A group of Phoenix area homebuyers says builder KB Home and its exclusive lender Countrywide, now owned by Bank of America, developed a scheme to sell homes at peak market prices even after real-estate values began to decline.

A lawsuit filed Thursday in U.S. District Court in Phoenix contends the builder and lender engaged in systematic appraisal-rigging to inflate by thousands of dollars the value of new homes sold since 2006. The plaintiffs, seven KB Home customers in Buckeye and Surprise, say the practice has cost customers millions of dollars and contributed to the recent flood of loan defaults and foreclosures.

KB Home and BofA representatives said they had not seen the complaint as of Thursday and could not comment.

The lawsuit arrives amid widespread resentment directed at lenders for practices perceived as predatory and at home buyers for taking on more debt than they could realistically afford. It is the latest in a series of lawsuits filed in Arizona and across the country to try to assess blame in the wake of the worst housing meltdown since the Great Depression.

In exchange for its participation with KB Home, Countrywide and its appraisal-management subsidiary, LandSafe, were made the exclusive providers of real-estate settlement services for KB Home, the suit says. They earned thousands of dollars per customer in loan-origination, title-insurance, appraisal and escrow fees.

The plaintiffs are seeking class-action status to add thousands more KB Home buyers nationwide. In the Southwest alone, at least 14,000 KB Home-built houses have been sold since 2006, the complaint says.

Inflated appraisals?

Many critics of the lending industry say inflated appraisals contributed to the nation’s economic crisis. The industry’s shift toward selling off mortgage loans as securities to investment brokers made lenders less concerned about the accuracy of appraisals, the critics contend, just as the rise of new incentives for mortgage brokers gave them more reasons to push risky loans on buyers.

Homebuilders sold their homes for higher prices, the banks profited from making and selling loans, and the mortgage brokers benefited from earning more commissions.

Some appraisers have said that they had to choose between playing along or losing the bulk of their business.

The Phoenix-area residents’ complaint, filed by their lawyer, Robert Carey, a former Arizona assistant attorney general, says the plaintiffs cannot be held responsible for their own lack of due diligence because participants in the homebuying transactions who presented themselves as disinterested third parties actually were in on the scheme.

That includes appraisers “who were under direct instruction to value homes at their contract price and were hand-fed inappropriate – if not outright false – comparable properties to use in completing their appraisals,” the complaint says. Reports written by different appraisers who should not have been communicating with each other or with KB Home relied upon the same “unverified information and patently faulty methodology,” the complaint says.

The complaint cites three common elements to the appraisals.

The first was “improper selection of distant, dissimilar properties” when there were “numerous available neighboring, identical comparable sales that would have revealed lower value.”

In addition, the complaint says, the appraisals contained identical “false and misleading statements regarding market factors and conditions” that ignored known facts about the housing market’s downward trajectory after 2005.

The third sign of a problem, the complaint says, was the use of pending KB Home sales as a basis for appraised value, “even when no sale was actually pending because the ostensible buyer had abandoned the transaction.”

On a more fundamental level, the complaint argues that the use of pending transactions raises a red flag because such information “would only have been known to KB Home” and the appraisers were not supposed to be conferring at all with the builder.

Other lawsuits

The lawsuit is the second filed against Countrywide and LandSafe this year by Carey’s law firm, Seattle-based Hagens Berman Sobol Shapiro, which also filed a similar case in Phoenix against Wells Fargo and its appraisal-management firm, Rels Valuation, in February.

A Wells Fargo representative said at the time that the lender’s process for obtaining home-loan proposals is legitimate.

Appraisers in Idaho filed a still-pending lawsuit in October against Countrywide, claiming the lender had pressured them to manipulate appraisals. A Countrywide representative at the time said that the lawsuit was without merit.

And a recent investigation of appraisals by New York Attorney General Andrew Cuomo prompted federally sponsored lending giants Fannie Mae and Freddie Mac to adopt new standards this month for the way appraisals are conducted.

The newest lawsuit describes the financial impact of KB Home and Countrywide’s appraisal maneuvers as “staggering.”

It contends that price inflation by the builder and lender is an average of $20,000 per home, which would have cost consumers $280 million in the Southwest region alone.

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Transaction process for home sales under fire

Participants in home-sales transactions at all levels have faced accusations of manipulating the process. Here’s a look at how it should work and what can go wrong.

Appraisers

What they do: Establish a property’s fair market value, which is used by banks as the basis for issuing a mortgage loan.

