Village Council’s Response to BHITA Activities

The Bald Head Island Transportation Authority (BHITA) was formed by the NC General Assembly via the Ferry Transportation Authority Act which authorized the creation of an authority to “provide reliable and safe public ferry transportation services in its service area.”  The Act included the creation of a public body governed by an 11-member Board of Trustees appointed by local governments and the State of North Carolina with the necessary authorities to own and manage any qualifying ferry in its service area.

Background on the Activities of the BHITA – Since its incorporation in August 2017, nearly all activities of the Bald Head Island Transportation Authority (BHITA) have not been shared with the public.  This is because the activities related to legal matters and negotiations and were performed by BHITA staff, consultants, the BHITA negotiation subcommittee, and the full BHITA board in duly noticed closed session meetings.  Most of the activities that have been taking place over the years were to perform “due diligence” for the BHITA’s application to the NC Local Government Commission (LGC).

The LGC assists local governments and public authorities in North Carolina. It approves the issuance of debt for all units of local government and assists those units with fiscal management.  Acquisition of the ferry system by the BHITA will require debt financing and the BHITA must apply to the LGC and receive LGC approval before closing on the acquisition of the ferry system.  BHITA representatives met with the LGC on December 1, 2020, and its presentation to the LGC includes some background on the BHITA and the BHITA’s due diligence initiatives. These initiatives included assessing Bald Head Island Limited’s assets/infrastructure, assessing its finances, and preparing legal documents. The presentation can be viewed HERE.

The Village’s Response to BHITA’s Activities – In last week’s recap of the December 9th Village Council meeting it was reported that the Village’s representatives on the BHITA board of trustees which include Mayor Sayre, Mayor Pro Tem Brown, and Claude Pope, discussed the BHITA’s activities. They reported that the BHITA held a special meeting on Tuesday, December 8, 2020, and that the BHITA adopted two resolutions.  One resolution included the approval of an Asset Purchase Agreement with Bald Head Island Limited, LLC to acquire the privately-owned ferry and barge systems for a total amount of $47,750,000.  The other resolution authorized application to the Local Government Commission for approval of Bald Head Island Transportation Authority transportation system revenue bonds.  Both resolutions were not supported by the three BHI trustees.

After reviewing the information on the BHITA’s activities and its next steps, the Village Council sent THIS LETTER to the LGC chairman requesting the following:

  • The LGC defer action on the Application until the Village Council’s concerns have been addressed and the LGC can be satisfied that the Application and its proposed findings are factually and financially sound.
  • The public, including residents, non-resident property owners, and other system users at Bald Head Island, which is accessible only by the transportation system, be provided an opportunity for comment and input.

If Bald Head Island’s request to defer is not fulfilled, closing on the system purchase is expected to occur in early February 2021.