Cottrell v. Atlanta Development Authority, D/B/A Invest Atlanta ( 2015 )

297 Ga. 1FINAL COPY
S14A1874. COTTRELL et al. v. ATLANTA DEVELOPMENT
AUTHORITY et al.
MELTON, Justice.
This case concerns the Superior Court of Fulton County’s validation of
roughly $200 million in municipal bonds (the “2014 NSP Bonds”) to be issued
by the Atlanta Development Authority d/b/a Invest Atlanta (“Invest Atlanta”).
Invest Atlanta and the Geo. L. Smith II Georgia World Congress Center
Authority (“Congress Center Authority”) (collectively, the “New Stadium
Entities”) propose to have the 2014 NSP Bonds issued for the purpose of
funding a portion of the cost of developing, constructing, and operating a new
stadium facility in downtown Atlanta (the “New Stadium Project” or “NSP”) for
the Atlanta Falcons professional football team. Additional funding for the NSP
will be provided by the Atlanta Falcons Stadium Company, LLC (“StadCo”), a
Georgia limited liability company associated with the Atlanta Falcons Football
Club, LLC (the “Club”), as well as through the sale of personal seat licenses.
The NSP is a successor facility to the over twenty-year-old Georgia Dome, and
it will be owned by the Congress Center Authority, which also owns the Georgia
Dome.
Procedurally, on February 4, 2014, the State of Georgia filed a Petition for
Bond Validation in the superior court to authorize the issuance of the 2014 NSP
Bonds. A notice to the public was filed on that same day, as well as a Rule Nisi
Order setting the bond validation hearing for February 17, 2014. Notice of the
proceeding was published in the Fulton County Daily Report on February 7,
2014 and February 14, 2014 as required by OCGA § 36-82-76. Rev. William L.
Cottrell, Sr., Mamie Lee Moore, Tracy Y. Bates, John H. Lewis, III, and Joe
Henry Beasley (hereinafter collectively “Cottrell”) moved to intervene in the
proceedings to file objections to the bond validation, and the trial court allowed
them to do so. Among other things, Cottrell contended that OCGA § 48-13-51
(a) (5) (B), which allows for an extended time period in which a county or
municipality may levy a Hotel/Motel tax for purposes of funding a “successor
facility” to an existing “multipurpose domed stadium facility,” was an
unconstitutional special law. See Ga. Const. of 1983, Art. III, Sec. VI, Par. IV
(a). The bond hearing was continued until April 10, 2014, and the trial court
entered a Consolidated Pre-Trial Order on April 8, 2014. Following the April
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10, 2014 hearing, the trial court entered a May 8, 2014 Validation Order and
Final Judgment validating the 2014 NSP Bonds and overruling all objections.
Cottrell appeals from this ruling, and, for the reasons that follow, we affirm.
By way of background, the Georgia Dome was, and the NSP is to be,
funded in part by a Hotel/Motel tax levied under OCGA § 48-13-51 (a) (5).1
Generally, Hotel/Motel taxes can only be levied at a rate of three percent or less.
The statute states in relevant part that
1
(i) . . . a county (within the territorial limits of the special
district located within the county) or municipality is authorized to
levy a tax under this Code section at a rate of 7 percent. A county
or municipality levying a tax pursuant to this paragraph shall
expend an amount equal to at least 51.4 percent of the total taxes
collected prior to July 1, 1990, at the rate of 7 percent and an
amount equal to at least 32.14 percent of the total taxes collected on
or after July 1, 1990, at the rate of 7 percent for the purpose of
[among other things]: (I) promoting tourism, conventions, and trade
shows[.] . . .
(ii) In addition to the amounts required to be expended under
division (i) of this subparagraph, a county or municipality levying
a tax pursuant to this paragraph shall further expend (in each fiscal
year during which the tax is collected under this paragraph) an
amount equal to 14.3 percent of the total taxes collected prior to
July 1, 1990, at the rate of 7 percent and an amount equal to 39.3
percent of the total taxes collected on or after July 1, 1990, at the
rate of 7 percent toward funding a multipurpose domed stadium
facility. . . . Any tax levied pursuant to this paragraph shall
terminate not later than December 31, 2020[.] . . .
OCGA § 48-13-51 (a) (5) (A) (i) and (ii).