The right way: Produce an independent property-value estimate based on recent similar-sale transactions.

The wrong way: Seek out recent transactions that justify a predetermined price and ignore transactions that conflict with the desired price.

Lenders

What they do: Approve or deny a mortgage loan based on a property’s assessed value and the anticipated ability of a borrower to repay the loan.

The right way: Rely on independent appraisals to determine a prudent loan amount for a given property.

The wrong way: Pressure appraisers to set the value of a property at an amount desired by the loan broker or property seller.

Home builders

What they do: Sell new homes based on current market value.

The right way: Establish a sale price based on an independent appraiser’s estimated valuation.

The wrong way: Pressure the lender or appraiser to set estimated property value at a predetermined amount.

Source: The Arizona Republic

Public Involvement Specialist Angie Brown of Gordley Design Group has been elected president of the Grand Canyon Chapter of the International Association for Public Participation, an association of professionals who seek to promote and improve the practice of public participation at all levels of society. She will serve a one-year term. Brown is responsible for public involvement and community outreach for a wide range of projects, from transportation planning and design to construction.

The Southern Arizona Chapter of the Public Relations Society of America honored local professionals at the 14th annual PRimus Awards. The PRimus Awards recognize professionals in the communication field for their work on public relations campaigns and tactics. Jodi Horton, owner and president of IDEAS@WORK Inc., received the Lifetime Achievement award. Jan Howard, communications director at Strongpoint Public Relations, was named the Public Relations Professional of the Year. Lisa Lovallo, vice president and system manager for Cox Communication, received The Meritorious Service award.

The A List gives props to the Tucson business community’s movers and shakers. Send information to alist@tucsoncitizen.com

He also targets codes that encourages companies to “ship jobs overseas”

WASHINGTON – President Obama promised sternly on Monday to crack down on companies “that ship jobs overseas” and duck U.S. taxes with offshore havens.

It won’t be easy. Democrats have been fighting – and losing – this battle since John F. Kennedy made a similar proposal in 1961.

Obama’s proposal got a lukewarm response Monday from Capitol Hill. Sen. Max Baucus of Montana, the Democratic chairman of the Senate Finance Committee, said the plan needed further study, even though similar ideas have been around for years.

The president’s plan would limit the ability of U.S. companies to defer paying U.S. taxes on overseas profits. At the same time, Obama would step up efforts to go after evaders who abuse offshore tax shelters.

Obama said his plan would raise $210 billion over the next 10 years, though no tax increases would go into effect until 2011.

Lost revenue isn’t the only problem, Obama says. He contends the current system gives companies an incentive to invest overseas rather than creating jobs in the U.S. “It’s a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, N.Y.,” Obama said Monday.

The business community argues the deferral system helps it compete against foreign companies that pay taxes only in the countries where they generate profits.

Obama also proposed a package of disclosure and enforcement measures designed to make it harder for financial institutions to help wealthy individuals evade taxes in overseas accounts. Obama said the government is hiring nearly 800 new IRS agents to enforce the tax code.

Obama’s plan would impose billions of dollars in new taxes on many of the nation’s largest corporations, tax experts said.

Obama agreed to make permanent a research tax credit that would provide firms about $75 billion in breaks over the next 10 years.

Workers wearing bio-hazard protection suits as a precaution against swine flu clean a hallway at National Autonomous University of Mexico in Mexico City on Monday. Mexican officials lowered their flu alert level in the capital on Monday, and plan to allow schools, businesses, museums and libraries to reopen this week.

The H1N1 virus, better known as swine flu, continues to infect people across the globe, but there is a growing sense among public health officials that the newly evolved influenza strain is mild, at least for now.

Though there is still much to be learned about the strain, Richard Besser, acting director of the Centers for Disease Control and Prevention, says he sees encouraging signs that it is a mild form.

In the U.S., the hospitalization rate is only 0.7 percent, says Jon Andrus of the Pan American Health Organization: “That’s comparable to most seasonal influenza.”

That appears to be the case in New York, which, with 73, has the highest number of confirmed cases in the nation.

“We have looked daily at every hospital and every intensive care unit in the city,” says Thomas Frieden, New York City Health Department commissioner, “and we have yet to find a single patient with severe illness from H1N1.”

But that could change quickly at any moment, Andrus warns. “Influenza viruses are predictable in their unpredictability.”

Officials worldwide are watching carefully to see how the virus evolves during the winter flu season in the Southern Hemisphere, which begins in June.

