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Hockey Prep School in Payson? Or Town funding boondoggle?
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December 25, 2017, 02:28:45 PM
A while back I had requested a copy of the contract between the Town, CCP, and Varxity.  The nice clerk said they would call.  So far, no call. 

But, Santa did show up.  Let’s just say the Town has the same plumbing contractor as the White House? 

Attached to this post is an apparent copy dated 09/21/17 of the contract.  To access the full .pdf, simply log in, and the attachment is below this post.  Register here.

The contract is not signed, but it appears to be legitimate.  Various recitals, “Whereas,” Various terms, and conditions.  As with most contracts, the fun stuff is in the “Exhibits.”   In the coming days I will take a look at all of it.  Today, a couple of snips. 

Some tidbits:

•   The Scope.  This appears to be far beyond a “plan.”  This appears to allow CCP to act on behalf of the town for development and financing. 
•   The Value.  Stated of $250,000.00.  Clearly an initial contract to develop a long term arrangement well in excess of $250,000.00.  I am uncertain how Town Counsel could not see that and note that during the twenty minutes of conversation or subject the deal to a procurement process. 
•   The incentives, to include waiver of Town fees, waiver of property tax, sales tax agreements, and potential incentives to CCP appear to potentially far exceed the $250,000.00 threshold.
•   The contract includes a “Break-up Fee.” 
•   The contract appoints project counsel.
•   The contract requires utilities and off-site improvements provided via the town.
•   The contract allows for securing a “Conceptual Guaranteed Maximum Price” for the project.
•   The contract requires a financing plan.

Something tells me the future planning meetings just got a whole lot more interesting?

Still waiting on the “official copy” but this is a good starting place?  In the next few days I will do some digging, some more looking, see where we end up? For all the world, this is looking like an end around for a general obligation bond plan? 

I am also dumbfounded that this passed by all council members voting for it.  Did any council member read it or did they all just accept it on face value?   Anybody? 


December 25, 2017, 02:38:30 PM
So where is The Roundup in all of this Rec Center / hockey puck planning?

The Roundup appears to remain a silent partner parroting only the narrative promoted by the town council and designated professional consultants.

There is no issue with The Roundup editorial staff being desirous of a recreation center, however a free press has typically policed our governments and held the elected accountable in spite of their own desires.  This observation may not be so much an indictment against The Roundup as it a commentary on our society in general.  “Truth” has apparently lost way to desire and expediency. 

Historically great institutions such as The Washington Post and New York Times have asked difficult questions of our government.  Electronic media has in large part followed suit.  Truth to power. Having said that, even the most basic of journalistic skills require that questions be asked.  The Roundup appears to refuse to do so and instead adopts a rather Machiavellian approach; where the ends justify the means.

America has a long and rich journalistic history. It is embodied in our Constitution under the First Amendment Freedom of Press. 

Amendment I
Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.

Embodied in our popular culture are many great names such as Adams, Franklin, Murrow, Cronkite, Brokaw, Woodward and Bernstein.  It doesn’t require significant review of The Roundup material to reveal that they are a few standard deviations left of center.  I freely admit I am one right of center. 

Following is a photo that I took at The Newseum in Washington DC.  It is a picture of graffiti along the Berlin wall.  This section of the wall was transported to Washington DC and is currently on display at The Newseum.  The phrase “Act Up” appears to succinctly embody “Speaking truth to power” and striving for a better collective future. 

Is RT a Russian propaganda machine?  Likely so.  Is Al Jazeera biased?  Undoubtedly.  Fifteen minutes watching CNN, Fox News or MSNBC will clearly reveal a bias.  Fair and balanced?  Fake news? Ultimately it appears that it is the end user who has to make that determination.  Does that make it correct or right?  Again, this may be a societal issue and not an issue of journalistic ethics.

I do not anticipate that The Payson Roundup will be under consideration for a Pulitzer Prize for its "hard hitting investigative journalism" anytime in the near future. Shouldn’t we, at a minimum, expect the Roundup to ask questions?  At least one?  Speak some truth to power?   


December 28, 2017, 09:14:14 AM
In the words of Jay-Z “Well, I ain't passed the bar, but I know a little bit.”  Keep that in mind.

It is important to note that this agreement is far beyond a “cost sharing” agreement.  This contract gives significant consideration to Varxity. Like what? That is Exhibit “E” below, and we will take a closer look at the 10 considerations in a bit.  Considerations #2, and #3 are striking. Varxity is identified as “lessee and manager" of the “ice rink facility” and “training center.”   A no bid, concession service agreement for a public service / amenity? Nice.  Also, very valuable to Varxity as they will control proposed public assets.  At least it is not Russians and uranium. Keep in mind this is “to include but not limited to….”  Curious; what else does it include?

First up, the players.  The Town and CCP are clearly identified.  Varxity Development Corporation?  Not so much.  They are only identified as “of Alberta, Canada.”  No mailing address, no agent of service, not much but intrigue. 

Generally speaking, a foreign corporation requires some form of standing in the US to conduct business.  A branch office (Physical location) a corporate form, A partnership, LLC, C Corp etc. or at a minimum a certificate of good standing. (1) (2) (3) So, let’s check the Arizona Corporation Commission: (4)

Well, no Varxity.  Surprised?  Wonder if Varxity has an EIN number?