3
See OCGA § 48-13-51 (a) (1) (D) (“Except as provided in paragraphs (2.1),
(2.2), (3), (3.1), (3.2), (3.3), (3.4), (3.5), (3.7), (4), (4.1), (4.2), (4.3), (4.4), (4.5),
(4.6), (4.7), (5), (5.1), (5.2), and (5.3) of this subsection, no tax levied pursuant
to this Code section shall be levied or collected at a rate exceeding 3 percent of
the charge to the public for the furnishings.”). However, OCGA § 48-13-51 (a)
(5) (A) provides an exception to this three percent ceiling for Hotel/Motel taxes
by allowing counties and municipalities to levy a seven percent Hotel/Motel tax
as long as a designated portion of the collected tax proceeds is used to fund a
multipurpose domed stadium facility. Before 2010, taxes imposed under
Paragraph (a) (5) of OCGA § 48-13-51 were required to have a stated expiration
date “not later than December 31, 2020.” OCGA § 48-13-51 (a) (5) (A) (ii).
However, the General Assembly amended Paragraph (a) (5) in 2010 to add a
new subsection (B), which allowed those taxing jurisdictions that had previously
levied a tax under Paragraph (a) (5) to extend the stated expiration date to
December 31, 2050, so long as the same portion of the proceeds that had been
used to fund the original multipurpose domed facility was expended to fund a
“successor facility” during the extended period. Pursuant to OCGA § 48-13-51
(a) (5) (B):
4
Notwithstanding the [December 31, 2020] termination date
stated in division (ii) of subparagraph (A) of this paragraph
. . . a tax levied under this paragraph may be extended by
resolution of the levying county or municipality and continue
to be collected through December 31, 2050, if a state
authority certifies: (i) that the same portion of the proceeds
will be used to fund a successor facility to the multipurpose
domed facility as is currently required to fund the
multipurpose domed facility under division (ii) of
subparagraph (A) of this paragraph; (ii) that such successor
facility will be located on property owned by the state
authority; and (iii) that the state authority has entered into a
contract with a national football league team for use of the
successor facility by the national football league team through
the end of the new extended period of the tax collection.
In order to structure the deal and issue the 2014 NSP Bonds for the New
Stadium Project, the New Stadium Entities created various agreements and took
several steps:
! Based on the 2010 subsection (B) amendment to OCGA §
48-13-51 (a) (5) allowing for an extended period to collect a
Hotel/Motel tax as long as a certain percentage of the proceeds
collected during the extended period were expended to fund a
“successor facility,” in March 2013, the City passed City Resolution
13-R-0615, which authorized
the Mayor to execute (1) a Hotel/Motel Tax Funding
5
Agreement with [Invest Atlanta], as consideration for Invest
Atlanta agreeing to provide for the development,
construction, equipping, and funding of the publicly financed
portion of the cost of a multi-purpose operable roof stadium
through its issuance of revenue bonds necessary to provide
such services and facilities and the [City] agreeing to make
payments from certain Hotel/Motel Taxes collected under
such agreement to be pledged as security for the [2014 NSP
Bonds] (2) a Hotel/Motel Tax Operation and Maintenance
Agreement [“O&M Agreement”] with [the] Congress Center
Authority for the use of funds in excess of the amount
necessary for payments due under the Hotel/Motel Tax
Funding Agreement to provide for operation and maintenance
services for the new stadium, all in accordance with OCGA
[§] 48-13-51 (a) (5) [(B)]; and for other purposes.
The City prepared a Hotel/Motel Tax Funding Agreement with
Invest Atlanta and an O&M Agreement with the Congress Center
Authority consistent with City Resolution 13-R-0615. The City
currently levies a Hotel/Motel Tax, and 39.3 percent of the first
seven percent of the tax will be paid to fund the NSP (the “NSP Tax
Proceeds”).
! Invest Atlanta is to issue the 2014 NSP Bonds, which Bonds will
be secured by Invest Atlanta’s pledge and assignment of the NSP
Tax Proceeds to a bond Trustee. The City will collect the tax and
6
transfer the proceeds to Invest Atlanta, and Invest Atlanta will use
the NSP Tax Proceeds to pay the debt service on the 2014 NSP
Bonds.
