E&F Cox v. City of Tulsa

MOTION FOR SUMMARY JUDGMENT AND BRIEF IN SUPPORT OF PLAINTIFF'S SECOND MOTION FOR SUMMARY JUDGMENT



COMES NOW Plaintiff in support of Plaintiff's Second Motion for Summary Judgment filed pursuant to Rule 13 of the Rules of for District Court of Oklahoma, and moves for Summary Judgment in this cause in favor of Plaintiff and against Defendants and Intervenors.



STATEMENT OF THE CASE



The City Council of the City of Tulsa passed City of Tulsa Resolution 7571 on July 10, 2008 purporting to create an assessment district, pursuant to 39 O.S. §39-101, et seq., to assess hundreds of individual properties, including Plaintiff's properties. Baseball Stadium Assessment District No. 1 will generate $60 million in revenues over a 30 year period to the City to transfer to the Trust to use to pay the principal and interest on $25 million in revenue bonds to be sold by Intervenor Tulsa Stadium Trust. (See: Attachments to Plaintiff's First Motion for Summary Judgment.)



The Tulsa Stadium Trust was eventually created and it sold the bonds to the Tulsa Community Foundation and awarded a contract to Tulsa Stadium Construction Company, L.L.C. to build the publicly owned multi-purpose sports and event facility located at Archer and Elgin, and now called "ONEOK Field”.



Plaintiff asserts that Resolution 7571 passed by the City Council of the City of Tulsa on July 10, 2008 was an unconstitutional and ultra-vires act because it assesses private properties located inside the IDL to pay for a general public benefit mulit-purpose sports and event facility and not a local improvement that directly and specially benefits the properties assessed.



PARTIES TO THE ACTION



Better Price Warehouse Sales Company is an Oklahoma corporation.



The City of Tulsa is an Oklahoma municipal corporation.



Kathy Taylor is the former Mayor of the City of Tulsa who has been replaced in office by Dewey Bartlett.



Intervenors are also owners of properties located inside the IDL.



UNDISPUTED FACTS



1.Defendant, City of Tulsa is a municipal corporation located in the State of Oklahoma.

2.Plaintiff is the owner of seven parcels of real property located inside the Tulsa Stadium Improvement District, referenced hereafter.

3.On July 10, 2008, the city Council of the City of Tulsa ("Council”) adopted a resolution creating the "Tulsa Stadium Improvement District No. 1.”

4.On September 25, 2008 the trust indenture creating the Tulsa Stadium Trust was executed.

5.On November 20, 2008, the City Council approved a resolution approving the sale of $25,000,000 in revenue bonds by the Tulsa Stadium Trust.

6.The Baseball Stadium Trust sold $25 million in revenue bonds to the Tulsa Community Foundation after receiving no bids on the bonds when they were offered for sale.

7.Baseball Stadium Assessment District NO. 1 will produce the $60 million in revenue from the assessed properties over a 30 year period needed to pay off the principal and interest on the revenue bonds sold by the Baseball Stadium Trust.

8.On December 5, 2008 work began on what would become ONEOK Field generally located north and east of Archer and Elgin in the northeastern, quadrant of the IDL.

9.On June 10, 2009, the City Council of the City of Tulsa approved an ordinance assessing Plaintiff's properties to pay part of the principal and interest on the revenue bonds previously sold by the Tulsa Stadium Trust.

10.The Tulsa Stadium Trust used the proceeds from the sale of the revenue bonds and private donations to build ONEOK Field located near Archer and Elgin.

11.ONEOK Field is multi-purpose sports and event facility that is held in trust for the City of Tulsa by the Tulsa Stadium Trust.

12.The baseball stadium was leased to the Tulsa Drillers by the Tulsa Stadium Trust.

13.The Tulsa Drillers sells tickets to the general public to attend minor league baseball games played during the baseball season with other minor league teams from other communities.

14.It also offers its 23 suites and other facilities for rent for events not related to professional minor league baseball games.



ARUGUMENT AND AUTHORIES THE ASSESSMENT OF PLAINTIFF'S PROPERTIES VIOLATES ARTICLE 10 § 7 OF THE OKLAHOMA CONSTITUION



Article 10, § 7 states: "The Legislature may authorize county and municipal corporations to levy and collect assessments for local improvements upon property benefited thereby, homesteads included, without regard to a cash valuation.”



