U.S. Supreme Court Asked to Review Financial Incentives for FedEx Hub

JANUARY 25, 2002

A lawyer who has opposed other state incentives for business is challenging the proposed FedEx hub in the U.S. Supreme Court. William Maready filed a petition Friday asking the court to hear his argument on whether the state, along with Guilford County and the Piedmont Triad Airport Authority, violated the interstate commerce clause of the U.S. Constitution by giving FedEx a package of incentives that its competitors at the airport lack, the Winston-Salem Journal reported.

FedEx has picked the airport as the site for its overnight, mid-Atlantic cargo hub, scheduled to open in 2005 or 2006.

The company was lured to North Carolina because of the tax breaks and other incentives that the company is receiving, thus giving it a "state-sponsored competitive advantage over its business rivals," Maready said.

The state's incentive package includes tax credits of almost $115.5 million over 25 years, according to recent figures from the state Department of Commerce. The airport authority and Guilford County also agreed to cut FedEx's rent in half and to exempt the company from sales taxes on certain parts and equipment.

Maready, who specializes in aviation law, has been challenging the use of business incentives for years. He sued the city of Winston-Salem, Forsyth County, and Winston-Salem Business Inc. over $13 million in tax dollars awarded to 24 companies in the early 1990s. The state Supreme Court ruled against Maready.

Maready started challenging FedEx's incentives almost four years ago when he represented Kent Urbine, whose land and home have been condemned for the hub. State courts upheld the condemnation.

Airport officials said this week they were intervening in a legal challenge between the Federal Aviation Administration and a nonprofit group of hub opponents challenging an FAA environmental impact study.

Source: Associated Press