It also ruled the authority provided proper meeting notice and complied with the state open meetings law in approving agreements with Silver Comet Partners for commercial passenger service at Paulding’s Silver Comet Field.
Residents Anthony Avery and Sue Wilkins challenged the required superior court validation of a $3.6 million bond issue last fall. They contended the county government and airport authority violated the state constitution by providing an “improper benefit” to a private company by guaranteeing the bonds with public funds, Justice Harold Melton wrote.
The state constitution’s “lending clause” bars governmental entities from lending or giving public money to private companies except for “purely charitable purposes.” Its “gratuities clause” states governments cannot “grant any donation or gratuity,” he wrote.
“There is no violation of either clause,” Melton wrote on behalf of the unanimous court.
Avery and Wilkins maintained the bond resolution “acts to extend Paulding County’s credit to Silver Comet” and violates the lending clause.
“It does not,” Melton wrote. “Under this agreement, Silver Comet is, at best, extending its credit to Paulding County.”
And Melton wrote the county and airport authority have not extended a gratuity to Silver Comet.
“Paulding County’s issuance of the bond creates a substantial benefit for the county, namely the presence and use of an airport which can accommodate commercial passenger flights.
“This is a direct benefit to the airport authority and Paulding County, and the fact that Silver Comet receives a secondary benefit as being the commercial airline service renting part of the terminal and landing flights on the expanded taxiway does not change this result.”
Avery and Wilkins also charged that “the trial court erred in its determination that the contract between Paulding County and the airport authority qualifies as an enforceable intergovernmental agreement,” Melton wrote.
The constitution allows any political subdivision of the state to contract with another for use of facilities or equipment, Melton wrote. “The prerequisites for such an intergovernmental contract are satisfied in this case,” he wrote.
“[The] agreement relates to both the provision of services and the joint use of facilities. The airport authority agrees to manage and maintain the expanded taxiway, and Paulding County, in return, agrees to provide funding and manage the debt required to be incurred to complete the expansion,” Melton wrote. Airport authority vice chairman Boyd Austin said Monday the ruling “validates the process and the legitimacy of the funding mechanism.”
“It cost a lot of time and money to get to this point and the Supreme Court held unanimously that both the process and the arrangement were completely constitutional,” he said.
Wilkins said Monday, “Although the Supreme Court’s decision is disappointing, it doesn’t mean the airport authority can use the bond for continued construction.”
Instead, per an agreement, the airport authority must reimburse the county government and county industrial building authority for funding it borrowed to complete the taxiway expansion while awaiting the ruling, she said.
The airport authority recently completed the taxiway’s widening from 35 to 50 feet. However, airport officials have delayed the extension of the structure until the Federal Aviation Administration completes an environmental assessment related to the proposed passenger service.
The ruling also means Silver Comet will be responsible for placing $500,000 in escrow as part of its agreement to pay the bond’s principal and interest payments.