AthleticBusiness.com has partnered with LexisNexis to bring you this content.

Copyright 2014 The Atlanta Journal-Constitution

A small group of Atlanta residents filed a legal challenge this week against the city's plan for partial public financing of the new Falcons stadium.

Four residents of neighborhoods near the site of the proposed $1.2 billion stadium filed the motion to intervene in Fulton County Superior Court.

The Rev. William Cottrell, Mamie Lee Moore, Tracy Bates and John H. Lewis III allege a long list of legal flaws in the stadium financing plan, including the use of bonds that would be repaid with hotel-motel tax revenue, and ask for the proposed bond issuance to be rejected and declared unconstitutional.

The residents are among those who have been critical of stadium negotiations, most recently decrying how the city plans to spend millions in community benefit funds intended to offset disruptions to their communities.

That plan --- negotiated during months of contentious meetings between city officials and residents --- was approved by the Atlanta City Council in December, a key milestone toward the city moving forward with issuing bonds. But some residents worry the plan doesn't guarantee the funds will be spent the way they want.

Lewis, of Vine City, has also criticized proposed plans for re-routing Martin Luther King Jr. Drive, where road construction around the future stadium is underway, and called for city and Falcons officials to unveil final plans for the hallmark boulevard.

The group isn't trying to halt the stadium project, he said.

"We just want things to be done correctly," said Lewis, adding he hopes the lawsuit will reopen talks with city and Falcons officials. "We've tried everything and did everything we can do ... We're just hoping that the community will get what it deserves."

Validation by the court is required before the bonds can be issued. A bond hearing is scheduled Monday before Judge Ural Glanville, who could decide whether the legal challenge has merit.

The use of bonds backed by hotel-motel taxes is critical to the stadium deal. An agreement reached last year by the Falcons, the city, the development authority Invest Atlanta and the Georgia World Congress Center Authority calls for $200 million in bond proceeds to go toward construction of the retractable-roof stadium slated to open in 2017.

The total bond issue would be as high as $278.3 million, with the rest used for interest payments during three years of construction and other costs.

Later, hundreds of millions of dollars in additional hotel-motel tax funds could go toward the costs of maintaining and operating the stadium and debt service over 30 years.

The stadium deal calls for bonds to be issued by July 31. The Falcons would not comment Thursday on how a delay would affect the project.

Anne Torres, a spokeswoman for Atlanta Mayor Kasim Reed, said the city and Invest Atlanta "are currently reviewing the motion in preparation for Monday's validation proceedings."

The GWCCA declined to comment.

The attorneys representing the residents --- former Fulton Superior Court Judge Thelma Wyatt Cummings Moore and John Woodham --- issued a joint statement Thursday about the case.

"The bonds for the stadium would be repaid with public funds. The method used for the issuance of the bonds is unconstitutional, illegal and will have a decidedly detrimental impact on the community. We are representing the community to uphold their constitutional, legal, and moral rights," the attorneys said.

Woodham won a 2008 Georgia Supreme Court decision in a case involving the Atlanta Beltline project, challenging the use of school property taxes to subsidize development. The General Assembly responded by amending the Georgia Constitution, which effectively undid the court's ruling.

Atlanta City Councilman Michael Julian Bond, who presided as chair over the community benefits meetings, said he believes the filing stems from sour grapes over how the $15 million from the Westside tax allocation district and $15 million from the Arthur M. Blank Family Foundation will be awarded to local organizations, a process still underway.

He doesn't expect the legal challenge to succeed.

Councilman Ivory Young, whose district also includes these communities, said he is disappointed by the filing, but also believes it is related to the contentious community benefits process.

The court filing contends the 2010 state law authorizing extension of the existing Atlanta hotel-motel tax for the purpose of replacing the Georgia Dome is unconstitutional because it morphed a "general law" with statewide applicability into a "special law" applying only to one situation.

The filing also argues that the proposed revenue bonds are illegal because they would be repaid with hotel-motel tax proceeds and not from project revenue.

In addition, it contends the city's abandonment of 2.85 acres of land to the GWCCA for part of the stadium site violates the gratuities clause of the state constitution and the requirement that the city first obtain a Development of Regional Impact review from the Atlanta Regional Commission.

 

February 14, 2014

 

 
Copyright © 2014 LexisNexis, a division of Reed Elsevier Inc. All Rights Reserved.
Terms and Conditions Privacy Policy