TUCSON (CN) — A conservative think tank claims in court that local officials had stars in their eyes when they approved a $15 million subsidy for a balloon spaceflight company, touted as a high-tech economic boon for Southern Arizona.
Backed by the Phoenix-based Goldwater Institute, three taxpayers sued Pima County and its Board of Supervisors in Superior Court, claiming that a county deal with World View Enterprises violates the state's gift clause and competitive-bidding rules.
World View is building a spaceport in Tucson from which it plans to launch balloons into the stratosphere. Eventually, the company hopes to take passengers to the edge of space —as high as 140,000 feet — in sealed capsules. Now it flies scientific payloads into near-space for NASA and Northrop Grumman.
Pima County approved the deal in January, saying it would bring more than 400 high-end jobs to the area and have an estimated economic impact of some $3.5 billion over 20 years.
"The biggest part of our business right now is serving these commercial customers who need a way to access the near-space environment," World View's director of marketing Andrew Antonio said in an interview. "That can range from applications for communications, to first-response and disaster recovery, to gathering better data for weather forecasting models."
The Goldwater Institute, which represented the plaintiffs, highlights the space tourism aspect of the company's business plan, saying in the complaint that it will cost $75,000 per ride, and that Pima County refinanced debt using public buildings as collateral to subsidize an "unproven, for-profit luxury adventure-tourism business."
Under Arizona's gift clause, taxpayer-funded economic development subsidies must have a genuine "public purpose," which is lacking in the space balloon project, the complaint states.
"The benefits received by Pima County from this project, if they ever do arise, are grossly disproportionate to the payments Pima County has obligated itself to make and the risks it has undertaken to aid World View," according to the complaint.
Responding to pre-lawsuit claims, Deputy County Attorney Regina Nassen defended the county's investment in an April 5 letter to James Manley, the Goldwater Institute's senior attorney.
"No reasonable person would argue that the stratosphere will, in the near future, replace Disneyland as a vacation destination for middle-class families," Nassen wrote. "But providing affordable recreational opportunities for county residents, though a legitimate public purpose, is obviously not the public purpose the county is seeking to further in its transaction with World View."
Nassen said the $15 million lease-purchase agreement approved by the Board of Supervisors is a legal "economic development initiative" that will create jobs and improve the local economy. She said the Arizona Supreme Court has ruled that such "indirect" benefits can establish a "public purpose" under the state's gift clause.
"The Court has likewise repeatedly stated that it will defer to a political body's determination of public purpose," Nassen wrote.
World View's Antonio said that the space tourism side of the company is only one part of its long-term plans.