Board debates 4 Peaks building costs and lease as AC failures and subsidies mount

Board members spent an extended portion of the meeting discussing recurring HVAC failures and operating losses at 4 Peaks, a district‑owned property currently leased to outside tenants. The discussion balanced legal landlord obligations against continuing maintenance subsidies for a building that does not house district students.

Facilities staff described a pattern of AC failures concentrated in a tenant area used by a watch‑manufacturing operation that had installed HEPA filters and negative‑pressure controls. Those modifications increase load on older rooftop package units; facilities staff said some units run 24/7 to support the tenant's clean‑room requirements. Facilities and operations estimates for replacing package units ranged from roughly $9,000–$15,000 per unit depending on whether an existing unit can be repurposed or must be replaced.

The board discussed whether rent levels cover costs: trustees noted some tenants pay as little as $720 per month and that the district has paid roughly $69,000 for AC maintenance and repair over recent years while also covering janitorial and custodial costs. Trustees questioned whether continued investment is prudent while the district also faces other capital needs and possible use of bond proceeds. One trustee asked whether the district is inadvertently giving a "gift of public funds" by subsidizing private tenants under the Arizona Constitution; the board said the issue will appear on a future agenda with the district attorney present.

Tenant notification and recordkeeping issues were raised: trustees asked that tenants submit maintenance requests through the district's FMX work‑order system so that work is documented, and facilities staff agreed to insist on that process going forward. Facilities staff also agreed to seek competitive bids for major replacement work and to review alternative contractors after trustees raised cost‑concerns about high‑priced vendors. The board did not vote on any expenditure during the discussion.

Next steps: staff will return with precise quotes for required HVAC replacements, a reconciliation of 4 Peaks operating receipts and expenses, and an agenda item on lease strategy and potential disposition or re‑negotiation of tenant agreements.