Staffers barely bothered to pay lip service to the pretext. In its agreement with Klutznick, the city failed to ensure that public transit users would get prime spaces — or even dedicated ones. As the appellate judges wrote, "There may be times when guests, customers, employees, vendors, and suppliers of the shopping center will occupy all the spaces. The agreement also provides that CityNorth has the right to change which spaces are designated for city use."

In other words, we pay for a parking garage; CityNorth's owners get to do whatever they like with it.

Fortunately, the appellate justices saw through the smokescreen. "Simply asserting that [the city's tax remittances] are made to obtain 'public parking' does not mean the payments will serve a public purpose," they noted. "In this case, the 'public' that will use the spaces are actually the private customers of CityNorth, who will be parking their cars so that they can do business with CityNorth's retail tenants."

As the justices concluded, "We think these payments are exactly what the gift clause was designed to prohibit."

Tom Simplot was one of two opposition votes to the CityNorth subsidy when it was up for approval in 2007 and, more recently, the only one to vote against appealing the case to the Supreme Court.

Simplot's been amused by news coverage suggesting that worthy public programs could be in trouble if the decision stands. (The Arizona Republic, bizarrely, wrote a story suggesting that cities could no longer give block grants to neighborhood groups in light of the CityNorth decision — as if helping a neighborhood has anything in common with giving zillions to developers.)

The hysteria is coming from the top, Simplot says. The city's attorneys "will tell you the sky is falling, that the world is going to end if we allow this decision to stand.

"Well, I for one read the opinion and, while I'm not an expert on this, what I read was the court's frustration with the extent of this incentive," he says. "They were saying, 'You guys went too far over the line. Somebody needs to bring you back.'"

Simplot has it exactly right. The appellate verdict doesn't strike down all subsidies; it strikes down this subsidy. And it strikes down this one for good reason. The city went too far. It gave away too much.

Don't take my word for it. Talk to Scottsdale Mayor Jim Lane. He's asking his city council next week to consider a "friend of the court" brief to the Supreme Court.

It's a gutsy move, because Scottsdale would be filing in opposition to Phoenix. It would be asking the court to let the verdict stand, to declare the subsidy unconstitutional.

Scottsdale has figured out what Phoenix refuses to admit: Giving away so much money on a deal this silly helps no one — except the developers and their investors, that is.

The sky really is falling in some parts of this city. But that has nothing to do with Klutznick and his backers not getting their payday. This giveaway was a bad idea when times were flush; now it's pure idiocy.

The appeals court gave us a get-out-of-jail-free card. Only in Phoenix would we rather spend tens of thousands rotting in our cell than use it.

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4 comments
William
William

If you really think about it, Mayor Gordon is as crooked as they get. He and Fife Symington have alot in common. The stupid project is just a few miles away from Kierland Commons, which has ten times the shopping oulets. No one will ever shop at City North as long as people can choose to go to Kierland. Sometimes I think that in order to run for Phoenix City Council, the criteria is not to have a brain cell.

Mark
Mark

Brilliantly said Richard. I wish Sarah Fenske would have come up with some actual "new details" for this article instead of simply attempting to provoke outrage that foreign investors hope to make a return on a project.

Sarah, if you're trying to make an argument that this is bad for Phoenix's citizens, then do some research and provide the data. Tell us what the sales tax revenue is projected to be with this huge retail project. I'm interested to know if getting half the revenue for 11 years is better than no revenue for 11 years if no investors were willing to excelerate the growth of NE Phoenix durring the same period.

John Clark
John Clark

If there is no project there is no sales tax so your really giving away nothing.

Richard
Richard

As the reporter who had the first reports on Desert Ridge Marketplace, which the Republic copied almost word-for-word the day my story appeared in another newspaper, I find the facts in this article to be totally erroneous.

First, the city has not given a dime to CityNorth. It was a tax incentive to build two garages where the city over 20 years would realize a greater profit.

Arizona only has about 4 Fortune 500s. The lowest per capita outside New Mexico and Utah in the Southwest. Arizona has the greatest job losses during the current DEPRESSION.

Barry Goldwater would be rolling over in his grave if he knew an institute bearing his name was costing taxpayers nearly $1-million to fight economic development and shut it down for good in Arizona. EVERY state has an incentive program to attract business and industry � the Goldwater Institute wishes to shut that tap down for Arizona. When you�re out of work � like the Arizona Republic, Phoenix Business Journal (which has never acknowledged last week�s lay offs), East Valley Tribune reporters � thank the Goldwater Institute.

CityNorth could have been the greatest thing to happen to northeast Phoenix since it ran the concert venue that changes names every year out to the Southwest Valley. Now there�s a chance to bring the Diamondback�s spring training facility to the region, but the Goldwater case puts that in jeopardy and it will more than likely end up on tribal land who are beyond the Goldwater Institute�s grasp.

As one of my most conservative friends admitted the day Barack Obama went to ASU to sweat his ass off, the light rail was visionary. Thank Phil Gordon. CityNorth was visionary on the part of Councilwoman Peggy Neely. She�s helped infill her district, one of the most economically repressed throughout Arizona. Now she�s had her hands tied by Goldwater Institute.

As for Nordstrom�s, check with the staff at Macerich�s Westcor division. See if it doesn�t show up in five years � if Westcor ever develops in the 101/Scottsdale Road area; a project they were scheduled to begin almost 10 years ago. Nordstrom�s is at two other Westcor run malls. At least CityNorth decided to be visionary � like the light rail � and move forward, unlike Westcor.

So why is it New Times desire to create greater economic degradation with stories like this? Does the newspaper � and I use the term loosely � wish to eliminate more jobs from the state? When potential developers or industry see stories like this, you are sending them into the arms of another state. REAL responsible community journalism.

 
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