A lawsuit filed by four former broadcasters and communications professionals claims the Charlotte City Council broke state open government laws when it went into closed session to discuss paying for renovations at Bank of America Stadium.
“They deliberated and voted secretly for a plan to raise the prepared food and beverage tax for stadium renovations,” said Mike Cozza, a former TV newsman and one of the plaintiffs in the case. “There’s no exemption in the Open Meetings Law that allows closed discussion or votes for a tax plan.”
According to transcripts of a Feb. 8 closed session of the Charlotte City Council, board members discussed renovations to the stadium where the NFL’s Carolina Panthers play. They also discussed asking the General Assembly to increase the city’s prepared food tax by 1 percentage point in hopes of raising $144 million to pay for stadium renovations.
At one point, according to transcripts of the Feb. 8 closed session, Patsy Kinsey, then a council member and now mayor, said that once council members voted on the incentives package, it would be a “done deal.”
The General Assembly didn’t go along with the council’s plan to increase the city’s prepared food tax. Instead, it allowed the city to expand the use of existing taxes to include stadium renovation.
In April, the council pared down the contribution to $87.5 million, and voted unanimously to provide the money for renovation as a “hard tether” to keep the Carolina Panthers in Charlotte for six years.
Cozza and his co-plaintiffs — Bruce Bowers, Ken Koontz, and Wayne Powers — say in their lawsuit that the mayor and city council defendants violated the state’s Open Meetings Law by going into closed session to discus the “location of industries or businesses” in the city, including potential economic development incentives.
Cozza said that the “location” of Bank of America Stadium never has been in doubt.
“It is the case that the Panthers stadium has been located at 800 S. Mint St. for 17 years,” Cozza said. “Nobody proposed to change the location.” Cozza went on to say that Panthers owner Jerry Richardson has said that the idea of moving the team would be “offensive” to him.
Nor is it clear that a potential new owner of the Panthers would find a financial benefit in moving the team since it owns Bank of America Stadium. An owner relocating to another city may have to purchase or lease a facility for the team, incurring an additional expense while leaving Bank of America Stadium without a tenant.
Bob Hagemann, Charlotte city attorney, said via email that the city council was well within its legal rights when it went into closed session to discuss the stadium renovations and “to tether the Carolina Panthers to Charlotte.”
Hagemann said that while Richardson does not plan to move the team, the team would be sold sometime in the future. Hagemann noted that Richardson is in his mid-70s and had a heart transplant several years ago.
“If not sold before, the team will be sold not long after Mr. Richardson dies,” Hagemann said. “The next owner is not likely to have the same commitment to the Carolinas that Mr. Richardson has, and other cities are trying to lure an NFL team.
Cozza said that the city council violated state open government laws when it discussed and voted to request the prepared food taxing authority.
“They deliberated and voted secretly for a plan to raise the prepared food and beverage tax for stadium renovations,” Cozza said. “There’s no exemption in the Open Meetings Law that allows closed discussions or votes for a tax plan.”
Cozza sais that while the law does allow for closed sessions for economic development incentives, taxes are not included.
“A tax is not something that the city gives,” Cozza said. “It’s something that the city takes.”
Hagemann said the law allows for closed sessions to discuss “matters relating to the location or expansion of industries or businesses.” And that would include discussing how to pay for them.
“To me it is illogical, impractical, and contrary to the ‘matters relating to’ phrase to suggest that the council may consider what it might offer in exchange for a commitment from a potential private sector partner, but may not consider how it would pay for the public contribution,” Hagemann said.
Cozza also notes the transcript showing that then-council member Kinsey, now the mayor, said that following the closed session, the action by the council would be a “done deal.”
According to the transcript, Kinsey said, “The fact is, friends, when we vote today it’s a done deal, based on the timeline that I’ve been told. Even though we say the public can come and speak to the increase in tax, it’s done. It’s done and that is OK, if that is what we want that’s OK.”
Hagemann said he didn’t dispute what Kinsey said, but he doesn’t see a legal significance to the “done deal” statement.
“The truth of the matter is that the proposal that council publicly announced immediately following the Feb. 8 closed session was obviously not a done deal as the state chose not to participate either by authorizing the proposed revenue source or by directly investing in tethering the Panthers to Charlotte and North Carolina,” Hagemann said.
Cozza said the council never took a public vote on the proposal. And he said that the council violated its own code of ethics, which states:
“The mayor and council members should conduct the affairs of the board in an open and public manner. They should comply with all applicable laws governing open meetings and public records, recognizing that doing so is an important way to be worthy of the public’s trust.”
Hagemann reiterated his position that the council complied with the state Open Meetings Law. He noted that Kinsey has asked that the ethics complaint be placed on the council’s Sept. 23 meeting.
“It would be premature for me to discuss the complaint before council considers the matter,” Hagemann said.
The plaintiffs are asking the court to declare that the actions taken in the closed meetings were in violation fo the state’s Open Meetings Law, to enjoin the council from future violations, and attorneys fees.
The city has yet to file its response. Hagemann said that the deadline for filing a response has not passed.
Barry Smith (@Barry_Smith) is an associate editor of Carolina Journal.