! Pursuant to a “Bond Proceeds Funding and Development
Agreement,” Invest Atlanta is to place the proceeds from the sale of
the 2014 NSP Bonds into a Project Fund and instruct the Trustee to
distribute money from the Project Fund to the Congress Center
Authority. The Congress Center Authority will use the money to
fund the New Stadium Project, and the Congress Center Authority
will own the New Stadium Project. The Congress Center Authority
will also raise money to fund a portion of the NSP by selling certain
personal seat licenses. StadCo will provide all additional funds
necessary for the NSP.
! After paying the necessary NSP Tax Proceeds to Invest Atlanta
to provide for the payment of the principal and interest on the 2014
NSP Bonds, the City will allocate the remaining NSP Tax Proceeds
7
to the Congress Center Authority, consistent with the extended levy
provision of OCGA § 48-13-51 (a) (5) (B). The Congress Center
Authority, in turn, will use those proceeds to pay a portion of the
NSP’s future capital upkeep, maintenance and operating expenses.
! StadCo and the Club are required to play Atlanta Falcons’
regular-season and post-season home games at the New Stadium
Project for at least 30 years.
1. Cottrell contends that the 2010 subsection (B) amendment to OCGA §
48-13-51 (a) (5) is an unconstitutional “special law” that violates the Uniformity
Clause of the Georgia Constitution. See Ga. Const. of 1983, Art. III, Sec. VI,
Par. IV (a). We disagree.
Pursuant to the Uniformity Clause, “[l]aws of a general nature shall have
uniform operation throughout this state and no local or special law shall be
enacted in any case for which provision has been made by an existing general
law. . . .” Id. In this regard, a statute would run afoul of the Constitution if it
were “a general law which lack[ed] uniform operation throughout the state or
8
a special law for which provision ha[d] been made by existing general law.”
Lasseter v. Ga. Public Svc. Comm., 253 Ga. 227, 229 (2) (319 SE2d 824)
(1984). However,
“[o]ur State Constitution only requires a law to have uniform
operation; and that means that it shall apply to all persons, matters,
or things which it is intended to affect. If it operates alike on all
who come within the scope of its provisions, constitutional
uniformity is secured. Uniformity does not mean universality. This
constitutional provision is complied with when the law operates
uniformly upon all persons who are brought within the relations and
circumstances provided by it.”' [Cits.] A law which operates
uniformly upon all persons of a designated class is a general law
within the meaning of the Constitution, provided that the
classification thus made is not arbitrary or unreasonable. [Cit.]
(Emphasis supplied.) State v. Martin, 266 Ga. 244, 246 (4) (466 SE2d 216)
(1996). Indeed, the General Assembly may properly exclude certain persons or
things from the application of a general law. McAllister v. American National
Red Cross, 240 Ga. 246 (2) (240 SE2d 247) (1977). As explained more fully
below, OCGA § 48-13-51 (a) (5) (B) is a proper exception to the general law of
OCGA § 48-13-51 (a) (1) (D), which imposes a three percent cap on
Hotel/Motel taxes, in that the statute applies uniformly on all taxing authorities
which come within the scope of its provisions, and because the classification
made by the statute is not arbitrary or unreasonable.
9
As an initial matter, this Court has previously determined that OCGA §
48-13-51 (a) (5) (A), the statute most closely related to OCGA § 48-13-51 (a)
(5) (B), is a proper general law. See Youngblood v. State, 259 Ga. 864, 866 (2)
(388 SE2d 671) (1990) (upholding constitutionality of OCGA § 48-13-51 (a)
(5) (A) under the similar Tax Uniformity Clause). In this connection, OCGA §
48-13-51 (a) (5) (A) provides a proper general law exception to OCGA §
48-13-51 (a) (1). More specifically, as mentioned previously, OCGA § 48-13-51
(a) (1) allows for the levy of a Hotel/Motel tax that may not “exceed[ ] 3
percent.” OCGA § 48-13-51 (a) (1) (D). There are several exceptions to this
three percent cap on Hotel/Motel taxes, one of which, OCGA § 48-13-51 (a) (5)
(A), allows for the levy of a seven percent Hotel/Motel tax for purposes of
funding a multipurpose domed stadium facility through December 31, 2020. See
OCGA § 48-13-51 (a) (5) (A) (ii). This exception to the three percent cap on
Hotel/Motel taxes is proper, in that it applies uniformly to any “county (within
the territorial limits of the special district located within the county) or
municipality” (OCGA § 48-13-51 (a) (5) (A) (i)) that has decided to levy such
an increased tax, and in that it is reasonable, because allowing this class of
taxing entities to collect an increased tax on “the provision of public
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accommodations. . . is not arbitrary[,] as the[ ] businesses [subject to the tax]
will directly benefit from an increase in tourism and the provision of local
government services within the district” in which the multipurpose domed
stadium facility is being built. Youngblood, supra, 259 Ga. at 866 (2).