In their defense, they may be registered in another state.  I was unable to find that if it exists.  I found the logo design competition, (5) the Canadian Corporation Number: 9016341 (6) but nothing that indicates that Varxity Development is a United States recognized entity of any sort.  Besides, the contract clearly indicates “of Alberta, Canada.”

So, the town has a contract with a Canadian Company?  Cool; international business law.  During the meeting of 09/21/17 Town Counsel, Mr.  Figueroa clearly indicates he has reviewed the contract.  Maybe should of reviewed standing of Varxity? Mr. Figueroa stated that the litigation venue was changed to “Gila County.”  There is a paragraph concerning “notice” but no agent listed for Varxity.  Well, not on the unsigned copy.  Hopefully we get to see the signed copy soon enough?

So, the venue is helpful, but where the contract was executed is somewhat important.  Does a US court have Jurisdiction over a Canadian Company?  Varxity is likely subject to “General Jurisdiction.”  So maybe.  But, how to complete service?  Is there any protection for Varxity as a Canadian entity?

By virtue of their foreign residency, Canadian citizens possess a host of specific strategies and defenses uniquely suited to the challenges posed by claims and litigation before American courts.  (7)

Why did Payson agree to all of the following for the “Benefit of Varxity Development Corporation?” Does the value of the incentives exceed the build-out of the Rec Center / Training Center / Hockey Rinks / Pool?  If so, can a $10m+ contract be awarded in this fashion?

The incentives:

* * *
(1) https://www.northwestregisteredagent.com/canadian-business-registration.html
(2) https://harrisbricken.com/blog/business-united-states-overview-foreign-companies/
(3) http://www.azcc.gov/divisions/corporations/CertGoodStanding.asp
(4) http://ecorp.azcc.gov/Search/Details?Category=0&Type=0&Term=Varxity&IsActive=True&EntityType=0&Check=
(5) https://logo.designcrowd.com/contest.aspx?id=713057&page=4
(6) https://www.can1business.com/company/Active/Varxity-Development-Corp
(7) https://www.canadianunderwriter.ca/features/you-can-t-sue-me-i-m-canadian/


December 28, 2017, 02:26:47 PM
Awhile back I had requested a copy of the contract and payments issued to date.  The nice ladies at Town Hall called the other day. So, went by and took a look. 

Did not get a new copy of it, but looked and saw the signatures.  Sorry about my bad photo skills.  I should have done better.  Clealry Varxity is a Canadian Company.  Looks like the contract was done with signatures on 10/9/17.  Here are the photos. 

Again, sorry for the bad photos.  :(

Approved as to form:

Varxity Contact Information

Varxity Signature

Ploszaj Signature. 

Well, tied up some loose ends on the contract? 

While I was there, figured a good time for more records? 



December 28, 2017, 03:26:58 PM
The second part of the initial records request was for copies of invoices and payments.  Six pages, three invoices and three checks.  The full set is attached in .pdf as an attachment, log in, and download, if you care to.
So, what can we figure out from this? 

Well, fully 20% of the contract value was absorbed prior to the Town Council Resolution date of 09/21/17. A total of $50,000.00 with the Town and Varxity each subject to $25,000.00.  The first invoice is for services provided June 20th through September 21st.  Clearly CCP was acting on behalf of the town, without a formal agreement in place.  Curious who provided that authority? 

Can the Mayor, Town Manager or Town Legal unilaterally extend that authority to act on behalf of the Town?  Was it previously approved via Town Council and if so, is that a violation of open meeting laws?  It appears the Resolution via the Town Council was merely a technicality? 

Photos of the first invoice are as follows:

The secondary invoice includes:
A line item for “Information Gathering – Varxity Corporation.”  Seems odd to have a line item like that on a party to the contract?
A line item for CCP to: “Obtain & Sumit (sic) Insurance & Business License.”   One would think that would have been required back in June when they were acting on behalf of the town or at least by contract inception date of 09/21/17? 

The third invoice includes three items of note: 
“Create Seed Funding / Fund Development Initiative” 
“Continue Dialogue with AZ IDA” 
“Continue Dialogue with Barclay’s Bank.” 

We are going to assume that AZ IDA is the:
Through the Arizona Industrial Development Authority (AZIDA), private borrowers can reduce their financing costs through the issuance of tax-exempt bonds.

Nationally, private activity bonds (PABs) are issued by industrial development authorities for the benefit of private users. Repayment of the bonds is an obligation of the private user, not of the issuing authority. The proceeds of these bonds are used for industrial and other private purposes and the interest on the bonds may be exempt from federal income tax (IRC Sec. 103). In Arizona, the interest on the bonds is also exempt from state income tax.

The AZIDA issues both taxable and tax-exempt bonds for commercial activities using a streamlined process at competitive rates. (1)

They have a “Procedural Pamphlet.” Lucky for us, they are subject to open meeting laws and records requests.  I guess it is time, or soon will be time, to make a records request?

