NOTICE: NOT FOR PUBLICATION.

UNDER ARIZ. R. SUP. CT. 111(c), THIS DECISION DOES NOT CREATE LEGAL PRECEDENT

AND MAY NOT BE CITED EXCEPT AS AUTHORIZED.

IN THE

ARIZONA COURT OF APPEALS DIVISION ONE

U-HAUL CO. OF ARIZONA, an Arizona corporation; FREIGHT SALES, 

INC., an Arizona corporation dba AUDIO EXPRESS; and EDWARD 

SANTACRUZ, as Trustee of the Edward Santacruz and Nancy Santacruz 

Revocable Trust dated 10/27/94, Plaintiffs/Appellants,

v.

CITY OF TEMPE, an Arizona municipal corporation; EL FENIX, LLC, an 

Arizona limited liability company; EL FENIX II, LLC, an Arizona limited 

liability company, Defendants/Appellees.

No. 1 CA-CV 13-0073

Appeal from the Superior Court in Maricopa County

No. CV2011-008946

The Honorable George H. Foster, Judge

AFFIRMED

COUNSEL

BRYAN CAVE LLP, Phoenix

By Steven A. Hirsch, Stanley B. Lutz

Counsel for Plaintiff/Appellant
2

Tempe City Attorney’s Office, Tempe

By Judith R. Baumann, Catherine M. Bowman, Clarence E. Matherson, Jr.

Counsel for Defendant/Appellee City of Tempe

Gammage & Burnham, P.L.C., Phoenix

By Richard K. Mahrle

Counsel for Defendants/Appellees El Fenix

MEMORANDUM DECISION

Judge Jon W. Thompson delivered the decision of the Court, in which 

Presiding Judge Andrew W. Gould, and Judge Peter B. Swann joined.

T H O M P S O N, Judge:

¶1 In this appeal from a statutory special action, 

plaintiffs/appellants U-Haul Co. of Arizona, Freight Sales, Inc. dba as 

Audio Express, and Edward Santacruz (collectively Appellants) appeal 

from the superior court’s decision in favor of defendants/appellees City of 

Tempe (the City), and El Fenix, LLC and El Fenix II (collectively the El 

Fenix entities). The court found that the City did not act in an arbitrary or 

capricious manner or abuse its discretion when the Tempe City Council

approved a rezoning application, a General Plan Amendment, and a 

Planned Area Development (PAD) Overlay, dismissed two other counts 

alleging the City violated the gift clause of the Arizona Constitution and

violated Arizona Revised Statutes (A.R.S.) § 9-402 (2008), which requires 

cities and towns to seek bids before selling any property, and concluded

that the City’s approvals conformed to the General Plan. For the 

following reasons, we affirm. 

FACTS AND PROCEDURAL HISTORY

¶2 U-Haul Co. and Audio Express own and operate businesses

on adjoining parcels north of property owned by the El Fenix entities on 

Scottsdale Road in Tempe.1 South of and adjoining the El Fenix property 

 

1 Santacruz is the Trustee of the Edward Santacruz and Nancy 

Santacruz Revocable Trust dated 10/27/94, which owns the property on 

which Freight Sales, Inc operates Audio Express. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

3

is a sliver of land owned by the City located along the banks of Tempe 

Town Lake (the Sliver Parcel). The El Fenix property and the Sliver 

Parcel comprise the Hayden Harbor Property. 

¶3 In October 2010, the El Fenix entities applied for 

amendments to the City’s Zoning Map and General Plan, as well as a PAD 

overlay, in anticipation of developing seven high-density and mixed-use 

towers on the property. The application incorporated the Sliver Parcel

into the proposed development, and the City of Tempe, as owner of the 

Sliver Parcel, was a co-applicant. U-Haul and Audio Express filed a legal 

protest against the project.2 They raised concerns about increased traffic 

congestion along Scottsdale Road adjacent to their properties and claimed 

they would be subject to particularized harm because their property 

already suffered from extreme traffic congestion and vehicle stacking as 

well as impaired access from Scottsdale Road, in that vehicles could make 

only a right turn into their premises and a right turn exiting their premises

traveling south and could not access the location at all traveling north.

They further claimed that the project would impair their historical ingress 

and egress over the Fenix property to reach a signalized intersection south 

of their property at Playa del Norte and Scottsdale Road, noting that they 

had proposed they be given a perpetual easement over the El Fenix 

property, but that the El Fenix entities had not agreed. 

