Updated: City of Amarillo files notice of appeal in civic center judgment

Amarillo Mayor Ginger Nelson held a press conference Thursday afternoon regarding the city’s next steps following the ruling against its ordinance that would have financed revamping the Amarillo Civic Center at City Hall.

The city of Amarillo had filed a notice of appeal in the civic center judgment issued by retired Potter County Judge William Sowder last month.

Sowder issued his final judgment against the city Oct. 25, declaring the city's actions invalid and void regarding the TIRZ (Tax Increment Reinvestment Zone) project amendments and plans, tax anticipation notes and city ordinances regarding the civic center, as previously reported, also noting there was insufficient public notice made on the subject of the actions.

Nelson says this filing is less about the Amarillo Civic Center improvement project and more about clarifying conflicts that the ruling has with current state law.

“The reason the council took the action that we took in May was in anticipation of projected interest rate increases between May and the end of the year, and we have seen those come about,” Nelson said. “So, we are now here approaching the end of the year, and what we hoped to get in front of to save a lot of money on the project is not going to happen."

More:Judge rules against city of Amarillo’s Civic Center funding plan

"The project the way we envisioned in May cannot move forward,” Nelson said. “Now we have the additional confusion of how we issue debt anyway, because the way we have always done it and cities across Texas have done it, according to this ruling, is now called into question. Going forward, we have to have some clarity, and we think the appeals process will bring that.”

Acknowledging that the judgment in the ruling muddies the water as far as knowing how to issue debt if needed by the city, Nelson said that it effectively killed the ordinance to finance the civic center due to rising costs.

“I think we all recognize that, with rising construction costs and the significant interest rate increases since May, the window to complete the Civic Center project as currently proposed has closed,” Nelson said. “The lawsuit was successful for the opposing party in that it created a delay to the point where the project isn’t feasible for the amount of money we authorized."

Nelson stressed that this appeal is not about relitigating the case to get the desired outcome, but to get needed clarification on rulings that seem to not be in adherence to current state laws.

“While we cannot proceed with the project at this time, this ruling creates confusion around several standard operating procedures and will interfere with the city’s ability to operate normally," Nelson continued. "We are seeking clarification on existing state law. We are responsible for clarifying how debt can be issued going forward because, like every city in Texas, the city council will have to continue to issue debt to operate the city. As for the Civic Center problem, it is not going away.”

Nelson said that the civic center will be business as usual with the same issues it has faced for the last decade, as the city has tried to produce solutions to make it viable. She said that going forward, the price tag will continue to rise to renovate the civic center, and she hopes that the center users will continue to hold their events, even with the challenges of the facility.

More:Amarillo Civic Center trial closes: Judge to make a decision within 10 days

Her message to users of the facility was that she hopes they stay and continue to bring those events that drive much-needed revenue to local businesses.

Speaking about the most damning aspect of the judgment that interprets the civic center as not a public work, Nelson said, “We use the civic center for so many different events. We have nonprofit events, youth sports events, and high school and college graduations. We host so many things there; I have a hard time envisioning a facility like that not being a public use. That is something that needs to be clarified. If we are now at a point of not understanding what public use means, that is what the appeals process is for. We want to follow the process and see if the appellate courts can clarify things like this.”

Nelson said that her fellow council members and citizens are concerned about the city's cost to subsidize the civic center for its operations and attract events to Amarillo. According to Nelson, it costs $6,300 a day, which amounts to $2.3 million a year. She said that she expects that number to go up with infrastructure and repair needs at the 60-year-old facility. She also said that the number would grow substantially with fewer users interested in renting and leasing the facility.

Nelson said that she was surprised that the judge ruled against the city on every aspect of the suit.

“We knew this was a novel idea, but we wanted to make sure that it was absolutely within the bounds of what state law provided for issuing debt and our advice was that it was,” Nelson said. “We moved forward on that legal advice; always, it was our heart to do what was best for the city. We made the best business decisions for the city.”

Feeling that there were more than just legal questions at stake in the case, Nelson said she felt that it was also became highly political.

“Even though this was a legal decision, there was a lot of politically motivated testimony and argument in the courtroom,“ Nelson said. “Therefore, the appeals process is there just to allow us to continue going through the legal process to get clarification."

Asked if the ruling impacts previous and future debt issuances from the city, Nelson assured that it will not affect prior issuances that they have used the process for in the past.

“This is a tool that the city has used before, and we used the exact same process,” Nelson said. “Those debt issuances have already happened and are already under contract. You cannot go back on something that has already been done.”

Looking forward, Nelson said that the ruling puts into doubt the process that had been used in the past, which the Attorney General had approved in the past.

“We followed that process, and now we have the indication that the process might not have been what we should have followed,” Nelson said. "So it (the ruling) conflicts with state law, and that’s why we feel that we have a responsibility to follow the appeals process to get more clarification — on how a city would issue debt, how would a city draft an agenda item on debt issuance, how would they put an ordinance out that’s being negotiated right up until the minute of the council meeting, how would you define public use."

“All of these things are questions that cities going forward have to know and understand to continue operating, because issuing debt is just a part of running a city,” Nelson said.

Nelson also said that the council does not believe that the court fees assigned to be paid by the city were properly attributed to the taxpayers, and that this appeals process could help to clarify. Also, Nelson stated that citizens of the city should understand that this appeal is not about the need to issue debt for any specific project, but a need to make sure that the city can be able to have a viable process to issue debt. She feels that this ruling impacts all cities in the state, confusing debt issuance for them.

The mayor also emphasized that due to the delays and costs of the project and the judge's ruling that this is no longer a viable project within the parameters of the initial plan, and this appeal will have no impact on the May 24 plan, which is officially a dead matter.

This article originally appeared on Amarillo Globe-News: City files appeal in Amarillo Civic Center project judgment