“That will tell us a lot about whether the virus is changing, whether it’s becoming more severe and what measures we might want to take in the fall,” Besser says.

The World Health Organization’s figures for Monday were 1,025 cases with 26 deaths in 20 countries, says WHO flu director Keiji Fukuda. The majority of cases continue to be reported in Mexico, the U.S. and Canada, Fukuda says, and most cases in the other 17 countries are related to travel from those three countries.

That means that raising the world pandemic phase to 6 is unlikely anytime soon, he says. WHO raised the alert level to Phase 4 on April 27 and to Phase 5 on April 29. Phase 6 would indicate “a global pandemic is under way,” according to WHO.

Besser suspects that the level probably will be raised to Phase 6 at some point “given that flu viruses spread easily from person to person,” but he says that wouldn’t change the work CDC already is doing.

In the U.S., the CDC’s report for Monday was 279 cases in 36 states and one death: a toddler visiting Texas from Mexico.

As of Monday, more than 330,000 children were out of school in the U.S. because of closures as the result of actual or suspected cases of H1N1. Taken together, the students would make up the nation’s sixth-largest school district, the U.S. Education Department says.

The CDC is considering revising its original advice that schools with active cases of H1N1 close for up to two weeks, Besser says. That’s because most schools have clusters of the flu, he says, and that means the virus is “already pretty well-established in those communities,” so closing schools won’t stop its spread.

REVERE, Mass. – City councilors in Revere, just outside Boston, say police should be better prepared for large crowds descending on a local beach after thousands of students skipped school and headed there.

Authorities were caught off guard April 28 when as many as 4,000 teenagers playing hooky hopped on trains and descended on Revere Beach, considered the country’s oldest public beach. The temperature hit a record 93 degrees that day.

Local, state and transit police say they reacted as quickly as possible. But traffic was tied up on nearby streets for much of the day.

Six people were arrested, and one injury was reported.

Revere Council President Daniel Rizzo called Monday for coordinated police planning to avoid similar crowd and traffic problems in the future.

The Joaquin Brothers play at a 1963 prom at St. John's Indian School, a boarding school in Laveen, just south of Phoenix. The band members (from left) are brothers Daniel Joaquin, Fernando Joaquin and Angelo Joaquin Sr.

The annual Waila Festival is off for now, due to budgetary reasons. But a waila special on KUAT-TV on Monday may take the edge off.

“Waila! Making the People Happy” is a half-hour film by Quechan tribe member Daniel Golding about the Tohono O’odham social dance tradition. The show airs on Channel 6 at 10:30 p.m. Monday.

A cousin of the northern Mexican norteño tradition, waila features polkas, cumbias and Schottisches. But while the musical repertoire of both norteño and waila overlaps, waila is a strictly instrumental tradition, played by ensembles typically made up of saxophones, button accordion, bajo sexto (a 12-string rhythm guitar), electric bass and drums.

The main instrumentation and musical styles came from 19th century European settlers. But over the years the Tohono O’odham have put their own spin on the music and made it their own.

Typical waila dances run sundown to sunup, and the band has a repertoire to span that time period.

Tucson has gotten to know the waila tradition better through the annual Waila Festival, which began in 1989 and has in recent years been a May event on the University of Arizona campus. But with the economy in a bind, the money that the festival usually borrows from the Arizona Historical Society is just not there this year, according to festival co-founder Angelo JoaquinJr.

“It was a cash flow problem,” Joaquin explains. To Joaquin and the festival committee it would be too hard to get everything together for a spring festival this year. But the group sees the current problem as an opportunity.

“It’s time for us to regroup and look at what’s really important and where we want to go from here,” Joaquin says. “I hope that there is quite a bit of support out there and people will work to help us put it on again next year.”

In fact, there may be two events – one in late spring, the other in winter.

The committee is focusing on creating an indoor dance to highlight more the orchestral style of waila. To be held sometime between November and January, the event hopefully will be a draw for winter visitors who likely will be surprised to see Native Americans playing and dancing to polka music.

Breaking from Native American stereotypes was on the mind of filmmakerl Golding when he started making “Waila! Making the People Happy.”

Golding, 42, first heard the music as a child growing up on the Fort Yuma-Quechan Reservation along the California border of Arizona.

A magazine article jogged his memory of the music, which is also called Chicken Scratch. He started researching the project in 2000 and began shooting in 2002-2003.

