Scottsdale, Axon come to a compromise over headquarters and number of apartments

The Scottsdale City Council approved a new deal with Taser-maker Axon to cancel a citizen referendum that tried to send the company’s plans to build a new headquarters to voters.

The deal comes months after Arizona lawmakers approved Axon-backed legislation that could have circumvented the referendum — though that law is the subject of an ongoing lawsuit.

Axon, the homegrown Taser and body camera manufacturer, plans to build a new campus that includes a headquarters, housing, a hotel and retail.

Exactly how many apartments the project will include is central to opposition to the development.

Taxpayers Against Awful Apartment Zoning Exemptions, a group led by former City Councilman Bob Littlefield, gathered enough signatures to send the project to voters after the City Council approved plans with 1,900 apartments and condos in 2024.

The new deal

A narrow majority of the City Council repealed that deal on Monday, which essentially cancels the referendum vote.

In its place, they approved a new memorandum of understanding with Axon that includes 1,200 housing units, 600 apartments and 600 condos.

The compromise, which initially featured 1,500 units, appeared dead on arrival on Monday after Mayor Lisa Borowsky signaled she wouldn’t cast the swing vote to approve the deal due to opposition from Taxpayers Against Awful Apartment Zoning Exemptions, or TAAAZE.

“I got notification from TAAAZE that if we sign this, if we approve this MOU, that they intend to do another petition drive and refer it a second time,” she said. “So that is not finality for me. That is absolutely not finality, and I do not want to see this, this mess really, continue.”

But, after a lengthy break in the meeting, the council returned with the lower apartment number and the council voted 4-3, with Borowsky showing a change of heart.

“For me, this creates finality on this issue. It gets the conversation moving in a direction of, let's break ground and start construction and let's go build a great project,” Borowsky said.

Axon also praised the deal and indicated that it plans to move forward with the development following delays caused by the referendum and on-again, off-again negotiations.

“We are very excited to move forward with our new headquarters. Our team will work harder than ever to deliver safe outcomes to public safety and communities alike,” according to a statement.

Axon President Josh Isner told reporters he expects construction to begin in the first or second quarter of 2026.

What’s next

It’s unlikely the new deal is the last chapter in the saga, which dates back to 2020 when Axon first bought the state trust land that will house the campus.

Littlefield, the former councilman, said he could push for another referendum challenging the new Axon deal.

“I think there's a lot of things that they did last night that are probably not legal,” he said. “And so, we're looking at everything to see what our options are to put a monkey wrench into this thing.”

Littlefield declined to say exactly what actions taken by the City Council he thinks are illegal.

In an email to supporters, he said he was opposed to a number of provisions in the new agreement, including the removal of a section requiring Axon to provide rights to around 3,000 acre feet of water, the anticipated amount of water that would be used by the 1,900 residential units included in the original deal.

There is some question about whether citizens can refer the new memorandum of understanding to voters, though.

The terms of the agreement refers to the memorandum of understanding as “an administrative act,” and City Attorney Luis Santaella said, “administrative acts are not considered referable.”

“Ultimately, whether something is referable is something the courts would have to determine,” he said.

What about the state law?

After Littlefield and TAAZE referred the original development plan to voters, Axon officials lobbied lawmakers to pass new legislation circumventing the public vote.

That law, SB 1543, was signed into law by Gov. Katie Hobbs in April.

Also referred to as “the Axon Bill,” it prohibits cities with populations of 200,000 to 500,000 people from blocking businesses from building hotels and apartments as part of a new international headquarters, as long as the headquarters meets certain requirements. Those requirements include employing at least 1,000 full-time employees at wages at an above average wage.

Even though the Scottsdale City Council effectively cancelled the referendum with its vote on Monday, Axon still needs SB 1543 to remain in place to move forward with the paired-down development outlined in the memorandum of understanding.

That’s because the vote to repeal the old deal also changed the zoning on the land owned by Axon back to light industrial, a category that doesn’t typically allow for housing or apartments.

But the new law allows qualifying headquarters projects to include apartment housing even if the area is zoned for light industrial.

Littlefield said he plans to continue his lawsuit challenging the state law.

“The issue for me, the most important issue, has always been the question of reversing the Axon Bill, because that takes away people's right to refer things,” he said.

Opponents of Axon’s development have long tried to pressure the city to join the TAAZE on that lawsuit challenging SB 1543.

On Monday, the City Council authorized the city attorney to file litigation only if Axon doesn’t sign the new deal by Nov. 19.