¶4 The Development Review Commission held public hearings 

on January 25, 2011 and February 22, 2011, and the Tempe City Council 

held public hearings on March 10, 2011, and March 24, 2011. U-Haul and 

Audio Express appeared and testified at each hearing. They requested 

that the City require as a condition of approval that the El Fenix entities

give U-Haul and Audio Express a permanent easement to allow access to 

their properties from the Playa del Norte intersection. The Mayor 

expressed concern that such a condition would convey a gift of value 

without compensation to the City in violation of the gift clause of the 

Arizona Constitution. The traffic engineer for El Fenix entities opined that 

the driveway U-Haul was seeking would create a potential safety hazard 

on the property. U-Haul asserted that granting such a condition was 

appropriate for the safety of the public; however, the Mayor expressed the 

view that the benefit sought was more for the convenience of the 

businesses north of the project than it was for public safety. 

 2 When a legal protest is filed, a zoning map amendment must be 

passed by a three-fourths vote of the Tempe City Council. Tempe Zoning 

& Dev. Code § 6-502(C). 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

4

¶5 On March 24, 2011, the Tempe City Council, by a 7-0 vote, 

adopted Resolution No. 2011.06, amending the City’s General Plan with 

respect to the Hayden Harbor Property from open space to mixed-use 

high density and passed Ordinance No. 2011.05 amending the Zoning 

Map to designate the Hayden Harbor Property as a Mixed-Use High 

Density District with a Planned Area Development Overlay (collectively 

the March 2011 Development Approvals). The City Council imposed 

certain conditions on the project, but did not impose a requirement that UHaul and Audio Express be given an easement across the El Fenix 

property. 

¶6 Appellants filed a special action pursuant to A.R.S. § 9-

462.06(K) (2008) seeking review of the City’s decision. Appellants’ fourcount complaint claimed that the City’s decision was arbitrary, capricious 

and an abuse of discretion; that the City had included the Sliver Parcel in 

the project and bestowed on the El Fenix entities benefits in the form of 

tax credits, rebates, and waivers arising from a Development and 

Disposition Agreement (DDA) with Playa Del Norte, L.L.C., the El Fenix 

entities’ predecessor developer, and that such benefits constituted illegal 

subsidies under the Gift Clause of the Arizona Constitution; that by 

allowing the Sliver Parcel to be incorporated into the project, the City had 

transferred the Sliver Parcel without competitive bidding in violation of 

A.R.S. § 9-402; and that the effect of the City’s adoption of Resolution No. 

2011.06 and Ordinance No. 2011.05 was a compensable regulatory taking 

of their properties. Appellants sought an injunction to enjoin enforcement 

of the resolution and ordinance. 

¶7 The City filed a motion to dismiss Appellants’ claims for

violation of the Gift Clause and for failure to obtain competitive bidding 

before transferring the Sliver Parcel, asserting that the claims were moot

or not ripe for adjudication. The City argued that the complained-of 

benefits in the Playa DDA expired in 2005 by the terms of the DDA itself, 

so any promises of benefits in that agreement were null and void, and that 

the Sliver Parcel could not be the subject of a Gift Clause violation because 

the City of Tempe still owned the property. Tempe also argued that, 

because the Sliver Parcel was still owned by the City, Appellants’ claim 

that the City had transferred it without competitive bidding failed. 

Appellants responded that the status of the benefits under the Playa DDA 

was not dispositive and that the actions of the City in allowing the Sliver 

Parcel to be rezoned in support of the project without receiving 

comparable consideration supported the claim for a violation of the Gift 

Clause. Appellants further argued that in allowing the Sliver Parcel to be 

incorporated into the project, the City effectively precluded compliance 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

5

with the fair bidding requirement. The court granted the City’s partial 

motion to dismiss, finding that the counts were not ripe for adjudication. 

¶8 The parties submitted briefs on Appellants’ claim that the 

City acted arbitrarily. Appellants argued among other things, that City

acted improperly by being a co-applicant with the El Fenix entities. 