(b) Public Nature of Application Process. The Authority is a nonprofit corporation designated a political subdivision of the State of Arizona. The Authority’s meetings are generally required to be open to the public. The instruments, documents, files, and records of the Applicant (and any guarantor) filed with the Authority, directly or through the Authority’s Counsel, will be available for inspection by the public. The Applicant, by submitting the Application, agrees that any information delivered to the Authority by or on behalf of the Applicant is not privileged and may be disclosed to the public. By submitting the Application to the Authority, the Applicant is expected to have disclosed any and all matters material to the proposed financing as of the date of the Application. (2)

The other item of note?  “Continue Dialogue with Barclay’s Bank.”  Wonder if that is on behalf of our fair town for new debt? 

As of December 9th, 52% of the contract has been completed. 

Again; Can the Mayor, Town Manager or City Legal unilaterally extend authority to act on behalf of the Town without a council vote or approval? Was it previously approved / known via the Town Council and if so, is that a violation of open meeting laws? 

* * *

(1)  http://www.azcommerce.com/financing/business-and-project-financing/arizona-industrial-development-authority
(2) http://www.azcommerce.com/media/1542430/azida-procedural-pamphlet-november-1-2017.pdf


December 29, 2017, 07:24:28 AM
So, I am curious what exactly went on before the Town Council approved the deal in an open meeting.

Time for another visit to the nice ladies at Town hall.  The worst they can say is "NO" right?  Don't get unless you ask........


December 29, 2017, 10:33:00 AM
A while back I asked the question if this was a joint and several contract with VDC. (1)  It is clear the contract was reviewed by Mr. Figuerora, Town Counsel, so let’s take a peek?


B. TOWN and VDC agree to equally share the financial responsibility of this Consulting Agreement. CCP shall invoice TOWN and VDC monthly, each for one half of the amount due based on the Exhibit "D" tasks completed and TOWN and VDC hereby agree to pay monthly based on the completed tasks. TOWN and VDC will equally share the monthly financial responsibility of this agreement as set forth in Exhibit "D." TOWN and VDC agree to make payment to CCP within fifteen (15) calendar days of the receipt of the invoice from CCP. CCP may cease the provision of any Pre-Development Activities until such time as a requested payment is made and delivered.

Well, what the heck does that mean? 

“TOWN and VDC agree to equally share the financial responsibility of this Consulting Agreement.”

That sounds more like a marriage than a concise statement such as “each party not to exceed $125,000.00” or “Town is not responsible for monies not paid by VDC.” 

Remember, VDC was crowd funded. (2)  Despite having a twenty six acre property in excess of $2,000,000.00 under escrow, (reported) they have not formed a legal entity in Arizona. (3)

Sure hope the checks (cheques?) clear and we don’t get to put that “equally share the financial responsibility” to the test. 

* * *

(1) http://www.260chat.com/town-government/hockey-in-payson/msg2291/#msg2291
(2)  https://www.crunchbase.com/organization/varxity-development-corp
(3) http://www.260chat.com/town-government/hockey-in-payson/msg2507/#msg2507


December 29, 2017, 03:39:03 PM
Lets see what is behind the Varxity curtain - Part 1

I anticipate most people who have put some thought into the prospect of an Elite Preparatory Hockey School coming to Payson would agree that it is an unlikely venture.  In all reality I would also anticipate that this is somewhat of a red herring and something to distract from the building of the rec center.  But it did get me to thinking, what is required by the State of Arizona to open a private school, elite or not? 

The State Regulation for the requirements are as follows:

Accreditation, Registration, Licensing, and Approval
•   No requirements for Accreditation.
•   No requirements for Registration.
•   No requirements for Licensing.
•   No requirements for Approval.
•   "Private school" is defined as "a nonpublic institution, other than the child's home, where academic instruction is provided for at least the same number of days and hours each year as a public school." Ariz. Rev. Stat. Ann. §15-802F.2.
•   "Nothing in this title shall be construed to provide the state board of education or the governing boards of school districts control or supervision over private schools." Ariz. Rev. Stat. Ann. §15-161.
Teacher Certification
•   Teacher certification is not required.
Length of School Year and Days
•   To comply with the Arizona compulsory school attendance statute, private school students must attend school for the full time school is in session in the local school district. Ariz. Rev. Stat. Ann. §15-802B.2.
There is a required curriculum that includes that each child “shall be provided instruction in at least the subjects of reading, grammar, mathematics, social studies and science.”  It also states that if the child transfers from a private school to a public school the public school must provide the student with a list indicating which credits will be accepted and denied. (1)

So what does it take to open a private school? Nothing. Pretty well if you can fog a mirror and collect a “tuition check” you are a "private prep school."  They do not even require that teachers be certified.  That is interesting. (And frightening!)

But what does it take to open an “elite” private school? I am no expert, and I attended public schools, but if I were to send my child to an “Elite Private Preparatory School” I would require at a minimum a solid reputation.  A pooling of teachers from proven programs as a start? So on one hand it may indeed provide jobs locally, seeing how apparently anyone could be a teacher.  On the other hand, and with the idea of a ramp up period, bringing teachers from schools in other areas with a track record for their graduates attending tier 1 universities.