He called on Ron Joaquin (brother of Angelo Joaquin Jr.) – a second-generation member of the pioneering waila saxophone band The Joaquin Brothers – and started attending the Tucson Waila Festival, as well as “battle of the bands” events.

“What was neat was just learning how a Native people have adapted this musical style to fit into their own community,” Golding says. “A lot of times it seems like we’re portrayed as living in the past, in movies and TV. This is an opportunity to really show how Native people have adapted something that was given to them, made it their own and created this new contemporary tradition. I think that’s very empowering for people to see and learn about the Native communities.”

Although the project mainly focuses on the Joaquin Brothers, it shows some of the other bands in the project, too, Golding says.

“Talking to people even around Phoenix and Tucson, they’re totally unfamiliar with the Indian people that live right there,” he notes. “It’s almost like this cultural divide right there. People don’t get to experience it even though it’s right there in their own backyard. This is an opportunity for people to step into their world visually and see and experience what’s going on.”

For more information on this and other Daniel Golding films visit hokanmedia.com. And don’t miss “Waila! Making the People Happy” on Monday night.

State lawmakers have pulled back on an effort to raid up to $210 million in development impact funds raised by cities and towns, but area officials say they are not convinced the issue has gone away.

The Pima Association of Government’s Regional Council aired the issue at its monthly meeting Thursday, with some members fearing that such an action could shred regional transportation improvement programs.

Impact fees collected by municipalities must be spent to lessen the effects of new development. The funds can be spent on roads, police and fire stations, and parklands.

The Legislature is facing a $3 billion deficit for the fiscal year that starts July 1. Senate leaders have vowed not to act on any bills until a 2009-10 state budget is passed.

That is one factor blocking floor votes on the proposal, which would hold back $210 million from state shared sales tax revenues owed to municipalities.

Municipalities would then have to replace those lost shared revenues with money from impact fees to maintain services funded by the state tax receipts.

“It’s impossible to fathom how they’re going to implement this,” John Liosotos, transportation planning manager for PAG, told Regional Council members.

Support for the proposal among legislators in limited, Liosotos said.

“Everything we hear is there is not a lot of support in either party,” Liosotos said.

But Oro Valley Mayor Paul Loomis voiced concern that the proposal could come back later in the legislative session, after the budget issue is settled.

The measure has the backing of the homebuilding industry in the state, whose members have called for a moratorium on development impact fees during the down market for new homes.

Bonnie White-McDaniel points out the repair work on the grandstand bleachers at Rillito Park Race Track. White-McDaniel is the daughter of Pat White, the general manager of the track.

Rillito Park Race Track will apparently get a reprieve, possibly as long as four years, while Pima County tries to come up with money to convert the North Side track to a soccer facility.

“At this point, that’s the only thing that’s saving us. They don’t have enough money to tear it down,” said Bill Matthews, who runs the nonprofit Save the Rillito Race Track.

Rillito has been on thin ice since the county supervisors agreed in 2006 to turn the track into an 18-field soccer complex. In 1984, voters guaranteed horse racing a home at the North First Avenue facility south of River Road for 25 years – through Dec. 31, 2009.

Shortly before the end of what was to be the track’s last racing season in February, County Administrator Chuck Huckelberry told the Pima County Horsemen’s Association it would likely be able to keep the track open for “three or four years,” said Pat White, the group’s president.

Huckelberry did not immediately return a telephone call seeking comment Thursday.

The prospect of having a 2010 season at Rillito had the Horsemen’s Association busy in recent weeks. The group poured $55,000 into painting and repairing windows, railings and stairways.

A crew of seven also screened in the grandstand to keep birds out and recoated the reflective roof, said Bonnie White-McDaniel, who supervised the work.

“We’ve been doing this for five weeks,” White-McDaniel said.

To prepare for the January start of the season, more repairs will be made this fall, she said.

The track opened in 1943 and is part of the nation’s “county fair” racing circuit. The five-eighths-mile oval features the first quarter horse chute, or starting system, in the nation.

The chute is on the National Register of Historic Places.

The 2009 season featured 11 days of racing on weekends in January and February. The track drew more than 9,000 fans on the next to last day and 10,000 on the final race day. It’s a likely attendance record, White said.

“We’ve had seven and eight before,” she said, “but never nine and 10.”

Funding for the soccer fields and a new race track at the Pima County Fairgrounds, on Houghton Road south of Interstate 10, would come from an unscheduled bond election.

The Horsemen’s Association has tried to find private backers for the track but none has emerged.