Like subsection (A) before it, OCGA § 48-13-51 (a) (5) (B) is also a
constitutional general law exception to the three percent cap on Hotel/Motel
taxes contained in OCGA § 48-13-51 (a) (1). It is of no consequence that
subsection (B) happens to only impact the New Stadium Project at this time, as
the other counties and municipalities covered under subsection (A) that could
have collected a seven percent Hotel/Motel tax for purposes of funding their
own multipurpose domed stadium facilities at the time that subsection (A) was
passed had every opportunity to do so. We reject the idea that the Legislature is
now forbidden from enacting legislation that affects the class of taxing entities
covered under subsection (A) simply because only one taxing entity chose to
take advantage of implementing a seven percent Hotel/Motel tax for purposes
of funding a multipurpose domed stadium facility over twenty years ago. To
determine otherwise would mean that this class would be forever off limits for
further legislation by the General Assembly simply because only one
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jurisdiction stepped into the previously open class. Indeed, even if the window
has now closed for additional entities to begin funding their own multipurpose
domed stadium facilities pursuant to subsection (A), that would not change the
fact that the law itself is a general law that provided a proper class with
reasonable taxing authority for funding a stadium facility if those class members
chose to do so during the time frame in which they had an opportunity to do so.
In this regard, like subsection (A), subsection (B) applies uniformly to all taxing
authorities affected by it.
Likewise, the classification of the taxing authorities affected by subsection
(B) is reasonable, in that (1) there is nothing arbitrary or unreasonable about
allowing the same taxing entities that already have experience paying for a
multipurpose domed stadium facility through the collection of a seven percent
Hotel/Motel tax under OCGA § 48-13-51 (a) (5) (A) to collect such a tax in the
future to fund a different stadium after the first tax has expired, and (2) the
collection of a seven percent tax by these authorized entities on “the provision
of public accommodations . . . is not arbitrary[,] as the[ ] businesses [subject to
the tax] will directly benefit from an increase in tourism and the provision of
local government services within the district” in which the new stadium facility
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is being built. Youngblood, supra, 259 Ga. at 866 (2).
Accordingly, we find that OCGA § 48-13-51 (a) (5) (B) is constitutional.
2. Cottrell argues that the Hotel/Motel Tax Funding Agreement between
the City and Invest Atlanta is illegal, and, by extension, unconstitutional,2
because OCGA § 48-13-51 (a) (5) (B) requires that tax proceeds collected to
fund the successor stadium facility “shall be expended only through a contract
with the certifying state authority,” and the City’s contract with Invest Atlanta
is not a contract with “the certifying state authority.”3 However, Cottrell ignores
the fact that more than one contractual agreement exists to control the manner
in which the NSP Tax Proceeds are ultimately expended by the Congress Center
Authority to fund the NSP. Indeed, as explained more fully below, the
Hotel/Motel Tax Funding Agreement works in conjunction with the Bond
Proceeds Funding and Development Agreement to ensure that the NSP Tax
Proceeds are expended in a manner consistent with the requirements of OCGA
§ 48-13-51 (a) (5) (B).
2
Cottrell contends that the contract violates the Intergovernmental
Contracts Clause of the Georgia Constitution. See Ga. Const. of 1983, Art. IX,
Sec. III, Par. I (a).
3
The Congress Center Authority is the certifying state authority.
13
OCGA § 48-13-51 (a) (5) (B) states in relevant part:
During the extended period of [Hotel/Motel Tax] collection [through
December 31, 2050], the county or municipality shall further expend (in
each fiscal year during which the tax is collected during the extended
period of collection) an amount equal to 39.3 percent of the total taxes
collected at the rate of 7 percent toward funding the successor facility
certified by the state authority. Amounts so expended shall be expended
only through a contract with the certifying state authority.
