Present: Carrico, C.J., Hassell, Keenan, Koontz, Kinser,and
Lemons, JJ., and Poff, S.J.
SHORT PUMP TOWN CENTER COMMUNITY
DEVELOPMENT AUTHORITY, ET AL.
v. Record No. 010456 OPINION BY JUSTICE CYNTHIA D. KINSER
November 2, 2001
ARLIE A. HAHN, JR., ET AL.
FROM THE CIRCUIT COURT OF HENRICO COUNTY
Randall G. Johnson, Judge Designate
In this action, the circuit court invalidated a bond
issuance approved by the Short Pump Community Development
Authority (“CDA”) for the purpose of financing certain
infrastructure improvements in conjunction with the
development of a retail shopping mall to be known as the
Short Pump Town Center (“the Center”). Because we conclude
that the CDA is not an entity authorized to bring this bond
validation action under the Public Finance Act of 1991,
Code §§ 15.2-2600 through –2663, we will vacate the
judgment of the circuit court and dismiss the action.
FACTS AND MATERIAL PROCEEDINGS
The Center is a proposed “[h]igh-end, upscale”
pedestrian shopping mall that, according to its plans, will
contain more than 1.1 million square feet and will be
anchored by four major department stores. It is to be
located on approximately 147 acres of real estate in
Henrico County and developed by Short Pump Town Center LLC
(“the Developer”). The Center’s location is approximately
five miles “straight-line distance” from the Regency Square
Mall, also situated in Henrico County.
In July 2000, the owners of the 147 acres petitioned
the Henrico County Board of Supervisors (the “Board”),
pursuant to the provisions of Article 6 of the Virginia
Water and Waste Authorities Act (“WWAA”), Code §§ 15.2-5100
through –5158, to create the CDA. The stated purpose of
the petition was to seek financing and the construction of
certain infrastructure improvements to facilitate the
development of the Center.
Upon considering the petition, the Board passed a
resolution creating the CDA “as a body corporate and
politic” for the purpose of “financing, constructing and
developing, and owning and maintaining if necessary,
certain improvements in connection with the development” of
the Center. Those improvements, as listed in the petition,
are the extension of a sewer trunk line and water main
line, storm water management facilities, a left turn lane
and traffic signal on roads abutting the CDA, a ring road
around the Center, entrance roads, lighting, landscaping, a
plaza, parking, excavation related to the improvements,
2
soft costs, and contingencies. 1 In its resolution, the
Board declared that the creation of the CDA “will benefit
the citizens of the County by promoting increased
employment opportunities, a strengthened economic base and
increased tax revenues and additional retail opportunities
not currently available in the local area” and that the
development “will have limited requirements” for the
services of Henrico County.
On October 20, 2000, the CDA authorized the issuance
of special assessment bonds to finance the requested
infrastructure improvements. In the same resolution, the
CDA agreed to enter into two other agreements with regard
to issuing the bonds and providing financial incentives to
the Developer. One agreement was a Memorandum of
Understanding between the CDA, the Developer, the
landowners, and the Board. The second was an Economic
Development Agreement between the Economic Development
Authority of Henrico County (EDA), 2 the Board, the CDA, and
1
In the past, commercial developers in Henrico County
were required by county zoning ordinances to provide, at
their own expense, the parking, lighting, landscaping,
entrance roads, sidewalks, and pedestrian areas that were
associated with a development.
2
Pursuant to Code § 15.2-4903(C), the name of the
industrial development authority in Henrico County is the
Economic Development Authority of Henrico County.
3
the Developer. Together these agreements provide that the
CDA will issue bonds in an amount sufficient to pay a
portion of the costs of the infrastructure improvements,
not to exceed 22 million dollars; plus an amount sufficient
to pay a portion of the costs of issuing the bonds, the
costs of establishing a reserve fund, and the capitalized
interest for a period not to exceed twelve months. The
bonds will be repaid in approximately five years by special
assessments on the properties within the CDA district. 3 The
Developer is required to pay semi-annual installment
payments on the special assessments to the Board, which
will then pay those amounts to the CDA for debt service on
the bonds. 4
Pursuant to these two agreements, the Board will also
make semi-annual appropriations to the EDA from the
county’s tax revenues in amounts equal to the special
assessments paid by the Developer. These payments are
financial incentives to facilitate the development of the
Center; however, they are subject to appropriation by the
3
The special assessments are to secure payment of the
bonds and are to be calculated “to correspond to the
benefit each parcel receives from the improvements for
which [the b]onds are issued.”
