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Legal action over airport could have precedent

RALEIGH Charlotte city officials already have made veiled threats of legal action if the General Assembly transfers control of the city’s airport to an independent authority.

And one lawmaker believes the city could win.

Democratic Sen. Dan Clodfelter, a Charlotte attorney, said there’s a recent precedent:

As a member of Asheville’s legal team, he helped persuade a Superior Court judge to block, at least for now, the legislature’s transfer of that city’s water system.

“They’re very analogous,” he said of the two cases.

Legislation to transfer control of Charlotte Douglas International Airport from the city to an independent authority took another step toward passage this week with its approval by a House committee. A vote next week by another committee could put the measure on the House floor this month.

If the Senate concurs with House changes, the measure would become law.

City officials have fought the bill. City Manager Ron Carlee said it could send the airport into “chaos.” Asked about possible legal action, Carlee and other officials have said all options are on the table. City Attorney Bob Hagemann said only that the mayor and council asked him to explore their legal alternatives.

Supporters of an authority bill say any lawsuit would only hurt the airport.

“A lawsuit would be counterproductive,” said Sen. Bob Rucho, a Matthews Republican and a main sponsor of the authority legislation. “It would be detrimental to the future of the airport … to the (adjacent) intermodal facility and therefore to the economic growth of the region and the state.”

Asheville’s lawsuit

Just as Charlotte has fought to keep Charlotte Douglas International Airport under city control, Asheville fought to keep its water system.

But last month lawmakers passed a measure to put it under a Metropolitan Sewerage District. Bill supporters said it would make water delivery more efficient and prevent the city from charging non-residents more.

Gov. Pat McCrory let the bill became law without his signature.

On May 13, the day the bill passed, Clodfelter’s team sued in Wake County Superior Court. A judge issued a temporary restraining order, which is still in effect.

Asheville’s suit argues that the General Assembly overstepped its authority.

“The transfer of assets and debts … is nothing more than an edict by the State that property now owned by Asheville shall belong to another entity,” the suit says. “… (The act) is not a valid exercise of the sovereign power to take or condemn property for a public use, since the property is already used for precisely the same purposes as are contemplated by the (act)….”

“The General Assembly’s power over local government is not unlimited,” Clodfelter said Thursday.

The Asheville suit also says that if a judge were to rule against the city, the city should be entitled to compensation for having its assets taken “against the wishes of the system’s owner.” It cited one study that put the value of those assets at over $1 billion.

“If the court disagrees with us to say that the General Assembly does have the power, they have to pay us just compensation,” Clodfelter said.

In making his point, Clodfelter cited a 1913 North Carolina case. The judge’s opinion in the case said that while the legislature generally has absolute control over municipalities, in certain functions “the legislature is under the same constitutional restraints that are placed upon it in respect of private corporations.”

Paying for lost assets

Frayda Bluestein, a faculty member at UNC’s School of Government, said she believes the legislature does have the broad authority over local interests. But she called compensation, “the issue where I think the court could come down one way or another.”

Neither the Asheville water bill nor the Charlotte airport bill call for any compensation to the cities.

Rucho questions the need for compensation. The airport’s physical assets, he said, have been paid for mostly out of airport revenues.

“What is there to compensate for?” he said. “Are they going to lose value? Are they going to lose resources?”

Another cause of possible legal action could involve airport bonds.

In March, a state Treasurer’s office said legal uncertainty over the airport’s $860 million debt “could result in potential prolonged litigation.” On Thursday a department spokesman said those worries remain.

“The Department of State Treasurer still has the same concerns about the airport transfer legislation,” spokesman Schorr Johnson said Thursday. “The House changes do not alleviate these concerns.”

Rucho dismissed such concerns, saying the bonds would continue to be backed by airport revenues.

“That’s not an issue anymore,” he said.

Morrill: 704-358-5059
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