Town Attorney Cautions Board

These are the real facts.  Unvarnished.  Provable.  Truthful.” 

An attorney for the Town of Carefree has contacted the North Boulders Homeowners Association (BHOA) attorney in response to the recent community-wide email titled “Additional Statement by the BHOA Board of Directors Regarding the Town of Carefree’s Lawsuit Against our Association”.

This is not the first time the Town has sent such a letter in response to statements from the current Board, but it is the first time that Carefree Unity has been able to read or republish one.  The Town’s statement is very direct, and it calls out long-running and apparently false Board narratives including the claim that the water tank would benefit a possible resort development across the street (at the corner of Tom Darlington & Carefree Highway).  It also provides a robust rebuttal to a variety of personal attacks made against Town officials and others.

Carefree Unity strongly recommends that anyone trying to develop a fact-based opinion on the water tank issue as well as anyone wishing to cast an informed vote in the upcoming BHOA Board elections read the Town’s letter completely and carefully.

Here is the full text of the letter (with attorney contact information removed):

Craig A. Morgan

Sherman & Howard L.L.C. 

Direct Dial Number:


February 3, 2022


Beth Mulcahy 

Mulcahy Law Firm, P.C. 

3001 E. Camelback Road Suite 130 

Phoenix, Arizona 85016 



Dear Beth:

As you know, my name is Craig A. Morgan, I am a lawyer with Sherman & Howard L.L.C., and this firm represents the Town and its Mayor, Les Peterson, and other town officials in their official capacities. 

Our understanding remains that your law firm represents the Boulders HOA generally, so I am sending this correspondence to you as the Boulders HOA’s legal counsel. We expect that you will forward this correspondence to your client. 

On January 31, 2022, the Boulders HOA posted the January 2022 Statement. As with some of the Boulders HOA’s prior publications, this latest publication is packed with inaccuracies, innuendos, and dangerous defamatory accusations. The purpose of this correspondence is to set the record straight and again caution your client to refrain from willfully making false and misleading statements about those individuals referenced in the January 2022 Statement. 

Since we have already corresponded about the law prohibiting the defaming of the Town’s public servants, I will not recount that law again here. Instead, I will directly address the January 2022 Statement and its myriad of inaccuracies. 

It seems clear to the Town that the January 2022 Statement is motivated by the Boulders HOA’s (or those aligned with its confusing and selfish agenda) repeated losses in courts throughout Maricopa County. Indeed, the Boulders HOA and those aligned with its agenda have wholly failed to obtain relief from two Superior Court judges and six appellate judges (who have rejected emergency stays prohibiting construction). Given the legality of the Town’s effort to bring much needed and updated water service to a thousand of the Town’s citizens to ensure their health and safety for years to come, its seems the Boulders HOA has elected to wage a campaign of misinformation so as to manipulate the narrative – perhaps to justify the thousands of HOA dollars misspent to prevent life sustaining water from reaching the Town’s citizens. 

The following points are worth clarification: 

1.       The provision of water to a thousand Town residents is a “legitimate public purpose” because the health and safety of all of the Town’s residents is and will always be of paramount concern.

2.       The Boulders HOA directors are not qualified to meaningfully judge or question the Town’s effort to address Town-wide issues affecting all residents. Residents at the Boulders represent about 15% of the Town’s population. Those residents matter. But so do the remaining 85% of the Town’s residents. The Town must do what is in the best interest of all residents, not just the vocal few who are wary of the construction of a modest water tank in an open area where doing so is the most effective and economical option for all Town taxpayers.

3.       The Town has never “admitted” to anyone, including “bond purchasers”, that the site at issue is not needed to upgrade water services to the Boulder’s neighbors in need. The site at issue has always been the most optimal site for purposes of system performance, affordability, and minimal neighborhood disruption. No other possible location exceeds this site in those metrics. What the Town has said, from the beginning, is that there are other much less optimal locations that could be used to provide these critical water services. Any other possible location would be more costly, perform less optimally, and require weekly entry into an actual occupied neighborhood for routine maintenance and repairs – all of which would require a rate increase for all of the water system’s customers to accomplish. You can see why any other option, on balance, would not be preferred when weighing the needs of the Town as a whole (as opposed to a vocal minority of a 15% minority of residents who want to preserve a small patch on otherwise untouched open space).

4.       There have been studies supporting the Town’s need for the site. To state that “[t]he Town admitted no such study exists” is simply false. Engineering studies were disclosed. And additional studies were performed. But those additional studies contain proprietary, confidential and highly sensitive infrastructure information that, for purposes of health, safety, and security, cannot be made generally available. To allow them to be openly wielded would place this very critical infrastructure at risk of sabotage or other unlawful activity.

