By Beth Duckett for The Arizona Republic
A judge has denied Scottsdale’s attempt to throw out a lawsuit that claims the city illegally subsidized improvements at the McDowell Mountain Golf Club.
Maricopa County Superior Court Judge Sally Duncan denied the city’s motion to dismiss the complaint from residents Mark Stuart, a business owner, and John Washington, a former Scottsdale mayoral candidate.
Stuart and Washington have argued the city’s $1.5M contribution toward renovations at the north Scottsdale clubhouse violates the state Constitution’s gift clause and the Scottsdale charter.
The gift clause prohibits giving public money to private parties without getting a fair return. Scottsdale’s charter bans subsidies unless there is a clear public purpose and the city receives a return equal to its costs.
Scottsdale has argued that the improvements serve a public purpose. City Attorney Bruce Washburn also argued in court filings that Stuart and Washington, as taxpayers, don’t have standing in the case, as the improvements are covered by golf fees at the club, not tax revenue.
White Buffalo Golf LLC, a private entity, bought the course’s operating rights in 2012, paying $2.2M. In exchange for the city’s $1.5M, White Buffalo agreed to pay Scottsdale a larger percentage of its gross sales — 3 percent instead of 2 percent — for 20 years.
The renovations were completed in January. They expanded the clubhouse, creating “a larger and more functional restaurant facility as well as improvements to the locker rooms and restrooms,” said Dan Worth, Scottsdale public works executive director.
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