During a meeting of the Navajo County College District Governing Board on Tuesday, the board approved a decision to allow Northland Pioneer College to take over the operation and control of the Northeastern Arizona Training Center (NATC) in Taylor. The facility has been used as a training facility for both fire and law enforcement agencies from the region for the past 10 years.
A letter from the other four key stakeholders of NATC was submitted to the board in November 2014 requesting that ownership and the autonomous operations of the law enforcement training facility be transferred permanently to NPC. Those stakeholders include the Town of Taylor, the Navajo County Board of Supervisors, the Northeastern Arizona Fire Chiefs Association and the Northern Arizona Police Association.
It was noted by NPC Vice President of Administrative Services Blaine Hatch that while the stakeholder letter requested that NPC own the facility, it is a non-profit organization and as such cannot be “owned” by the persons that started it. It belongs in its entirety to the public at-large. “A nonprofit corporation cannot be sold. It is simply not possible. If a nonprofit corporation were to close down, or dissolve, the board of directors of the nonprofit must distribute all of the nonprofit’s assets to another nonprofit corporation after all debts have been settled,” he explained.
The facility consists of a burn tower and buildings that were financed through a Greater Arizona Development Authority (GADA) loan that is handled by the Town of Taylor, with $302,000 remaining to be paid. With the transfer to NPC would come the obligation to pay the remaining amount owed on the outstanding loan, with the option to continue with payments or to make payment in full. The board also had the option to decline the offer.
It was recommended by staff that the college take over operations and pay off the GADA loan balance of $302,150, which would result in an estimated $22,647 in interest charges.
Board member Prescott Winslow asked about the ongoing cost of the facility and the unusual circumstances that involve operating a facility not owned by the college.
Hatch initially estimated that the annual support services cost for the facility would be about $124,000 for maintenance of the facility, utilities, grounds keeping and so forth.
After some discussion Hatch revised that estimate, believing it would actually fall below $100,000 annually.
“How will the revenues for using the NATC be enough to cover the expenses? It sounds like it’s asset rich, but cash poor. What would be the liability to cover the cash shortfall?” asked Winslow.
Hatch admitted that it would be an expense that the college would have to pick up, but that operating the facility served a greater purpose within the community. “It will help us as an education provider, but we will have to pay for this. We operate well below our revenue stream and set aside funds for capitol development. This would be folded into that,” he explained.
Board member Frank Lucero asked what the college would have to cut next year to accommodate the funds used for the facility.
Hatch stated that he saw no cuts especially associated to the facility. “We need to assess how we grow programs. We go back to the strategic plan and this is a component of that,” noted Hatch.
It was addressed by Winslow that in taking over NATC, they were taking on a sort of “hybrid.” “The auto and welding buildings are owned and controlled by private owners; we are the tenants. Custodial and utilities are something we (NPC) pay. For NATC, their money pays their own bills, correct?”
Hatch agreed, adding that NATC has its own board, three members selected by the college board, one of which is Hatch. He explained that that NATC would have its own financials with its own line items separate from the college.
Winslow sought to clarify that the college was not bailing out the facility. “NATC does not operate any programs. We have science and the police academy, so we want to make this justifiable,” he said.
“My sense is that since 2012 this has been something we’re responsible for. We need to decide if yes, we are, if not then there are liabilities. If we have plans and expectations, then we do have a responsibility. NPC is owned by the public and NATC is owned by the public, in both cases this board decides,” stated Hatch.
Lucero indicated that he felt the college was taking on something that rightfully should fall under the purview of Navajo County. “This should go to Navajo County and we continue as we have been. For Navajo County, it’s their benefit. I think this is a conflict of interest,” Lucero stated, questioning Hatch’s involvement as both a board member of NATC and an employee of NPC.
“NPC operates and controls NATC. I am an employee of NPC,” replied Hatch, reiterating that if the strategic plan is something that is valued, then an investment must be made in order to provide for the communities.
Winslow explained that he was hopeful that the revenues earned from using the facility would cover the debt. “Since we won’t own the facility, we can’t decide what happens to it, if we want to continue operation or make changes like we do with other facilities. But I actually do support taking control of the facility and paying it off,” he concluded.
Lucero asked if NATC is planning to raise tuition to cover costs.
Hatch said that it is a possibility, but that he didn’t recommend it at this point. “We need to understand the value of the membership of the users. Any increase in membership cost is simply a shift. NPC won’t have the debt, but the fire district would or another user,” he explained.
Board member James Matteson stated that it seemed a moot point, noting, “We already have it. We’re just affirming the current operational model.”
The majority of the board agreed, with Matteson, Winslow and Chairman Ginny Handorf voting in favor of the measure, Lucero voting against it and Daniel Peaches abstaining from the vote.
The board then voted 4-1 to approve payment in full of the $302,150 loan balance for the facility, with Lucero opposing it.