4
The payments of annual installments to the CDA are
subject to annual appropriation by the Board and do not
constitute a general obligation of Henrico County.
4
Board and are capped at the amount of incremental tax
revenues generated by the properties in the CDA district.
The EDA will, in turn, pay those same amounts to the
Developer as reimbursement for the special assessments.
However, if any special assessment remains unpaid when an
incentive payment is to be made to the Developer, the EDA
is required to pay that installment directly to the CDA for
application to the debt service on the bonds. Under this
financing scheme, it is possible that the Developer would
never have to pay a special assessment after paying the
first one, but could instead allow incentive payments from
the EDA to be used for that purpose. The Developer will
also receive reimbursement for the first special assessment
approximately six months after the bonds are retired. In
other words, if sufficient incremental tax revenues are
generated from the properties in the CDA district, the
Developer will be fully reimbursed for the special
assessments levied to retire the bonds.
In November 2000, the CDA filed an action under
Article 6 of the Public Finance Act, Code §§ 15.2-2650
through –2658, seeking to validate the bond issuance and
all proceedings, including the Memorandum of Understanding
and Economic Development Agreement, taken in connection
with the authorization and issuance of the bonds. Two days
5
later, The Taubman Limited Partnership filed a chancery
suit against the Board, the CDA, and the EDA (collectively,
the “Public Entities”), requesting declaratory judgment
that the incentive payments to the Developer and the
financing structure of the proposed bond issuance are
unlawful and in violation of the Constitution of the United
States and the Constitution of Virginia. 5 Taubman also
sought injunctive relief to prevent the Public Entities
from taking any further action to finance or support
improvements at the Center. 6
5
In the bill of complaint, The Taubman Limited
Partnership alleged that it owned Regency Square Mall. It
subsequently moved the court to correct a misnomer,
asserting that TRG-Regency Square Associates is the real
party in interest and the owner of that mall. The circuit
court granted the motion and ordered that TRG-Regency
Square Associates LLC be identified as the plaintiff in the
chancery suit. That order applied only to the chancery
suit, and we find no similar order addressing the alleged
misnomer in the law action, which is the case on appeal.
However, in their response to Taubman’s motion, the Public
Entities stated that they took no position on the addition
of TRG-Regency Square Associates as a new party to the law
action, although they objected to treating the motion as
one for correction of a misnomer. Subsequently, TRG-
Regency Square Associates LLC filed an amended grounds of
defense in the law action. For purposes of this appeal, we
will refer to The Taubman Limited Partnership and TRG-
Regency Square Associates LLC as “Taubman.”
6
Prior to filing its suit, Taubman had discussed plans
with the City of Richmond to locate a nearly identical
shopping facility within the city limits. Taubman had also
unsuccessfully sought similar financial assistance from
Henrico County in 1997 to make improvements to Regency
Square Mall.
6
Taubman and three other taxpayers filed grounds of
defense in the bond validation action: Arlie A. Hahn, Jr.,
Bryan B. Gresham, Jr., and Robert Anderson (collectively,
the “Taxpayers”). At the same time, the CDA, along with
the EDA and the Board (both of which had intervened as
party plaintiffs in the bond validation action), moved to
enjoin Taubman’s suit and to consolidate the two
proceedings. Taubman opposed consolidation and, in its
chancery suit, moved the circuit court to stay the bond
validation action. The circuit court granted the motion to
consolidate but denied the Public Entities’ motion to
enjoin and Taubman’s motion to stay.
Hahn and Taubman then moved the circuit court judge to
disqualify himself from hearing the bond validation case
since, as a taxpayer, property owner, and citizen of
Henrico County, the judge was a party defendant to the
action pursuant to Code §§ 15.2-2651 and -2652. After
hearing argument on the motions, the circuit court judge
vacated the previous order consolidating the two
proceedings and decided to continue presiding in Taubman’s
suit. The Chief Justice of this Court then designated
another circuit court judge to preside in the bond
validation action. After the proceedings were severed,
Taubman amended its grounds of defense in the bond
7
validation action to include most, if not all, of the
claims raised in its separate chancery suit. 7
After hearing evidence in the action filed by the CDA,
the circuit court, in a subsequent letter opinion,
concluded that the infrastructure improvements to be
financed by the proposed bond issuance do not satisfy the
requirements of Code § 15.2-5158. That provision requires,
among other things, that the bond-financed infrastructure
improvements be “necessary to meet the increased demands
placed upon the locality as a result of development within
the district.” Code § 15.2-5158(A)(1). Based on the
evidence presented, the circuit court found that only the
left turn lane and traffic signal meet this statutory
requirement and that all other proposed infrastructure
improvements are instead for the Developer’s benefit. In
an order incorporating its letter opinion, the circuit
court ruled that the bond issuance proposed by the CDA to
finance certain infrastructure improvements at the Center
is invalid and contrary to law. 8 The Public Entities appeal
7
Taubman acknowledges on brief that its suit is in
abeyance pending this appeal.
