Local News

Was the Stilo Water Proposal Just a Legal Dodge?

June 15, 2013

By Michael Scerbo

Italian Developer Stilo’s subsidiary missed yet another deadline to come up with a water supply for its massive development plan that would add three million square feet of commercial space and thousands of homes to the environmentally fragile area at the doorstep of the Grand Canyon.

Now it appears the whole water plan just exists on paper until Stilo can change the terms of the deal it cut with the Tusayan Town Council.

Stilo subsidiary Tusayan Ventures kept asking for and getting extensions from the Arizona Corporation Commission for a Certificate of Convenience and Necessity (CC&N), something that is required before forming a water company.

Stilo is in default of the development agreement it reached with the Town of Tusayan because the CC&N and the proposed water company have failed to get off the ground.

New filings indicate the whole concept exists on paper just to satisfy the development agreement.

On June 12th Stilo lawyer Garry Hayes wrote this letter to the Corporation Commission asking for an extension so that the CC&N could exist on paper long enough for Stilo to get the CC&N requirement dropped from the development agreement.  

As you are aware, Tusayan Ventures LLC (“TV”) filed for a new Certificate of Convenience and Necessity (“CC&N”) in December of 201 1. This CC&N was filed because an affiliate of TV, Stilo Development Group USA (“Stilo”), had entered into a development agreement with the Town of Tusayan that required a new CC&N to be filed within thirty days of the signing of the development agreement. TV understands that it does not have the information necessary for Staff to determine that the filing is sufficient under the rules of the ACC. TV would not have filed this new CC&N when it did but for the requirement by the development agreement. Stilo is currently in negotiations with the Town to remove the requirement to file for the CC&N. It is Stilo’s and TV’s understanding that this process should take less than 60 days. TV would respectfully request that Staff grant a 60 day extension so that Stilo can remove the language from the development agreement. Once that language has been removed, TV will file a request in this docket to withdraw the application.

A letter from Tusayan Town Attorney William Sims filed June 14th hints that the Town of Tusayan is working on a deal with the Italian developer that would let Stilo off the hook for the CC&N.

The undersigned, as Town Attorney for the Town of Tusayan (the “Town”), is currently negotiating an amendment to the current Pre-Annexation and Development Agreement between the Town and Stilo Development Group USA (“Stilo”), an entity affiliated with Tusayan Ventures. Under that agreement, Stilo was required to file for a CC&N within 30 days after the Town and Stilo entered into the Pre-Annexation and Development Agreement in 201 1. While there are still several issues to be worked out, upon the resolution of those issues, I am confident that we can agree on an amendment that will relax the requirement which caused the CC&N filing so soon in the process.

This begs the question, was the whole CC&N along with promises of a water supply just an act when Stilo negotiated with the Town Council for a development agreement? Because right now Stilo is asking for an extension, not because they want to build a water company, but because they need a little time to weasel out of the deal the developer struck with the Town, and the residents of Tusayan.