News: CJ Exclusives

New CLT Airport Authority Lands In Court

City officials waste little time litigating actions by legislature

RALEIGH — It was one of the most contentious bills this legislative session, but Senate Bill 81 ultimately was approved, transferring ownership of Charlotte Douglas International Airport to an independent regional authority.

“Unfortunately, if this measure passes this bill and everything associated with it is going to end up in court, just like the water system issue in Asheville, just like the airport in Asheville,” state Rep. Kelly Alexander, D-Mecklenburg, presciently warned at a July 10 House Finance Committee meeting.

After six months of intense debate, the bill became law July 18 without Gov. Pat McCrory’s signature. That is because S.B. 81 is a local bill that does not require his approval. McCrory, the Queen City’s former mayor, maintained for months the airport measure was a local matter and should have been settled amicably.

Instead, shortly after the bill’s passage, the city wasted no time filing suit to block the law from taking effect.

“We are indeed in litigation,” said Charlotte City Councilman Andy Dulin, declining to discuss specifics. He referred lawsuit questions to Charlotte City Attorney Bob Hagemann, who did not respond to messages left for him.

Longtime airport Director Jerry Orr, credited by many as a catalyst for the airport’s growth and success, became the first casualty of the months-long feud. Charlotte City Manager Ron Carlee canned Orr, who supported the regional authority.

State Sen. Bob Rucho, R-Mecklenburg, who shepherded the bill through the General Assembly, did not return messages asking about the state’s response to the lawsuit.

Rucho consistently maintained that transfer of the airport to state ownership was necessary to protect the facility from city meddling and the potential siphoning of airport revenue for city operations. He said economic activity at the airport had a statewide impact.

A regional authority with members drawn from five counties would strengthen the airport’s future, Rucho said.

Dulin agreed with the city’s dismissal of Orr.

The airport director submitted a letter of resignation to the city manager the day the law passed because, under the legislation, the airport director immediately became an employee of the airport authority rather than the city.

But Orr could not have known the city would obtain a temporary injunction from Mecklenburg County Superior Court to block implementation of the law, citing “immediate and irreparable harm” and “monetary damages” from a likely default on $860,095,000 in airport bond obligations. The city called the state’s action unconstitutional.

In a letter to Rucho, State Deputy Treasurer Vance Holloman said outside bond counsel hired by the treasurer’s office warned of “legal uncertainty [that] could result in potential prolonged litigation” if S.B. 81 passed. The legislation “could have an impact on the North Carolina municipal bond market.”

A hearing on the restraining order is set for July 29.

Carlee refused to rescind Orr’s resignation letter once he learned the airport ownership transfer had not occurred. Carlee appointed Brent Cagle, chief financial officer at the airport, as interim aviation director.

“That’s a legitimate interpretation on my part, on anybody’s part,” that Orr was resigning his employment with the city and acceptance of his resignation was reasonable, Dulin said.

“[Orr] lawyered up” as a result of his dismissal from city employment, hiring former Charlotte mayor Richard Vinroot, Dulin said.

Vinroot’s involvement “makes this thing even more interesting,” Dulin said. “A guy who was the mayor for four years and had authority over the airport is now fighting to give it away. It’s bizarre and sad that Richard Vinroot would be doing that.”

Citizens of Charlotte “deserve governance over their own airport,” Dulin said, and that is why he and Warren Cooksey, the two Republicans on the Democrat-dominated City Council, have joined with Democrats in opposing the airport authority.

As it stands, the existing Airport Advisory Committee will continue to report to City Council about airport operations. If the court upholds the legislation — “a big if,” Dulin said — the committee would become an interim airport authority until a permanent authority is named.

“All those things are in litigation limbo right now, and it’s too bad. None of this had to happen. This is a solution looking for a problem created by the state House and the state Senate,” Dulin said.

Debate on the bill varied little in substance over six months. In the end, Alexander said during the July 10 House Finance Committee meeting the issue “has split the delegation seven ways from Sunday, and that is not the way we have traditionally done business in Charlotte and Mecklenburg.”

But state Rep. Ruth Samuelson, R-Mecklenburg, said House leaders attempted to the end to work out compromises with Charlotte City Council. Those included a proposal, rejected by the city, to perform a joint legislative study that would include 12 members, all appointed by the city, comprising six supporters of the authority and six opponents.

After the bill arrived from the Senate, the House slowed the fast-moving legislation, Samuelson said. “We allowed [the city] to hire [its] own consultant.”

The city’s consultant agreed with business leaders that an authority should operate the airport. “The City Council did not like that,” Samuelson said.

State Rep. Becky Carney, D-Mecklenburg, said the city wants to maintain ownership of the airport and is willing to create a city-appointed commission as “an operating structure.”

That would achieve the same goals of an authority “without the disadvantages,” she said. “This also is a commitment by our council that Charlotte airport will remain the lowest-cost” and most competitive facility in the USAirways system.

Alexander said a city commission could assume responsibilities of airport finance, procurement, compensation, and other activities based on recommendations of the city consultant.

But state Rep. Bill Brawley, R-Mecklenburg, said he saw no advantage to prolonging the negotiations because Charlotte has a history of rejecting studies it doesn’t like until it hires a consultant who delivers recommendations with which it agrees.

Dan Way (@danway_carolina) is an associate editor of Carolina Journal.