Goldwater Institute Demands Probe Into Phoenix Gift Clause Breach

By Matthew Holloway |

An investigation led by Republican Representatives David Marshall, Walt Blackman, and Quang Nguyen has uncovered that the City of Phoenix allocated over $28.5 million in taxpayer funds to more than 100 private organizations, raising serious concerns about oversight. In response, the Goldwater Institute is urging Arizona Attorney General Kris Mayes to intervene and halt what they describe as an “unlawful spending spree.”

The Goldwater Institute’s findings highlight that entities such as the Phoenix Film Foundation and Phoenix Pride Inc. received financial support under ambiguous categories like “Sponsorships” and “Emergency Assistance.” They assert that the city lacks the legal authority for these expenditures.

Parker Jackson, a staff attorney at the Goldwater Institute, asserted, “This effectively turns large portions of the city’s budget into a patchwork of slush funds.” He noted the city does not track donations by nonprofit status, leaving a significant gap in accountability.

The alleged misappropriations contravene the Arizona State Constitution’s Gift Clause. Jon Riches, the Institute’s Vice President for Litigation, emphasized that many of these outlays appear to breach this clause, which prohibits the use of public funds for private benefit without direct public returns.

Article 9, Section 7 of the Arizona Constitution states that public entities cannot donate or loan funds to private entities, except as authorized by law. This raises critical legal questions regarding the city’s practices.

Goldwater’s attorneys have officially requested Mayes to halt these illegal payments and recover any misappropriated taxpayer funds, invoking relevant state laws.

Jackson’s commentary suggests this issue reflects broader national concerns over government spending practices. He expressed, “Public dollars should be used for public purposes, not to enrich special interests.”

Matthew Holloway is a senior reporter for AZ Free News. Follow him on X for his latest stories, or email tips to Matthew@azfreenews.com.