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Can Cuomo really dissolve the Peace Bridge Authority?

WASHINGTON – In the view of the Canadian government and the Peace Bridge Authority’s lawyer, it’s an open-and-shut case – first made by a revered state attorney general nearly 60 years ago and signed, sealed and delivered by federal courts that have said, again and again ever since, that no state can shut down a public authority whose creation was sanctioned by Congress.

But Gov. Andrew M. Cuomo is getting very different legal advice.

His advisers are telling him there’s a loophole that makes it legally permissible for the State Legislature to pass legislation that could lead to the disbanding of the Peace Bridge Authority no matter what the Canadians think.

The State Legislature passed such legislation on Wednesday, and perhaps that will somehow prompt a resolution of the cross-border dispute over how Buffalo’s key border crossing is governed.

If not, though, the result is likely to be a decidedly unpeaceful legal battle.

And that, of course, could delay improvements at the Peace Bridge – which is exactly the opposite of what Cuomo and the bill’s sponsors say they are trying to do.

The root of such a legal dispute would be the Canadian government’s contention that New York cannot act alone to disband a public authority, which is just what the legislation sponsored by Rep. Sean Ryan, D-Buffalo, and State Sen. Mark Grisanti, R-Buffalo, would in effect do.

“Canada’s view is that significant amendments to the governance of the bridge authority cannot be made without the consent of both federal governments,” Scott Streiner, assistant deputy minister of Transport Canada, said in a May 31 letter to Howard B. Glaser, a top aide to Cuomo.

Asked why Transport Canada feels that way, agency spokesperson Karine Martel cited a 1955 legal opinion from then-New York Attorney General Jacob Javits.

Commenting on a 1955 Peace Bridge governance dispute remarkably similar to the one happening today, Javits wrote: “While it has been recognized that unilateral legislation by a state in furtherance of an interstate compact or agreement does not require consents of the participating parties and of the Congress, such consents are required where changes in the agreement are unilaterally proposed or attempted to be made by one of the parties.”

While a 1955 legal opinion from Albany might not seem to carry that much weight, Javits’ opinion now has the weight of legal history to support it.

In fact, the legal history is so strongly on the Canadians’ side that Arthur J. Giacalone, an East Aurora attorney who specializes in land use and environmental issues and who has been following the issue closely, said: “I think there’s absolutely no rational legal support for the state’s position” that it can dissolve the Peace Bridge Authority on its own.

First and foremost, the state would have to overcome a little legal impediment called the U.S. Constitution, which says “no state shall, without the consent of Congress … enter into any agreement or compact with another state, or with a foreign power.”

Federal courts have long interpreted that to mean, as well, that no state can abrogate such an agreement on its own. In fact, a legal opinion drawn up for the Peace Bridge Authority by its counsel at Phillips Lytle LLP last month cited more than a dozen federal court decisions that appear to buttress the argument that the state cannot act alone.

Most notably, in a 1994 Supreme Court case called Hess v. Port Authority Trans Hudson Corp., the justices said that compacts entered into to create public authorities “are not subject to the unilateral control of any one of the states.”

In addition to the requirement that Canada approve it – which it refuses to do – some sort of U.S. government approval would be required as well.

The legal opinion from Phillips Lytle said Congress had delegated the approval power to the Secretary of State, but the Congressional Research Service said last week that Congress gave that power to the Secretary of Transportation instead.

Adding up all the evidence, though, the Peace Bridge lawyer, Craig R. Bucki, concluded that it’s clear that Canada and the U.S. government would have to approve the just-passed legislation in Albany.

“Absent such consent, any unilateral effort by the State Legislature to enact a law that would claim to dissolve the PBA or compromise its powers would be of no effect,” he said.

Definitive as that sounds, Cuomo’s lawyers say: not so fast.

That’s because they think a quirk of history will play in their favor.

In a memo, the governor’s legal advisors note that New York and Canada amended the Peace Bridge Authority’s founding document in 1970 – but that Congress never agreed to those changes.

That being the case, the state lawyers argue that a previous Peace Bridge revision authorized by both the U.S. and Canadian governments in 1957 remains in effect – and that agreement called for the Peace Bridge Authority to expire on July 1, 1992 or when its bonds were paid off.

Since the authority operated for a time since then with no bond debt, the state views the Peace Bridge Authority as the legal equivalent of the living dead.

“The 1957 agreement was the last amendment consented to by both national governments,” the memo to the governor says.

“Therefore, the proposed NY law returning to the ‘status quo ante’ of the 1992 termination date … does not need further approval by either national government.”

But if he signs, legal action is likely to follow, sources on both sides of the debate conceded.