The Arizona Court of Appeals says Pima County didn’t need to use competitive bidding to lease county-owned land to a balloon spaceflight company as part of an economic development package.
The decision Thursday overturns a Superior Court judge’s ruling that the $15 million deal in 2016 between Pima County and World View Enterprises violated state law that required competitive bidding to protect public resources.
The Phoenix-based Goldwater Institute sued, saying the deal put taxpayers at risk if World View leaves without fully paying for the space for its headquarters and operations base. The institute said the county violated state law regarding appraisals, auctions and rental rates.
Pima County Superior Court Judge Catherine Woods sided with Goldwater in February and moved to void the lease. But the Appeals Court ruled unanimously that county boards do not have to use a competitive bidding process when issuing leases that fit their economic development guidelines.
“To require competitive bidding in such a circumstance would only frustrate that purpose by driving up the price and thereby nullifying the very power the statute grants: the power to spend monies for economic development,” Judge Peter Eckerstrom wrote.
The appellate court also said an economic development law allows counties to lease county-owned land at less than market value.
Pima County Administrator Chuck Huckelberry said it is a clear victory for economic development efforts throughout the state.
“The Goldwater Institute was off-base in attacking economic recovery in Pima County. While I can understand their opposition to sweetheart development deals in Maricopa County, they should keep their hands off the real job growth and economic development plans in Pima County,” Huckelberry said.
Jim Manley, Goldwater’s lead attorney, said the ruling allows governments to negotiate secret backroom deals with private firms.
“Competitive bidding helps guard against favoritism, fraud and public waste, and by rejecting the necessity of this process, the court has opened the door to greater government abuse,” said Manley.
“We plan to appeal this decision to the state Supreme Court and continue the fight against sweetheart deals that put taxpayers on the hook to subsidize private profits.”
Manley added that he believes the agreement between World View and Pima County also violates the state’s “gift clause,” which prohibits the government from giving or lending taxpayer money to private businesses.