NOTICE: NOT FOR OFFICIAL PUBLICATION.

UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL

AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE

ARIZONA COURT OF APPEALS

DIVISION ONE

NEPTUNE SWIMMING FOUNDATION, Plaintiff/Appellant,

v.

CITY OF SCOTTSDALE, Defendant/Appellee.

No. 1 CA-CV 21-0053 

Appeal from the Superior Court in Maricopa County

No. CV2019-007172

The Honorable Joseph P. Mikitish, Judge

AFFIRMED

COUNSEL

Goldwater Institute, Phoenix

By Jonathan Matthew Riches, Timothy Sandefur

Co-Counsel for Plaintiff/Appellant

DL Hall Attorney PLLC, Scottsdale

By Dennis L. Hall

Co-Counsel for Plaintiff/Appellant

Scottsdale City Attorney’s Office, Scottsdale

By Eric C. Anderson

Counsel for Defendant/Appellee

FILED 3-9-2023
NEPTUNE v. SCOTTSDALE

Decision of the Court

2

MEMORANDUM DECISION

Judge Jennifer M. Perkins delivered the decision of the Court, in which 

Presiding Judge Cynthia J. Bailey and Judge Maria Elena Cruz joined.

P E R K I N S, Judge:

¶1 Neptune Swimming Foundation (“Neptune”) sought 

mandamus, declaratory, and monetary relief stemming from Scottsdale’s 

failure to award Neptune a license to operate a youth competitive 

swimming program in Scottsdale’s facilities. Neptune now challenges the 

superior court’s entry of judgment for Scottsdale. For the following reasons, 

we affirm.

FACTS AND PROCEDURAL BACKGROUND

¶2 Scottsdale’s Parks and Recreation Department maintains 

various recreational facilities, including four aquatic centers. Scottsdale

opens its aquatic centers for public swimming, swim lessons, and youth

competitive swimming. Youth competitive swim teams can use the aquatic 

centers only after the team’s sponsor obtains a revocable license from 

Scottsdale.

¶3 Scottsdale Aquatic Center (“SAC”) and Neptune operate 

comparable youth competitive swimming programs. SAC is the only 

competitive swim team Scottsdale has allowed to use its aquatic centers for 

over 50 years. Scottsdale and SAC entered the most recent iteration of this 

arrangement in 2016 when SAC received a revocable license (“2016 

License”). The 2016 License contained an initial three-year term with two 

consecutive one-year options. The 2016 License required SAC to pay: $3 per 

hour for short course lap lanes, $7 per hour for long course lap lanes; $3,150

per year for office space; $1,400 per year for storage space; and additional 

operating fees. Scottsdale’s City Council set the lap lane fee rates and 

increased those rates in May 2019.

¶4 In August 2017, Neptune’s counsel sent Scottsdale’s mayor a 

letter objecting to the 2016 License. Neptune asserted that the 2016 License

violated the Scottsdale Charter and Arizona Constitution because “[t]he 

grant was made at significantly below market rates and without compliance 
NEPTUNE v. SCOTTSDALE

Decision of the Court

3

with open bidding.” Scottsdale disagreed with Neptune’s assertions but 

developed a procurement process for the next available license.

¶5 In January 2018, Scottsdale published its Request for Proposal

(“RFP”), explaining the procurement process and presenting the license 

terms. The RFP included a provision stating “all procurement 

activities . . . are in conformance with the rules and regulations of the 

Scottsdale Procurement Code” (“Code”). The Code directs procurement 

awards be made to the most advantageous bidder. Code § 2-188(c)(5). The 

RFP provided Scottsdale’s five weighted evaluation criteria and other 

factors the scoring committee could consider, which included: revenue; the 

bidder’s experience; the bidder’s ability and willingness to meet the listed 

specifications and standards; and the quality of the bidder’s proposal and

other presentation materials. The RFP’s bidding process description

included notice that “[b]idders may be invited to make a presentation on 

their proposals.”

¶6 Scottsdale selected three disinterested city employees to serve 

on the scoring committee. Only SAC and Neptune submitted bids and the 

scoring committee selected SAC as the most advantageous bidder; SAC 

received 31.75 more points than Neptune. Scottsdale provided its Notice of 

Intent to Award the license to SAC in March 2018. Neptune formally 

protested the RFP results, but Scottsdale dismissed that protest because it 

believed “the recommended award to [SAC] as the most advantageous 

Contractor . . . met all Procurement Code rules and procedures.”

