WASHINGTON — A U.S. district court judge last week dismissed a lawsuit against the Metropolitan Washington Airports Authority that contested its right to collect toll revenues that secure more than $900 million of MWAA's outstanding bonds. The bond proceeds are helping to finance the system's expansion of rail service to Washington Dulles International Airport.
The ruling, by Judge Leonie M. Brinkema of the U.S. District Court for the Eastern District of Virginia in Alexandria, "resolves any question" of MWAA's authority to collect tolls and use the revenue for the Dulles Corridor Metrorail Project, Philip Sunderland, general counsel for MWAA, said Friday.
In August, the MWAA issued the first series of bonds for this project totaling $963 million, which are backed by tolls collected from the Dulles Toll Road. The agency expects to issue a total of $2.9 billion of debt for the project over the next three years. The lawsuit was filed just days after the August the bond sale.
Brinkema said in her opinion that she dismissed "with prejudice" the lawsuit filed by two plaintiffs, Parkridge 6 LLC and the Dulles Corridor Users Group, because they lack standing to raise their complaints. Additionally, the "length and vagueness" of the plaintiffs' 15-count, 130-page complaint made it "difficult to discern the bases" of their claims.
Brinkema dismissed the count specifically related to the MWAA's tolling authority, saying that it does not "request any specific remedy, and appears to be nothing more than a polemic against the [Metrorail] project."
The MWAA was created under an interstate compact and approved by the U.S. Congress, Brinkema said. It is authorized to levy tolls, and any Virginia law that conflicts with that authority "is preempted under the supremacy clause of the U.S. Constitution," she said.
Christopher W. Walker, who founded the Dulles Corridor Users Group, said the judge's ruling was "incorrect" and "brushed aside" the plaintiffs' complaints. He said they plan to appeal the ruling to a federal appellate court in Richmond.
The state has a history of legal challenges concerning toll roads. The Virginia Supreme Court ruled in March 2008 that the Northern Virginia Transportation Authority, a body created by state lawmakers, did not have the right to collect tolls because its members were appointed, not elected. The NVTA had plans to issue $130 million of toll-backed bonds.
But the MWAA has had better legal success. In October 2008, a Richmond circuit court judge dismissed a suit challenging Virginia's planned transfer of the Dulles Toll Road from the state's Department of Transportation to the MWAA. In this case, plaintiffs alleged that tolls collected on the Dulles Toll Road are a tax, and that Virginia cannot transfer taxing power to an entity not mentioned in the state's constitution. But a state judge disagreed, ruling that the tolls are "neither taxes nor revenue" of the state.
Separately, MWAA president and chief executive officer James E. Bennett, who was one of six federal and state officials listed as defendants in the lawsuit, announced his retirement last week, effective May 8. He directed the agency through these challenges and the Metrorail planning, which began more than 12 years ago. The two-phase project will ultimately connect Metro riders in and around the District of Columbia with the airport. The initial phase to Tyson's Corner is expected to be finished in 2014. A second phase is scheduled for completion in 2017.
Bennett joined the authority in 1996 and was appointed president and CEO in 2003. The authority's board will appoint an interim president and will begin searching for a new, permanent president and CEO.
At the same board meeting last Wednesday where Bennett announced his retirement, the board authorized $700 million of Dulles Toll Road bonds. Pricing of the bonds is scheduled for early May and the proceeds will fund the Metrorail extension project as well as improvements on the toll road, MWAA spokesman Robert Yingling said Friday. The board also approved $500 million of aviation bonds, which will price this summer he said.