Appellants asserted that the project could not proceed without the Sliver 

Parcel, owned by the City, and that the City therefore had to transfer the 

Sliver Parcel to the El Fenix entities or enter into a joint venture

agreement, but did not. Appellants contended that the City acted as a coapplicant to avoid taking the necessary proper steps to transfer the 

property because they were problematic. Appellants argued that by 

approving the redevelopment plan and the zoning under these 

circumstances, the City abused its discretion. Appellants further argued 

that the City acted arbitrarily by not mitigating the adverse impacts the 

project would have on U-Haul and Audio Express, particularly regarding 

increased traffic and lack of access to the Playa Del Norte intersection, that 

the March 2011 Development Approvals did not conform to the City’s 

General Plan and did not consider the impact on the Salt River Outfall 

Interceptor, a regional pipeline running under a portion of the El Fenix 

entities’ property that transports wastewater to a treatment facility, and

that the City Council failed to make findings on the record as required by 

the Zoning Code.

¶9 The court rejected Appellants’ arguments regarding the 

Sliver Parcel, noting that the site plan was conceptual and subject to 

change and concluding that the premise that the Sliver Parcel was 

necessary to the rezoning and to the project was not supported by any law 

or evidence. The court found that the City Council’s decision not to 

impose an easement on the El Fenix entities for the benefit of Appellants

was not an abuse of discretion, noting that the Council had considered the 

concerns regarding the traffic and recognized the negative impact, but had

indicated an intent to address the concerns during the project 

development process. The court also found the Council had legitimate

concerns regarding granting an easement from one private property 

owner to another private property owner without compensation. The 

court rejected Appellants’ claim that the rezoning did not conform to the 

General Plan, finding that the record supported the Council’s approval. 

The court noted, however, that the Council had not made findings on the 

record as required by the Tempe Zoning and Development Code, and 

ordered the Council to make the findings. The City Council made the 

findings and filed them with the court. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

6

¶10 The court denied Appellants’ motion for new trial, and 

stayed any proceedings on Appellants’ claim for a regulatory taking. The 

court’s judgment included language pursuant to Rule 54(b), Arizona Rules 

of Civil Procedure. Appellants appealed. We have jurisdiction pursuant 

to A.R.S. § 12-2101(A)(1) (Supp. 2013). 

DISCUSSION

¶11 Appellants first argue that the trial court erred in dismissing 

their claims that Tempe violated the Gift Clause and the statutory 

requirements for the sale of property. 

¶12 We review a decision granting a motion to dismiss de novo. 

Coleman v. City of Mesa, 230 Ariz. 352, 356, ¶ 7, 284 P.3d 863, 867 (2012). 

We accept as true the facts alleged in the complaint and will affirm the 

dismissal only if the plaintiff would not be entitled to relief under any 

interpretation of the facts susceptible of proof. Fidelity Sec. Life Ins. Co. v. 

State, 191 Ariz. 222, 224, ¶ 4, 954 P.2d 580, 582 (1998). We do not, however, 

accept as true conclusions of law or unwarranted deductions of fact. Folk 

v. City of Phoenix, 27 Ariz. App. 146, 150, 551 P.2d 595, 599 (1976). We 

resolve reasonable inferences in favor of the plaintiff. McDonald v. City of 

Prescott, 197 Ariz. 566, 567, ¶ 5, 5 P.2d 900, 901 (App. 2000). In reviewing 

the decision, we may consider documents attached to the pleading 

because such documents are not “outside the pleading” under Rule 

12(b)(6), Arizona Rules of Civil Procedure. Strategic Dev. & Contr., Inc. v. 

7th & Roosevelt Partners, L.L.C., 224 Ariz. 60, 63, ¶ 10, 226 P.3d 1046, 1049 

(App. 2010). 

¶13 Appellants’ Count II alleged that the March 2011 

Development Approvals violated the Gift Clause of the Arizona 

Constitution because of tax credits, rebates, and waivers contained in the 

Playa DDA and because the Approvals included the Sliver Parcel. 

¶14 The Arizona Constitution directs that no city, town, or 

municipality can “give or loan its credit in the aid of, or make any

donation or grant, by subsidy or otherwise, to any individual, company, 

or corporation.” Ariz. Const. art. 9, § 7. A government entity violates the 

Gift Clause when it receives inadequate consideration for the expenditure 

of public funds such that the transaction constitutes a gift or subsidy to a 

private entity. Turken v. Gordon, 223 Ariz. 342, 349, ¶ 30, 224 P.3d 158, 165 

(2010). 

