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N.C. Senate to vote today on control of Charlotte’s airport

The N.C. Senate is scheduled to vote Tuesday on whether to transfer control of Charlotte’s airport from the city to an independent authority.

On the eve of Tuesday’s scheduled vote, a new report says transferring control of Charlotte’s airport would have no impact on investors who hold more than $800 million in airport bonds. Questions about the bonds had caused a delay in the otherwise quick-moving path the airport legislation has taken.

Supporters of an authority said the report, done by a Louisiana-based bond counsel, should remove at least one hurdle to creating an authority.

“What these folks are saying is … there really is no reason why we shouldn’t be able to go forward with this in an expedited manner,” Sen. Bob Rucho, sponsor of the Senate bill, said Monday.

Coming a day before the Senate’s scheduled vote, the report is intended to defuse questions about what a change would mean to the fate of outstanding airport debt. Once past the Senate, the airport bill would go through the N.C. House, where it also has support.

Mayor Anthony Foxx and City Council members argue that Charlotte Douglas International Airport has prospered under city control since it was created in the 1930s.

Authority supporters such as Rucho, a Matthews Republican, say an authority would provide regional oversight of a regional asset and ensure an airport free of what they see as increasing micro-management by the city.

Bonds are the latest battlefront in the airport war.

Last month the city of Charlotte’s bond counsel, the Parker Poe law firm, warned about the impact on bondholders if an authority is created. Bondholders, it said, would have to approve of the transfer of airport control. And tracking them down, they cautioned, would be difficult and expensive.

State Treasurer Janet Cowell also launched her own study of the bond implications. That study won’t be ready until mid-March.

“I’m really looking forward to Treasurer Cowell’s report,” said council member Andy Dulin, a Republican. “She has gone out to outside counsel in Virginia and South Carolina. With the city’s information showing trouble with bond transfer and Sen. Rucho’s information, (Cowell’s) information will be key.”

It’s unclear who paid for the pro-authority study. The Louisiana-based firm, Jones Walker, released its conclusions in a memo to the Alliance for a Better Charlotte, a group led by former City Council member Stan Campbell, who also chaired the city’s Airport Advisory Committee.

Campbell declined to say who paid for the report. But he refuted suggestions in a February memo from the mayor and council to Mecklenburg County lawmakers. In the memo, they said more than $820 million in airport bonds are backed by the city and its AAA bond rating.

“The city doesn’t have anything whatsoever to do with the bonds,” Campbell said Monday. “To suggest that the city … backs the airport revenue bonds is at worst a lie and at best disingenuous and plain wrong.”

Todd Spence, a credit analyst with Standard & Poor’s, said Charlotte Douglas has an A+ credit score, based mainly on airport revenues.

“There’s no direct link in our criteria (to) the city’s credit rating,” he said. “The airport is evaluated on its own merits.”

As to whether it’s run by the city or an authority, he said: “Our criteria doesn’t consider one to be superior to the other.”

While the Parker Poe memo said transfer of bonds to an authority would require bondholder consent, the Jones Walker study for authority backers said no such consent should be required.

“The creation of the authority,” it said, “ … will not impair the contractual obligations owed to bondholders of the Airport Revenue Bonds and therefore should not require consent of such bondholders.”

Morrill: 704-358-5059
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