An attorney for developer Philip Philippou is joining the state land commissioner in disputing the attorney general’s legal opinion that finds fault with a controversial
Just as important, attorney Ben Silva said, is that the AG opinion doesn’t allege any wrongdoing by Philippou.
Meanwhile, Attorney General Gary King is beginning to talk tough after first indicating that his office doesn’t plan to try to enforce the opinion in court. In response to Land Commissioner Pat Lyons’ Friday comments disputing the opinion, King said Saturday that his office will “wait to see what happens next and then decide our next course of action.”
“Again, if the land commissioner chooses not to take our advice on this matter, he does so at his own risk,” King said in a statement released by his office.
The formal opinion states that the issue of whether the agreement between the land office and Philippou’s Solo Investments is enforceable would have to be decided by the courts, and King’s spokesman said previously that another party that might have legal standing, such as the City of
The AG opinion states that the lease agreement’s method of compensating Philippou’s company for developing The Vistas at Presidio is “not comprehended by and in conflict with” a statute that allows developers who improve land for the state to be compensated only for the appraised value of the improvements. In the lease, the land office also agrees to compensate Philippou for other project costs and 40 percent of the change in value of the land as a result of the improvements.
‘Not some sweetheart deal’
The change in value of the land is where the profit from the deal is generated for both the land office and the developer, and Silva said there are currently at least eight other land office leases that compensate developers with a percentage of the change in value of the land.
At least one of those deals – Mesa Del Sol in
“This is not some sweetheart deal limited to Philip and his companies,” Silva said. “The contract in question… provides for the best return for the state of all the contracts that have been done this way.”
Silva said the statutes the AG opinion cites in taking issue with the deal all concern governance of the land office, not private developers.
“It does not allege that Mr. Philippou did anything wrong whatsoever, much less violate any law,” he said. “This is just something that was presented. He signed it. He didn’t violate any law.”
Silva: City doesn’t have standing to sue
Silva pointed out that the AG opinion is “but an opinion of one lawyer” and is “not legally binding.” He said he agrees with
The Las Cruces City Council is expected to discuss the possibility of challenging the land deal. Silva said such a challenge would “only harm the state’s education coffers.” He also said he does not believe the city has legal standing to challenge it.
That’s because legal standing only comes from being a party to the contract or an intended beneficiary, Silva said. The city successfully argued, in a recent legal fight with a water utility, that the utility was an “incidental” beneficiary, not an intended beneficiary. He said the city is now in the same situation – as an incidental beneficiary – in the land office agreement with Philippou.
He said a lawsuit by the city “would be contrary to the position they took just recently.”
The land in question is part of a 6,000-acre development on Las Cruces’ East Mesa that has been controversial in part because of financial contributions from Philippou that went to Lyons’ 2006 re-election bid around the same time Lyons bypassed his own bidding process for the land lease and gave the contract to Philippou.
In addition, frustrated residents who believe there wasn’t enough public involvement in city council deliberations about the project, which could double the city’s size within 20 years, overthrew the city council in the recent municipal elections.