What are Tier 1 universities in the US?  The answer can be a little bit murky with an explanation of any ranked school in the top 200 being considered a Tier 1 but by the terms of what is generally accepted an actual Tier 1 University would be the top 50 ranked universities. (2) Wikipedia states that the percentage of applicants admitted reflects both desirability and competitiveness. (3) The top 13 of these schools in 2017 were:

Stanford University
Harvard University
Columbia University
Princeton University
Yale University
Pomona College
Brown University
University of Chicago
University of Pennsylvania
Northwestern University
Duke University

The cost per year for the top schools appears to be $45,000 to $60,000 per year.  The required GPA is around a 4.18 and the SAT needs to be 1590 and above. (4)

So if the “clients” expectations are for these Tier 1 Universities, let’s hope there is a plan in place for pooling some teachers with a strong track record, or that are at least accredited?

But what if the “clients” are looking to get an education and be a Division 1 Hockey player?  It appears there have been some additions to that list in recent years with new Division 1 University teams and there are roughly 1,450 available spots.  (5) There are 60 Universities with NCAA Division I hockey programs.  (6) The schools range from United States Air Force Academy, University of Alaska, Arizona State University, Boston University, and Harvard University.  All good and fine choices, but all with differing degrees of "cachet."  At the "Prep" level I suspect the same analysis comes into play, including "cachet."

As we are all more readily familiar with colleges, we continue with them as an example.  The University of Alaska average SAT score for admission is 1070 with an average GPA of 3.0 and Arizona State University has an average SAT score of 1210 with an average GPA of 3.49.  (7) ( 8 )

These are very different than using the top 50 Universities in the US as “Tier 1” schools.  All of this information to what end?  The cost of attending ASU as an out of state student is $27,372 for tuition.  A very different cost than the ranked top 50 schools.  Also with the cost of room and board about the same cost as the proposed tuition for the Private Elite Hockey School to be erected here in Payson.  (9)  A "Prep" school, high-school age, would really need to be a something to secure that kind of tuition? 

Here is where all this information is heading; what are they selling? When they say “elite” and discuss it for those looking to attend a Tier 1 university, do they mean Harvard? Or do they mean ASU? (Both are fine, and no doubt better and more prestigious than my life choices) How many families are going to pay $50,000 per year for an unproven preparatory school in a town with highly limited amenities? I anticipate that most students coming from a home that can afford $50,000.00 in high school tuition are going to require a little more than a town with one movie theater and the best shopping choices offered at Wal-Mart?  Do not misunderstand me, we chose this lovely town, but we can all agree to the limited amenities.

It did not take long to research the need, or in this case the lack of a need, for a private hockey school geared to gain admission into a top hockey Division 1 university.  Most students can gain admission by attending a public school and doing well.  Skilled hockey players WILL be found by equally skilled scouts at all levels. 

After the research I think most people can see that this proposed school is apparently a red herring, a distraction, a fantastic magic trick for you to watch one thing while the real magic is taking place right in front of you? That trick?  A double barrel revenue bond, an effective general obligation bond, passed without your vote or input. 

* * *

(1) https://www2.ed.gov/about/offices/list/oii/nonpublic/arizona.html
(2) https://www.usnews.com/best-colleges/rankings/national-universities?int=9ff208
(3) https://en.wikipedia.org/wiki/Rankings_of_universities_in_the_United_States
(4) http://www.collegesimply.com/colleges/california/stanford-university/admission/
(5) https://www.nytimes.com/2017/03/23/sports/hockey/ncaa-college-teams.html
(6) https://en.wikipedia.org/wiki/List_of_NCAA_Division_I_ice_hockey_programs
(7) http://www.prepscholar.com/sat/s/colleges/University-of-Alaska-Anchorage-admission-requirements
( 8 ) http://www.prepscholar.com/sat/s/colleges/ASU-SAT-scores-GPA
(9) https://www.collegedata.com/cs/data/college/college_pg03_tmpl.jhtml?schoolId=1096


December 30, 2017, 07:58:15 AM
Let’s see what is behind the Varxity curtain - Part 2

Lane Moore of Alberta is the CEO of Varxity.  Time to lean some more.  Let me preface this:  I am generally in awe of anybody that can do what I can’t.  Play a musical instrument?  In awe.  Ice Skate without hurting yourself?  More awe.  Devote your career to working with children?  Super awe.  More than three children at one time?  I would curl into a fetal position and whimper.  For that alone, I applaud Mr. Moore.   Had we just met in passing, I would more than likely conclude “heck of a dude.”  Enter into a suspect contract with a town where I pay taxes? Subject to just a bit more scrutiny.   

Time for class to begin.   

I will assume that Mr. Moore is the chief educator of the “Elite Private Prep School.”  Mr. Moore is currently the Principal of Bentley School: Home of the Panthers! (1) (Roar!)

“The selection committee was particularly impressed with his interpersonal skills and his ongoing commitment to staff development” said Deputy Superintendent Kurt Sacher. “Lane brings a natural appreciation for rural education and will be a tremendous addition to the proud staff of Bentley School.”

