Questions over

the legality of Peachtree City's hotel-motel tax contracts with the Peachtree

City Airport Authority almost cost the city "well over $100,000."

But some last-minute

negotiations and an emergency called meeting of the authority Tuesday

night seems to have solved the problem.

The problem

was with the city's issuance of bonds to refinance the airport authority's

existing debt of $1.5 million which will result in savings from a lower

interest rate. The action was approved by voters on a referendum in last

November's general election, and the yearly payments that end in 2015

vary from a low of $155,000 to a high of $164,000.

The city's

bond attorney told officials Friday that since the validity of the city's

intergovernmental contract with the authority is in question, another

contract would be needed to make sure the city's plan to cover the debt

was in writing, explained Mayor Steve Brown.

A new contract

was approved by the authority Tuesday night and signed by Brown Wednesday

morning. Because the matter had to be handled quickly, council members

were notified of the situation before Brown signed the contract, the mayor

said.

The old contract,

signed by former Mayor Bob Lenox last year, has been called into question

because of a change that required the authority to agree with the city

in order to reduce payments to the authority from the hotel-motel tax

fund.

Lenox claims

that change was in the contract council voted unanimously to authorize

him to sign at its June 6 meeting.

The new agreement

signed by Brown and the authority essentially says that the city agrees

to take on the authority's existing debt and that in turn the authority

will continue to provide the service of running the airport for the city,

said authority attorney Doug Warner.

Without the

agreement, it could have cost the city "well over $100,000"

in fees for the bond transaction, Brown said. It also could have forced

the proceeds from the bond sale to be put into escrow, said authority

attorney Doug Warner.

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