By Melissa Rosequist
Twitter: @mrosequist_

A mere four months after entering the public arena, Southbridge Two has officially been laid to rest ending the pursuit of a 10-acre, mixed-use development in the Old Town Scottsdale area.

The Scottsdale City Council’s split 4-3 vote on April 7 did not come without questions of legal and ethical ramifications due to superseding a successful citizen referendum.

Scottsdale City Attorney Sherry Scott believes the action will not violate any state statutes, citing a 1982 Arizona Attorney General opinion.

Since its Dec. 4, 2019, approval by Scottsdale City Council, Southbridge Two has endured public push-back stemming from thousands of residents signing a petition to put the project to a public vote in November 2020. Following the successful referendum, project developer Spring Creek Development challenged the referendum in court, where it was defeated once again.

Spring Creek Development President Carter Unger has maintained the notion that it doesn’t make financial or business sense to allow the project to go to a vote, and thus requested for the council-approved development agreement be repealed.

Members of Scottsdale City Council had ranging opinions on the action before them, including Linda Milhaven saying she felt it was a sad day for the city, while Guy Phillips said the action undermined the referendum process.

Mayor Jim Lane and councilmembers Virginia Korte, Suzanne Klapp and Linda Milhaven voted for the ordinance repeals, while Vice Mayor Kathy Littlefield and councilmembers Guy Phillips and Solange Whitehead voted against the measures.

Trampling voter rights

Ms. Littlefield kicked off the council discussion on Southbridge Two’s ordinance repeals by stating she believes the resolution would be denying citizens the right to vote for the project.

While there is an assumed population who would vote against Southbridge Two --- those who supported the referendum petition --- she said the city will never know what the majority of registered voters think of the project.

“By nullifying the resolution to allow Southbridge Two be built it would also be denying the citizens’ right to vote. Their right to vote was earned legally and legitimately and with great effort by gathering the required signatures to put this issue on the ballot --- they wanted this vote and they earned the right to have it,” Ms. Littlefield said, calling the 28-day endeavor garnering 17,500 signatures a herculean effort.

“We now will never know how the other 90% of the voting population --- or 157,500 voters --- in Scottsdale would have voted. Their votes will now be denied. I’m sure this will pass tonight, but it has no favors and it does no favors to the basic political rights of our citizens.”

Ms. Littlefield said this entire saga sets a terrible precedent, stating citizens’ willpower will be weakened, feeling as though the council can deny their voices at will with a vote on the dais.

“By doing this tonight we undermine our basic premise of our way of government going forward; a check-and-balance system going forward that holds everyone accountable through a ballot vote,” she said. “Also, I believe it very well may be illegal to deny this vote under Arizona constitution.”

Ms. Littlefield cited: “if a referendum has at least 100% of the minimum number required by the constitution, the initiative or referendum shall be placed on the ballot in a manner by law.”

“Shall means mandatory, not ‘we will put it on the ballot if it is convenient for us to do so.’ I saw nothing in the constitution to say a City Council could deny the citizen vote and remove it from the ballot,” she said.

Ms. Scott, the city attorney, refuted Ms. Littlefield’s claims, saying in her legal opinion the council has the right and ability to repeal the ordinance.

“There is more than one law in place here,” Ms. Scott said.

“In fact we have reviewed this issue and analyzed it in detail. One of the clearest authorities that I can cite is from an Arizona Attorney General opinion in 1982 where a very similar matter was being reviewed. The Attorney General, at that time, in her conclusion stated, ‘when the subject matter of the referendum has been repealed, any vote on the measure would be without legal effect. Therefore we think the referred measure should be omitted from the ballot. The same rational applies also to the preparation of the general election publicity pamphlet.’”

Ms. Scott said without going into a lot of detail about the legal analysis, basically the message is that when sending a referendum ballot measure to the electorate would be without any legal effect, the council does not have an obligation to send it.

“They can repeal the ordinance and by doing so, make it a moot point or a moot question. I’m citing you just one authority, there are others. I feel very confident in our legal analysis on this point,” Ms. Scott said.

Mr. Phillips pointed out the difference from population referendum and recall referendum, stating the council must adhere to the letter of the law.

“There is no such choice in the statutes accepting the recall referendum, which is clearly stated and what I believe our attorney was referring to. That is separate from population referendums in the statutes. I fully understand the mechanical and cost-prohibitive reasoning behind trying to remove this referendum from the ballot,” Mr. Phillips said. “But by doing so we’ll be in direct violation of Arizona statutes, and what I consider even worse is the ethical ramifications of trampling voter rights in this matter.”

Public perception

Councilwoman Milhaven said she is surprised that the folks behind the referendum process don’t view this as a “win” as their goal of stopping Southbridge Two has been achieved.

“I think this is a very, very sad day for Scottsdale,” Ms. Milhaven said. “This developer has done an amazing job, done more public outreach than any project I know of in my council history. No developer ever made more accommodations or provided more benefits to the community than this developer. I think it’s a shame that a project of this quality is not going to happen in our communities.”

While the referendum was specific to having Southbridge Two go to a public vote, the broader context associated with the petition was to stop the project entirely to maintain Old Town’s character.

“Not only is this project not happening as was their desire, but this referendum will have an incredibly chilling effect and dampen any future investment in our downtown so folks who want to see Fifth Avenue and Old Town stay exactly as it is, they will get exactly that,” she said.

“We’re going to face a depression and a recession --- who knows how bad it’s going to be --- but certainly it will be a long time before we see anyone investing in our downtown again. I think this is very sad.”

Mayor Lane said he thinks there’s a simple conflict between how the Arizona Constitution may state the referendum “shall go to the ballot” versus an individual being forced to do something they are not able to do or has no desire to do.

“It’s unfortunate because there’s a conflict in the way this is being legally described. I don’t know where it is that somehow or another, in order to just affect what the desired results was and the promotion of this referendum everyone knew was to reverse this action,” Mr. Lane said. “It accomplished exactly that. To drag, if you might put it this way, Mr. Unger through a torturous routine over the next several months is something he might not be in a position financially to withstand the timeframe we’re talking about if we were to refuse to release him from this.”

Mr. Lane said he isn’t privy to the legal agreements between Mr. Unger and the city officials for releasing him from the development agreement, but he knows it is at the developer’s request.

“To tell him ‘no, you’re going to have to go through this, irrespective of what damage it might do to you financially or even mentally’ I just think is an unfortunate consequence of a view --- that is somehow or other, for whatever motivations --- the public has the absolute position he may no longer be able to do, or frankly, want to do. But he’s willing to take the consequences of the loss,” Mr. Lane said.