Who’d think chess could attract upward of 300 people to downtown?

Jean Hoffman would think that.

Her first Chess Fest last year at Hotel Congress, 311 E. Congress St., drew 200 to 300 people, and Chess Fest, from noon to 8:30 p.m. Saturday could bring in 300 to 500 people, said Hoffman, co-founder of 9 Queens, a local nonprofit that teaches chess to girls and at-risk youth.

Admission is free.

“Tucson is an emerging chess capital,” Hoffman said.

Catalina Foothills High School won the national high school team chess titles in 2005, 2007 and 2008, and Hoffman estimates 10 to 20 local schools send chess teams to Southern Arizona Chess Association events.

Catalina Foothills chess team members will have workshops for chess players of any level, Hoffman said.

The 2009 Arizona state chess champion, Levon Altounian, will speak at 2 p.m.

Chess Fest will offer speed chess matches, where players have 10 minutes to finish a game, from 1 to 4 p.m. Speed chess last year had 72 players, and Hoffman believes 100 to 150 will play this time. Registration is at noon or by e-mail at chessfest09@gmail.com.

“This is not a serious, intense competitive day,” Hoffman said. “The lessons are meant to be fun. A lot of people have chess phobia. We’re trying to get people over that. It can be a fun game.”

The fun will be evident at 5 p.m. with the Human Chess Match, where children age 5 through middle school age will enact chess figures on a life-size chess board behind Hotel Congress. More fun: City Council members Rodney Glassman and Karin Uhlich will face off across a chess board at 1 p.m.

Chess Fest also will have live music and an art exhibit at Maynard’s Market in the Historic Depot, 400 E. Toole Ave., across from Hotel Congress.

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Chess world loses former Catalina Foothills High champion

One of Catalina Foothills’ three-time team champions and 2006 national high school champion, Landon Brownell, 19, died April 21 when, while driving, he fell asleep at the wheel and crashed into a tree near Bakersfield, Calif. Mr. Brownell had reached national master level in chess and his death and career were prominently reported by the U.S. Chess Federation.

A proposal in the Legislature to tap into cities’ and towns’ development impact fee programs for up to $210 million to help cut into the state budget deficit has area officials challenging the legality of such a move.

Enough so that it will be discussed at Thursday’s Pima Association of Governments Regional Council meeting.

Impact fees are used by local governments to make transportation improvements to meet growth.

“An action that will undermine basic infrastructure is not a good idea,” Gary L. Hayes, executive director of PAG and the Regional Transportation Authority, said this week.

PAG is the regional umbrella agency for transportation, air quality and population issues. Members include Tucson, Pima County, Marana, Oro Valley, South Tucson and Sahuarita.

The RTA’s 20-year regional transportation plan is largely funded with a half-cent sales tax that would not be impacted by the state taking the impact fees.

But impact fees collected by member jurisdictions also go to fund RTA projects, and that money would be sorely missed if appropriated for state budgetary relief, Hayes said.

“I looked at it and it struck me as an impossibility,” lawyer Martin Willett, Pima County deputy administrator, said Tuesday.

Willett is the county’s point man on legislative issues. He has heard and seen few details about the proposal, which would allow the state to dun cities and towns for $210 million in state-shared revenues that would have to be made up through their development impact fee programs.

“I would say they have no legal authority to take impact fees already collected by cities and towns,” said Mike Rankin, Tucson city attorney.

The city and most local jurisdictions have development impact fee programs where money collected from developers is used for road, park and sewer facilities improvements.

The enabling statutes approved by the Legislature in the past stipulate that fees collected for improvements made necessary by growth be used in the specific geographic areas of the new development.

“The only legal option for us is to use those fees for improvements needed because of the developments,” said Jason Baran, state and federal relations coordinator for the Tucson Office of Intergovernmental Relations.

Details of how supporters of the action would justify taking the impact fees were unclear, enough so that a planned state hearing on the proposal Tuesday was canceled pending more study.

Backers of the proposal have said it would involve the state holding back $210 million in state-shared revenues from cities and towns this coming fiscal year. The affected communities would have to replace those detoured funds from their impact fee coffers.

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Impact fee links:

Tucson impact fee pages: http://www.tucsonaz.gov/planning/prog_proj/projects/cost/index.html#TopOfPage

Pima County: www.dot.pima.gov/transsys/impactfees/

Oro Valley: www.ci.oro-valley.az.us/BLDSFTY/PDF/Oro%20Valley%20Fee%20Schedule.pdf

Marana: www.marana.com/DocumentView.aspx?DID=312&DL=1

South Tucson and Sahuarita do not impose impact fees.