Moore holds a Bachelor of Education with a major in Physical Education from the University of Calgary and a Bachelor of Physical Education with a major in Coaching from the University of Alberta. Moore is currently the Chair of the Wolf Creek Administrator’s Association and plans to complete his Master of Education degree this summer with City University.

Moore began his teaching career in 1996 at Lord Beaverbrook High School with the Calgary Board of Education where he taught Physical Education to Grade 10, 11 and 12 students. (2)

So, management experience? 

Bentley School is located in the beautiful Blindman Valley in Central Alberta. We are located about 20 km west of Lacombe, and serves approximately 373 students and their families in grades K to 12 and another 51 students in our Bright Futures Play Academy. For the 2016-2017 school year, we have 18.35 FTE teaching staff and about 11.1 FTE support
staff. (3)

Assuming full build out for the “Prep School” and the same staffing levels that works out to be 33 new teachers and 54 new support staff. 

Like any school district, those in Canada also try to measure or quantify success.  They are just as devoted to paperwork as any U.S. District.  Let’s take a peek at the current achievement?

Ouch. Not the best record to market “an Elite Prep School.”  Let's not put that into the marketing materiel?  But, in Mr. Moore’s defense, the floods and wildfires of Alberta likely had an impact.  Payson shares that fear and concern with Alberta. 

The Annual Education Result Report even makes note of it:
Impact of May to June 2016 Fires and June 2013 Flood in Alberta

Participation in Provincial Achievement Tests was impacted by the flooding in June 2013 (Grade 9 only) and by the fires in May to June 2016. Caution should be used when interpreting trends over time for the province and those school authorities affected by these events.

Participation in Diploma Examinations was impacted by the flooding in June 2013 and by the fires in May to June 2016. Caution should be used when interpreting trends over time for the province and those school
authorities affected by these events. (4)

I know that Varxity got its kick off with crowd funding.  Mr. Moore has been involved in other fund raiser efforts.  Some pretty cool stuff for the kids: Playground Equipment. Like US. Schools, never enough money for the cool stuff.  The current goal of Bentley?  $500,000.00. The results?  $71,000.00 (5)

I don’t know, maybe the Varxity Prep and Varxity Development is impacting the performance results of the fundraiser and the achievement goals?
Just in passing I note that the “Elite Prep School” seems to use a lot of the same Verbiage as the school district? (6)

Let’s see what Varxity Development is up to? 

Here is the basic stuff:

VARXITY DEVELOPMENT CORP. was established on 11-Sep-2014 as a Non-distributing corporation with 50 or fewer shareholders company type and registered at 1300-10020 101A AVENUE EDMONTON AB T5J 3G2 Canada. Its Corporation No. is 9016341 and annual filing period is 09-11 to 11-10. VARXITY DEVELOPMENT CORP. is: Active. Varxity Development Corp. has been running for 3 years 3 months, and 19 days since its incorporation. (7)

Well, looks like trademark is in the works? 

Providing courses of instruction and athletic training at the junior high school and senior high school levels; organizing and providing junior high school and senior high school sporting events; providing college preparation academy services ( 8 )

Filed on 12/13/17?  Dang man, no expert here, but tend to the Arizona Entity first?  Maybe the trade mark attorney Ms. Meyer can point Varxity in the right direction?

Maybe there is a reason NOT to have an Arizona entity? Depending on where Varxity signed the “Development Agreement” this could work out to be a jurisdictional nightmare.  But, employment records and all. Maybe I am just not seeing the benefit?

For all the world it appears that the dream of Varxity is being transformed into a “Straw” or “Nominee” to establish revenue in support of a Rec Center.  Generally speaking, that is frowned upon if it involves finance agreements and that agreement crumbles. 

In United States v. Quintero-Lopez, two men were charged with locating eight straw purchasers for homes and helping the straw purchasers falsify pay history documents in order to obtain $8.3 million in mortgage loans. The government alleged these loan purchases were illegal because the straw purchasers inflated their incomes as part of an attempt to defraud the lenders. In 2011, one of the two straw purchaser recruiters was sentenced to six years in prison and the other was sentenced to one year of probation.[6] Straw or nominee purchases of mortgage loans are legal when intent to defraud is not present. (9)

Your mileage (kilometers?) may vary?  I suspect Varxity will have a few years to “pull it off” so to speak, but that Canadian protection may well come in handy?

(edit) BTW, in case you think I am referencing the wrong person, this twitter account would suggest otherwise? 

* * *

(1) https://bentley.wolfcreek.ab.ca/
(2) https://www.rimbeyreview.com/news/lane-moore-appointed-as-new-principal-of-bentley-school/
(3) https://bentley.wolfcreek.ab.ca/download/106658
(4) https://bentley.wolfcreek.ab.ca/download/117754
(5) https://bentley.wolfcreek.ab.ca/parents/playground-fundraiser
(6) https://bentley.wolfcreek.ab.ca/download/106658
(7) https://www.canadacompany.info/Varxity-Development-Corp-9016341/
( 8 ) https://www.trademarks411.com/marks/87719307-varxity
(9) https://en.wikipedia.org/wiki/Straw_purchase


December 30, 2017, 08:05:36 AM
Before we continue, let me clarify.