¶7 Neptune then notified Scottsdale that the scoring committee

miscalculated the point totals. Per the corrected scores, Neptune received 

.75 more points than SAC. Scottsdale agreed that it miscalculated the bid

totals and identified additional bid evaluation anomalies. Scottsdale then 

invited both SAC and Neptune to give presentations on their proposals.

Neptune protested Scottsdale’s decision to reconvene the scoring 

committee and invite the bidders to give presentations, arguing the Code 

required Scottsdale to instead award Neptune the license.

¶8 Scottsdale responded that the Code did not bind the RFP

because it did not involve Scottsdale “purchasing materials, services, or 

construction and this is not a City-mandated or City-sponsored program.”

Scottsdale then canceled the RFP on May 11, 2018, rescinding its Notice of 

Intent to Award the license to SAC. Instead, Scottsdale exercised the first 

one-year extension option under SAC’s 2016 License.
NEPTUNE v. SCOTTSDALE

Decision of the Court

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¶9 To set the fees for the extension, the Scottsdale City Council 

reviewed data for swim lane access in other Arizona municipalities such as 

fees, quality, operating expenses, and how the city and licensee divide 

expenses. The surveyed cities’ lane pricing ranged from $1 (in Marana) to 

$15 (in Chandler) per lane per hour. Scottsdale set the new fee at $8 per lane 

per hour for the long course and $4 for the short course.

¶10 In May 2019, Neptune filed a complaint seeking a writ of 

mandamus compelling Scottsdale to award Neptune a license under the 

RFP. Neptune alternatively alleged a violation of the Gift Clause, claiming

the 2016 License is not supported by adequate consideration given 

Neptune’s bid for a higher rate per lane hour. Neptune’s remaining claims 

asserted Scottsdale caused Neptune money damages by failing to follow

the bidding process.

¶11 Neptune and Scottsdale filed competing motions for 

summary judgment. Neptune argued that Scottsdale abused its discretion 

by abandoning the RFP, thus violating the Code, and that the 2016 License

violated the Gift Clause. Scottsdale argued it used the Code only as a guide,

as the Code did not otherwise apply to the RFP. Scottsdale nonetheless 

contended that cancelling the RFP did not violate the Code. Scottsdale 

asserted the statute of limitations barred Neptune’s Gift Clause claim and 

alternatively claimed the 2016 License met the Gift Clause’s requirements.

¶12 The superior court granted summary judgment in 

Scottsdale’s favor. The court found Scottsdale’s decision to cancel the RFP 

did not violate the Code, nor was it arbitrary and capricious. The court 

reasoned that because the RFP sought the “most advantageous” bid, not the 

highest bidder, once a bidder raised concerns about the scoring committee’s 

calculations, Scottsdale could request presentations and seek “a consensus 

of committee members.” The court concluded that Neptune “failed to 

continue with the process” by objecting to the presentation invitation, and 

Scottsdale acted within its discretion to cancel the RFP. 

¶13 The superior court found no Gift Clause violation but did not

address Scottsdale’s statute of limitation defense to that claim. The court 

ruled that the recreational services provided under the 2016 License serve

a public benefit and that “[j]ust because Neptune agreed to pay more [per 

swim lane] does not mean that the [2016 License] is so inequitable that it 

amounts to a subsidy.”

¶14 Neptune timely appealed, and we have jurisdiction under

A.R.S. § 12-2101(A)(1).
NEPTUNE v. SCOTTSDALE

Decision of the Court

5

DISCUSSION

¶15 Neptune argues the superior court erred in granting

summary judgment to Scottsdale on the Gift Clause claim and upholding 

the contract award to SAC. We review the court’s grant of summary 

judgment de novo, “viewing the evidence and reasonable inferences in the 

light most favorable to the party opposing the motion.” Zambrano v. M &

RC II LLC, 254 Ariz. 53, 55, ¶ 9 (2022). 

I. Mootness and Statute of Limitations

¶16 Scottsdale argues that this appeal is moot because the license 

pursued by the swim organizations would expire by the conclusion of the 

appeal. Arizona courts may consider an appeal either of great public 

importance or an issue “capable of repetition yet evading review.” Phoenix 

Newspapers, Inc. v. Molera, 200 Ariz. 457, 460, ¶ 12 (App. 2001). Failure to 

follow a city procurement code and applicability of the gift clause to 

situations in which the city takes a less lucrative deal is capable of 

repetition.

