A new scheme to finance a downtown hotel is being promoted by developer Garfield Traub. This time the developer proposes that a real estate investment trust from Chicago buy bonds to finance the hotel, a Tucson Convention Center Expansion, and a new parking garage. The only problem with this deal is that the City of Tucson taxpayers would be on the hook for $230 million to back up the bonds.
If the hotel-convention center plan is such a good deal, why can’t it be financed entirely by private investors without taxpayers being on the hook? Let private enterprise take the risk and reap the rewards, if any.
I also wonder if the Tucson City Council has heard of the “Gift Clause” in the Arizona constitution. The “Gift clause” AZ constitution art. 9, § 7 states: “Neither the state, nor any county, city, town, municipality, or other subdivision of the state shall ever give or loan its credit in the aid of, or make any donation or grant, by subsidy or otherwise, to any individual, association, or corporation, or become a subscriber to, or a shareholder in, any company or corporation, or become a joint owner with any person, company, or corporation, except as to such ownerships as may accrue to the state by operation or provision of law or as authorized by law solely for investment of the monies in the various funds of the state.”
The City should take note of what happened to Tucson Electric Park, the county-owned baseball park built and maintained by county taxpayers. Professional baseball has abandoned Tucson. An article in the Arizona Daily Star says, “The county-owned baseball facility is home to a stadium and practice fields, but nobody plays there any more, since the Tucson Sidewinders and spring training have packed up and moved on.” The article goes on to say that the park might be seeking a new name. I suggest Pima’s Folly.