The town of Marana has decided not pay off its 99-year lease on the Tortolita Preserve with a one-time, $8.9 million investment.
Instead, the town plans to keep paying its annual state lease on the 2,400-acre preserve —$475,000 this year – while exploring "legislative options for Tortolita Fan preservation," the town council decided Oct. 20.
Marana now pays the state of Arizona $475,000 a year to lease the Tortolita Preserve, north of Tangerine Road and west of the Dove Mountain development. The town entered its 99-year lease with the state of Arizona in 2000, protecting the land to mitigate the loss of nearby habitat for the pygmy owl, and for the lesser long-nosed bat, to development.
Every five years, the lease amount increases by 10 percent.
Marana has the option to prepay the lease for $8.9 million. It has to exercise that option within the first 10 years of the lease; specifically, prepayment would have to occur before the 10th annual payment.
If it paid off the lease, Marana would realize financial savings over the life of the lease, finance director Erik Montague and parks and recreation director Tom Ellis told the council.
Yet the disadvantages are several, they explained; principally, the drawdown of available cash, and the fact Marana would not own the land at the end of the lease term.
"At the end of the day, if I'm the manager in 2099, I don't own anything," Ellis said.
To make the lump sum payment, Marana would have to use existing reserves, to be reimbursed from the sale of taxable bonds, Montague said. Taxable bonds are issued at a more expensive rate. Further, the town would consume part of its excise tax pledge debt capacity. And, while "the ultimate goal is the permanent protection of those lands," Montague said the commitment of funds may hinder Marana's financial ability to protect other sensitive lands where habitat and open space preservation is "significant and important."
"If the world were perfect, and you got to make your own way, not only the Tortolita Preserve, but other lands in the Tortolita Fan, lands to the west of us against the national park and the national monument, ag lands in the flood plain, there's precious lands all around Marana," Ellis said. "That's why people come here to live."
Town Manager Gilbert Davidson said there were "a number of decision points and opportunities" with regard to the Preserve lease.
"Purchase is not an option," Ellis reminded the board. The only way to do so would be to participate in the state land auction process, which is a bidding environment.
"There are many cities and towns in Arizona surrounded by properties similar to this," Ellis said. "We hope for some legislative state land reform that would allow municipalities to still purchase the land, but not necessarily in a competitive process."
Marana's strategic plan does call for preservation of the parcel, Ellis said, as well as habitat and open space throughout the community. "The desire is to not lose that open space," Ellis said.
"We need to talk to the public," Ellis told the council. "Should the land be preserved? What other lands should be preserved. How should preservation be paid for? Are there legislative solutions to preservation?"
Open space protection is a common topic for people who interact with Marana's parks and recreation employees. In the master planning process for parks and recreation, "every time we open our doors, people ask 'what are you going to do to preserve the mountains and desert?'" Ellis said.
The Tortolita Preserve has a popular, nine-mile trail around its perimeter. It's frequented by equestrians, trail runners and mountain bike riders. Off-road vehicle enthusiasts have encroached on the southwest corner, Ellis said, though Boy Scouts are helping to erect fencing. The Catalina Mountain Riders have adopted the trail, and are taking care of it. There are some cattle grazing on the parcel.
The governing board, which met for 30 minutes in closed session before considering the subject, plans to "continue to pursue options to identify the community's desire for permanent protection" of the ground.