A minor league professional baseball stadium and event facility is "general benefit” public improvement.



At the end of 2008, the City of Tulsa owned multi-purpose general benefit public purpose sports and event facilities inside the IDL. They were:



1.The Maxwell Convention Center



2.The Performing Arts Center



3.The BOK Center



The Maxwell Convention Center, Performing Arts Center and BOK Center were built wholly or in part with funds generated from the sale of general obligation bonds approved by the voters of the City of Tulsa. All operate in essentially the same fashion and provide the same basic general public benefits to the City of Tulsa, i.e., venues for public paid admission events.



The City owned Maxwell Convention Center, which was completed in 1964 is located inside the IDL northeast of 7th and Houston, is a 7,111 seat multi-purpose general public benefit arena used for indoor sports and events. It was home to the Central Hockey League Tulsa Oilers ice hockey team and to the Tulsa Talons, an arena football team prior to the opening of the BOK Center in 2008. It hosted the Missouri Valley Conference men's basketball tournament title game in 1982 and 1984-87. It was also the home of the Tulsa Golden Hurricane basketball team until the program moved to the Reynolds Center in 1998. The Professional Bull Riders (PBR) hosted a Built Ford Tough Series event at the Convention Center each year between 2005 and 2008 which then moved to the BOK Center. Beginning in 2009, the Convention Center will be the home arena for the Tulsa 66ers of the NBA Development League. Maxwell Center was completed in 1964 and was funded by funds from the sale of general obligation bonds approved by Tulsa voters. See: http://www.tulsaconvention.com



The City owned Performing Arts Center or "PAC”, which was completed in March of 1976, is located inside the IDL northwest of 3rd and Cincinnati, is a multi-purpose publicly owned general benefit facility that houses four theaters, a studio space and a large reception hall. The Chapman Theater seats has a seating capacity of about 2,400. The PAC itself does not present events, but rents its space to resident arts organizations, touring shows, and to the public for a variety of activities, including private receptions, meetings and seminars. The PAC was built with funds from the sale of $12 million in general obligation bonds approved by Tulsa voters and $5 million private gifts. See: http://www.tulsapac.com



The City owned BOK Center, or Bank of Oklahoma Center, which was completed in 1976 is located inside the IDL northeast of 3rd and Cincinnati, is a 19,199-seat multi-purpose arena and is primarily an indoor sports and event venue. Ground was broken on August 31, 2005 and a ribbon cutting involving Tulsa musicians Garth Brooks and Hanson took place on August 30, 2008. Current permanent tenants are the Tulsa Oilers of the Central Hockey League, the Tulsa Talons of the Arena Football League, and the Tulsa Shock of the Women's National Basketball Association, although the facility will host NBA preseason games and college basketball matchups on a regular basis and seek to attract national and regional sporting tournaments. It was built with $178 million in public funds obtained from the sale of Vision 2025 general obligation bonds and $18 million in privately funded upgrades. See: http://www.bokcenter.com



When ONEOK Field, located northeast of Elgin and Archer, was completed in Spring of 2010, it became the fourth City owned (equitably) general benefit public multi-prupose sports and event facility located inside the IDL. ONEOK Field has 23 suites and an unenclosed baseball playing field with a seating capacity of 7,333 for baseball games, but is capable of holding up to 9,000 for special events. With a construction cost of $39.2 million, $25 from the sale of revenue bonds, $5 in anticipated rental of the Tulsa Drillers and private gifts. Located in downtown Tulsa, ONEOK Field is touted to be an event planners dream. Boasting state-of-the-art amenities, ONEOK Field offers 5 unique event rooms, 3 flexible meeting rooms and 6 group hospitality areas to entertain guests. Built for baseball, ONEOK Field's exceptional design provides accommodations for board meetings, conferences, weddings, concerts and music festivals. See: http://www.oneokfieldevents.com