8
Despite its decision invalidating the bond issuance,
the court concluded that the bonds serve a public purpose
and that the financing arrangements and monetary incentives
under the Memorandum of Understanding and the Economic
Development Agreement do not violate Code § 15.2-4905.
8
from that order, and Taubman and the Taxpayers have
assigned cross-error.
ANALYSIS
Although there are several assignments of error and
cross-error, one of Taubman’s assignments of cross-error
raises a threshold, dispositive issue: whether the CDA is
an entity that is authorized to file an action under
Article 6 of the Public Finance Act to validate its bonds
issued pursuant to the provisions of the WWAA.
Taubman first raised this question in a hearing before
the circuit court on the Public Entities’ motion to
consolidate the bond validation action and Taubman’s
chancery suit. Later, in its demurrer and motion to
dismiss the bond validation action, along with its
supporting memorandum, Taubman asserted that the CDA cannot
initiate a bond validation action under the Public Finance
Act. In our review of the record, we do not find a
specific ruling by the circuit court on Taubman’s demurrer
and motion to dismiss. However, the court implicitly
overruled the demurrer when it stated in its letter opinion
that this action was brought under the Public Finance Act
9
and then proceeded to address the merits of the arguments
concerning the validity of the bond issuance. 9
In claiming that this action was improperly brought
under the Public Finance Act, Taubman focuses on two
provisions in Article 6 of that act, Code §§ 15.2-2650 and
–2651. The pertinent parts of those sections provide:
The provisions of this article apply to all
suits, actions and proceedings of whatever nature
involving the validity of bonds of any locality or
other political subdivision, agency or instrumentality
of the Commonwealth . . . .
Code § 15.2-2650.
The governing body of any locality or other
political subdivision, agency or instrumentality of
the Commonwealth proposing to issue bonds may bring at
any time a proceeding in any court of the county or
city having general jurisdiction and in which the
issuer is located to establish the validity of the
bonds . . . .
Code § 15.2-2651.
Taubman contends that, under the provisions of these
two statutes, only the specified entities, i.e., a
“locality or other political subdivision, agency or
instrumentality of the Commonwealth,” may commence a bond
9
On the first day of trial, the circuit court
acknowledged that a demurrer had been filed, and counsel
for the CDA and Taubman advised the court that they had
agreed to submit the demurrer “on the papers” filed by
them. The Public Entities state in their reply brief that
the circuit court treated this action as one brought under
the Public Finance Act and that all proceedings conformed
to the provisions of that act.
10
validation action. Continuing, Taubman argues that, unlike
many authorities, the CDA is not statutorily denominated a
“political subdivison” and thus cannot proceed under Code
§ 15.2-2651. Taubman also points out that the WWAA has its
own mechanism, set forth in Code § 15.2-5126, for
challenging the validity of the CDA’s bonds, and contends
that that section provides the sole method for determining
the validity of the bond issuance involved in this appeal.
Disagreeing with Taubman’s argument, the Public
Entities assert that the CDA is fundamentally similar to
those authorities that have been designated “political
subdivisions” by the General Assembly. Thus, according to
the Public Entities, the CDA does not have to be labeled a
“political subdivision” in order to avail itself of the
bond validation procedure established in the Public Finance
Act. Finally, they posit that Code § 15.2-5126 provides an
additional method, but not the sole method, for challenging
the issuance of bonds by a community development authority.