Tucson may see higher bus fares after all.

Almost a year after rejecting a fare increase proposed by the Transportation Department, the City Council voted Tuesday to have an ordinance created that would raise regular fares to $1.25 from $1.

The vote on the ordinance will occur after a public hearing scheduled for June 2, City Attorney Mike Rankin said.

The council voted unanimously to have Rankin draw up the ordinance, although Councilman Steve Leal took pains to ensure that he was not voting to raise rates.

“There’s parts of this that I do not support,” he said.

Leal later explained that among his concerns was the availability of economy passes at places along bus routes.

Tuesday’s motion was put forward by Councilwoman Nina Trasoff and seconded by Councilwoman Karin Uhlich, who spearheaded opposition to the increase last summer based on questions about data supporting it.

The new proposal advanced the recommendations of the citizens’ committee that was created after the proposal last summer was voted down.

The group advised raising regular rates to $1.25, increasing day passes to $3 from $2 and raising express passes to $1.50 from $1. The group did not recommend an increase for the economy fare but supported more long-term planning.

Transportation Director Jim Glock told the council that not raising fares last summer under a slightly different schedule caused a $2 million loss to the mass transit fund for the fiscal year that ends June 30. He was responding to a question from Councilman Rodney Glassman, who supported the increase last year.

The talk of fee increases widened divisions among council members about how to keep the city in the black.

Leal is a vocal supporter of regular fee discussions in the council. Others including Uhlich advocate considering an index system that would incrementally raise fees over time, ideally avoiding sudden and sharp increases. A proposal to have the directors of departments in which fees are supposed to cover operating costs set the rates also was floated Tuesday.

Trasoff said she understood the council’s role as setting policy on how to adjust fees. In the other camp, Leal said that would be an abdication of responsibility of elected officials and a compromise to the transparency and accountability council members say they have been pushing.

A proposal to increase golf fees amplified the debate. The fees of the golf program are supposed to cover the city’s costs, but this fiscal year, the golf fund was short $1.5 million.

The council voted unanimously to have an ordinance increasing the fees drawn up for a later vote.

Also Tuesday, an increase in water rates that would amount to about an extra $1.80 a month tacked onto the bills of 90 percent of Tucson Water users moved a step closer to reality.

Officials emphasized the $11 million in spending cuts Tucson Water has put in place and the low price of city water compared to bottled water. With the increase, a gallon of tap water would still cost one-tenth of a penny, Director Jeff Biggs said.

“I think it’s a pretty good deal for our customers,” he said.

The increase would generate a 10 percent increase in water rate revenue.

City Manager Mike Letcher hopes to acquire warehouses like these on the northeast corner of East Toole and North Stone avenues for the Warehouse Arts Management Organization.

New City Manager Mike Letcher was out of the loop with Rio Nuevo during the Mike Hein era, even though Letcher’s office shared a wall with the city manager’s for nearly the full life of Rio Nuevo.

So Letcher did not offer any grand announcement about Rio Nuevo to start his tenure as the city’s top bureaucrat.

Hein had personally taken charge of Rio Nuevo and did not keep his deputy apprised of project details.

“I was not involved in Rio Nuevo,” Letcher said of his eight-year stint as deputy city manager. “I was involved in internal operations management. What I’m doing is making sure I know what’s going on.”

Letcher answered all Rio Nuevo questions with a prepared statement he submitted for a Tucson Citizen interview

“The mayor and council are taking great steps to get Rio Nuevo aligned with expectations of the state legislature,” Letcher wrote. “We are doing all the right things to ensure that Rio Nuevo will continue to improve our downtown.”

When asked specific questions in a brief interview, Letcher responded: “I’ll stand on the previous statement.”

“At this point in time, (Assistant City Manager) Richard Miranda and I are just getting up to speed on all the projects and progress,” he said.

As deputy city manager, Letcher was directly involved in negotiations with the Arizona Department of Transportation to acquire the state-owned warehouses along Toole Avenue. Several are occupied by artists with month-to-month leases, and Letcher’s intention is to acquire them for the Warehouse Arts Management Organization.

During 2008, the city was trying to arrange a land swap by giving the state three city-owned properties in exchange for about two dozen warehouses, but that swap fell through, Letcher said.

