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 misred 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 SunTrust 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.”
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