¶17 Scottsdale also argues that the statute of limitations bars

Neptune’s suit because Neptune had one year under A.R.S. § 12-821 to file 

suit, Neptune was aware of the 2016 License no later than August 8, 2017, 

and did not file until May 3, 2019. But Scottsdale ignores its own conduct 

inducing Neptune to delay suit by offering the RFP process. See Nolde v. 

Frankie, 192 Ariz. 276, 279–80, ¶¶ 13–14 (1998) (a defendant who induces 

plaintiff to delay filing suit cannot then rely on a statute of limitations “as a 

shield for inequity”). Scottsdale did not cancel the RFP process Neptune 

participated in until May 11, 2018, and Neptune filed its complaint within 

one year. This appeal is not moot or time barred.

II. Procurement Code

¶18 Scottsdale attempts to avoid Neptune’s procurement code 

challenges by contending the Code applies only to purchases of materials, 

services, and construction made with public funds. Even if we read the 

Code as ordinarily inapplicable to the transactions contemplated by the 

RFP here, Scottsdale explicitly held out the RFP as subject to the Code. But 

assuming, without deciding, that the Code applies, Scottsdale abided by the 

Code when it canceled the RFP.

¶19 Neptune raises two challenges to the superior court’s findings 

implicating the Code. First, Neptune claims Scottsdale violated the Code by 

requesting bidder presentations after the Notice of Intent to Award issued 
NEPTUNE v. SCOTTSDALE

Decision of the Court

6

and it raised the scoring discrepancy. Once Scottsdale acknowledged its 

miscalculation, Neptune argues, the Code required Scottsdale to award 

Neptune the license. Second, Neptune disputes the superior court’s finding 

that Neptune “failed to continue with the [procurement] process.” 

¶20 The Code distinguishes between a Notice of Intent to Award 

and an actual award. See, e.g., Code R2-188.23(B)(1) (“All Notices of intent 

to Award shall be posted for at least 7 days prior to the award.”). Before the 

city awards a contract, an aggrieved bidder may protest an alleged Code 

violation, including whether the city correctly evaluated the bids. Code 

§ 213(a). If the city manager or a designee sustains the protest, then “the 

Director shall implement an appropriate remedy.” Code R2-213.2(A). 

Acceptable remedies include reissuing the solicitation, issuing a new 

solicitation, awarding a contract consistent with the Code, or “[s]uch other 

relief as is determined necessary to ensure [Code] compliance.” Code R2-

213.2(C)(1)-(4). “After opening of bids or proposals, but before award, a 

solicitation may be canceled if the Director determines that cancellation is 

advantageous to the City.” Code R2-193.3(A).

¶21 After Scottsdale issued the Notice of Intent to Award to SAC, 

Neptune timely protested whether Scottsdale correctly evaluated the 

parties’ bids. In response to Neptune’s protest, Scottsdale corrected the 

scores. Scottsdale’s director reconvened the scoring committee and invited 

the parties to give presentations. Both SAC and Neptune sent Scottsdale 

letters objecting to its plan. The director then canceled the RFP, stating, 

“[a]fter further review of this matter, it has been determined that it is in the 

best interest of the City to cancel the RFP.”

¶22 The Code provides the director with discretion to cancel a 

solicitation if it is advantageous to Scottsdale, until it issues an award. Once 

Scottsdale sustained Neptune’s protest for the miscalculation, the director 

could “implement an appropriate remedy,” or cancel the RFP. Id. Here, the 

director first invited the parties to give presentations to the scoring 

committee. When both parties refused to participate, the director concluded 

that Scottsdale would benefit from cancelling that process altogether and 

reverting to the original license. 

¶23 Neptune contends once Scottsdale accepted a bid it had to 

move forward with the RFP because all subsequent actions were necessarily 

ministerial. But Neptune’s reliance on City of Phoenix v. Wittman Contracting 

Co. for that proposition is misplaced. In Wittman, Phoenix had to decide 

between two bids for construction of a water line. 20 Ariz. App. 1, 2 (1973). 

The court determined the city’s remaining actions were necessarily 
NEPTUNE v. SCOTTSDALE

Decision of the Court

7

ministerial because Arizona law at the time required preference for parties 

that successfully performed previous public contracts. Id. at 5 (relying on 

A.R.S. § 34-241). In other words, the court’s analysis rested primarily on a 

statute no longer in force. See Big D Constr. Corp. v. Ct. of Appeals, 163 Ariz. 

560, 570 (1990) (A.R.S. § 34-241 violates the equal protection (art. 2, § 13) and 

special privileges (art. 4, pt. 2, § 19) provisions of Arizona’s Constitution). 

