Cannon's statement on airport coverage

March 26, 2013

Asked to address the Forum this morning, Charlotte Mayor Pro Tem Patrick Cannon said he would like to share with Forum participants materials prepared by the city on the legislative proposal to transfer the city-run airport to a new regional authority, and a comment on legislation that would allow teachers to carry guns in schools.

The text below is what he sent in via e-mail:

 

 

    

The city of Charlotte wanted to make clear several media articles on
legislation for an authority at Charlotte Douglas International Airport have
contained misinformation, and we wanted to take this opportunity to clarify
these incorrect statements.

We understand there are many complexities surrounding the authority discussion, and it is easy to mischaracterize the facts. While numerous erroneous statements have been made, we've chosen to focus on these major topics that are important to the ongoing conversation:

●

Wrongly suggested: Airport Bonds are not backed by the City's AAA bond
rating.

Fact: The City's existing Airport Revenue Bonds are rated: AA1 Moody's, A+
S&P, A+ Fitch. They are repaid wholly by revenues generated at the
Airport. The City of Charlotte � the issuing unit � has an overlying G.O. rating
of AAA from all three agencies. Should Airport revenues be insufficient to
pay the debt, the City could use other available funds, an option that would
not be available to an authority. If the Airport becomes an authority, new
ratings will be determined for airport revenue bonds without the benefit
of the City's strong credit characteristics and the highly rated "umbrella"
issuer will no longer be present or have any responsibility for new debt
issued.

●

Wrongly suggested: The City did not approve a Capital Investment Plan for
the Airport in 2012.

Fact: On June 25, 2012, City Council approved the Aviation department's
5-year CIP (FY13-FY17), which totaled $1.04 billion. The projects included in
the Airport's CIP include airfield projects, terminal complex projects,
general aviation projects, cargo development projects, and other
miscellaneous airport improvement projects.

Each of the enterprise funds (Aviation, CATS, Storm Water, and CMUD) have
their own capital investment plan (CIP) funded by dedicated fees/charges
that are dedicated to each enterprise fund. The various enterprise CIPs are
separate from the General CIP, which has been the focus of Council
discussion for the past year.

●

Wrongly suggested: CMPD's presence at the Charlotte Douglas International Airport is because the City needed a place for 50 officers and $5.6 million once funded by federal stimulus dollars.

Fact: The expiration of Federal stimulus dollars for police officers and
the decision to place CMPD in charge of security at the Airport are entirely
separate issues. After the stimulus grant ended in FY 12, the City Council
approved shifting the funding for those officers to the City's General
Fund. Security and law enforcement staffing levels at the airport are based on
the CMPD's assessment of need. CMPD officers assigned to the Airport are
fully funded by Airport revenues.

●

Misleading: The recent error in distributing bonds was the Finance
Department's responsibility, not the Airport's.

Fact: It is true that only the City Finance Department "disburses"� City
bond funds. However, the Aviation Department determines where the money is
spent. In 2010 the Finance Department responded to a routine inquiry from the
Internal Revenue Service concerning the use of the 2004 Aviation Revenue
Bonds. The Finance Department consulted with the City's tax counsel who
determined that the Airport was financing projects from the proceeds of the
2004 bonds without regard to Federal tax law.

●

Wrongly suggested: The FBI, Homeland Security and the FAA investigated the Tisdale case and absolved the Airport of any responsibility.

Fact: These agencies never conducted independent investigations of the
Tisdale case. The City Manager, Aviation Director and Police Chief agreed that
CMPD would lead the multi-jurisdictional task force to conduct an
investigation.

●

Incorrect Statement: Some Airport revenues such as parking fees might not
be covered by federal restrictions on the use of Airport Revenue.

Fact: Since parking fees at the Airport are clearly airport revenues
subject to restrictions as outlined by the City Attorney in a March 5, 2013
memo to Mayor and Council, such revenues cannot be diverted for general
municipal purposes. During the fall budget workshop process, staff provided
information on potential revenues associated with creating a new Business
Privilege License tax category for parking facility operators. Since the parking
facilities at the Airport are operated by the City, even if such a tax were levied on businesses that operate parking facilities, such a tax would not apply at the Airport.

 

Senate Bill (SB) 27, if passed, would allow firearms to be carried by
teachers and any other employee, volunteer or contracted person after going
through firearms training and emergency/crisis management training by the NC
Criminal Justice Education and Training Standards Commission. Currently
this bill is in the Committee on Rules and Operations. As Chairman of
Community Safety I stand in support with Superintendent Heath Morrison, Chief Bud Cesena of CMS, any official members of the Board of Education and CMPD
Chief Rodney Monroe in OPPOSITION to this proposed bill. Please contact
representatives of the Committee on Rules and Operations.

Click here to contact members of the committee to let them know you are
in opposition. By clicking on the names you will be able to get each
member's e-mail and phone numbers to communicate with them.

To see who sponsored Senate Bill 27 and gain history on it, click here.

 

Please see a cover letter out of State Treasurer Janet Cowell's office
from Deputy State Treasurer and Secretary of Local Government Commissioner
T. Vance Holloman. Click here to download the letter, or look below for a copy on this page.

Thanks, Patrick D. Cannon