The Georgia Supreme Court justices on Tuesday
asked tough questions of both sides in the pending case over whether Cobb
County government can take on nearly $400 million in debt for construction of a
new Atlanta Braves stadium without a public vote.
The stakes are high in the case, which likely
won’t be ruled upon for a few months, because the Braves have already spent
tens of millions of dollars in construction at the stadium site. The county
can’t issue debt for its portion of stadium construction without the Supreme
Court saying it is legal.
The questions asked by justices Tuesday
revolved around the revenue that will be used to pay off the bonds for the
project, and the contractual agreement between the county government and the
Cobb-Marietta Coliseum and Exhibit Hall Authority. The authority will issue the
bonds and then rely on county-wide property taxes to pay about half the debt.
The county will use a variety of other taxes and fees to repay the rest.
For example, when Tom Curvin, an attorney for
the coliseum authority, was explaining that the Braves agreement is structured
in a way that is similar to deals already deemed lawful by the court, Justice
David Nahmias interjected: “Would you agree that this goes ... one step beyond
our prior cases?”
Curvin said it did not. He was then asked
what services the authority are providing to the county, with Nahmias noting
that the development authority in a case cited by Curvin performed operations
at that facility. The Cobb-Marietta authority will cede all operational
responsibilities to the Braves.
Curvin said the major service the authority
is providing to Cobb County is issuing the bonds.
That led to questions about the revenue being
used to pay off the bonds. Justice Harold Melton asked why tax dollars
are being used to pay off revenue bonds, which by law must be repaid by revenue
from the project.
“This is one of the things we’re seeing more
of,” Melton said. “Revenue bonds, conceptually, are supposed to be paid by
revenues generated from the project. We’re seeing more and more revenue bonds
being paid back from general tax funds that would normally have to go to a
vote.
“What would you say to that?”
Curvin said he “would point to a line of
precedent from this court.”
“If the county itself were issuing the
revenue bonds, then you couldn’t pledge general taxpayer funds as the source of
payment, right?” Nahmias asked. “So basically, to be able to do it, you need
the authority to issue the bonds, which are repayed from the project, the
project being the county’s agreement with the authority.”
The justices directed equally pointed
questions to the three Cobb residents arguing that the court should overturn a
Cobb Superior Court judge’s ruling that the bonds are valid.
Larry Savage, who is not an attorney, said
the court’s previous rulings over decades allowing authorities to issue
bonds on behalf of municipal governments is incorrect.
Nahmias asked if Savage’s view was that all
of those cases had to be overturned in order for him to prevail. When he said
the cases would have to be overturned, Nahmias said the state Constitution was
rewritten after many of those cases had been decided.
“Even if we misread the Constitution in 1945,
that’s not the Constitution we’re under now,” Nahmias said.
Tucker Hobgood, an attorney arguing against
validation of the bonds, said he was encouraged by the questions asked by the
justices. Hobgood argued that the stadium will not be a public facility and
therefore the government can’t contribute toward construction, saying: “The
county has no authority to engage in a private enterprise, which is what
Sun-Trust Park is.”
“They were extremely active, animated and
interested,” Hobgood said of the justices.
Kevin Moore, an attorney for the
Cobb-Marietta authority, called the questions “appropriate.” When asked what he
thought they meant for the ultimate ruling, Moore said: “I stopped trying to
read the tea leaves a long time ago.”
Source: AJC
Comments
Georgia law should require all bond sales to
be subject to a ballot vote.
Norb Leahy, Dunwoody GA Tea Party Leader
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