“We have another (property) that ADOT wants that’s gaining traction,” Letcher said. “There is a gap between what the value of the warehouses is and the property ADOT wants to secure from us.”

To compensate for a precipitous drop in sales tax revenue, City Manager Mike Letcher has proposed $17.4 million in new or increased taxes and millions more in new or increased fees.

The largest chunk, estimated at $10 million in Letcher’s recommended budget, would come from a 2 percent tax on residential rental property.

The tax, which needs City Council approval, would apply to residential property owners with more than three such rental units in Arizona, at least one in Tucson, says a fact sheet from the Finance Department. Properties rented as public housing would be included.

The new levy would mean that renters who pay $600 a month would likely have to pay another $144 a year, the budget states.

Landlords would be responsible for getting a business license and collecting the taxes, and they would be audited as the city audits any business, officials said.

The tax has been criticized as regressive, a burden to the poorest made all the heavier by an economic recession.

U.S. Census Bureau statistics for 2005-2007 show that about 42 percent of the more than 94,000 Tucson households that rent pay $500 to $749 a month.

More than 41 percent of Tucson renters pay more than 35 percent of their monthly income on rent, compared to about 19 percent of city mortgage holders, according to the bureau.

City officials note that property tax rates for rental and owner-occupied homes have changed since the 1970s, when the city last imposed a rental tax.

Under the new system, both types of properties are taxed at equal levels.

The cost of the property tax, however, is likely still passed to renters.

The city already imposes a 2 percent tax on commercial rentals.

Tucson tried to add a rental tax in 2004 but backed away after 1,000 people rallied by the Arizona Multihousing Association protested.

The association again opposes the tax, leaving pamphlets at apartment doors and setting up a site – www.norenttax.com – that urges Tucsonans to show up at the council’s public hearing Tuesday at the Tucson Convention Center. The meeting begins at 5:30 p.m.

Courtney LeVinus, president of Capitol Consulting, which handles lobbying and governmental affairs for the trade group, said last week, “The AMA has always seen this as an unfair and regressive tax and we don’t support it under any circumstances.”

Linda Ronstadt (left) performs with Jesus "Chuy" Guzman of Mariachi Los Camperos de Nati Cano during the Mariachi Espectacular concert at the Tucson Convention Center on Friday night.

Even for the always-amazing Tucson International Mariachi Conference, last night’s Espectacular was one for the books.

The 3 1/2-hour show was a cavalcade of the breadth and heights of mariachi artistry.

It was nostalgic for me personally. The first Espectacular I reviewed for the Citizen back in 1988 had Linda Ronstadt as the headliner, hot on the heels of the release of her “Canciones de Mi Padre” record. Back then, a sea of Bic lighters swayed in the darkness as she sang. Friday night the lighters were replaced by cell phones, but the emotion and sense of connection was the same.

Ronstadt performed five songs, ably backed by Los Camperos de Nati Cano.

Though it’s not as easy for the 62-year-old singer to breeze through the vocal acrobatics of this repertoire as 21 years back, plainly the music has grown deeper and more meaningful in her heart.

And she still has the pipes to pin ears, tempered with the grace to evoke waves of emotion in her audience.

Ronstadt’s “stand and deliver” stage style was a stark contrast from Eugenia Leon, who made the concert stage a theatrical venue with her lithe interpretation of classic ranchera fare. A singer of full-bore power and silky nuance, she embroidered her songs with dramatic gestures, fluid movements and natural dance impulses.

Like an operatic diva, Leon is at heart a storyteller, but as a singer, she is also someone who finds a unique perspective on well-known fare. On “La Bruja” in particular, her phrasing was as supple as her silk blouse, the dreamy character of her singing amplified by tango-like accordion accents and Los Camperos’ sensitive backing.

It was a huge night for Los Camperos, which was the MVP in every respect of last night’s show. After leading the workshops all week and rehearsing with the two guest singers, the recent Grammy-winning ensemble managed to make its own set one of the best it’s ever delivered in Tucson.

Proud and heroic, tender and suave, the mariachi poured on chops to rival any of the best ensembles in the classical world.

Blessed with the perfect voice to match every style in the massive mariachi repertoire, Camperos proved equally flawless instrumentally. Its violins pulsed with the singular regularity of a helicopter blade, its trumpets blazing like lasers. Similarly its rhythm section proved as tight and driving as any the genre has produced, while cherubic musical director Chuy Guzman’s arrangements balanced sophistication with intensity and emotion.

