That brings us back to Superstition Vistas -- the most significant piece of the state lands in question. Over the next 50 years, the sale of land in this area alone could generate at least $9 billion for the trust fund, according to the State Land Department. And development here would increase Phoenix's urban area by about one-third, unleashing billions of dollars as homes, businesses, schools and parks for another 1 million people are built.
In 2002, Charles Backus, then the new president of the East Valley Partnership -- a coalition of community leaders from the eastern suburbs of Phoenix -- began the charge to plan that development. The Land Department, however, lacked the funding, staff or expertise to do sophisticated planning for even small parcels of state land, let alone a 275-square-mile project. Backus suggested that the private sector and municipalities initiate the process with the State Land Department involved as needed. The department held monthly meetings where the "stakeholders" laid out the framework for transforming state trust land from desert to concrete. A steering committee was formed, made up of business leaders, elected officials and Arizona real estate veterans. The committee also brought in nonprofit conservation and planning groups, including the Lincoln Institute of Land Policy and the Tucson-based Sonoran Institute.
The land is actually ideal for the project, according to John Shepard, deputy director for strategic programs and advancement for the Sonoran Institute. That's because it's "not ecologically significant" and lies near existing transportation corridors, including freeways, a regional airport and a rail line. Rather than cover it with strip malls and parking lots and cookie-cutter garage-burbs, the group sees an opportunity to plan a series of New Urbanism-style walkable villages that can respond to climate change and slash water use. "We have a hunch there is a way to build a community that will have amazingly better results than we have seen so far," says Armando Carbonell, senior fellow at the Cambridge, Mass.-based Lincoln Institute.
"Superstition Vistas is pretty innovative," says Rosemary Shearer, executive director of the Superstition Area Land Trust, a conservation group seeking to protect 25,000 acres of the state-owned desert foothills from development. "It is acknowledging that growth is going to come. Like it or not it is going to come, so we should be planning for it."
The steering committee commissioned the Morrison Institute to prepare a $200,000 study, written by Phoenix real estate attorney Grady Gammage, that offered different scenarios for best developing the state land. The report, released in April 2006, included three overarching visions for the land, each of them more environmentally sustainable than Phoenix as it currently exists. It also suggested innovative ways to guide the area's growth. More importantly, the report provided intellectual justification for the further expansion of landlocked cities onto state trust land.
"The East Valley cities recognized their future was tied to expansion onto state trust lands, and they wanted to have a plan to make that happen," says Glen Collins, a former deputy state land commissioner.
Even as Gammage wrote the report, the state was already moving forward with the sale of the first parcel of land for Superstition Vistas, 1,030 acres known as Lost Dutchman Heights. Though the housing bubble was already showing signs of a leak -- Phoenix home prices peaked in June 2006 -- there were good reasons to bid high on the land. The developer who bought Lost Dutchman Heights, Land Department officials said in published interviews, would be in a key position to develop the rest of the Superstition Vistas, a project worth tens of billions of dollars.
Among the companies clamoring for that opportunity was Actus Lend Lease Communities, a multinational corporation. Actus had been brought on by the Land Department in late 2005 to develop plans and engineering for the Lost Dutchman parcel. Shortly thereafter, Actus hired Gammage as a legal consultant, a position he continued to hold even as he wrote the Morrison Institute report. Gammage says he was open about his position with Actus Lend Lease, revealing it to the Land Department, the Morrison Institute, East Valley Partnership and others. "It was disclosed to all, and they felt no conflict presented," he says. But his dual roles were never disclosed to the public, so the report's readers had no idea that the author developing scenarios for selling off state-owned property was also working with a developer who was seeking to buy some of that very same property.