Attorney general sues universities over massive ASU real estate deals

The Arizona Republic
Thursday, January 10, 2019
Rachel Leingang

The Arizona attorney general has launched another battle against the state's public universities, this time over large Arizona State University real estate projects that he says are illegal.

Attorney General Mark Brnovich sued the Arizona Board of Regents, which oversees the state's universities, in Arizona Tax Court Thursday.

He claims real estate deals approved by the board allow universities to boost favored companies and help them avoid paying taxes. ASU is essentially renting out its tax-exempt status to private businesses, Brnovich said.

Specifically, Brnovich calls out Arizona State University's practice of allowing for-profit companies to build on university-owned land, which is tax-exempt. He seeks to force an unbuilt Omni Hotel to pay property taxes.

"ASU is a public university, not a commercial enterprise or an urban development authority. It is inappropriate for this educational institution to pick winners and losers in the highly competitive property development industry by negotiating for the use of ABOR's tax shielding status," the lawsuit says.