We begin our analysis of this issue by comparing the
designation given by the General Assembly to the
authorities created in the WWAA with that afforded to
authorities established in other statutory provisions. In
the WWAA, the term “ ‘[a]uthority’ means an authority
created under the provisions of § 15.2-5102 or Article 6
11
(§ 15.2-5152 et seq.).” Code § 15.2-5101. The authorities
specified in Code § 15.2-5102 are created to provide water,
sewer, sewage disposal, stormwater control, and refuse
collection and disposal. That section further states that
“[t]he authority shall be a public body politic and
corporate.” Code § 15.2-5102. Article 6 of the WWAA, Code
§§ 15.2-5152 through –5158, deals only with community
development authorities. However, unlike Code § 15.2-5102,
none of the provisions of Article 6 provides that a
community development authority shall be a “body politic
and corporate.” Nor do those provisions classify a
community development authority as a “political
subdivision.” This lack of such designation for a
community development authority differentiates it not only
from those authorities created in Code § 15.2-5102, but
also from virtually every other authority in the
Commonwealth. 10 Indeed, our search of the Code revealed
10
See, e.g., Code § 5.1-153 (Metropolitan Washington
Airports Authority created as a “public body corporate and
politic”); Code § 10.1-1601 (Virginia Recreational
Facilities Authority created as a “political subdivision”);
Code § 15.2-4903(A) (industrial development authorities
created as “political subdivision[s]”); Code § 15.2-5302
(hospital authority shall be a “political subdivision”);
Code § 15.2-5403 (electric authority shall be a “political
subdivision . . . and a body politic and corporate”); Code
§ 15.2-5604 (public recreational facilities authority shall
be a “political subdivision”); Code § 15.2-5702 (park
authority shall be a “body politic and corporate”); Code
12
___________________
§ 15.2-5801 (Virginia Baseball Stadium Authority
established as a “body corporate and politic” and as a
“political subdivision”); Code § 15.2-5901 (Hampton Roads
Sports Facilities Authority established as a “body
corporate and politic” and as a “political subdivision”);
Code § 15.2-6200 (Alleghany-Highlands Economic Development
Authority created as a “body politic and corporate, a
political subdivision”); Code § 15.2-6302 (Authorities for
Development of Former Federal Areas created as “political
subdivision[s]”); Code § 15.2-6402 (regional industrial
facilities authorities created as “political
subdivision[s]”); Code § 15.2-6500 (Tourist Train
Development Authority created as a “body politic and
corporate, a political subdivision”); Code § 22.1-163
(Virginia Public School Authority created as a “public body
corporate and an agency and instrumentality of the
Commonwealth”); Code § 23-30.25 (Virginia College Building
Authority created as a “public body corporate and as a
political subdivision and an agency and instrumentality of
the Commonwealth”); Code § 23-30.41(a) (Educational
Facilities Authority, by reference to the “Virginia College
Building Authority created by § 23-30.25,” created as a
“public body corporate and as a political subdivision and
an agency and instrumentality of the Commonwealth”); Code
§ 23-50.16:3 (Virginia Commonwealth University Health
System Authority created as a “public body corporate and as
a political subdivision”); Code § 23-231.13 (Roanoke Higher
Education Authority created as a “political subdivision”);
Code § 36-4 (redevelopment and housing authorities created
as “political subdivision[s]”); Code § 36-55.27 (Virginia
Housing Development Authority is a “political
subdivision”); Code § 62.1-200 (Virginia Resources
Authority created as a “public body corporate and as a
political subdivision”).
Likewise, four authorities established by the General
Assembly in statutory provisions effective October 1, 2001
are all explicitly created as “political subdivision[s].”
See Code § 2.2-2202(B)(Virginia Commercial Space Flight
Authority); Code § 2.2-2219(B) (Innovative Technology
Authority); Code § 2.2-2261 (Virginia Public Building
Authority); Code § 2.2-2280(B) (Virginia Small Business
Financing Authority).
