ATLANTA - Continuing his two-year-old battle against the Kentucky Turnpike Authority, a retired taxpayer has asked for a court order barring sale of the $200 million refunding bond issue the authority plans to offer this summer.
In a motion filed last month, Noel D. Wilson demanded that the Franklin, Ky., Circuit Court grant him a temporary restraining order to stop the proposed bond issue because his 1990 lawsuit contesting the authority's right to sell debt "is pending and has yet to be finally decided."
Julius Rather, Mr. Wilson's lawyer, said yesterday that he would ask the court to set a hearing date on the motion as soon as the authority sets a date for the sale.
"We are hoping the authority holds off [selling the bonds] until our arguments against it are heard and the case is decided on its merits," Julius Rather, Mr. Wilson's lawyer, said yesterday. "But we are also now prepared to push for the restraining order if they try to sell the bonds before then."
Mr. Rather said he has also recently filed a new brief reiterating and expanding arguments presented in the 1990 lawsuit, and applying them to the planned refunding bond issue. He said the suit would again argue that the turnpike cannot sell the bonds without voter approval. In addition, the updated suit contends that the authority is not authorized to sell bonds to renovate highways, the lawyer said.
"We will concentrate on the constitutional requirement for voter referendum and the fact that the turnpike authority was not meant to borrow money to fix potholes," he said.
In October 1990, completion of a $307.8 million issue of turnpike authority bonds was held in limbo for two weeks after the bonds had been priced, following the circuit court's decision to grant Mr. Wilson a restraining order barring sale of the debt.
The authority was finally able to close the bond issue, but not until a state appeals court overturned the restraining order and he state Supreme Court declined to take a stand on the appeals court ruling.
Because the turnpike authority has not sold bonds since then, Mr. Rather said. Mr. Wilson has not pressed the issue and the case was never heard.
With Mr. Wilson's motion before the court, the turnpike authority has decided to postpone "for the time being" its plans to sell about $200 million of bonds, while its lawyers study the matter, according to Tim Bennett, deputy director of the Kentucky's office of financial management, which oversees state debt issuance.
"Given the low level of interest rates, we would love to sell these bonds this summer, but will not move forward until we decide what" to do about the motion, Mr. Bennett said.
In opposing the 1990 restraining order, state officials argued that Mr. Wilson's complaint was groundless because legislation authorizing the sale of turnpike authority bonds without voter approval has been established by a 1983 state supreme court case, Blythe v. Transportation Cabinet of the Commonwealth.
In his recent request to the Franklin Circuit Court, Mr. Wilson also asked that the turnpike authority be barred from condemning property in Franklin and Owen counties, the site of planned renovations on U.S. Highway 21. Those renovations, which would be funded with proceeds from a bond issue planned for sale next year, violate the legislature's six-year construction plan, Mr. Rather said.