Wed March 27, 2013
Airport Authority Backers Downplay Concerns
RALEIGH Two key supporters of a proposed Charlotte airport authority Tuesday sought to downplay a report from the state Treasurer’s office that raised issues over the move.
In a letter Monday to Sen. Bob Rucho, a main sponsor of a bill to transfer airport control from the city to an independent authority, Deputy Treasurer T. Vance Holloman warned that could result in “prolonged litigation” and even raise the cost of state borrowing. He urged lawmakers to “proceed cautiously.”
Holloman drew his conclusions from a study by a New York bond attorney that raised questions about the legal issues involving the effect of a transfer on the airport’s $860 million in bond debt.
Rucho said it “pretty much repeated the same questions” as an earlier report from a Charlotte bond attorney.
Rep. Bill Brawley, the House sponsor and like Rucho a Matthews Republican, said “there’s not any new information” in the Treasurer’s report.
“It shows possible problems, but they did not say, ‘You cannot do this,’ ” he said. “They said, ‘If you do this you can get sued.… We’ll do more research and make sure we have a high level of confidence that we can do what we want to do.”
Among the concerns raised by New York bond counsel Steven Turner is whether a state-mandated transfer could hurt airport bondholders in violation of the Contract Clause of the U.S. Constitution.
“It’s the kind of red flag you don’t play around with,” said Sen. Dan Clodfelter, a Charlotte Democrat. “You get it resolved before you jump off the cliff. … If you get it wrong, there’s a lot of money at stake.”
Republican Rep. Charles Jeter of Huntersville said the issues raised in the report “(have) to be accounted for and will be.”
“Certainly it’s an obstacle that needs to be overcome, and I think overcome before final passage of the bill,” he said.
The report could help buy time for the bill’s opponents.
The city is paying $150,000 for a study of airport governance. The committee’s report is due May 1.
GOP Rep. Ruth Samuelson of Charlotte said the Treasurer’s report makes her “more interested in hearing what the committee says.”
“I don’t think (the authority bill) will get on the floor before the independent committee does its study,” she says.