In no way shape or form am I against the future growth of Payson.  I welcome it.  I wish it could occur overnight.  I have some ideas how that could be accomplished with minimal risk or cost.  This town would benefit immensely from a “full build out.” 

So NOT anti growth.
(Double negative makes me "Pro Growth!"  ;D )

Even the Roundup recognizes this grand plan is a ploy for a new bond.
This works out to $50 in per-capita revenue. Now, that’s not an outlandish sum — but it’s a chunk of change. (1)

Some “backwardation” (not really in this case, but it IS a fun word) tells us this:

15,000 population * $50.00 = $750,000.00.   
$750,000.00 / 12 = $62,500.00.   
$15,000,000.00 at 3% for 30 years is $63,240.61 monthly. 

So the Roundup calculates this as a $15,000,000.00 bond issue!

(BTW, it appears $750,000 per year or $15m is not outlandish to the Roundup?  Explains the subscription rates?   ;D ) 

Again, not anti-growth. If part of that growth is a new Rec Center, great!  But, we should play by the rules?  Maybe a General Obligation Bond instead of some contrived, obtuse deal? 

We can then discuss and vote as a Town, the merits of a $15,000,000.00 project?  Would that money have more impact elsewhere?  I personally think it could.  If my fellow citizens want a Rec Center, and the vote supports that, I will be there with a shovel (and check book) in hand to support that goal.  :)

What I am not a fan of is having a few elected politicians, telling me, or a town of 15,000, in a very tangible fashion, how to spend our money.  Even less of a fan of opaque backroom deals.  >:(

Anti-Growth?  Heck no!   

* * *

(1) http://www.paysonroundup.com/opinion/editorials/prep-school-raises-some-intriguing-questions/article_cce0c75f-b2bc-5712-aa5b-5aadc8fb9b28.html


December 30, 2017, 12:10:51 PM
So it came to my attention that some harsh words were said at the last council meeting.  :-\  I was not there.  I need to get out more?  Sorry in advance, but this is a long one.  Going to break it into three parts.

Harsh Words – Part one

It was described as a “chiding” or “reprimand” by Town Counsel Mr. Figueroa.  Figured it would best to have a look myself?  Maybe you want to decide for yourself? Before we do that, sometimes it is important to review the basics, so here is the flow chart for the city.  Pesky “citizens” come first. 

Here is the video link, or alternately you may have to go here and find the 2017, 12/14 meeting video. (1)

You can decide for yourself if it is a “scolding.”
Time stamp markers to avoid the boredom. 

12:25 Mr. Charles Doe: asking for transparency in process of Prep School Rec Center. 
16:56 Ms. Dalene Yonker: Rumsey Park / School issue questions.
20:30 Ms. Barbra Bunton:  Ice Rink / School issues.
30:45 Mr. La Ron Garret Update on Rec Center. (Getting close to the ruffle….)
32:12 – 36:26 Mr. Hector Figueroa (I suspect this is what ruffled some feathers?)  Let’s do it verbatim?


Time Stamps: 30:39 – 36:26

Mr. Garrett:  Mr. Mayor and members of the council, I just wanted to give an update on where we are at with the activities center and Community Center Partners as our consultant.  Uh we have had several meetings recently, uh two focus groups, one with some younger business leaders and some with some more experienced members of our community.  Uh we are going to have another focus group on January 8th.  On January 2nd we’ve got a meeting of the design team to go through everything that has been updated on the plans and hopefully at that point then we will have something that we could put out to the public to let them look at uh (inaudible) shortly after that if we need to make any changes so the public can see it before the public meeting on the 17th which will be held at the Nazarene Church on Tyler Parkway on January 17th at 5:30 PM.  And we want to invite all the public to come to that, so hopefully we get that information out and we will also if all goes well we will be out in the community prior to that meeting so that we can get everybody a chance to look at that upfront.

Mayor:  Where are we going to be we are going to try and be at the three grocery stores?

Mr. Garrett:  We are going to try and be at the three grocery stores at Safeway, Basha’s and Wal-Mart at different times uh with a staff member there to help explain uh and any questions that somebody might have.

Mayor:  Any council have any questions?

Mr. Figueroa:  Mr. Mayor?

Mayor:  Yes Hector

Mr. Figueroa:  This process not with the Community Center but the private school has been ongoing and I heard tonight a comment we don’t respond to  to questions but in light of the fact that misinformation is out there I think it is our duty to correct.  There this Canadian outfit was not in contact with Mayor and council prior to the sales tax.