For purposes of this analysis, we do not consider
those authorities without statutory authorization to issue
bonds, although virtually all of those are also designated
as political subdivisions and/or as public bodies corporate
13
that a community development authority is one of only a few
authorities for which such a designation is noticeably
absent from the enabling legislation. 11 Also significant is
the fact that the General Assembly provided a method in
Code § 15.2-5126 to challenge bonds issued by a community
___________________
and politic. See, e.g., Code § 15.2-5501 (Tourism
Development Authority is a “political subdivision, a body
politic and corporate”); Code § 15.2-6000 (Virginia
Coalfield Economic Development Authority created as a “body
politic and corporate, a political subdivision”); Code
§ 15.2-6100 (Southside Virginia Development Authority
created as a “body politic and corporate, a political
subdivision”); Code § 33.1-426 (Virginia Coalfield
Coalition Authority created as a “body corporate and as a
political subdivision”); Code §§ 37.1-242 to –243
(Behavioral Health Authorities are “public
instrumentalit[ies],” “public bod[ies]” and “bod[ies]
corporate and politic”); Code § 51.5-54(B) (Assistive
Technology Loan Fund Authority created as a “public body
corporate and as a political subdivision”); and the
following authorities established by the General Assembly
in statutory provisions effective October 1, 2001 and
explicitly created as “political subdivision[s]”: Code
§ 2.2-2234(C) (Virginia Economic Development Partnership
Authority); Code § 2.2-2248 (Virginia Information Providers
Network Authority); Code § 2.2-2315(C) (Virginia Tourism
Authority).
11
In addition to community development authorities,
other authorities not denominated as a “political
subdivision” or as a “body politic and corporate” include
jail authorities, Code §§ 53.1-95.2 through –95.24, and,
effective July 1, 2002, the Northern Virginia
Transportation Authority, Code §§ 15.2-4816 through –4828.
However, the enabling legislation for jail authorities
provides that each such authority “shall be deemed to be an
instrumentality exercising public and essential
governmental functions . . . .” Code § 53.1-95.7.
Similarly, Code § 15.2-4817 states that the Northern
Virginia Transportation Authority “shall function as a
public instrumentality.”
14
development authority, but that it did not do so in the
enabling legislation for all those authorities previously
listed, supra note 11, except the Virginia Resources
Authority. 12
However, the Public Entities argue that the mere fact
that a community development authority is not classified by
the General Assembly as a “political subdivision” is not
determinative. Relying on County of York v. Peninsula
Airport Commission, 235 Va. 477, 369 S.E.2d 665 (1988),
they contend that the pertinent question is whether a
community development authority enjoys the essential
attributes of a political subdivision. Using that
analysis, the Public Entities assert that the CDA is a
political subdivision because it possesses all the
necessary powers, with the exception of the power of
eminent domain.
We are not persuaded by this argument and believe that
Peninsula Airport and other similar cases are
distinguishable. The issue in Peninsula Airport was
whether the Peninsula Airport Commission was a political
subdivision within the meaning of Article X, § 6(a) of the
12
The Virginia Resources Authority does not actually
have a separate method for determining the validity of its
bonds. Instead, Code § 62.1-208 provides that the
Authority may bring an action under the Public Finance Act.
15
Constitution of Virginia and former Code § 58-12(1), and
thus exempt from taxation by York County. Id. at 478-79,
369 S.E.2d at 665. Noting that the trial court had used
the terms “municipal corporation” and “political
subdivision” interchangeably and without objection by
counsel, we reiterated that “municipal corporations are
‘political subdivisions of the State.’” Id. at 480, 369
S.E.2d at 666 (quoting Richmond, Fredericksburg & Potomac
R.R. Co. v. City of Richmond, 145 Va. 225, 238, 133 S.E.
800, 803-04 (1926)). However, since the converse is not
necessarily true, the Court then considered whether the
Commission was a municipal corporation. In doing so, we
listed the six attributes of a municipal corporation as
previously enumerated in City of Richmond v. Richmond
Metropolitan Authority, 210 Va. 645, 647, 172 S.E.2d 831,
832 (1970)(citing Hampton Rds. Sanitation Dist. Comm’n v.
Smith, 193 Va. 371, 376, 68 S.E.2d 497, 500 (1952)). One
of those attributes is “[c]reation as a body corporate and
politic and as a political subdivision of the
Commonwealth.” Id.
Focusing on that attribute, York County argued that
the Peninsula Airport Commission could not occupy the
status of a municipal corporation because the legislative
act creating the Commission did not expressly classify it
16
as a political subdivision. Peninsula Airport, 235 Va. at
481, 369 S.E.2d at 667. We rejected that argument because
“[t]he original act provided that [the Commission] was to
be an ‘independent body corporate[,]’ ” and the “enabling
act, as amended, provided that ‘neither the Commonwealth
nor any political subdivision thereof other than the
[C]ommission shall be liable’ ” on any bonds issued by the
Commission. Id. (quoting Acts 1946, c. 22, § 8 and as
amended, § 15) (emphasis deleted). We then concluded that
the Peninsula Airport Commission possessed the essential
attributes of a municipal corporation. Id.
