Mike Fann, President and CEO, Fann Contracting
Interview by Ray Newton
Prescott businessman and philanthropist Mike Fann has been a strong influence In Yavapai County since the 1980s. Though not an Arizona native, Fann has anchored in Prescott since 1958, when his family moved there from St. Louis, Missouri. In 1960, his father founded J L Fann Ditching and Excavating when he purchased a backhoe. Mike began working for the company as a teen and developed a lifelong passion for construction.
Fann bought the business from his father and mother in 1990, and it became Fann Contracting. Since then, it has grown into one of the largest road construction firms in Arizona. With headquarters in Prescott, Fann Contracting does business throughout the state and has, on average, about 250 full-time employees.
Fann has two children: son Jason, who is an executive with the Prescott business, and daughter Audrey, who is a teacher in California. Fann and his fiancée Tammy recently moved into a three-story home in the heart of downtown Prescott, which they say allows them to enjoy the best of what Prescott has to offer. We sat down with Mike to learn more about his company, his love for the community and why growth should be managed, not restricted.
PRESCOTT LIVING: Mike, you’re a successful hometown Prescott boy. You could have gone anywhere. Why are you staying in Prescott?
Mike Fann: I’ll tell a brief story. When one of my kids was doing a homework assignment –to interview one of your parents – it asked if I could live anywhere in the world, where would it be. I said, “Well, give me a day or two to think about that.” I took it very seriously. I thought I probably could live anywhere in the world if I just chose to do it, but I can’t think of any other place that I’d rather live than right here. I love the town; I love the architecture in the downtown square; I love the weather here. You get all four seasons. But what makes Prescott is the people.
I can’t drive around town without waving at somebody or having somebody wave at me, and many times I don’t even know them. There’s just no place like Prescott.
PRESCOTT LIVING: How did you get started in contracting? How old were you?
Mike Fann: [Laughs] I think I started really working when I was 12 during summers for my dad – just a laborer in a ditch. We were mainly doing work for the phone company installing conduits and direct burial phone lines.
My dad’s philosophy of work was this: You’re gonna spend, out of a 24 hour day, somewhere around 12 hours of that day on things that you have to do to survive: sleeping, eating and hygiene. The other 12 hours of your day is mostly work, so you better pick something that makes you happy. Whatever it is – and that can be a garbage man, a ditch- digger [Laughs] – whatever you choose, choose something that you enjoy. Don’t choose something that’s going to make you rich or make you famous, because you’re not going to spend any real time enjoying the fruits of that.
When I got out of high school, I thought of various careers and I always came back to construction. It’s a career that’s very satisfying.
PRESCOTT LIVING: And was your father the one who started it all originally. What was his spark just to start it way back?
Mike Fann: (Fann points at a photograph on his office wall of a man falling off a bull). See the guy on the bull about to hit ground on that bull right there?
PRESCOTT LIVING: Yes.
Mike Fann: That’s my uncle Sid. Uncle Sid lived here before we moved here. We think that’s 1944, Prescott Frontier Days 1944. In 1957, or early ‘58 my dad and mom, Jim and Sylvia, came out here to visit my Uncle Sid and my Aunt Ollie. Uncle Sid offered my dad a job, so they came back to St. Louis, which is where I was born and living, packed us all up, and we moved out here in 1958. My dad took a job with him in 1958. And then in 1960, he quit working for my Uncle Sid, and he bought a backhoe and he and my mom started JL Fann Ditching and Excavating. That’s what it was called back then. It just flourished from there. My dad was a hardworking guy.
PRESCOTT LIVING: So, after high school, you got a degree at ASU?
Mike Fann: Correct. Their college of engineering has a division of construction now called the Del E. Webb School of Construction. I graduated from there, as did my son Jason.
PRESCOTT LIVING: Over the years, you’ve seen Prescott evolve from a sort of a sleepy country, agricultural, ranching community with a lot of retirees into now what is becoming a dynamic economic force in Central and Northern Arizona. Why is that happening?
Mike Fann: Mainly because it is such an attractive place to live. Elliott Pollack made a presentation to Prescott a few years back. His message was quite compelling and quite clear. (Editor’s note: Elliott Pollack is an economist) He said, “You’re never going to stymie the growth of the Prescott area. It’s just too beautiful and too nice of a place. You can shape it; you can shape that growth; you can impact the growth by the various rules and regulations and ordinances that you adopt, but you’ll never stop it.”
He used an example of a community in Colorado and explained how they tried to stop growth in their community.
