TUSAYAN, Ariz. - On June 1, the town of Tusayan and Stilo Development Group U.S.A. reached an agreement that allows both entities to move forward with commercial development and town housing without having to get Forest Service approval for immediate access to their properties.
The town also agreed to join in a lawsuit with Stilo, if necessary, to get the Forest Service to resume the application for easements.
Former Tusayan Mayor Craig Sanderson said the town would do everything possible to move forward with the easement approvals before suing the Forest Service.
"We are going to exhaust all efforts before we even consider a lawsuit," Sanderson said. "We have a very important relationship with the Forest Service that we want to maintain. They're our neighbors. But if all else fails and the town has 40 acres of land that we cannot develop for housing, we are going to want to make sure the Forest Service understands that."
Under the new agreement, the town will begin construction on 20 homes on the Ten X property east of Tusayan and Stilo will start commercial development at Camper Village in Tusayan.
In the past, Stilo representatives said the proposed development could include hotels, restaurants, retail, entertainment and educational attractions. The properties, one of which is Kotzin Ranch, is located just outside the entrance gates at Grand Canyon National Park and the other, Ten X, is located southeast of Tusayan. One other property owned jointly by Logan Luca, an affiliate of Stilo, and the Halvorson family, is located in Tusayan. That property, Camper Village, is 18 acres and is located off the northern roundabout in Tusayan.
According to Jackie Banks, public affairs officer for Kaibab National Forest, said the Forest Service has had and will continue to have conversations with representatives from Tusayan regarding needs the town might have, including access to the private property and improved internet availability.
"The Town of Tusayan is an important partner to the Forest Service, and we want to work with them when and where we can, as we do with other partners and local governments. As an example, Town representatives have talked to the Kaibab National Forest about the possibility of a fiber optic line for enhanced internet and road maintenance agreements for access to private parcels," she said.
Banks said at this time the Forest Service has received no applications from the town for any of potential small-scale special use permits.
"If and when the Forest Service receives any applications for special use permits from the town of Tusayan, we will consider them against applicable law and regulation," she said.
Sanderson said the agreement with Stilo is a big opportunity.
"This is a historical moment, having the opportunity to do this," Sanderson said. "This is changing the future of the town of Tusayan forever. We are a town of employees, not residents and we finally have an opportunity to see that change."
Sanderson resigned his council seat June 1 and the title of mayor in order to run for mayor of Tusayan.
After the town's application for right of way easements across U.S. Forest Service land was returned March 4, the town and Stilo began discussing options for moving forward with the development and town housing.
The Forest Service returned the town's application because the application did not meet required agency screening criteria. The town needed the application to be approved in order to obtain access to property that will be used for housing. The easement allows Stilo to move forward with plans to build a major commercial development on the same properties.
In the original agreement between Stilo and the town, the town received 40 acres of Stilo's property to develop for housing needs. The town chose to receive the first 20 acres up front and were allowed to choose whether that would be on Ten X or at Kotzin. The deed to the additional 20 acres would go to the town after road easements were approved by the Forest Service. The town chose Kotzin for the first 20 acres and subsequently designated Ten X to receive the additional 20 acres after the easements were approved.
Stilo put the 20 acres at Ten X out into escrow until easement approval.
When the Forest Service returned the easement application to the town, the town approached Stilo and negotiated to take Ten X out of escrow and begin building housing units at that property.
The town agreed to start with 20 homes, the final goal is to have as many as 70 homes at Ten X. In return, Stilo agreed to provide adequate employee and interim housing at Camper Village. Providing employee housing cuts down on the amount of commercial development that can occur at Camper Village.
In the agreement, the town agreed to allow Stilo to move 50 percent of Camper Village employees to a different location after the town gets access to all 20 acres. For every 10 percent of employees that are moved out of Camper Village, the town receives 10 homes.
"When they hit 10 percent, the town can build 10 more houses," said Eric Duthie, Tusayan town manager. "In three years from now, if they've moved another 10 percent out we get to build 10 more houses. Two years after that, if they've moved another 10 percent out we get to build another 10. Until final Forest Service approval then all bets are off because then it's done. We can build at Kotzin and they can build all their stuff. If Forest Service approval never comes, in 10 years we'll be able to have 70 homes at Ten X."
Sanderson said the agreement does not affect the development at Kotzin or Ten X properties but does give Stilo more flexibility to develop Camper Village. Stilo Spokesman Andy Jacobs said the agreement is a temporary solution to a long term goal for housing and development.
"Even though there isn't a road easement and it's not going to solve the problem, Stilo was open to working with the town to provide some land at Ten X to do some housing in the meantime," Jacobs said. "The town felt strongly that there were promises made by both the developer and by the council to citizens that there needs to be better housing opportunities in town. Stilo hasn't always gotten what it wanted from the town and I think the town has been very diligent on making sure that everything the town does is on behalf of the people who live there."
Because the 20 acres at Ten X are located on private property and the town does not intend to improve the existing dirt road or apply for easements for utility or electrical lines, Tusayan doesn't need easements from the Forest Service.
"Because of the quality of the road - it is not a paved road, but it's a decent road...we can use (it) without any approval from the Forest Service and we can build homes off the grid," Sanderson said. "In other words, they'll have to haul their water and use alternatives for electricity and propane for back up."
Sanderson said the town does plan to make the off the grid housing as comfortable and convenient as possible and said the town is considering options for providing utilities for the property.
During the special Tusayan council meeting, Clarinda Vail, a Tusayan resident and owner of Red Feather Lodge in Tusayan, questioned whether or not the town could commit future council members to possibly suing the Forest Service.
"I want to comment that this commits the town to appealing a Forest Service rejection no matter the grounds for that rejection, even if it wasn't caused by the town, even if it was caused by Stilo," Vail said. "The town will be contracting away its legislative discretion on whether or not to pursue legal action without any conditioning on the purpose or reasoning. To me this is bad policy for a public entity. I'm not even sure if you can commit the future board to that. If this provision were in place before the last Forest Service rejection the town would be stuck in litigation today, regardless if it was your fault or not."
Sanderson said he appreciated Vail's comments and said her concerns were legitimate, however, the town recognizes what they are committing to in this agreement.
"Obviously what is not shown in the second amendment is the intent, when we had our negotiations with the developer, in making it clear that our relationship as a town with the Forest Service is paramount," he said. "We would not want to do anything but (have) a positive relationship with them. We would want to give it every opportunity before we (would go) forward with litigation."
According to Sanderson, one reason the town wanted to get the agreement passed immediately was because of the possibility of President Barack Obama using the Antiquities Act to designate a proposed 1.7 million acres of the Grand Canyon Watershed as a National Monument. If that happens, Sanderson said it could be difficult to know how the designation would affect future development on the property.
"We are going to do what we can now... before that happens," he said.
On May 5, council members passed a housing authority guideline to determine who meets the requirements to apply for housing.
Sanderson said the next step will be preparing the land for development and going to the community to determine the interest and who qualifies for the housing.
"Twenty homes is a good start," Sanderson said. "It's something that we don't have today."