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6-26-06 Crain's--Meter runs on mayor

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Meter runs on mayor's Meigs shutdown

Legal bills top $500K as city fights the feds over late-night closure
By Paul Merrion

Three years after Mayor Richard M. Daley ordered the bulldozing of Meigs Field, the legal bills continue to rise.

The city of Chicago has spent more than $200,000 on outside lawyers to appeal a $33,000 fine the Federal Aviation Administration (FAA) imposed, and the meter is still running.

Another matter, an FAA investigation of whether the city illegally used $2.9 million in airport development funds to deactivate Meigs, has cost the city even more in legal fees.

Photo: Erik Unger

As of mid-June, the Washington, D.C. office of law firm Pillsbury Winthrop Shaw Pittman LLP has billed the city almost $550,000 for handling both issues, according to a spokeswoman for Chicago Corporation Counsel Mara Georges. About 40% of the bill is related to appealing the fine; the rest is tied to the diversion-of-funds investigation.

Noting that the city's legal challenge of the $33,000 fine is now costing more than six times the original penalty, Laurence Msall, president of the Civic Federation, a budget watchdog group, says, "It may be time for the city to re-evaluate this strategy."

Last October, the FAA levied the maximum possible fine over the city's failure to give the agency the required 30-day advance notice before closing Meigs on March 31, 2003. The city argues that a public safety emergency and the "unreasonable hardship" of giving the FAA a heads-up exempted it from the rule.

The case had been on hold pending the city's motion to dismiss, which an FAA administrative law judge denied this year.

Both sides this month are starting to submit documents regarding the city's claim that terrorist threats prompted the shutdown; the FAA maintains the city acted secretly to avoid litigation.

The corporation counsel spokeswoman says the city is concerned that paying the $33,000 fine could erode its defenses in the diversion-of-funds probe, which could prove costly. The potential penalty is three times the amount diverted, or about $8.7 million.

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