Pima County Board of Supervisors Approves World View Lease Redo

The Pima County Board of Supervisors has voted 4-1 to approve a new lease with southside aerospace firm World View. The new lease resolves an issue related to lengthy litigation challenging the economic development agreement the county made with World View in 2016 in an effort to retain the company in the region.

A conservative think tank in Phoenix, the Goldwater Institute, sued the county a few months after the board approved the agreement six years ago this month, claiming the county violated several state laws. The county prevailed over the past five years on all but one of the claims. Goldwater succeeded late last year on the final claim, when the state Court of Appeals ruled that the portion of the agreement allowing World View to take over the headquarters and manufacturing building at the end of the lease’s 20-year term for a nominal sum violated the state’s Gift Clause. The county argued to the court that the acquisition of the property by World View was not a gift because taxpayers would have essentially realized a $4 million “profit” over the county’s manufacturing and financing costs over the life of the lease. The court disagreed.

“This revision of the World View lease should put to rest years of legal wrangling over how Arizona counties can participate in economic development activities and business retention. Having prevailed on three of Goldwater’s four claims, and Goldwater on the fourth, we and all the other counties in the state now know where the lines are drawn, which is the silver lining in this costly dispute,” said County Administrator Jan Lesher.

The new 20-year lease is broken into five-year renewable increments and sets the lease rate at 90 percent of market rate, which is specifically authorized by state law. It also gives World View the option to buy the property within the next two years at 90% of the appraised value, which is also allowed by statute.

“The reason Pima County entered into this agreement in 2016 is the same reason the board agreed to this revised lease – to retain a high-wage employer in Pima County that will employ over 100 people with average salaries of $80,000 once fully operational,” said new Board Chair Adelita Grijalva.

World View is located in the county’s Aerospace Research Campus south of Raytheon Missiles & Defense. It will soon be joined on the campus by American Battery Factory, which plans to build a $1 billion lithium battery manufacturing facility. World View uses high-altitude balloons to lift so-called stratollites carrying technology payloads that perform a variety of functions. It also intends to lift tourists in a capsule to near-space heights. The World View lease is structured similarly to the American Battery lease, which the board approved last month. Both leases reflect the settled legal issues of the World View lawsuit.

Also on Tuesday, the board decided not to appeal the Gift Clause decision to the state Supreme Court, ending the lawsuit.