5.       The new site will not provide water to, or benefit, anything located on the corner of Tom Darlington Drive and the Carefree Highway. The water pressure from the site is simply too low for use on the corner of Tom Darlington Drive and the Carefree Highway. All of this water will be used for “Neighborhood A” and system wide fire flow. We know of no other way to convince the Boulders HOA of this truth and the Boulders HOA has certainly failed to provide any evidence supporting its wild supposition to the contrary.

6.       Accusing the Town and its public servant agents of engaging in “pervasive secrecy” is nonsense. Secrecy about what precisely? The town is literally litigating these issues (thus far successfully) publicly in court. These issues have been discussed in open meetings. These issues have been made as public as possible.

7.       The Town considered alternative sites. But as explained above, and repeatedly in filings and at public Town meetings, the site at issue is the most optimal site.

8.       The Town and its legal counsel are not “attempt[ing an] end run around Arizona’s constitution, willing to present the [T]own’s false narrative to the courts and willing to harass [the Boulders HOA] with baseless allegations of defamation ….” The Boulders HOA failed to prevail in court. The Boulders HOA at one point removed defamatory statements from its website after being made aware of those statements. If the Boulders HOA has any evidence supporting these defamatory allegations, then we are confident that evidence would have long ago been presented. Yet, nothing has been presented (nor ever will be, because none exists).

9.       The assertion that “the current town council has advanced plans to develop every patch of open land” is inaccurate. We understand that 2% – 2.5% of the Town’s landmass is zoned for commercial development. Compare that to other similar communities like Scottsdale, Paradise Valley, and Fountain Hills, which we understand exceed 15%. Moreover, about 80% – 85% of the Town’s landmass is already built out as residential. The Town owns precious little real estate. Any efforts to rezone land will be initiated by those parties who seek to do so and subject to the same rigorous and open approval processes every person or business who seeks to rezone property within the Town must undergo. The Town simply has advanced no such plans and the Boulders HOA has proffered no proof to the contrary.

10.   Despite the Boulders HOA’s inaccurate contrary narrative, the Town cannot unilaterally condemn property on a whim or for purely economic purposes. We urge the Boulders HOA to consult its legal counsel about the limits of condemnation authority. Alternatively, the Boulders HOA can review the briefs the Town has filed in its thus far successful condemnation action for an accurate recitation of the law of condemnation as applied to this situation.

11.   Accusations of “conflicts of interest, graft and cronyism” are unequivocally false.1 If the Boulders HOA has evidence supporting such wild defamatory statements, then the Boulders HOA would have laid that evidence on the table. Yet to date all that has been supplied are accusations and innuendo without proof.

12.   The Town has no clue what the references to “extraordinary behavior of those in” the Boulders HOA “who are connected to the [M]ayor” and “e-mail phishing and a physical threat” are related to. The Town certainly has done no such thing nor encouraged others to do so. The Town unequivocally denounces uncivil or unlawful discourse. If the Boulders HOA is receiving harsh criticism from others, then perhaps the Boulders HOA should examine those circumstances internally before ascribing ulterior motives to others.

13.   The Boulders HOA’s baseless and factually unsupported cries of having been “swindled and fleeced”, of constitutional violations, and of “a violation of criminal statutes” are laughable given the Boulders HOA’s (a) track record thus far in court, and (b) failure to present any evidence overcoming the true public necessity of providing reliable and potable water to a thousand Town residents. The site’s owner will receive just compensation for any condemnation. The Town commissioned and presented an Appraisal from a qualified appraiser related to the site. The Boulders HOA did so, but once it realized the appraisal would essentially comport with the Town’s own appraisal, the Boulders HOA scrambled, fired its appraiser, and concluded that its own appraisal would not be “robust enough” (translation: favorable for the Boulders HOA’s narrative). Again, where is the evidence supporting all these baseless lies?

These are the real facts.  Unvarnished.  Provable.  Truthful.  We urge the Boulders HOA and its members to stop defaming the Town’s hard-working public servants. We urge the Boulders HOA and its members to cease spewing defamatory, bitter, irrational accusations that are hurtful and provable as false. In that regard, those affected by the Boulders HOA’s defamatory actions, including the Town’s public servants, reserve all rights and remedies they as victims may have at law or in equity. That said, the purpose of this correspondence is to set the record straight so that those not aligned with the Boulders HOA’s vocal minority are apprised of the truth. We are confident that the rest of the Town, and many members of the Boulders HOA, will quickly dismiss the rhetoric and false narrative and conclude that the Town and its public servants are doing, as they always have, what is best for the Town. 

If you desire to discuss this matter, please do not hesitate to call me.

Very truly yours,

Craig Morgan

Craig A. Morgan

1 Graft is a form of political corruption involving the misdirection of public money by a public official for a private benefit. This statement as it applies to the Mayor or any other Town public servant is provably false and grossly defamatory. I remain astonished someone would be so callous with such an accusation without providing proof.

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