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Revolting Development

New city regs trigger a $12 million claim--and a test of a property-rights law passed by voters last year


If you walk along Adams Street near Third Avenue, you see a new cluster of housing that local residents have taken to calling Goodmanville.

The two-story hulks, set back just a few yards from the sidewalks, create an ugly streetscape of garage doors and upstairs balconies.

Developer Michael Goodman's high-density "mini-dorms"--which push the housing and building regulations to the limits of density--aren't popular with many of the members of the Feldman's Neighborhood Association, located northwest of the University of Arizona.

"Like most of the longtime residents, I hate them," says Feldman's resident Diana Lett. "Mr. Goodman feels that it's right to put up any atrocity he wants in our neighborhood with no regard at all to history, the context, the privacy of neighbors or the affect of density."

Lett and many of her neighbors fear that Goodman will extend his rental empire by demolishing aging bungalows to make way for the gargantuan rentals on the other property he owns in the neighborhood, which is bounded roughly by Speedway Boulevard, Euclid Avenue, Lee Street and Stone Avenue.

Karolyn Kendrick, co-chair of the association's neighborhood preservation committee, complains that "Mr. Goodman doesn't listen to anyone."

The neighborhood has always included renters and students, says Kendrick, but Goodman's developments threaten to ruin the character of the neighborhood by "taking advantage of the city's very badly written land-use code. They claim these are single-family residences when really they're dormitories. They're rooming houses where they're renting by the room."

Like a master monopoly player, Goodman has acquired several other houses in clusters along Speedway, Euclid Avenue and Helen, Mabel and Drachman streets--and neighbors fear he will soon exercise the opportunity to replace the homes with not shiny red hotels, but more of the blocky mini-dorms.

Goodman's plans remain unclear; through his attorney, Russell Krone, Goodman had no comment about his developments.

But earlier this month, the Tucson City Council took steps toward delaying any immediate demolition of more central-city buildings without a historic review.

Goodman responded to the new ordinance with a $12 million claim against the city, saying the regulations had decreased his property value.

Goodman made his claim under the Private Property Rights Protection Act, which voters passed as Proposition 207 last November. The new law requires government to compensate landowners if new regulations somehow decrease property values.

Clint Bolick, a Maricopa County attorney eager for a test case regarding Prop 207, filed the $12 million claim on Goodman's behalf. He says that under the law, Goodman is free to build whatever he pleases as long as it's within existing regulations.

"This is a classic Proposition 207 claim," Bolick says. "The city has decided that it wants to preserve a certain neighborhood and has imposed heavy regulations on the property owners within that neighborhood. The city is free to do that, but it is not free to single out the property owners within that neighborhood to bear the cost of those regulations."

City Attorney Mike Rankin maintains that the city is on solid legal ground.

"The demolition code provision was properly adopted by the mayor and council after a public hearing, and it does not trigger any compensation claims under Prop 207," says Rankin.

The city may have found a loophole in the law: Rather than amending the zoning code, the council amended the building code. The new regulations stop short of giving the council the power to deny a demolition permit. But anyone who wants to tear down a midtown home that's 45 years or older must now do a historical inventory and allow the city a chance to acquire the property.

The new regulations are one step in an ongoing effort by the city to regulate the development of "mini-dorms" and other high-density infill development that destroys neighborhood character and quality of life.

Ward 3 City Councilwoman Karin Uhlich is pushing the idea of an Neighborhood Preservation Zone that neighborhoods could opt into, but the city is still trying to determine how to create new regs that don't trigger a challenge under Prop 207.

"We're following the city attorney's advice on this approach and don't believe that it is something that triggers a Prop 207 claim," Uhlich says. "I think the opposite could be argued, that we're protecting property values by retaining the historic character of neighborhoods."

While the legal wrangling continues, residents like Diana Lett worry about the impact of Goodman's rentals on their own property values, along with their neighborhood character.

"Mr. Goodman's activities may reduce the property value of single-family residences in our neighborhood," Lett says. "We're very pleased that the Tucson City Council has finally taken some baby steps toward protecting us. They did that in response to our desperate pleas that they do something to stop the bulldozing of our neighborhoods."

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