¶15 Appellants argue that they adequately stated a claim for a 

Gift Clause violation based on the inclusion of the Sliver Parcel in the 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

7

March 2011 Development Approvals. They contend that their complaint 

adequately stated that the Sliver Parcel was a necessary component of the 

development project and that the City of Tempe received no 

compensation or consideration from the El Fenix Entities for using the 

Sliver Parcel. 

¶16 The Sliver Parcel has not, however, been used in the project. 

As alleged by Appellants, the Sliver Parcel is owned by the City of Tempe. 

That ownership has not been altered by the rezoning of the parcel along 

with the El Fenix entities’ property. Even if the Sliver Parcel is a necessary 

component of the project,3 the City has not as yet transferred the Sliver 

Parcel to El Fenix entities. There has as of yet been no expenditure or 

conveyance by the City requiring consideration. 

¶17 Appellants also contend that they stated a valid current 

claim for a Gift Clause violation based on tax credits, rebates, and waivers 

contained in the Playa DDA. They argue that the court wrongly 

considered unsupported factual allegations that the Playa DDA was void

and assert that the continuing validity of the DDA is irrelevant to whether 

the complaint adequately stated a claim. 

¶18 Appellants not only attached a copy of the Playa DDA to the 

complaint, but also expressly incorporated that document by reference. 

The court could therefore properly consider it, as it was not outside the 

pleadings. See Strategic Dev. & Contr., Inc., 224 Ariz. at 63, ¶ 10, 226 P.3d at

1049. In Section 5.5.1 of the Playa DDA, the parties recognized that the 

development was economically feasible only by the City of Tempe 

waiving “fees for all planning and building plan check fees, excavating 

and grading fees, engineering fees, and building permit fees.” In Section 

5.5.2 the parties acknowledged that the development would be 

economically feasible only by the City of Tempe granting “a sales tax 

rebate of the City’s share of construction sales taxes . . . and excise sales 

taxes.” Both sections limited the benefits “to projects for which the City 

issue[d] a building permit within twenty four (24) months of the effective 

date” of the agreement. The date of the agreement was August 21, 2003. 

Appellants’ complaint recognized that Playa did not develop the 

property. Consequently, any commitment to benefits in the form of tax 

 

3 This assertion has been repeatedly refuted by El Fenix entities, 

which has stated that the drawings used for the proceedings showing use 

of the Sliver Parcel were conceptual only and that the project could 

proceed without the Sliver Parcel. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

8

credits or fee waivers expired in August 2005 under the plain terms of the 

Playa DDA. Therefore, Appellants could not maintain a claim based on 

the waivers or tax credits included in that agreement. 

¶19 Appellants also argue that the court wrongly concluded that 

their claim that the City of Tempe violated A.R.S. § 9-402 was not ripe. 

That section provides that a city or town may sell or convey all or any part 

of its real or personal property, but must first issue a public invitation for 

bids. A.R.S. § 9-402(A), (B) (2008). Appellants contend the March 2011 

Development Approvals effectively transferred control of the Sliver Parcel 

to the El Fenix Entities without the City of Tempe having complied with

the bid requirement. Appellants acknowledge that the City of Tempe has 

not actually transferred the Sliver Parcel to the El Fenix entities. The 

Appellants assert though that the March 2011 Development Approvals 

have precluded fair bidding because the Sliver Parcel has been rendered 

useless to any potential bidder other than the El Fenix entities.

¶20 The court properly found Appellants’ claim to be premature. 

Because the City of Tempe has not sold or conveyed the Sliver Parcel, it 

cannot have violated a statute requiring bidding before a sale or 

conveyance. What might be done with the Sliver Parcel in the future is 

speculation. At this time, the failure to invite bids on property prior to a 

sale or conveyance cannot be a violation when no sale or conveyance has 

occurred.4 

¶21 Appellants ask this court to remand the matter with 

directions allowing them to amend their complaint. Appellants’ claims of 

violations of the Gift Clause and of § 9-402 are not susceptible to 

amendment. They are based either on a transfer of the Sliver Parcel, 

which has not occurred, or on benefits provided in the Playa DDA, which 

have expired. Amendment under these circumstances would be futile. 

See Bishop v. State, 172 Ariz. 472, 474-75, 837 P.2d 1207, 1209-10 (App. 1992)

(court does not abuse discretion in denying a motion to amend where 

amendment would be futile). 

