WASHINGTON - An adverse federal appeals court ruling will not disrupt the Metropolitan Washington Airports Authority's tax-exempt bond construction financing program, at least for the next year, an authority official said yesterday.
The D.C. Court of Appeals on Tuesday overturned parts of the law passed by Congress that set up the authority. But the decision will not affect either the authority's $1.3 billion of outstanding debt or the $500 billion of bonds that the authority has been authorized to issue before Sept. 30, 1995, said Lynn Hampton, chief financial officer of the authority.
The ruling also will not affect the $366 million in passenger facility charges the authority is using to help finance the renovation and expansion of Washington National and Dulles International airports, she said.
"That's a couple of years' worth of money. Hopefully, that gives us enough time to take the next judicial steps and whatever steps are [taken] after that," Hampton said.
The $1.3 billion of bond proceeds provides enough "to finish all the construction at National and finish stage one at Dulles. The only thing that we have on the drawing boards that we haven't financed are the renovations of the old main terminal at National and the old main terminal at Dulles," she said.
The appeals court ruling, which upheld a similar ruling by the U.S. District Court for the District of Columbia in February, said Congress violated the separation of powers doctrine when it retained the right to review the authority's borrowing and spending practices.
But the ruling made clear that any further rulings or legislative changes would be prospective and not affect outstanding debt, already authorized bond issues, or the authority's ability to spend the funds, Hampton said.
"My goal in the beginning of going ahead and borrowing all this money was that we've got two big years of construction," she said. "I felt like if I could stay out of [the contractors'] way for a couple of years, that would be good."
At this point, the authority is faced with either appealing the case to the U.S. Supreme Court, which invalidated a similar law in 1991, or asking Congress to approve legislation to correct it, Hampton said.
"We still will be appealing to the Supreme Court, and hopefully [the appeals court ruling] would be overturned; if not, a legislative cure. We hope that whatever this cure is, that's it's a final one," she said.
The federal district court's ruling in February reached the same conclusion the Supreme Court did in 1991 when it held that the authority's nine-member review board, which includes members of Congress, was a congressional entity that exercised executive branch powers.
To overcome the Supreme Court decision, Congress passed amendments to the Metropolitan Washington Airports Act later in 1991 that removed the board's power to veto key decisions by the airport authority, including bond authorizations.
Congress instead specified that the board could only recommend changes to proposed authority actions, and it directed that board members did not have to be members of Congress.
However, the lawmakers required that the board members be selected from lists submitted to the authority by the House and Senate. In addition, the legislation did not call for Congress to submit more names than vacancies, nor did it specifically prohibit naming members of Congress.
The new requirements also specified that members have aviation expertise, be frequent users of the Washington area airports, and be registered voters in states other than Maryland and Virginia, and the District of Columbia.
However, the U.S. district court ruled in February that the review board "exercises significant control over the Airports Authority and management over its core aspects of operation." The criteria added in 1991 "created an entity that is unquestionably an agent of Congress," the district judge said in the February ruling.
The federal government owned and operated National and Dulles airports, but turned them over to the newly created regional airport authority in the mid-1980s to ease capital improvement financing burdens.
