Scottsdale's Motor Mile just may be one of the most profitable corners of real estate in Arizona. Featuring luxury cars such as Bentley and Rolls-Royce, its a safe bet most Arizonans probably will spend more time dreaming about cars like these than driving them.
So why are taxpayers footing bills for these dealerships? A few years ago, the Scottsdale City Council voted to give $1.5 million to 19 car dealers for an ad campaign to make the area the ultimate car buying destination. I guess 19 car dealerships weren't obvious enough.
Not to put too fine a point on it, but there are taxpayers out there having trouble keeping up with gas bills who might wonder whether this was really a necessary expense.
Advertising is the kind of thing millions of businesses pay for every day. But Scottsdale is on the cutting edge of a disturbing trend where heavyweight corporations make deals behind closed doors, enriching themselves at the expense of regular taxpayers.
If the Scottsdale deal seems like a gift to the car dealers, it is. And it is exactly the reason Arizona has a constitutional prohibition, called the gift clause against schemes like this.
If taxes, building fees, impact fees, planning permit fees and other municipal fees are stifling new business, cities should lower taxes fees across-the-board. If it's a good policy for one company, why not all? In the meantime, city councils should treat all businesses equally or face their day in court from legal challenges that are sure to arise.
Darcy Olsen is president of the Goldwater Institute. A longer version of this article originally appeared in the East Valley Tribune.
-East Valley Tribune: Giveaways to corporations stick regular taxpayers with hefty tab
-Goldwater Institute: Regifting Gift Clause: How the Arizona Constitution Can End Corporate Subsidies
-Arizona Republic: Surprise from Surprise