This detailed examination of our decision in Peninsula
Airport demonstrates two analytical points. First, in
determining whether that Commission was a political
subdivision, the Court looked solely at the statutory
language used in the Commission’s enabling legislation, not
at the Commission’s attributes, an approach advanced by the
Public Entities. Second, the essential attributes, one of
which was the fact that the Commission was created as a
political subdivision, were relevant only to the inquiry
whether the Commission was also a municipal corporation.
This same analytical framework is evident in other cases.
See, e.g., Carter v. Chesterfield Co. Health Comm’n, 259
Va. 588, 590, 527 S.E.2d 783, 784 (2000) (stating that
17
Chesterfield County Health Commission is a political
subdivision 13 and that such entities may be entitled to the
status of a municipal corporation for purposes of immunity
from tort liability; parties generally agreed that
Commission was entitled to such status); Virginia Elec. &
Power Co. v. Hampton Redev. & Housing Auth., 217 Va. 30,
32-33, 225 S.E.2d 364, 367 (1976) (housing authority
designated by statute as a political subdivision, one of
the attributes of a municipal corporation); Richmond Metro.
Auth., 210 Va. at 647-48, 172 S.E.2d at 832-33 (noting that
Richmond Metropolitan Authority was created by statute as a
“political subdivision and public body corporate and
politic of the Commonwealth” and concluding that the
Authority possessed attributes of a municipal corporation);
Hampton Rds. Sanitation Dist., 193 Va. at 376-77, 68 S.E.2d
at 500 (by statute, the Hampton Roads Sanitation District
Commission was created as a body corporate and politic and
each commission “shall constitute a political subdivision
of the Commonwealth”; that attribute, along with other
powers, made the Commission a municipal corporation).
13
Code § 15.2-5200 states that “a hospital or health
center commission shall be created as a public body
corporate . . . .”
18
Thus, we conclude that we must confine our analysis of
whether the CDA is a political subdivision to the language
of the relevant enabling legislation. Based on the
analytical framework in our prior cases, that inquiry does
not include consideration of the CDA’s attributes or
whether it is similar to other authorities that are
designated by the General Assembly as “political
subdivisions.” We also are persuaded by the fact that the
General Assembly clearly knows how to denominate an
authority as a “political subdivision” when it wishes to do
so. See supra note 11. Thus, in the absence of any
statutory designation of community development authorities
as “political subdivisions,” we conclude that the CDA is
not such an entity. 14
The Public Entities have not asserted that the CDA is
a locality, or an agency or instrumentality of the
Commonwealth. We also conclude that the CDA is not one of
14
We recognize that, in the resolution creating the
CDA, the Board designated it as a “body corporate and
politic.” However, in light of the enabling legislation
for community development authorities, we believe that the
Board did not have any statutory power to do so. “In
Virginia the powers of boards of supervisors are fixed by
statute and are limited to those conferred expressly or by
necessary implication.” Bd. of Supervisors v. Horne, 216
Va. 113, 117, 215 S.E.2d 453, 455 (1975) (citing Gordon v.
Bd. of Supervisors, 207 Va. 827, 832, 153 S.E.2d 270, 274
(1967); Johnson v. Goochland County, 206 Va. 235, 237, 142
S.E.2d 501, 502 (1965)).
19
those other entities. Cf. Virginia Elec. & Power Co., 217
Va. at 32-33, 225 S.E.2d at 367 (although housing authority
denominated a political subdivision of the Commonwealth,
such authority comes into existence only by local action
and is thus purely local in nature and not a state agency).
Since Article 6 of the Public Finance Act applies only to
proceedings to validate bonds of “any locality or other
political subdivision, agency or instrumentality of the
Commonwealth,” Code § 15.2-2650, and since the General
Assembly did not classify community development authorities
as one of those entities, the CDA cannot utilize the
procedure set forth in Code § 15.2-2651 to validate its
bonds.
