Goldwater Sues Scottsdale for Deceiving Voters About Tax Hike

The city of Scottsdale is illegally deceiving voters about a proposed sales tax hike—falsely claiming that the tax increase is actually a tax reduction so that residents will approve it in November.

But Arizona law prohibits such misleading ballot measures. Now on behalf of three Scottsdale residents, the Goldwater Institute is suing the city to stop the measure from being placed on the 2024 general election ballot.

The numbers just don’t add up.

Scottsdale has referred to the ballot a 0.15% sales tax to support city parks that would start on July 1, 2025. Meanwhile, an old sales tax of 0.20% for land purchases ends on June 30, 2025. Scottsdale is using the expiration of the old tax to pitch the new one to voters as a tax reduction. The city claims a “yes” vote would replace and reduce the current 0.20% sales tax, while a “no” vote would deny the city to ability to replace and reduce that 0.20% tax. But voters will actually pay a lower sales tax rate if they vote “no” on the new sales tax than if they vote “yes.”

In other words, the city is trying to convince voters to approve a sales tax hike by framing it as a tax cut.

“Our own city leaders are deceiving taxpayers so that we’ll vote to raise taxes on ourselves,” says Yvonne Cahill, one of the Scottsdale taxpayers whom Goldwater is representing in this suit. “We deserve honesty from our local officials—especially when it comes to the money hardworking Arizonans are required to fork over to the government.”

Fortunately for Scottsdale voters, such misleading ballot propositions are illegal under state law.

“Arizona law prohibits ballot measures from communicating objectively false or misleading information,” says Goldwater Institute Senior Attorney Scott Freeman, lead attorney on the case. “A ballot measure may not engage in a ‘bait and switch,’ but that is what this referral does: it tells voters a ‘yes’ vote would reduce taxes, when it’s actually a ‘no’ vote that would lead to lower taxes.”

The Arizona Supreme Court has consistently held that ballot measures cannot deceive voters. “Having misleading measures on the ballot would undermine the fundamental fairness of an electoral system that asks voters to approve certain measures,” Goldwater Institute Staff Attorney Adam Shelton adds. “Whether or not the new tax is good policy is besides the point—a city must accurately and unequivocally tell voters they are increasing taxes when a ‘yes’ vote would lead to a higher tax than a ‘no’ vote.”

While national and statewide elections usually garner the most attention, it’s often local government that has the largest impact on people’s day-to-day lives. Scottsdale is far from the only Arizona city to try getting what it wants by ignoring state law—but the Goldwater Institute is standing up to local government overreach across the state. We’re uncovering what local officials in Arizona’s two largest cities won’t say about their failed attempts to fight the homelessness crisis, we’re challenging illegal prevailing wage mandates in Phoenix and Tucson, we’re suing over an illegal tax in Yuma County, and we’re fighting Pima County’s illegal firearms mandate.

Now, Scottsdale is misleading voters to support a tax hike by calling it a tax cut. That’s illegal—and we won’t let it stand.

You can read more about the case here, and read our complaint here.