Other / Unidentified:  Uh huh

Mr. Figueroa: Uh there is a town wide city wide uh assessment that was done many years ago and it was re-updated that number one priority was a community center.  We had an uh event at Town Hall at the Nazarene Church which 200 people appeared and a lot of you appeared and it was for the purpose of trying to get some guidance from the community to Mayor and council uh how to go.  There was no decisions made there and to so today there is no decision made as of today.  Simply because the firm that was hired was paid for half by the private enterprise and half by the town it uh eh the responsibility.  It is a feasibility study it is not called that it is a planning document that will be presented to Mayor and council and to the public uh the final uh document.  So if you say that you know it’s just going to be at certain hours and certain people can use it and stuff, all of that is speculation.  Whether the property is uh being uh purchased right now behind the Wal-Mart, and there’s going to be the town either the officials nor the citizens can interfere with private enterprise.  Private enterprise is going to set whatever school wherever they're going to put the facilities what we do have control of is what facilities go on public lands.  And all of that will come forth um because the newspaper they have a duty to cover Mr. Garrett speaking at the Republican Party and if he had provided, excuse me

Other / Unidentified:  tea party

Mr. Figueroa: The tea party, if he provides certain information it’s information that is not a hundred percent every detail that could be given and for anybody to think that this town this Mayor or this town administration and my office the legal department is going to do something that’s behind the scenes that’s not ethical that is not forthright you’re mistaken. And I have an open door policy if you ever want to come and talk to me about a legal issue and question something feel free to do it.  But it upsets me that we have thousands of people in our community listening on Channel 4 uh getting misinformation that they think they received through some source.  The source is right here. And you know Mr. Mayor I don’t seldom I seldom get out here and um speak my mind this way, but I think that at the end of this year we need to as one of the speaker’s said in our prayer we need to work with each other, we need to trust each other, look into each other’s eyes and and see are we one and the same.  Are we working on the same goal for this community and if we’re not call us out but don’t call us out with information that you don’t have a hundred percent grasp of and a lot of you know me a lot of you deal with me on a daily basis, I’m a straight up person and if you have something that you would like to speak with me about, please by all means come to my office.  Thank you Mr. Mayor.

Other / Unidentified:  Ron anything else?

Mr. Garrett: Nah I think that covers it. 

“Misinformation,” “speculation,”
such hurtful words.    :'(

“But it upsets me that we have thousands of people in our community listening on Channel 4 uh getting misinformation that they think they received through some source.  The source is right here.”

Good to know there is only “One Source.” Guess it is time to pull the plug on 260Chat.com?  ;)   That's no fun!

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(1) http://www.paysonaz.gov/Video/Council-Meetings.html
(2) http://www.paysonaz.gov/Video/Council-Meetings.html
(3) http://ecorp.azcc.gov/Details/Corp?corpId=L22058569


December 30, 2017, 12:14:13 PM
Harsh Words – Part Two

Now, lets flash back to the 09/21/17 meeting or alternately you may have to go here and search for the 09/21/17 meeting. (2) As a side note, of the approximate 20 minutes of “conversation” on this Resolution, Mr. Figueroa takes over five minutes in time on this one, very long, paragraph.   (Don’t worry, the highlight is below.) And again, verbatim:



Time Stamps: 47:25 – 52:40

Mr. Figueroa: One thing, one thing I can say, and uh some of you have worked longer with me than than others  ‘cause you just got elected at the last election,  but I can tell you one thing, I have been doing this for 20 years, I’ve worked for three cities, I’ve worked for several fire districts, some school districts (inaudible) let me tell ya I’ve dealt with contracts and one of the things that you’ve seen in the two and a half years that I’ve been here I’m not a person that’s gonna put the town in a situation where given it be financially responsible for something that because the contract was not done properly.  You’ve seen some of the contract uh uh items that were included, they were included because of Ron and I worked to make sure that we got those some are required statute and some are not.  Sometimes you’ve seen me and heard me say you buy something like the lighting I think at the ball park and they wanted us that if there was a legal dispute we had to go to Minnesota or something to be arbitrated.  No sir that’s not, this particular case if they wanted uh they had a paragraph or a term of the contract to settle disputes in Maricopa County I said no sir it’s going to be in Gila County. 

So what I’m saying to you is I haven’t led you wrong in the past and but there are some things that as a lawyer, I’m not a criminal lawyer anymore but it’s like telling the client to plead the fifth because you don’t want to put all of these terms and all of these details out why? Because if something goes awry then you’re going to have to explain that. That’s why I was real careful in saying to you tonight that we couldn’t tell you all the details because we don’t know them and that’s why we’re hiring these people to be able to come up with design and you know cost estimates and uh you know details as to what would be the best, not only at Rumsey Park but also with uh our partners that are going to be involved.  Uh the Mayor mentioned the partners, the partners involved uh are going to be individuals they may be corporations it may be non-profits uh what they do is that they buy into the whole concept and then that’s uh where some of the money is going to come for development.  Honestly somebody that’s coming from Canada wants to put in an elite academy they’re not expecting us to give them tax payer money to to build a school, quite the opposite, they’re looking like are we going to have water, are we going to have a street, you know things that are already planned, masterplanned.  I can tell you that I did the resolution gives you a good historical perspective of how we got here. I didn’t know that the original plan that was done the masterplan was signed by Craig Swartwood in 1993.  I put that in here, I didn’t know that the original you know uh Parks and Rec uh masterplan identified, Sheila put it up, uh identified the Rumsey Park Development as number 1. You and I and a lot of community members participated in a Town Hall you heard what the members of the public indicated you heard parents and little kids come up here and tell you about the pool (inaudible).  You’re not reinventing something you’re not coming out because you got up in the morning on the wrong side of bed and said well this is what we’re going to do to uh fulfill my wishes those are not your wishes they’re not my wishes they’re the people’s wishes and there was a process where the general plan was required by statute went through planning and zoning approved by you all and then you directed your town clerk to put it out for a vote. The town voted to pass the masterplan.

