s budget by $500 million, forcing the university to seek better financial terms from the Alliance.
Evans said the governor’s action represented his single greatest frustration with the project leaving him “feeling like I was betrayed by that veto.”
Reportedly, ASU’s most recent offer to the Alliance sought free use of the facilities for 20 years, plus all the revenue from student dorms.
In addition, ASU had proposed that the university would end up owning the campus facilities after 20 years.
The Alliance has rejected those terms, prompting ASU to request a meeting next week to explore other options, said Evans.
In the meantime, the Alliance has had preliminary discussions with a number of other universities, some public and some private, said Evans. He refused to confirm widespread rumors as to the identities of those other universities, but said they included a mix of low-tuition public universities and high-tuition private colleges.
He said backers have already spent $1.5 million to develop detailed plans for a campus on the 300-acre Forest Service parcel and about 90 acres the Alliance has an option to buy north of Highway 260 across from the Forest Service land.
The Rim Country Educational Foundation was formed by the Volunteer Committee to raise money and enlist volunteers on behalf of the effort to build a campus here. However, the SLE, run by a six-member board that does not include Evans, will actually own the facilities and sign the agreement with the university partner and other spin-off businesses, like a convention hotel and research park. No representatives of the Alliance spoke at the 90-minute session.
Committee marketing chairwoman Laura Bartlett opened the session with a summary of the accomplishments and setbacks to date, saying everywhere she goes people want to know why signing a deal with a university is taking so long.
“How many of us have started a project at home and found it was harder than we thought it would be?” she asked.
She said the Alliance has prepared preliminary site plans that will cut many months off the construction time no matter what university strikes a deal. She said the Alliance would settle on a university partner in “the next few months.”
But Evans dominated the meeting with his sometimes-revealing summaries of the convoluted history of the marathon effort.
He said he was the fastest runner in his high school, but when the coach put him on the relay team he couldn’t seem to master the timing involved in handing off the baton to the next member of the team. Evans spearheaded the development of the project, but in the past year has tried to step back and hand over control to the Alliance, headed by former Payson Councilor Mike Vogel.
“That passing of the baton can be a critical factor,” he said in apparent reference to recent confusion and missteps in the complex juggling act behind the university project. “For me, it’s an anxiety that eats away at me every night,” said Evans, who is reportedly among the major donors who have already put up $1.5 million to develop plans and push for the project.
He confessed to having made a “stupid blunder” when he publicly revealed that backers of the Payson campus had discussions with people associated with an international sports management and training corporation about the possibility of building a facility here as part of the university plan.
He said his statement inadvertently violated a non-disclosure agreement with the corporation. . Evans said he couldn’t explain the blunder or the status of any discussions with the company or anyone connected to it without again violating the non-disclosure agreement.
In previous statements college backers had said they’d had discussions with IMG, but Evans did not mention the name of the company at the meeting Wednesday. Officials at IMG have refused to acknowledge whether any discussions have taken place
Evans said ever since Gov. Brewer vetoed the bill that would have allowed Payson to partner with ASU to create the SLE, backers have struggled to make the project pencil out. The veto cost the project a 2.8 percent interest rate on $500 million in funding. Now, the interest rate for that same $500 million stands at 5.6 percent, he said.
“That’s a $375 million difference in the bottom line for the project,” he said. “It’s a monstrous math problem.”
The effort to secure an agreement with the Forest Service to sell the Alliance the 300 acres on which it wants to build the campus has also proved vexing, despite a law authorizing eventual sale of the property 12 years ago. The Alliance wants the Forest Service to approve a direct sale of the property, which means the price would be set by an independent appraisal without competitive bidding.
However, the Alliance must first complete an environmental assessment and only then can it seek approval of the direct sale from four layers of Forest Service bureaucracy.
So far, the Alliance has only managed to get the Forest Service to sign what amounts to a letter of intent to consider a direct sale. The lenders said they wanted the Alliance and the Committee to raise the money for the environmental assessment locally, to demonstrate community commitment, said Evans. The mayor noted that the developers and lenders would repay that money to the Committee once the Forest Service approved the sale and the Alliance signed with a university partner.
Some listeners wondered whether the Committee could simply return the money to the donors when it got reimbursed. Others wondered whether the Alliance could in effect sell shares in the project, so donors would get the same 5.7 percent rate of return as the lenders.
However, Committee fund-raising chairman Richard Johnson said such promises or guarantees would be too complicated and raise too many tax questions. Instead, he said the Committee hopes to ultimately use for the environmental assessment, and the refund for things like scholarships for local students.