Well, what that caused was growth to dramatically occur around and outside of their community. Even though the citizenry in that town said, “We’re just going to stop growing,” they still got all the traffic coming in to town. They still got all the crime adding to their town. They had all of the negative impacts of growth, but none of the positive impacts of growth, of having a robust economy, having a good sales tax base and having everybody contributing to the economy. It was a terrible disaster.
So, when people talk about “smart growth,” I think that it’s not a catch phrase. What we want to do is grow smart.
PRESCOTT LIVING: Prescott was for many years a retirement community. It’s changing rapidly now, don’t you think?
Mike Fann: I think Prescott proper is still a retirement community in its present form. Do I think there are new opportunities here and that there will be more new opportunities moving in to the future? Certainly. But I think it’s still very attractive to a retired demographic. I think it will always be attractive to them, so it will never move totally away from a retirement community. I would hope it is enhanced with good jobs and good economic growth, but I think it will always remain attractive to retirees.
PRESCOTT LIVING: Construction is very important. Considerable construction – residential and commercial – is going on in Prescott and the greater area. You have one such development called The Dells. What do you see as a consequence of all that?
Mike Fann: As I said earlier, we need to grow smart. We need growth that considers our water quality and considers the traffic impacts. But certainly we need to realize that we will likely grow at a rate of probably 2-3 percent every year, some years it’s going to be less, and some years it’s going to be more. What we need to do is make smart decisions on how we handle our wastewater, how we handle our water, how we handle traffic and how we handle police and fire protection. Some people in Prescott may say, “Let’s stop growth,” but that doesn’t stop growth in central Yavapai County or around Prescott. No individual entity, whether public or private, can control growth other than the areas that they individually can impact.
PRESCOTT LIVING: I sense you are very supportive of what was done with Deep Well Ranch. (Editor’s note: Deep Well Ranch is the name of a 1,800-acre residential-commercial development recently approved by the City of Prescott on the northeast border of the community).
Mike Fann: Affirmative. I mean the annexation process is important.
Annexation needs to be, as much as possible, a win-win both for the landowner and the community that they’re annexing into. It’s important to annex, because you can’t control it at all if you don’t annex it. You have no influence over how it’s going to be developed.
PRESCOTT LIVING: My observation of what you did with Granite Dells (the Fann-owned development) is that you were very particular in picking builders. You said these are going to be energy-efficient.
Mike Fann: I think we live in a time when you need to be conscientious with the use of natural resources. So I think the days of having homes with lots of lawn and lots of irrigation and a big water feature as you enter a subdivision and things like that…it’s not needed, and I would say borderline irresponsible.
You need to build homes that are energy-efficient, low-water use and developed in a working, playing and living environment, so you can enjoy your work space and your play space close by.
PRESCOTT LIVING: Do you think de facto that growth is going to destroy the small-town quality of life?
Mike Fann: No, I think if we didn’t grow, we would grow stale. You break it down to simple microeconomics, the supply/demand curve. If you cut off supply, demand doesn’t go away. The curve rises. If there was a strong enough force in Prescott to say we’re just going to close our borders to anymore growth, demand to live here would still be here. Supply would be cut off, so the price of a home or land in Prescott would grow exponentially.
Eventually, the younger folks and people with families won’t be able to afford it, so they’ll move out, and we’ll end up with a community that lacks diversity and only caters to those who can afford it.
I want to live in a community that welcomes young families and kids, along with retired people, and that demographic would change if growth was shut off.
PRESCOTT LIVING: Mike, a comment I hear routinely is, “All this new growth, where is the water coming from?” You probably know as much about the sources and the uses of water as anyone in the community. What’s your take on that? How do you respond to these people?
Mike Fann: Well, No. 1, I think I’m far from knowing almost everything about water [Laughs]. There are a lot of people a lot smarter than I am when it comes to where the water is coming from and where we’re at.
I do know that in the Big Chino, when I was a kid – we moved here in 1958 – that was all ranch land, and the pumping of the water out there was more than it is ever going to be moving forward. I mean our water usage today is less than it was decades ago, because we’ve shifted from an agricultural community to what we are today. When I was a kid, when you drove through Chino Valley, it was loaded with alfalfa fields and corn fields. There was a ton of farming going out there and it went out to the K-4 Ranch, where the Big Chino Water Ranch is. There just seemed like miles of farmland out there, and all being irrigated.
When people are talking about the water, I think they don’t recognize how big the aquifer really is below us. Is it a finite resource? Of course, it is, as is coal, as is oil, as is most things on this earth. The difference with water is, it’s a delivery problem, it’s not a supply problem.
There is water. There is always going to be water, whether it’s salt water that needs to be desalinated and piped here, whether it is wastewater that needs to be cleaned up, whether it is storm water, surface water or whether it is groundwater. I mean the water is there, the question is how to deliver it to people that need to use it. That’s what we’re struggling with. Do we pump the Big Chino? At some point it has to happen.