Other / Unidentified: MM hmm

Mr. Figueroa:  So, what I’m trying to tell you is I don’t ever like to tell my clients uh trust me.  I tell my client judge me for the work that I’ve done.  Judge me for eh the legal advice I give you.  That is the way this is going to go down.  So, uh any questions that you have my my office I have an open door policy, feel free to come over and I we’ll discuss the legal issues

Other / Unidentified:  Do you have another question?

The highlight?  At 51:23:  “So, what I’m trying to tell you is I don’t ever like to tell my clients uh trust me.  I tell my client judge me for the work that I’ve done.  Judge me for eh the legal advice I give you.”

Wait for it……

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(1) http://www.paysonaz.gov/Video/Council-Meetings.html
(2) http://www.paysonaz.gov/Video/Council-Meetings.html
(3) http://ecorp.azcc.gov/Details/Corp?corpId=L22058569


December 30, 2017, 12:18:53 PM
Harsh Words – Part Three (The end)

“So, what I’m trying to tell you is I don’t ever like to tell my clients uh trust me.  I tell my client judge me for the work that I’ve done.  Judge me for eh the legal advice I give you.”

Well Mr. Figueroa, I’m your huckleberry…..  You approved as to form the following:


A "Tri-Party" contract with a face value of $250,000.00 and additional considerations.  Assuming the future considerations have a value of greater than $0.01, even as a "future," still under the contract, an apparent clear violation of the Town procurement policy.  There is no apparent way to designate "Varxity" as a "Registered Professional" for the work around on the value.  (If the "future consideration(s)" have no value, they would not be in the contract. Clearly there is a value there.)

A contract with a foreign entity that may be a jurisdictional nightmare. (To the extent this is an ongoing “partnership” why not require an Arizona entity to forgo that headache?)

A contract with dubious / non-concise wording on financial obligations.  (“(S)hare the financial responsibility of this Consulting Agreement.”  Why not modify that one sentence for clarity and to provide clear intent?)

A contract that includes significant future / potential financial concession, with a party to the contract, (see above) that has an apparent value in excess of $250,000.00, in possible violation of procurement policy?  These concessions include “but are not limited to:”
•   Preferred Shared Use Agreements.
•   No Bid designation of “Manager” of public facilities. (By extension a Concessionaire Contract with a one year projected gross value, via CCP, of $600,000.00 to $700,000.00 dollars.)
•   Committed the town to future spending via “Cooperative Marketing”
•   Committed town resources, including future labor costs, including Town code specified fees, and various improvements to existing infrastructure, with a currently undetermined value, to Varxity.
•   A waiver of Town Code (See Above)
•   Designated Legal Counsel for the project.
•   Delegated oversight of Town monies / designation of subcontractor(s) to a third party – CCP

Allowed the Town, and via extension your office, to honor an invoice of CCP for services prior to the creation of that entity.  (CCP was incorporated on 07/27/17 (3)   the invoice includes dates of 06/20/17 to 09/21/17.  How does a non-existent entity complete and invoice for work? Has the Town asked for a refund for any work prior to 07/27/17? )

Yes sir;

“Judge me for the legal advice I give you.”

Have it your way.   

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(1) http://www.paysonaz.gov/Video/Council-Meetings.html
(2) http://www.paysonaz.gov/Video/Council-Meetings.html
(3) http://ecorp.azcc.gov/Details/Corp?corpId=L22058569


December 30, 2017, 12:23:19 PM
So what else happened at the meeting?

Well, the meeting of 12/14 also produced this tid bit. Here is the video link, or alternately you may have to go here and find the 2017, 12/14 meeting video. (1) Again, let’s do it verbatim?   


Time Stamps: 38:12 – 38:55

Female Other / Unidentified:  A public meeting that’s coming up you said January 17th?

Other / Unidentified:  Yes

Female Other / Unidentified:  And it’s not RSVP like the other one was, it’s open

Other / Unidentified:  It’s open the more the better.

Mayor:  And we’ll come up with dates or grocery stores and that’s going to be informal and that’ll have the three options and it will be a Q&A for individuals.  And if anybody, we did a live Facebook, if anyone can think of different ways that we can be more transparent love to hear about em.  We are looking for ideas. Barb?

“(I)f anyone can think of different ways that we can be more transparent love to hear about em.” Gosh, I have an idea! In the event you are reading this, can you expedite my records request for the emails prior to open meeting of 09/21/17?  That would help on the transparency front? 

Just in case, here it is again:

Yes, that would be swell!  Thank you so much for the generous offer!

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(1) http://www.paysonaz.gov/Video/Council-Meetings.html


December 31, 2017, 09:09:29 AM
All indications are pointing to our local government entering into an illegal contract, prior to any public meetings or input.  We are now apparently obligated for many thousands of dollars, without any vote of the people here, and with very little due diligence as far as researching Varxity, and it's owners.  In order to get a project of this size, this far, in a community this small...the process would have had to been started many months ago!