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Goldwater Institute Files Suit to Stop Taxpayer Subsidy to Balloon Company

April 15, 2016

Tucson—The Goldwater Institute has filed a lawsuit in Pima County Superior Court to stop a planned subsidy to a luxury tourism company. The County will mortgage County buildings to raise $15 million to build a headquarters and balloon field for World View Enterprises, a private company that hopes to offer luxury trips in high-altitude weather balloons.

Last November, Pima County voters resoundingly rejected six ballot measures that proposed to let the County borrow hundreds of millions of dollars for economic development and tourism. Two months later, County officials secretly negotiated a deal to borrow $15 million to benefit World View, without taxpayer approval.

The deal puts government-owned buildings up for collateral in order to build a 135,000 square-foot headquarters and balloon pad for World View. The company plans to charge $75,000 per balloon ride. If World View defaults on its lease, taxpayers will be left with the bill.

“Private companies should go to the bank for a loan just like everyone else,” said Jim Manley, a senior attorney at the Goldwater Institute.

The World View deal violates the state constitution and state law. The Arizona Constitution makes it illegal for the County to “give or loan its credit in the aid of, or make any donation or grant, by subsidy or otherwise, to any . . . corporation.” In Turken v. Gordon the Arizona Supreme Court found that public expenditures must be for public purposes. The Court held that general economic improvement or potential job growth do not satisfy the Constitution.

The deal also violates Arizona laws that require competitive bidding for construction contracts and forbid counties from leasing land without auctioning it to the highest bidder. The County claimed there was no time to follow the competitive bidding rules. In reality, county officials agreed to an expedited timeline for construction with hand-picked companies, and then used that timeline as justification to avoid competitive bidding.

Read more about Rodgers v. Huckelberry here.

About the Goldwater Institute

The Goldwater Institute drives results by working daily in courts, legislatures and communities to defend and strengthen the freedom guaranteed to all Americans in the constitutions of the United States and all 50 states. With the blessing of its namesake, the Goldwater Institute opened in 1988. Its early years focused on defending liberty in Barry Goldwater’s home state of Arizona. Today, the Goldwater Institute is a national leader for constitutionally limited government respected by the left and right for its adherence to principle and real world impact. No less a liberal icon than the New York Times calls the Goldwater Institute a “watchdog for conservative ideals” that plays an “outsize role” in American political life.

 

 

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