Key Points:

• The Scottsdale City Council voted to challenge state law 

• Law allows Axon to build its global headquarters in the city

• Citizen group also preparing to take action against the law

The Scottsdale City Council voted on Sept. 12 to take a preliminary step towards filing a lawsuit against the state over a law that will allow Axon to build its global headquarters in the city.

The council voted 6-1 to instruct the city’s interim attorney to file a notice of claim, which will reserve the city’s right to challenge the law that paved the way for the headquarters and bypass a ballot measure that would’ve let voters determine the fate of the project.

Councilmember Kathy Littlefield cast the lone ‘no’ vote.

The council approved the notice of claim just days after they voted during a Sept. 9 meeting to withdraw an agenda item to authorize a lawsuit against the state.

The new law will require cities with populations between 200,000 and 500,000 to allow hotels and multifamily residential housing to be built in areas zoned for light industrial use without needing an application that would require a public hearing. It is set to take effect on Sept. 26. 

If the city doesn’t move forward to stop the legislation, a group called Taxpayers Against Awful Apartment Zoning Exemptions, or TAAAZE, intends to file a lawsuit before the law takes effect, said TAAAZE Chairman Bob Littlefield, who is a former Scottsdale City Council member and Kathy Littlefield’s husband.

Some City Council members cited ongoing negotiations with the company as a reason not to approve a lawsuit.

“Litigation is a failure of negotiation. We’re not done negotiating,” said Councilmember Solange Whitehead, who made a motion to authorize the notice of claim. “In my mind, there’s a lot that we can still do. We want to keep every single option open.”

Councilmember Adam Kwasman said at the meeting that the notices of claim are a normal means to a “litigatory end.”

“Right now, I could confirm that we are smack dab in the middle of high stakes (negotiations) with a massive employer in order to guarantee a serious reduction of apartments for Scottsdale residents,” Kwasman said. “And when you’re in the middle of a high stakes negotiation, that does not mean you preclude any chance of litigation.”

However, some council members still wanted to move forward with the lawsuit.

Councilmember Barry Graham made an alternate motion during the meeting to file a notice of claim and a lawsuit challenging the constitutionality of the law, but the motion failed 4-3 with Mayor Lisa Borowsky and Councilmembers Kwasman, Whitehead and Maryann McAllen voting against the measure.

An Axon spokesman declined to comment on the council’s decision.

TAAAZE is also looking to take action before the law goes into effect.

The group filed a referendum application to send the legislation to the ballot after it was approved in April. They have also kept open the possibility of a lawsuit.

The deadline to submit signatures for a recall election is Sept. 26. The group would need 127,975 signatures to send the law to the ballot.

Still, Littlefield is hoping the city will file a lawsuit.

“It still depends a little bit on what the city’s doing because they have better standing than we do,” Littlefield said.

Axon’s headquarters reached a point of contention after the company proposed to include about 1,900 apartments and condominiums, a hotel and retail integrated as part of the project. 

The company and city engaged in negotiations over the number of apartments and density of the project, but company officials said in June that they had withdrawn from negotiations and blamed city officials for creating a “toxic environment” during the talks.

Axon President Josh Isner said that, at the time, the company still intended to stay in the city and would be open to future negotiations.

The Scottsdale City Council initially approved zoning for the project last November, although the majority of the current council members took office after the approval. 

Once the zoning was approved, TAAAZE collected enough signatures to send the measure to the ballot after some residents expressed opposition to the project.

However, the law, which was introduced last legislative session as Senate Bill 1543, cleared the way for the project without needing voter approval.