PRESCOTT LIVING: I wanted to talk about the airport. You’re on the Board of Visitors for Embry-Riddle Aeronautical University. You’ve been very aware of the growth of Embry-Riddle in the past few years. Embry-Riddle is among a number of organizations really trying to push for expansion of the airport. What’s your take on the airport expansion?
Mike Fann: Well, I think it’s critical to the economic development of central Yavapai County. I can’t think of any organization that is positively impacting our economy more than Embry-Riddle right now. They really embrace our community.
Potential high-paying jobs will come to Prescott because ERAU is cranking out some of the finest students in the United States. Many of the ERAU students love Prescott, and so they get a very good education and then they stick around. They’re contributing to our community in a very positive fashion, also.
The airport itself: No. 1, the terminal needs to be improved. It’s too close to the main runway, so it’s already out of compliance with Federal Aviation Administration guidelines. It is no longer serving the needs of the community. So, we need a new terminal, and we need a longer runway to encourage the bigger jets to come in. That doesn’t mean we’ll ever get a 727 or 737. That’s not in the cards here, but having a regional jet service here would really enhance our attractiveness to companies that want to come here.
PRESCOTT LIVING: Some of the advocates for a regional airport say it would help improve our transportation efforts in and out of town, because we are not on an interstate. We’re not, in fact, on a major thoroughfare.
Mike Fann: Absolutely. I don’t know how to add to that. [Laughs]
PRESCOTT LIVING: You’ve been known as a generous philanthropist to the community. For many years, a lot of what you’ve done has gone unnoticed or unheralded. However, through FEMAD (Fann Employees Making a Difference), thousands of dollars have gone into this community. What is it that compels you and your organization to be this generous?
Mike Fann: There are few things that make you feel good at the end of the day more than contributing your time or your treasure to others, to people in need. So, somewhat selfishly, it just feels good.
PRESCOTT LIVING: You’ve encouraged your employees and they are active participants.
Mike Fann: Yeah. You know, if you asked me, “Mike, what accomplishments are you most proud of today?” it would be FEMAD. Part of it now is expanding FEMAD to other companies. We are on the eve of having an employee and employer giving/matching program with several other companies in Prescott now. It’s really exciting. I can’t say enough about Kerri Vaughn (Editor’s note: Kerri Vaughn is the staff member whom Fann has designated to organize and supervise the annual FEMAD philanthropic campaign) and her contributions. FEMAD was her brainchild. Now, together we are expanding the FEMAD concept to eight other companies.
PRESCOTT LIVING: Do you do work in other parts of the state as well as outside of Yavapai County?
Mike Fann: We do. For instance, ADOT (Arizona Department of Transportation) recently awarded us one of the largest project we’ve ever bid – $35.3 million.
PRESCOTT LIVING: Wow.
Mike Fann: That’s on top of the largest project we ever were awarded last year.
PRESCOTT LIVING: Where is it?
Mike Fann: It’s on the I-40. So, this summer, we’ll have two jobs that are only a mile apart on Interstate 40 going west to Williams, through Williams and about 15 miles east of Williams, totaling $70 million. So, we’re gonna be busy.
We work throughout Arizona. We’ve worked all the way down to the New Mexico border on Interstate 8. Our trucks would have to go into New Mexico and get turned around and come back into Arizona. We’ve worked down in San Luis, south of Yuma, right up to the Mexico border.
We’ve worked on Interstate 40, right up to the New Mexico border at Lupton. On the northwest corner, we’ve worked Interstate 15 between Las Vegas and St. George, Utah. We literally reach every corner of the state.
PRESCOTT LIVING: Looking forward, do you have plans to retire?
Mike Fann: Well, eventually I’d like to slowdown. I don’t know if I ever want to quit. My son Jason is in a position to take a much larger role in this organization immediately. I could take a smaller role in the day-to-day operations of the company. I think that’s going to happen very soon. Will I ever totally walk away from it? Probably never, but I certainly will reduce my role, and the impact that I have here will continually decline as I decline. [Laughs]
PRESCOTT LIVING: [Laughs] And when that happens, then what do you do? What are you and (fiancee) Tammy going to do?
Mike Fann: Oh, I think travel and enjoy life. Tammy and I both like to travel.
PRESCOTT LIVING: What kind of travel?
Mike Fann: Oh, anywhere and everywhere. I think the sky’s the limit on that, whether it’s going to visit family on short trips or traveling overseas and seeing more of the world.
We like to travel. We like to see new places. We both have a real love for our friends and our family. So whether it’s visiting them or going to see new places or doing both, it’s all good.