 4 The City also argues that, as a Charter City, it is not subject to the 

requirements of A.R.S. § 9-402. See City of Tucson v. Arizona Alpha of Sigma 

Alpha Epsilon, Inc., 67 Ariz. 330, 335, 195 P.2d 562, 565 (1948). Because we 

find that the statute is inapplicable because Tempe has not conveyed the 

Sliver Parcel, we do not address this alternative argument. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

9

¶22 Appellants assert several bases on which it argues that the 

Tempe City Council acted arbitrarily and capriciously with respect to the 

March 2011 Development Approvals. 

¶23 In making zoning decisions, a municipal body acts in a 

quasi-administrative and legislative role. Town of Paradise Valley v. Gulf 

Leisure Corp., 27 Ariz. App. 600, 605, 557 P.2d 532, 536 (1976). In reviewing

such decisions, courts are limited to determining whether the decision is 

arbitrary or capricious, or an abuse of discretion. Murphy v. Town of Chino 

Valley, 163 Ariz. 571, 574, 789 P.2d 1072, 1075 (App. 1989). The reviewing 

court cannot substitute its opinion for that of the municipal body. Id. If 

credible evidence supports the decision, the decision must be affirmed. 

Austin Shea (Arizona) 7th St. & Van Buren, L.L.C. v. City of Phoenix, 213 Ariz.

385, 392, ¶ 29, 142 P.3d 693, 670 (App. 2006). 

¶24 Appellants contend that the City improperly acted as a coapplicant with the El Fenix entities.5 They argue that the project cannot 

be built without the Sliver Parcel, that the City was therefore required to 

transfer the Sliver Parcel to the El Fenix entities, and that because the 

means of transferring the Sliver Parcel would run afoul of the Gift Clause 

and A.R.S. § 9-402, the City acted as co-applicant to allow the El Fenix 

entities to obtain rezoning for the project. 

¶25 Appellants’ argument is based on the faulty premise that the 

Sliver Parcel was necessary to the project. Even if the parties intend that it 

become part of the development, the testimony before the City Council 

was clear that the development proposal at this stage is conceptual only. 

The representative for the El Fenix entities told the City Council that they 

were at the beginning of the planning process, that they were not sure 

what the site plan would be, and that as they moved forward they would 

determine where the buildings would be placed. The record does not 

 5 The City argues that Appellants have waived this issue by not 

raising it before the City Council. See Englert v. Carondelet Health Network, 

199 Ariz. 21, 26, ¶ 13, 13 P.3d 763, 772 (App. 2000) (appellate court 

generally does not consider issues raised for the first time on appeal).

Appellants, however, were not required to raise the matter before the City 

Council before challenging the ordinance in court. See Manning v. Reilly, 2 

Ariz. App. 310, 313, 408 P.2d 414, 417 (App. 1965) (one need not exhaust 

administrative remedies to challenge an invalid zoning ordinance). 

Appellants did raise the issue in superior court. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

10

support the assertion that the project cannot proceed without the Sliver 

Parcel. 

¶26 Furthermore, the City still owns the Sliver Parcel, and 

Appellants offer no authority to suggest that the City cannot apply to have 

its own property rezoned, whether it does so independently or in 

conjunction with another applicant. 

¶27 Appellants further argue that the City acted arbitrarily and 

capriciously by failing to require the El Fenix entities to give them an 

easement across the El Fenix property as a condition of approving the 

March 2011 Development Approvals. Appellants had raised concerns 

about increased traffic congestion on Scottsdale Road with cars stacking 

up in front of their properties. They sought to have permanent access 

across the El Fenix property to reach a traffic light at Playa Del Norte and 

Scottsdale Road south of Appellants’ property.6 The City Council did not 

impose the requested condition for an easement. The Council did not 

abuse its discretion. 

¶28 Section 6-601 of the Tempe Zoning and Development Code

provides: 

The decision-making body may impose conditions on any 

approval. Such conditions shall be designed to implement 

the requirements of this Code, protect the public from 

potential adverse impacts from the proposed use or 

development, or to fulfill an identified need for public 

services. 

Under this provision, the City Council may impose conditions on 

approval but is not required to do so. 

