Neptune Swimming Foundation v. City of Scottsdale1 min read

Arizona Supreme Court:    No. CV-23-0076-PR  Filed February 6, 2024

Neptune Swimming Foundation v. City of Scottsdale

ISSUES:

1. Whether a qualified bid from a higher bidder should be considered when determining if a city violated the Gift Clause of the Arizona Constitution.
2. Whether the City failed to follow its own rules by canceling the Request for Proposal (RFP) and, therefore, abused its discretion in deciding which club should be awarded the license.

DECISION:

1. The court held that a higher bid in an RFP process is relevant, but not conclusive, in determining the fair market value of a license under the Gift Clause analysis. The Gift Clause does not require public entities to maximize profits at the expense of other considerations.
2. The court found that there were disputed issues of material fact as to whether the City acted with a “fixed intent” to award the license to Scottsdale Aquatic Club (SAC) throughout the RFP process and engaged in favoritism by canceling the RFP after Neptune submitted the more advantageous proposal.

The court’s analysis provides insight into how courts balance public interests against private rights in government contracting situations.