¶24 The Wittman court’s additional authority—and Neptune’s 

other primary authority for this argument—is similarly unpersuasive. In 

Brown v. City of Phoenix, the city considered competing bids for car rental 

businesses to lease space at the airport. 77 Ariz. 368, 371 (1954). The city 

awarded the lease to the “less favorable bidder,” id. at 375, despite direction 

in the city charter to make the award to the “highest responsible bidder,” 

id. at 370. Our supreme court determined that the city officials abused their 

discretion, and the court directed issuance of a writ of mandamus awarding 

the lease to the other bidder. Id. at 377. Critical to the court’s conclusion, the 

city in Brown conducted a one-sided evaluation—it failed to investigate the 

reliability and capability of the competing bidder. Id. at 375. The city’s 

exercise of discretion thus could not have been reasonable on a conclusion 

“in the best interests of the city, its citizens and taxpayers.” Id. at 375.

¶25 Neptune suggests that, under Brown, Scottsdale necessarily 

acted arbitrarily by failing to accept Neptune’s higher bid. But Scottsdale 

did not reject Neptune’s higher bid and accept SAC’s lower one as the city 

did in Brown. The Notice of Intent to Award the contract was not an 

acceptance and did not bind Scottsdale. See Code R2-201.1(A). Ultimately, 

the director decided to reconvene the scoring committee because the RFP 

process involved the mathematical error Neptune identified and some

procedural anomalies. Specifically: the scoring evaluations failed to include 

some of the criteria identified in the RFP; using revenue as the primary 

factor undermined the fees already set by the city council; one response did 

not “contain a realistic estimate of lane utilization based on historic 

availability”; and the RFP did not make it clear whether the per hour fee 

included charges for staff time.

¶26 The director’s decision to reconvene the scoring committee 

and receive the parties’ presentations also falls squarely within the Code’s 

broad, non-exhaustive list of available remedies. See Code R2-213.2(C). 

Even after choosing this remedy, the director was under no obligation to 

issue an award. See Code R2-193.3(A) (director may cancel a solicitation 

before an award if cancelation is advantageous to Scottsdale). Faced with 

objections by both parties to the proposed remedy, Scottsdale acted within 
NEPTUNE v. SCOTTSDALE

Decision of the Court

8

its authority by cancelling the RFP and reverting to the 2016 License. The 

superior court did not err in rejecting Neptune’s procurement challenge.

III. Gift Clause

¶27 An Arizona city may not “make any donation or grant, by 

subsidy or otherwise, to any individual, association, or corporation.” Ariz. 

Const. art. 9, § 7 (“Gift Clause”). “[T]he evil to be avoided [is] the depletion 

of the public treasury or inflation of public debt by engagement in nonpublic enterprises,” State v. Nw. Mut. Ins. Co., 86 Ariz. 50, 53 (1959), or “by 

giving advantages to special interests,” Schires v. Carlat, 250 Ariz. 371, 374, 

¶ 6 (2021) (quoting Wistuber v. Paradise Valley Unified Sch. Dist., 141 Ariz. 

346, 349 (1984)).

¶28 We apply a two-part test in evaluating a Gift Clause 

challenge. Schires, 250 Ariz. at 374, ¶ 7. First, we consider whether the 

benefit at issue serves a public purpose. Id. If so, we evaluate whether the 

public is paying far more in consideration than it receives in value. Id. at 

375, ¶ 7. Our courts have applied this analysis even when cities receive 

rather than dispense funds. See Kromko v. Ariz. Bd. of Regents, 149 Ariz. 319, 

322 (1986). Neptune contends Scottsdale’s cancellation of the RFP lacked a 

public purpose and the court erred in its public purpose analysis. Neptune 

also argues the 2016 License lacked the requisite consideration and the 

court failed to determine the fair market value of the public’s benefit. 

A. Public Purpose

¶29 Government expenditures or benefits must be in pursuit of a 

public purpose. Wistuber, 141 Ariz. at 349. “[A] public purpose promotes 

the public welfare or enjoyment,”and can arise out of a direct or indirect 

benefit. Schires, 250 Ariz. at 375, ¶ 8 (citation omitted). The political 

branches of government are best suited to determine what purposes are

public, and we afford them deference. Turken v. Gordon, 223 Ariz. 342, 349, 

¶ 28 (2010).