Pursuant to the Hotel/Motel Tax Funding Agreement, after Invest Atlanta
issues the 2014 NSP Bonds, the City will pay the NSP Tax Proceeds to a bond
trustee to whom the proceeds have been assigned by Invest Atlanta. The funds
are used to pay the debt service on the bonds and are distributed from the bond
trustee to the Congress Center Authority pursuant to a Bond Proceeds Funding
and Development Agreement, which allows the Congress Center Authority, as
the certifying state authority here, to expend the money to fund the New
Stadium Project. In this manner, the City will meet its obligation to ensure that
it “expend[s] [the NSP Tax Proceeds] toward the funding of a successor facility”
while also making sure that the “[a]mounts so expended [to fund the New
Stadium Project] shall be expended only through a contract with the certifying
state authority.” This arrangement complies with the requirements of OCGA §
48-13-51 (a) (5) (B), and Cottrell’s argument to the contrary is without merit.
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3. Cottrell asserts that the proposed bond transaction violates Ga. Const.
of 1983, Art. IX, Sec. VI, Par. I and OCGA § 36-82-66 of the Revenue Bond
Law because Invest Atlanta will not own or operate the NSP. Specifically,
Cottrell contends that, because Invest Atlanta would not “own or operate” the
New Stadium Project, the “revenue” to be paid to Invest Atlanta by the City
would not actually be revenue “derived from the project.” See Ga. Constitution
of 1983, Art. IX, Sec. VI, Par. I (“The obligation represented by revenue bonds
shall be repayable only out of the revenue derived from the project[.]”). See also
OCGA § 36-82-66 (“Revenue bonds . . . shall not be payable from or charged
upon any funds other than the revenue pledged to the payment thereof[.]”);
OCGA § 36-82-61 (3) (“‘Revenue’ or ‘revenue of the undertaking’ means all
revenues, income, and earnings arising out of or in connection with the
operation or ownership of the undertaking[.]”). We disagree.
There is no requirement that Invest Atlanta own the New Stadium Project
in order for it to issue revenue bonds to fund the project or for the tax proceeds
paid to Invest Atlanta to be considered as part of the “revenue” to pay for the
15
bonds.4 Indeed, pursuant to OCGA § 36-82-61 (3) of the Revenue Bond Law,
“revenue” consists of “all revenues, income, and earnings arising out of or in
connection with the operation or ownership of the undertaking.” (Emphasis
supplied.) Here, Invest Atlanta need not be the owner of the NSP, as the
Hotel/Motel NSP Tax Proceeds are being collected “in connection with the
[Congress Center Authority’s] operation or ownership of the [NSP].” In this
manner, the NSP Tax Proceeds qualify as lawful revenue, and Invest Atlanta
need not actually own the NSP for this to be the case.
4. Cottrell further contends that the bond transaction here violates the
Intergovernmental Contracts Clause (see Ga. Const. of 1983, Art. IX, Sec. III,
Par. I (a)), in that the NSP is not an authorized “project” of Invest Atlanta. More
specifically, Cottrell argues that, because the NSP is really a “project” of the
Congress Center Authority, and not a project actually being developed by Invest
Atlanta, the NSP is not eligible for bond financing under the Developmental
Authorities Law. See OCGA § 36-62-2 (6) (H) (i) (“‘Project’ includes . . . [t]he
4
Cottrell does not dispute whether tax funds may properly be included as
part of the “revenue” to repay a bond issue. He contends only that, because
Invest Atlanta will not “own or operate” the NSP, the tax funds collected here
will not constitute “lawful” revenue.
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acquisition, construction, improvement, or modification of any property, real or
personal, which shall be suitable for or used as or in connection with . . . [s]ports
facilities’”). Cottrell is incorrect.