ONEOK Field was described by the Mayor and others before and during the July 10, 2008 meeting of the City Council as an additional element to the existing multi-purpose sports and event entertainment facilities already owned and operated by the inside the IDL. Mr. Stan Lieberger, the President of the Bank of Oklahoma and future Chairman of the Board of Directors of the yet to be created Baseball Stadium Trust, spoke at the Council meeting. When asked by Councilman Gomez about safeguards to protect the City from another Great Plains Airlines like liability, Mr. Lieberger responded on Page 106, at Line15 of Exhibit 3 to Plaintiff's First Motion for Summary Judgment as follows: "The clear obligation of those Trustees (of the anticipated trust) would be to operate in the best interest of the City of Tulsa. The sole beneficiary of the trust would be the City of Tulsa and the idea is to maximize the amount of cash flow that Tulsa ultimately generates from this project.”



The foregoing information about the City of Tulsa's four public owned downtown sports and event venues clearly demonstrates essentially the same. They are all general public benefit multi-purpose sports and/or event facilities that are rented to companies that seek profit from the sale of admission tickets to events staged in the facilities. As the saying goes, "If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck. " Each of the venues has the same basic characteristics. They are publicly owned general benefit improvements. They were designed and are operated to attract attendees to paid admission events staged in them to benefit the City as a whole. They are not local improvements. As the saying goes, "If it looks like a duck, swims like a duck, and quacks like a duck, then it probably is a duck.” They are all, metaphorically speaking, "ducks”.



Whether a public improvement is "local” is normally a question of law. 70A Am.Jur.2d §24. No assessment may be made in Oklahoma to pay for a general benefit public improvement. City of Lawton v. Akers, 1958 OK 292, ¶ 14; Bragdon v. City of Muskogee, 1928 OK 659, ¶ 16; and Rollow v. City of Ada, 1990 OK 59, ¶ 8. See also: 63 C.J.S. § 1302, page 1046.



The now four public sports and/or event facilities described above all function in the same manner. Each is rented or leased to promoters, businesses or organizations that generally sell tickets to conventions, shows, games, etc. staged to attract attendees to paid events. They are all general public improvements that serve the entire City, if not Northeast Oklahoma, Southeastern Kansas, Southwest Missouri and Northeastern Arkansas. All but ONEOK Field were, in whole or in substantial part, paid for with funds generated from the sale of general obligation bonds approved by Tulsa voters.



The Maxwell Convention Center, the BOK Center, and the Performing Arts Center are all general public benefit sports and event facilities located inside the IDL. ONEOK Stadium is also a general public benefit sports and event event facility located inside the IDL. It is functionally identical the other three facilities except it is not completely enclosed. Like the others, it is, physically and functionally, a general public improvement which, under Oklahoma law, may not be funded by assessments levied on private property. Nothing the Tulsa City Council says can changes what ONEOK Field is or the Article 10, § 7 limitation on the power of Oklahoma Cities to assess private property to build public improvements. The Oklahoma Supreme Court in City of Lawton v. Akers, supra at ¶ 23 stated that a city cannot convert a project from general to local simply by decreeing it to be so. In other words, the City of Tulsa cannot convert a professional sports and event center facility into a local improvement by fiat any more than it can convert a duck into a ostrich by ignoring reality and simply saying so, then by putting its municipal head in the sand when challenged before this Court.



In addition, the Oklahoma Supreme Court in City of Lawton v. Akers, supra., at ¶ 23, quoted 48 Am. Jur. § 29, which states in part that a city cannot: "... by its fiat make a local improvement of that which in its essence is not such an improvement, and it cannot by its fiat make a special benefit to sustain a special assessment where there is not special benefit.” In other words, the City Council of the City of Tulsa cannot by fiat make a duck into something other than a duck anymore than it can change a general public benefit improvement into a local improvement.



CONCLUSION



It is for the Court to determine, as a matter of law, whether ONEOK Field is a general or local public improvement. ONEOK Field is a general public benefit multi-purpose sports and event facility like the Maxwell Convention Center, BOK Center and Performing Arts Center. The Court should, therefore, sustain Plaintiff's motion and enter judgment declaring the Resolution creating Baseball Stadium Assessment District No. 1 to be an unconstitutional and ultra-vires act.