We are, nonetheless, mindful of the broad language
contained in the Public Finance Act. Specifically, Code
§ 15.2-2650 states that the provisions of Article 6 of that
act “apply to all suits, actions and proceedings of
whatever nature involving the validity of bonds of any
locality or other political subdivision, agency or
instrumentality of the Commonwealth,” (emphasis added), and
pursuant to Code § 15.2-2651, such entities “may bring at
any time a proceeding in any court . . . to establish the
validity of the bonds.” Code § 15.2-2650 also states that
“[t]hese provisions supersede all other acts and statutes
20
on the subject and are controlling in all cases,
notwithstanding the provisions of any other law or charter
to the contrary.” Despite these all-embracing statements,
the fact remains that the plain terms of Code §§ 15.2-2650
and –2651 allow only a “locality or other political
subdivision, agency or instrumentality of the Commonwealth”
to bring a bond validation proceeding under Article 6 of
the Public Finance Act.
Furthermore, the WWAA contains equally broad language.
Code § 15.2-5100 provides that the WWAA “shall constitute
full and complete authority, without regard to the
provisions of any other law for the doing of the acts
herein authorized, and shall be liberally construed to
effect the purposes of the [WWAA].” Similarly, Code
§ 15.2-5129 states that “[b]onds may be issued under the
provisions of [the WWAA] without obtaining the approval or
consent of any department, division, commission, board,
bureau or agency of the Commonwealth, and without any other
proceeding or the happening of any other condition or thing
than those proceedings, conditions or things which are
specifically required by [the WWAA].”
We also note that Code § 15.2-2627 of the Public
Finance Act is similar to Code § 15.2-5126 in the WWAA.
Both sections provide that “any person in interest” may
21
contest the validity of bonds for a period of 30 days after
the date when the ordinance or resolution authorizing the
bond issuance is filed in the circuit court. However,
while the Public Finance Act contains two discrete
provisions through which the validity of certain bonds may
be either challenged, see Code § 15.2-2627, or established,
see Code § 15.2-2651, the WWAA provides only the method of
challenging the validity of bonds issued by a community
development authority, see Code § 15.2-5126, and that
provision does not permit the community development
authority itself to initiate a bond validation proceeding
such as the present one. A person in interest may contest,
but not seek to establish, the validity of such bonds.
Code § 15.2-5126. However, the fact that only one method
is available to determine the validity of bonds issued by a
community development authority does not change our
analysis. Such matters are within the province of the
General Assembly to decide.
Moreover, as we emphasized earlier, the inclusion of
Code § 15.2-5126 in the WWAA is singular among the Code’s
various provisions establishing other authorities. Our
search of the Code revealed virtually no other authority
for which a separate procedure to determine the validity of
a bond issuance is included within the legislation
22
expressly pertaining to that authority. Thus, the General
Assembly obviously realizes when it needs to include such a
procedure because a particular authority, in this case the
CDA, cannot utilize Article 6 of the Public Finance Act to
validate its bonds.
This last observation is in accord with our decision
in Mayor of Lexington v. Industrial Development Authority,
221 Va. 865, 275 S.E.2d 888 (1981). There, the appellant
challenged the right of an industrial development authority
to proceed under the Public Finance Act in effect at that
time. In rejecting the appellant’s argument, we concluded
that “[w]hen the General Assembly made industrial
development authorities political subdivisions of the
Commonwealth, it thereby brought them within the purview of
Code § 15.1-214,” (the predecessor to Code § 15.2-2651).
Id. at 871, 275 S.E.2d at 891. We believed it was apparent
that the General Assembly did not provide a separate
procedure for challenging or validating industrial
development bonds in the Industrial Development and Revenue
Bond Act itself because the language of former Code § 15.1-
214 clearly applied to all political subdivisions, and thus
to industrial development authorities. Id. Based on the
rationale in Mayor, it follows that, in the present case,
the General Assembly included a procedure in the WWAA to
23
challenge bonds issued by a community development authority
since that authority, not being a “locality or other
political subdivision, agency or instrumentality of the
Commonwealth,” Code § 15.2-2650, does not come within the
purview of the Public Finance Act.
CONCLUSION
For the reasons stated, we conclude that the circuit
court erred in allowing this action to proceed under the
Public Finance Act. This Court is fully aware of the fact
that its decision today leaves unresolved the question
whether the proposed bond issuance is valid. We are also
cognizant of the significant financial and economic
interests at stake. However, we cannot ignore the plain
terms of the Public Finance Act and the enabling
legislation for community development authorities simply to
accommodate those interests or to conserve judicial
resources. Accordingly, we will vacate the circuit court’s
decision invalidating the proposed bond issuance and
dismiss this action. 15
Vacated and dismissed.
15
In light of our decision, we do not address the
remaining assignments of error and cross-error.
24