Camperos’ performance of “El Pastor” in particular was a thing of sheer luminosity.

Mariachi Vargas de Tecalitlán upheld its reputation as the best mariachi in the world, even with close competition.

Perfect on both vocal and instrumental fronts, blessed with the best charts in the business, what sets Vargas apart these days is sheer showmanship and an ability to take an audience on a cinematic ride.

Every song in the set, whether in quick medley form or full-length treatment, was carefully calculated to build a sort of dramatic architecture.

By the time Los Camperos came out to join Vargas in Pepe Martinez’s “Violin Huapango,” the audience was at a frenzied level of excitement.

Camperos and Vargas seemed evenly matched in the tune, trading licks in carbon copies and fanning each other to incandescent intensity.

If it turns out to be my last Espectacular, what a way to go.

SATURDAY’S EVENTS

What: Mariachi Mass

When: 9 a.m. Saturday

Where: St. Augustine Cathedral, 192 S. Stone Ave.

Admission: Free

What: Fiesta de Garibaldi

When: 10 a.m. to 10 p.m. Saturday

Where: Reid Park

Admission: $5 (12 and under free)

Schedule:

10:30 Ballet Folklorico Davis Bilingual School

11:00 Mariachi Davis Bilingual School

11:30 Mariachi Anacatlan

12:00 Mariachi Pumas

12:30 Mariachi Mixteco

1:00 Mariachi Nuevo Melodia

1:30 Mariachi Los Charritos

2:00 Mariachi Tesoro de Tucson

2:30 Mariachi Imperial de San Diego

3:00 Mariachi Los Tigres

3:30 Mariachi Los Vaqueros

4:00 Mariachi Brillante

5:00 Mariachi Los Changuitos Feos

5:45 Mariachi Los Mineros

6:30 Mariachi Master Apprentice

7:15 Mariachi Sonido

8:00 Mariachi Aztlán de Pueblo High School

8:45 Mariachi Los Arrieros

Members of Mariachi Vargas de Tecalitlán perform during the show.

Margarita Sandoval (left) and her boyfriend Owen Sully dance during the concert.

Talent overflows as kids get to show what they learned in workshops

Isabella Bryant (left), 8, and Karina Romero, 7, of Mariachi Aguilitas de Davis perform during the showcase concert on Thursday at the Tucson Convention Center.

The Mariachi Espectacular concert always gets top billing, but to this writer, the real show happened Thursday night.

Though the Tucson Convention Center Arena was only around half full, the spacious joint was brimming with talent as the students who attend the Tucson International Mariachi Conference workshops got to strut their stuff.

It was a big night for the Valenzuela family in particular. Alfredo Valenzuela, who heads the mariachi program at Davis Elementary School, was inducted into the Mariachi Hall of fame. His group, Mariachi Aguilitas de Davis, was up first and full strength, with some 70 talented youngsters chiming out “Mexico Lindo,” “Tata Dios” and “Cancion Mexicana” in style. A group of his graduates called Mariachi Nueva Melodia made an impressive debut on the show, as did son Jaime Valenzuela’s Mariachi Tesoro.

Mariachi Aztlan de Pueblo High School set the high water mark in a strong lineup. The group barreled through taxing arrangements with aplomb, wowing the crowd with a set that showed its grasp of the music’s roots, as well as its sophisticated branches. A practically classical trio tossed into the set set the audience on its ear.

Mariachi Mixteco from El Centro, Calif., won the hearts of Tucson with its soulful version of Lalo Guerrero’s “Barrio Viejo” and an equally joyous rendition of his “Cancion Mexicana.”

Mariachi Brillante Juvenil showed it’s grown into its name in every respect. Polished, suave and precise, it had chops to match its stage presence. The dedication to Jose Rincon, who was killed in a car wreck last year, tugged the hearts of all who recall his special talents.

David Gill’s Los Potrillos de Cholla High School was second only to Mariachi Aztlan in poise, showmanship and crisp virtuosity from every sector. Likewise Mariachi Apache from Nogales High School, under the direction of Gilbert Velez, brought commanding style and powerful vocal talent to its too-short set. And former Tucsonan Adam Romo’s Mariachi Los Vaqueros from Las Vegas, Nev., made a powerful impression, both instrumentally and vocally.

With each passing year, this showcase makes more and more evident the strides young people are making in this music.

My sole complaint is the absence of folklorico dancers at the show. They too are vital participants who deserve a showcase. Let’s fix this.