¶29 The provision is intended to apply to protect the public from 

negative impacts from a development. Despite Appellants’ assertion that 

the City Council acted arbitrarily in not imposing the condition in light of 

the potential drastic impact of the project on the traveling public, 

Appellants do not explain how the easement they requested would ease 

the anticipated traffic congestion or benefit any members of the public 

 

6 Although Appellants refer to being allowed “continued” access 

across the El Fenix property, they have no actual easement and have not

asserted prescriptive rights. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

11

other than their businesses and their customers. The Mayor recognized 

this discrepancy, noting that traffic studies showed only twenty or thirty 

vehicles entering and exiting the U-Haul property per day, expressing 

skepticism that the easement would change the traffic congestion in any 

way, and concluding that the requested easement would provide value to 

U-Haul and Audio Express only. Both the Mayor and another councilman 

expressed concern about imposing a condition on one private party for the 

benefit of another private party. The Mayor also suggested that a more 

appropriate time to address and resolve traffic issues would be at a future 

date when an actual design for construction on the site was being 

prepared. 

¶30 In addition, the traffic consultant for the El Fenix entities

acknowledged that traffic was congested and that the development would 

have a major impact on future traffic conditions at three intersections in 

the area, including the intersection at Playa Del Norte and Scottsdale 

Road. That consultant also testified, however, that the easement 

requested by Appellants would create a potential safety hazard because 

vehicles traveling on the proposed easement would have to join an 

existing queue at the development’s driveway waiting for the light at the 

intersection. 

¶31 The record here contains evidence to support the City 

Council’s decision to not impose an easement on El Fenix entities for the 

benefit of Appellants. The City therefore did not abuse its discretion in 

denying Appellants’ request. 

¶32 Appellants also argue that the City Council failed to 

consider the impact of the proposed development on the Salt River Outfall 

(SRO) Interceptor, a pipeline located on the Hayden Harbor Property and 

operated by the Subregional Operating Group (SROG). This claim lacks 

merit. 

¶33 The March 2011 Development Approvals included seven 

conditions, one of which provided: 

Prior to final acceptance of the request to relocate the Salt 

River Outfall (SRO) Interceptor and its easement, located 

near the northwest portion of the property, the Sub-Regional 

Operating Group (SROG) Advisory Committee of the Joint 

Municipal Water Reclamation System shall review the 

request to make a determination of approval on any changes 

related to the interceptor. This approval shall be completed 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

12

prior to issuance of any building permits which may affect 

the area within the easement of the SRO Interceptor. 

Clearly, the City Council considered the SRO Interceptor and addressed 

any concerns by requiring approval by SROG before the City will issue 

building permits on any project. 

¶34 Appellants also argue that the City Council abused its 

discretion because it failed to make required findings under the City’s 

Zoning and Development Code. Under Section 6-502(B), “findings of fact 

justifying the decision shall be noted for the record.” Tempe Zoning & 

Dev. Code § 6-502(B). A zoning ordinance enacted without substantial 

compliance with statutory requirements is void. Manning v. Reilly, 2 Ariz. 

App. 310, 313, 408 P.2d 414, 417 (App. 1965). 

¶35 The City Council here failed to make findings at the time of 

its decision. The Council did, however, comply with the substantive 

requirements of § 6-502. The Council conducted public hearings, gave the 

applicants the opportunity to explain the project, gave the protestors the 

opportunity to explain their opposition, applied the appropriate standard 

requiring a three-fourths majority for approval because of the legal 

protest, and rendered its decision. Tempe Zoning & Dev. Code 6-502(A), 

(B), (C). Although the City Council failed to make the required findings 

for the record at the time, it has since done so, and Appellants have raised 

no argument finding fault with those findings. Given the Council’s 

compliance with the procedural requirements in the conduct of the 

hearings, we view the failure to make its findings at the time of the 

hearing to be a technical failure, now remedied, that does not require 

finding the ordinance void. 

¶36 Appellants also argue that the March 11 Development 

Approvals do not comply with the City’s General Plan and therefore the 

City Council abused its discretion in adopting them. They also contend 

that the rezoning violates the policies and intent behind the General Plan. 

