This Saultite owns Town Hall (in Fountain Hills, Arizona)

Seven months ago, when the Town of Fountain Hills, Arizona held a special meeting to discuss a potentially crippling financial crisis, someone suggested moving Town Hall out of the three leased buildings it currently occupies.

Not possible, the meeting was told.

The Town had a signed lease with the owner of the property, Dr. Lou Lukenda (shown) of Sault Ste. Marie, Ontario.

There was no way the terms of that lease could be altered, ratepayers were told. Official minutes

The ratepayers were misinformed. There was no lease for Fountain Hills' leased Town Hall.

At least, not on paper.

Since 1989, when the Town of Fountain Hills was incorporated, Dr. Lukenda has collected monthly rent on the three buildings used by the municipality.

In addition to the council chambers and administrative offices, the buildings also house the public works, building safety, planning and engineering departments, the municipal court, the Maricopa County Sheriff's Office, and the Arizona Department of Public Safety.

$400,000 a year, in U.S. dollars

The rent cheques total almost $400,000 U.S. a year.

Amazingly, town officials refuse to sign a lease with their Sault landlord.

Still more amazingly, Dr. Lukenda says he's content to allow the arrangement to continue, at least for the time being.

"I don't think it's going to be a problem," the affable dentist and philanthropist told SooToday.com on Saturday, after details of the non-lease were published by the Arizona Republic. "We've had an ongoing relationship for 30 years," he said. Arizona Republic coverage

At the same time, Lukenda acknowledges the situation is highly unusual - there's no other tenant this size he's willing to carry without signed papers.

'Lou from the Soo'

Lukenda has been a local legend since the mid-1950s, when the Globe and Mail started referring to him as "Lou from the Soo" in reports about his exploits as a University of Toronto basketball centre.

"In those days, I was never afraid to wear my hometown on my sleeve," he tells SooToday.

After graduating in 1964, the star athlete returned home to set up his dental practice in the Ontario Sault and to begin a lifetime of service to education and healh care on both sides of the border. Learn more

Among other business initiatives, he founded Tendercare, now Michigan's largest provider of long-term care services. Tendercare.net

How a cattle ranch became Fountain Hills

Until the late 1960s, Fountain Hills, Arizona was the decidely unglamourous P-Bar Cattle Ranch.

A developer named Robert McCulloch bought the place, envisioned it as a model community and brought in Charles Wood Jr. (the designer of the original Disneyland) as urban planner.

Fountain Hills considers its birthday to be Dec. 15, 1970 - the day that the development company now known as MCO Properties turned on the world's tallest man-made continuously running fountain.

World's tallest fountain, View #1 World's tallest fountain, View #2

Residential construction started in 1971.

Today, Fountain Hills is home to more than 20,000 permanent residents and several thousand snowbirds.

How Lukenda got involved

Lukenda was one of several Saultites attracted to the Phoenix-Scottsdale-Fountain Hills area during the early seventies. (Another was Jim Rudack, who enjoys SooToday.com from his winter home in Scottsdale.)

While visiting a friend in Phoenix, Lukenda snapped up what's now Fountain Hills Town Hall as an investment and leased it to the developer MCO Properties. See the Town Hall

MCO signed a lease including an escalator clause that provided for rent increases.

Everything went fine for 20 years, until the Town of Fountain Hills was incorporated in 1989.

The municipality took over the MCO-leased building and started to rent other parts of the property to complete its Town Hall complex.

Why the lease wasn't signed

The first fly in the ointment arrived when the Town started using one building that needed significant repairs.

The original lease required MCO to pay for such improvements.

The Town was unwilling to do so and wanted new clauses to give it credit in such cases.

Lukenda wasn't much interested in altering the original terms, and thus began what town officials term a "friendly impasse" under which monthly rent was paid even though no formal lease existed.

Renewed discussions

In 2001, the Town re-opened negotiations with Dr. Lukenda, and Fountain Hills Town Council gave approval in principal to a new lease, subject to reaching agreement on certain indemnity and insurance clauses.

But final agreement was never achieved on those issues.

When the Town subsequently underwent a change in administration, the talks with Lukenda ended up on the back burner.

"The former administration called me after the council approved the lease and said everything would go through," Lukenda told the Arizona Republic.

"I kept checking back, but there were a lot of issues going on and the lease wasn't a priority ... I was assured everything was in order and it would be signed soon."

Town offices may move

Today, still without a lease, Lukenda is prepared to continue with the status quo.

However, the Town is again renewing its efforts to get a new deal from the Sault dentist.

If these talks don't succeed, there's talk that the Town Hall may move elsewhere.

Lukenda isn't worried.

The buildings are among the finest in Fountain Hills, he says, and are right in the heart of the community.

Lukenda anticipates little difficulty in finding new tenants to take the Town's place.

With a little luck, they might even be willing to sign a lease.