Judge dismisses KC streetcar lawsuit

03/15/2013 11:03 AM

05/16/2014 9:31 PM

A Jackson County judge on Friday dismissed a lawsuit filed by two downtown property owners who had challenged the new sales and property taxes for the downtown streetcar system.

Circuit Judge Peggy Stevens McGraw said the deadline had passed for people to challenge the mechanism for imposing those new taxes.

The lawsuit was filed by property owners Sue Burke and Jeffrey “Stretch” Rumaner, who argued that the new taxes imposed on downtown property owners to help pay for the $100 million streetcar system were unconstitutional.

Plaintiffs attorney Mark Bredemeier said Friday that he would be reviewing the legal options with his clients, including a possible appeal.

But Doug Stone, an attorney for the streetcar authority, said that in the event of an appeal, he would explore whether it’s appropriate to ask the court to require the plaintiffs to put up an appeal bond to protect against additional costs to the streetcar project if there are further delays.

The authority had hoped to issue $30 million in bonds this month to begin construction, but the lawsuit put the brakes on that plan. If a bond issue is delayed to the point that interest rates rise, it could increase the overall project cost.

On Friday, Mayor Sly James praised the judge’s ruling.

“The plan has now had two separate affirmative court rulings and two separate ratification votes by our citizens,” the mayor said. “The city is now ready to fulfill the wishes of its downtown residents and build a modern streetcar in Kansas City.”

Lawyers for the streetcar authority had argued that citizens had their chance to challenge the streetcar district and the proposed taxes a year ago and that the time for any such challenge has passed. McGraw agreed.

In her order Friday, she said that the public had an opportunity to file objections back in 2012. She said that after court hearings on the streetcar proposal, then-circuit judge Charles Atwell ruled on April 27, 2012, that neither the streetcar district nor its funding mechanism were illegal or unconstitutional. The formation of the district and the new taxes were subsequently approved in two separate elections among district voters.

“As Judge Atwell’s judgment noted, the purpose of last April’s proceedings was to determine the legality and constitutionality of the district and its funding ‘before any public dollars are spent.’ That purpose would be eviscerated if plaintiffs were allowed to proceed on their petition at this late date,” McGraw wrote. “Both the city and the district were entitled to rely on the validity and finality of the April 27 judgment and order finding the district and its funding legal.”

McGraw noted that plaintiffs could have appealed the April 27, 2012, ruling but did not.

“Plaintiffs’ failure to raise these issues as provided by the statute essentially waives their right to raise them now,” she said.

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