¶37 The Tempe Zoning and Development Code provides that no 

General Plan Amendment shall be approved unless it substantially 

conforms to the following criteria: 

1. Appropriate short and long term public benefits; 

2. Mitigate impacts on land use, water infrastructure of 

transportation; 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

13

3. Helps the city attain applicable objectives of the 

General Plan; 

4. Provides rights-of-way, transit facilities, open space, 

recreational amenities or public art; 

5. Potentially negative influences are mitigated and 

deemed acceptable by the City Council; and 

6. Judgment of the appropriateness of the amendment 

with regard to market demands, and impacts on 

surrounding area, service, fiscal, traffic, historic properties, 

utilities and public facilities. 

Tempe Zoning & Dev. Code § 6-302(D). Without elaborating, Appellants 

assert that the March 2011 Development Approvals do not substantially 

conform to any of these criteria. 

¶38 According to the development plan presented to the 

Council, the completed project, on land currently vacant, would stimulate 

the economy of the area. A development including office space, shops, 

restaurants, and entertainment facilities would increase demand for 

commercial services on and off-site, increasing the City’s tax base. The 

project intended to provide access to the open space and recreational 

amenities of Town Lake and to create a garden-like environment with 

pockets of open space. These features conform to the stated criteria. 

¶39 In addition, the Tempe General Plan 2030, adopted in 2003, 

projected that the area in question would be mixed-use. The Staff 

Summary Report (SSR) for the City Council’s March 24 hearing noted that 

the requested amendments would more accurately align the properties 

intended for development from those properties intended to be open 

space, consistent with the General Plan. In explaining why the rezoning 

would be in the public interest and why it would conform to and facilitate 

the General Plan, the SSR stated that the rezoning would be consistent 

with the General Plan Land Use maps and provide the property with 

necessary infrastructure and improvements that benefit Tempe’s goal for

development around Town Lake. In recommending approval of the 

General Plan Amendment, Zoning Amendment, and PAD Overlay, the 

SSR expressly found that the request met the criteria. Specifically, the SSR 

found that the project met the Projected Land Use and Projected 

Residential Density for the site under the General Plan and that the 

Zoning Amendment was compatible with similar projects around the 

Tempe Lake vicinity. 
U-HAUL et al. v. TEMPE et al.

Decision of the Court

14

¶40 The record contained adequate evidence from which the 

City Council could conclude that the requested amendments were 

consistent with the General Plan. This court is not in a position to second 

guess the City in making such a decision. See Murphy, 163 Ariz. at 574, 789 

P.2d at 1075. 

¶41 Appellants also assert that, because the project was not 

intended to begin vertical construction until 2015, the City Council’s 

decision violated a development policy for the Rio Salado Specific Area 

Plan, which provided: 

Land speculation is strongly discouraged. Developers 

should be prepared to begin substantial (i.e. vertical) 

construction of at least the first phase of any project within 

two years of Council approval. 

The City Council imposed a condition on the El Fenix entities requiring 

them to complete a building permit application by February 24, 2015, with 

the intent to commence construction, or the zoning could revert back to 

open space. The Council thereby allowed the El Fenix entities two years 

longer than the policy indicates. 

¶42 The policy does not impose a mandatory deadline requiring 

developers to build within two years; rather it states that applicants

“should be prepared” to build within two years. The policy also does not 

constrain the City Council from modifying the deadline. The Council here 

was advised that the Rio Salado Specific Area Plan applied, as evidenced 

by a copy of the policies being included in the SSRs for both the March 10

and March 24 hearings before the City Council. Although it does not 

appear that the policies were discussed at either hearing, the Mayor noted 

in another context that funding for the project in the existing economy 

would be difficult. He also noted that the owners were attempting to 

bring the property out of a bad financing situation involving bankruptcy 

so they could move forward toward development, which would benefit 

the community. We cannot find that the City Council’s decision to allow 

time in excess of the Rio Salado Specific Area Plan policies was an abuse 

of discretion. 

CONCLUSION

¶43 We affirm the superior court’s dismissal of Appellants’ 

claims for violation of the Gifts Clause and for failing to invite bids for the 

sale of the Sliver Parcel. Appellants’ claims fail because the City did not 

transfer the property and because the alleged gifts under the Playa DDA
U-HAUL et al. v. TEMPE et al.

Decision of the Court

15

have expired. We find no abuse of discretion in the City Council’s 

approval of the General Plan Amendment, the Zoning Amendment, and 

the PDA Overlay. We further find that the record supports the conclusion 

that the March 2011 Development Approvals conform to the General Plan. 

The superior court’s ruling is affirmed.