Just as there is no requirement that Invest Atlanta own the NSP, there is
also no requirement that Invest Atlanta actually construct the NSP in order to
properly issue revenue bonds for the purpose of financing the project. Pursuant
to the Developmental Authorities Law, Invest Atlanta has the power to “issue
. . . revenue bonds . . . and to use the proceeds thereof for the purpose of paying
all or part of the cost of any project” (OCGA § 36-62-6 (a) (13) (emphasis
supplied)), not only those projects “constructed” or “developed” by the authority
issuing the bonds. Nor is there any language in the Developmental Authorities
Law that would otherwise prohibit Invest Atlanta from using bond proceeds to
pay the costs of another government entity’s project that “promote[s] trade,
commerce, industry, and employment opportunities for the public good and the
general welfare.” OCGA § 36-62-9. See also Youngblood, supra, 259 Ga. at
866 (2) (multipurpose stadium facility would benefit businesses subject to
Hotel/Motel tax in that the facility would bring about “an increase in tourism”).
This enumeration is without merit.
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5. Cottrell argues that the trial court erred in failing to hold that City
Resolution 13-R-0615, which extends Atlanta’s existing Hotel/Motel tax to fund
a portion of the construction and maintenance costs of the NSP, is illegal. He
contends, primarily, that City Resolution 13-R-0615 is void because the City
enacted it in March 2013, over a year before the Congress Center Authority
provided the City with a tax certification required by OCGA § 48-13-51(a) (5)
(B) to allow for the City to pass such a resolution.5 Cottrell is mistaken.
In this regard, OCGA § 48-13-51(a) (5) (B) provides in relevant part that
. . . a tax levied under this paragraph may be extended [past
the December 31, 2020 termination date stated in OCGA §
48-13-51(a) (5) (A) (ii)] by resolution of the levying county
or municipality and continue to be collected through
December 31, 2050, if a state authority certifies [among other
things]: (i) that the same portion of the proceeds will be used
to fund a successor facility to the multipurpose domed facility
as is currently required to fund the multipurpose domed
facility under division (ii) of subparagraph (A) of this
paragraph[.] . . .
By its plain terms, OCGA § 48-13-51 (a) (5) (B) dictates that a seven
percent Hotel/Motel tax may be “levied . . . and continue to be collected through
5
It is undisputed that the Congress Center Authority provided the
certification prior to the final bond validation hearing.
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December 31, 2050” to fund a successor facility if the appropriate certification
is given by the state authority involved (in this case, the Congress Center
Authority) (emphasis supplied.). It does not say that a city resolution cannot be
written or passed in anticipation of the required certification. Nor does it say that
a resolution passed before the city receives the certification would be rendered
void. To the contrary, the statute requires that both the certification be given and
the resolution passed before the City continues to levy and collect the seven
percent Hotel/Motel tax beyond the December 31, 2020 termination date of the
tax being collected to fund an initial multipurpose domed stadium facility
pursuant to OCGA § 48-13-51 (a) (5) (A). In other words, while subsection (B)
can be fairly read to imply that the certification must be given before a
resolution is passed, there is nothing in the statute to imply that strict adherence
to this chronological order of events is necessary in order for a city to pass a
valid resolution or that the failure to adhere to this chronological order would
have the extreme result of rendering prior authorizing actions void. In any event,
here, both requirements have been met, as the City has passed a proper
resolution and it has received the proper certification from the Congress Center
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Authority.6 Accordingly, City Resolution 13-R-0615 is not “void,” as Cottrell
argues.
6. Cottrell asserts that the trial court erred in adjudicating the validity of
the O&M Agreement7 in this case, because the Agreement did not act as
“security” for the 2014 NSP Bonds. In this regard, he contends that, by
answering any question regarding the validity of the O&M Agreement, the trial
court violated its own self imposed limits on its “subject matter” jurisdiction. In
its final validation order, the trial court stated that “[t]he purpose of this
proceeding is to determine whether as a matter of law the proceedings for the
issuance of the [2014 NSP] Bonds were lawfully conducted and the procedures
6
To the extent that Cottrell argues that City Resolution 13-R-0615 is void
because OCGA § 48-13-51 (a) (5) (B) is an unconstitutional special law, that
argument fails in light of our holding in Division 1 that the statute is
constitutional. In addition, we find no merit to Cottrell’s argument that the tax
certification given by the Congress Center Authority in 2014 is allegedly
defective, as the certification itself contains all of the information required by
OCGA § 48-13-51 (a) (5) (B) and tracks all of the necessary components of the
ongoing deal between the New Stadium Entities and the relevant parties who
will bring the entire deal to fruition.