¶30 Neptune argues that the court’s public purpose review 

applies to Scottsdale’s decision to cancel the RFP. But the RFP cancellation 

simply closed the city’s procurement process and is not a “payment or 

conveyance.” Wistuber, 141 Ariz. at 349. The “conveyance” is Scottsdale’s 

pool facilities license to SAC. The license provides access to a venue for 

competitive swimming activities. These swimming activities provide a 

recreational service to members of the public. Neptune agrees that 

recreational services are a public benefit. The superior court did not err in 
NEPTUNE v. SCOTTSDALE

Decision of the Court

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concluding that the 2016 License allowing SAC to offer its swimming 

activities served a public purpose. See Schires, 250 Ariz. at 375, ¶ 11.

B. Consideration

¶31 The “primary check on government expenditures for gift 

clause purposes” is whether the consideration for the transaction is 

sufficient. Id. at 376, ¶ 13. Government expenditures must not far exceed 

the consideration offered by the private entity. Wistuber, 141 Ariz. at 349. 

“[P]aying far too much for something effectively creates a subsidy from the 

public to the seller.” Turken, 223 Ariz. at 350, ¶ 32. “Our inquiry, therefore, 

focuses on what the public is giving and getting from an arrangement and 

then asks whether the ‘give’ so far exceeds the ‘get’ that the government is 

subsidizing a private venture in violation of the Gift Clause.” Schires, 250 

Ariz. at 376, ¶ 14.

¶32 Neptune argues its offer to pay a higher rate per lane hour 

creates a subsidy to SAC of the difference between the two rates. But 

Neptune fails to properly identify the “give” and the “get” for purposes of 

our consideration analysis. As noted above, after the cancelled RFP process, 

Scottsdale reverted to the 2016 License. We do not review the failed RFP 

process resulting in no agreement; we instead evaluate the 2016 License—

as extended in 2019—for potential Gift Clause infirmity. We find none. 

¶33 Through the 2016 License, SAC agreed to pay Scottsdale the 

rates and fees established by the city council and subject to revision by the 

council. Supra ¶ 3. To establish a violation, Neptune must demonstrate that 

the “give” of the 2016 License to Scottsdale far exceeds any “get” the city 

received. And in evaluating Neptune’s challenge, we do not defer to 

Scottsdale’s “assessment of value but should instead identify the fair 

market value of the benefit provided to [SAC] and then determine 

proportionality.” Schires, 250 Ariz. at 378, ¶ 23.

¶34 Neptune contends its higher offer establishes the market 

value of the license and it cites to cases defining fair market value in the 

deficiency judgment context for the proposition that its higher bid controls 

the consideration analysis at the fair market value stage. See TCC Enters. v. 

Est. of Erny, 149 Ariz. 257, 258 (App. 1986); see also Honeywell Info. Sys., Inc. 

v. Maricopa Cnty., 118 Ariz. 171, 174 (App. 1977). But a governmental 

procurement process is unlike a judicial decision-making process. Each 

process is governed by different statutes and controlled by different policy 

rationales. Compare MidFirst Bank v. Chase, 230 Ariz. 366, 368, ¶ 7 (App. 2012)

(citation omitted) (the goal of the deficiency judgment statute is to prevent 
NEPTUNE v. SCOTTSDALE

Decision of the Court

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a “windfall” to a real property purchaser), with Schires, 250 Ariz. at 378, ¶ 

23 (goal of Gift Clause fair market value judgment is determining 

“proportionality” of cost to benefit). 

¶35 Neptune would have us hold that the monetary value of 

unsuccessful bids on government contracts establishes the standard by 

which we judge reasonable consideration. Schires tells us we must identify 

the objective fair market value and in this case—unlike in Schires—the city 

actually provided the evidence from which the superior court could 

evaluate proportionality. See supra ¶ 9. Notably, the range of fees that the 

city considered started well below its 2016 fee structure and continued to 

above Neptune’s bid. 

¶36 The 2016 License details the lane rate and extra costs SAC 

must pay. Scottsdale then updated the license with new fees in 2019 based 

on its assessment of other swim lane fee structures. The undisputed 

material facts do not establish that the updated fees are unreasonably low, 

or that the consideration SAC paid is disproportionate to Scottsdale’s cost 

in providing the lanes. Instead, Scottsdale structured the payment to 

account for additional staffing and mimic similar lane prices. The superior 

court did not err in granting summary judgment on the Gift Clause claim.

IV. Attorneys’ Fees

¶37 Neptune requests attorneys’ fees and costs under A.R.S. §§ 12-

341, -348, and the private attorney general doctrine. Because Scottsdale is 

the prevailing party on appeal, we deny Neptune’s request. 

CONCLUSION

¶38 We affirm.