Judge Rules In Favor Of Town Using Airport Fund For Ongoing Litigation

EAST HAMPTON, NY — A judge has recently ruled that the town's legal fees in the ongoing litigation swirling around the fate of East Hampton Airport can be paid from the town's airport fund, East Hampton officials said.

The East Hampton town board and Supervisor Peter Van Scoyoc said that the town "continues to vigorously defend against litigation driven by aviation interests in fight to manage and regulate the East Hampton Town Airport in accordance with what the community wishes."

To that end, town officials said that the ongoing litigation has put the brakes on the town's efforts to implement use restrictions to address traffic, noise and environmental issues at the airport.

On August 3, Suffolk Supreme Court Justice Paul J. Baisley denied a motion by litigants East End Hangars, Inc. and Hampton Hangars, Inc., to require the town to return the fees to the airport fund for work done after May 16, 2022. The judge "affirmed the town’s position that associated legal fees may be paid from the town’s airport fund," town officials said, adding that the town has been using the revenues raised by airport user fees, rather than other taxpayer dollars, to defend its position regarding the airport.

Neither East End Hangars, Inc. nor Hampton Hangars, Inc. could immediately be reached for comment.

The litigants had filed suit in February, 2022, contending that the Town of East Hampton did not properly follow New York State Environmental Quality Review Act regulations when taking steps to deactivate East Hampton Airport, or HTO, and reopen the private East Hampton Town Airport, or JPX, which would have enabled the imposition of use restrictions.

On May 16, 2022, Justice Baisley issued a temporary restraining order, and on October 19, 2022, ruled in favor of the litigants and issued an order enjoining the Town from deactivating or closing East Hampton Airport, the town reminded. Because the deactivation of HTO was already underway, the Federal Aviation Administration determined that the process could not be safely stopped or undone at that time, and the FAA proceeded to deactivate HTO and activate JPX.

Next, the petitioners claimed that the temporary restraining order precluded payment of legal fees from the airport fund, and sought a ruling to require that Cooley LLP, Whiteman Osterman & Hanna LLP, and Rigano LLC return to the airport fund any fees they had received for work performed after the date of the temporary restraining order.

"In response to this legally baseless motion, the town argued that the FAA previously had determined that airport funds may be used for legal fees," the town said.

In his ruling last week, Justice Baisley agreed and denied the aviation interests’ motion. In his opinion, Justice Baisley cited the FAA’s findings in a prior proceeding, National Business Aviation Association, Inc., et al., v. Town of East Hampton, stating that "[t]he presumptive rule is that fees related to airport legal issues may be paid with airport revenue."

Justice Baisley reiterated the FAA’s determination that 'a sponsor may use airport revenue to pay attorney fees to the extent that fees are for service in support of the airport or operating costs," and ruled that the town’s legal counsel did not need to return any fees to the airport fund.

The ongoing litigation concerning the airport "has impeded the town’s goal of managing and regulating its airport to reflect the desires of the community and ability to respond to community concerns about the airport. The town has vigorously defended the litigation, largely driven by commercial aviation interests," town officials said.

The town’s appeals of Justice Baisley’s grant of a permanent injunction preventing the town from deactivating or closing HTO and holding the town in contempt for violations of the temporary restraining order are currently pending before the Appellate Division, town officials added.

In November, the East Hampton town board gave a review on the status of the airport at a town board meeting.

During the meeting, the status of litigation against East Hampton regarding airport operations was given — and next steps were outlined.

"The East Hampton town board continues to pursue solutions to satisfy community concerns about noise and other environmental impacts related to aviation and use of the East Hampton Town Airport," officials said.

Giving a history of what has transpired so far, the town said its grant assurances, or agreements with the Federal Aviation Administration, based on the town's acceptance of federal airport funds, had expired in the fall of 2021.

The town worked with the FAA for years to chart a path forward with an eye toward local decision-making, increased local control over operations, and involving the public in the process.

To that end, community engagement was sought through several work sessions in 2020 and 2021, and four focused community engagement sessions in fall 2021. During that time, the town board said it found that a majority of East Hampton residents would like to see "significant change at the airport to address noise and environmental issues — or, if not possible, airport closure" with privatization sought.

East Hampton Town sought to study the impact of reasonable restrictions at the airport during the 2022 summer season, as required by the New York State Environmental Quality Review Act, or SEQRA, officials said.

Several entities sued the town, and a temporary restraining order was issued in May 2022 that precluded the town from modifying airport operations and implementing the SEQRA study of reasonable airport restrictions, the town said.

Among those who sued the town were Blade, a commercial aviation operator, as well as Montauk residents; East End Hangars, including airport tenants and local individuals; and Coalition to Keep East Hampton Airport Open, including local residents and aviators.

Those commencing litigation claimed that the town violated SEQRA and a federal aviation statute, the Airport Noise and Capacity Act of 1990, town officials said.

The town opposed the claims, saying that SEQRA permits the town to collect data and study the impact, if any, of modification or closure at the airport, as contemplated by the town; also, officials said, ANCA did not apply.

On October 19, 2022, the Suffolk County Supreme Court ruled against the town on the cases. The full court decision can be found here.

The town filed a notice of appeal on November 9.

Other pending court action include state court action by East Hampton resident Manny Vilar; state court action by Long Island Airlines; federal court action by the National Business Aviation Association; and FAA Part 16 action by Curtis Air Taxi.

Following the Suffolk County Supreme Court ruling, the town said it would immediately re-initiate the SEQRA process, town officials said.