Michelle and Brendan Daly read the fine print before they bought their new Richmond American home in Chandler’s Saguaro Canyon.
But nowhere in the stack of documents they signed were they warned about a nearby city solid waste transfer station.
Now the Dalys and hundreds of other residents have discovered their homes were built near the city facility that is expected to expand when the adjacent landfill closes in October 2005.
"We knew the dump would be closing and felt pretty strongly that once the dump closed, the truck traffic slowed and the smell went away, it would really increase our property value," Michelle Daly said. "We thought it was a really good investment."
But developers did not disclose information as required by state law, leaving residents pleading with the city to stop the expansion.
State law requires developers to produce a public report describing the condition of the land, all utilities and adjacent land uses.
Builders must provide a copy of that report to prospective buyers before closing on a home.
Richmond American Homes, Fulton Homes and Morrison Homes are the three developers closest to the facility located near McQueen and Queen Creek roads. Of those, only Morrison disclosed the existence of the transfer station in its public report, but it failed to disclose the expansion plans.
The Arizona Department of Real Estate monitors developers to ensure state statutes are followed.
"If they had knowledge of the transfer station expansion when they produced their public report," said Arizona Department of Real Estate spokeswoman Liz Carrasco, "then they may face disciplinary action, but we would have to prove that they intentionally tried to defraud the public or intentionally left it out."
According to city documents, the expansion has been planned since the early 1990s. Records show developer representatives met with city officials at least twice in 2001 where the expansion was discussed.
Fulton, Richmond American, and Morrison filed their public reports in 2002, months after their representatives met with the city.
The Dalys purchased their Richmond American home in 2002 and said there was no mention of the transfer station in their public report.
It wasn’t until October 2003 that they learned of the expansion plan from a neighbor. Since then, the media has covered several protests and resident meetings with city officials.
"Now that they (the developers) know there’s been discussion about the transfer station, now that we know the city intends to use it as a transfer station (in the future), we ask that the developers still selling lots come in and amend their public reports to disclose that," Carrasco said. "If they don’t, then they may face disciplinary action."
As of Friday, Fulton, Richmond American and Morrison had not filed amendments to their public reports disclosing the expansion. They did not return numerous phone calls from the Tribune.
Lantana Ranch resident Sandi Nagel is among homeowners from Saguaro Canyon, Lantana Ranch, Cooper Corners, Alamosa Estates, and Cooper Greens who have flooded the city with calls and e-mails over the last few months and have attended City Council meetings seeking help from the city. She made calls to the city before she bought her home and said no one told her about the expansion, so she puts the blame on city as well as the developer.
"Ultimately, the developer has a responsibility to disclose," Nagel said. "The city had a responsibility to us. They had superior knowledge of something happening there and failed to disclose it."
Chandler spokesman Jim Phipps said the expansion has been discussed at numerous council and other public meetings through the last decade. Phipps said the city held meetings with developers in which they were told about the transfer station in 2001 when the city teamed up with them to produce a informational pamphlet about southeast Chandler.
"There were several occasions where the developers were told about the expansion," Phipps said. "It’s also been a part of our general plan for many years and our capital improvement program since 1992."
Richmond American Homes has had some trouble in the past with nondisclosure. The company was named in complaints filed in January 2003 in Maricopa County Superior Court for failing to disclose the Honeywell jet engine testing plant near its Windchimes development, also southeast Chandler. Those complaints were settled out of court.
Richard Gramlich, a partner at the law firm of Carmichael & Powell, P.C., said he has brought claims against Richmond American Homes in the past for nondisclosure of expansive soils and is currently in litigation with Fulton Homes for nondisclosure on an expansive soils case.
"You have to be able to prove that the developer knew or should have known this would adversely and materially affect the value of the property," Gramlich said. "If a reasonable buyer said they would not have bought had they known of the information, that’s material enough to prove it should have been disclosed."
DeWitt Gibson purchased a home in Fulton’s Lantana Ranch, which is 400 yards from the station, and said he never would have purchased the home had he known about the city’s plans. His real estate agent has since advised him that if he sells the property he must disclose the transfer station.
Carrasco said the state does not follow up on what developers put into public reports unless it receives complaints. To date, she said the state has received one complaint regarding Alamosa Estates.