State Treasurer Janet Cowell added her voice Wednesday to those concerned that transferring control of Charlotte Douglas International Airport to an independent authority could create massive problems with its debt.
She said transferring control would be an unprecedented move that would be widely watched by the financial world because of the hundreds of millions of dollars involved.
This would also mark the first time, she said, that state legislators deliberately altered public debt in a way certain to spark lawsuits.
“You are going into uncharted territory when you proceed with this,” Cowell, a Democrat, told the Observer. “As the treasurer and the protector of the public debt markets, I view this with some trepidation. I personally would not want to be dealing with all of this litigation.”
Cowell was in Charlotte to tout the state’s N.C. Innovation Fund, which makes private equity investments in North Carolina companies.
The state Senate has already passed a bill that would move control of the Charlotte airport from the city to an authority composed of members from throughout the region.
Sen. Bob Rucho, a Matthews Republican who sponsored the bill, said Wednesday that a Louisiana law firm had already spelled out several ways to handle the airport’s more than $800 million in bonds. He said bondholders would have no reason to object to the transfer to begin with. But he said the airport authority could, for example, decide to buy an insurance policy to protect itself.
“That bond issue is not even an issue anymore,” he said.
Rucho said he is planning to meet with Cowell on Thursday to clear up her concerns.
A House version of the bill is pending in its transportation committee. State Rep. Bill Brawley, also a Matthews Republican, pitched the bill to the committee for the first time earlier this month, and said he believed the bond concerns could be easily addressed.
Brawley also said in the meeting that he would not push for a final vote until the Charlotte City Council had a chance to publish a consultant’s report on its airport’s governance.
The Louisiana law firm’s memo appears to contradict a legal opinion commissioned by the state treasurer’s office and completed last month. In a letter sent to the bill’s sponsors, Deputy Treasurer T. Vance Holloman warned of “prolonged” litigation and the potential of making North Carolina debt less desirable and thus more costly going forward.
Brawley did not respond to requests for comment Wednesday.
Dunn: 704-358-5235 Twitter: @andrew_dunn
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