7
Pursuant to this Agreement, the City will provide the Congress Center
Authority with any portion of the NSP Tax Proceeds not required to pay the debt
service (and related expenses) on the 2014 NSP Bonds, and the Congress Center
Authority will apply any NSP Tax Proceeds it receives to operate and maintain
the New Stadium Project.
20
were complied with, and whether as a matter of fact there is adequate security
for the payment of the bonds.” Validation Order at 5, n. 6. However, the trial
court’s statement has nothing to do with and no control over a superior court’s
jurisdiction “to hear and determine all questions of law and of fact in the [bond
validation] case and . . . render judgment” on those issues. (Emphasis supplied.)
OCGA § 36-82-77. See also Berry v. City of East Point, supra, 277 Ga. App.
649, 650 (1) (627 SE2d 391) (2006) (“In a bond validation hearing, the role of
the trial court is to determine whether the bond proposal is sound, feasible, and
reasonable.” [Cit.]) (Punctuation and footnote omitted). The validity of the
O&M agreement was indeed placed in issue at the April 10, 2014 bond
validation hearing, and the trial court committed no error in rendering a
judgment on this issue. See OCGA § 36-82-77.
7. Finally, Cottrell urges that the trial court erred in failing to find that the
O&M Agreement violates the Intergovernmental Contracts Clause of the State
Constitution, in that this Agreement between the City and the Congress Center
Authority requires the City to reimburse StadCo, a private company, for certain
expenses incurred from events and other activities at the New Stadium Project.
Again, we disagree.
21
Pursuant to the Intergovernmental Contracts Clause:
The state, or any institution, department, or other agency
thereof, and any county, municipality, school district, or other
political subdivision of the state may contract for any period
not exceeding 50 years with each other or with any other
public agency, public corporation, or public authority for
joint services, for the provision of services, or for the joint or
separate use of facilities or equipment; but such contracts
must deal with activities, services, or facilities which the
contracting parties are authorized by law to undertake or
provide. . . .
Ga. Const. of 1983, Art. IX, Sec. III, Par. I (a). Here, consistent with the
Intergovernmental Contracts Clause, the O&M Agreement is solely between two
governmental entities, the City and the Congress Center Authority; the period
of the Agreement does not exceed fifty years; the Agreement “involve[s] the
provision of services, or . . . the joint or separate use of facilities or equipment”;
and it “deal[s] with activities, services, or facilities which the contracting parties
are authorized by law to undertake or provide.” The fact that StadCo pays some
of the operating expenses for the NSP and is then reimbursed by the Congress
Center Authority from funds that are specifically earmarked for covering “costs
relating to the operation, maintenance and improvements for the New Stadium
Project” does not somehow make the O&M Agreement invalid. The Congress
22
Center Authority is simply using the necessary funds to pay for the NSP as it is
required to do in a manner consistent with its ownership of the NSP.8
Judgment affirmed. All the Justices concur.
Decided March 16, 2015 – Reconsiderations denied April 9 and 14, 2015.
OCGA § 48-13-51 (a) (b) (B); consitutional question. Fulton Superior
Court. Before Judge Glanville.
Thelma W. Cummings Moore; John F. Woodham, for appellants.
Paul L. Howard, Jr., District Attorney; Samuel S. Olens, Attorney General,
Denise E. Whiting-Pack, Senior Assistant Attorney General; Hunton &
8
Nor would Cottrell’s challenge to the individual clause of the O&M
Agreement allowing for StadCo to approve any changes to the Agreement
render the entire O&M Agreement invalid. See O&M Agreement § 7.4 (“This
O&M Agreement may not be effectively amended, changed, modified, altered
or terminated by the parties hereto without the concurring prior written consent
of StadCo; provided StadCo shall not unreasonably withhold its consent.”).
Indeed, despite the existence of this clause, again, StadCo is not an actual party
to the O&M Agreement, and the Agreement itself contains a severability clause
that would leave the remainder of the Agreement intact even if this particular
provision failed. See O&M Agreement § 7.3. Thus, even if we assume without
deciding that the clause in question were invalid, our analysis regarding the
overall validity and constitutionality of the O&M Agreement would remain
unchanged.
23
Williams, Matthew J. Calvert, Douglass P. Selby, Ashley F. Cummings;
Sutherland, Asbill & Brennan, Thomas W. Curvin, Matthew W. Nichols, for
appellees.
24