With a lawsuit challenging the formation of the Coos County Airport District out of the way, hope is rising that three-way transition negotiations to give the district full power to operate the airport are nearing completion.

Long-snarled transition discussions between the newly formed district, the Oregon International Port of Coos Bay and the city of North Bend are making strong headway in the wake of the legal opinion that dismissed a challenge to the district's existence. Airport General Manager Gary LeTellier said he is hopeful a draft agreement could be in place by the district's Aug. 28 meeting.

"We've gotten movement in all directions," LeTellier said.

LeTellier said negotiations with the three governmental agencies have been simplified since Coos County Circuit Judge Richard Barron dismissed the lawsuit a week ago Monday, saying a suit filed by Powers, Lakeside and Myrtle Point was received too late and was filed using the incorrect guidelines.

Barron's decision shut the door on the legal challenge, not only dismissing the case but also preventing it from being refiled. Unless an appeal is filed and a higher court overrules Barron, the cities' argument that the district vote was held illegally will never reach a court.

That gives the port, city and district fewer issues to debate in negotiating an agreement. Reaching a draft conclusion this month would give the groups some breathing room, LeTellier said.

"That would probably leave the month of September to dot the I's and cross the T's," LeTellier said.

Transition discussions have been held privately, either through attorneys or at staff level. Publicly, the difficult issues included whether the district would repay a debt to the port and if North Bend could retain ownership of the sewer treatment plant while giving up its ownership of the airport.

Conceptually, the intergovernmental agreement will specify the terms under which the city will transfer ownership of the airport. It also will formalize an agreement relinquishing the port from its responsibility to operate the airport and details the amount and timeline the district will follow in paying the port its debt.

Port General Manager Allan Rumbaugh said Barron's decision makes many of the contingencies discussed during the early transition negotiations irrelevant.

"Our three-party negotiations had become incredibly complicated as we were trying to imagine every possible scenario from the court case, if it went bad for us," Rumbaugh said.

That's not to say negotiations will be easy now, but much of the hardest work already has been done.

"I think we're nearly there," Rumbaugh said. "I think we've knocked out probably 95 percent of it."

A key issue was deciding whether the port would levy the final year of its $300,000 serial bond to pay for the airport. While the port was prepared to certify the levy in a worst-case scenario, commissioners were disgruntled by the option. Port commissioners had been resolute against levying the tax and with the lawsuit dismissed, that won't be necessary, according to the port.

"The port will not certify our levy," Rumbaugh said.

"With the Airport District apparently now being in a very good position, the last year of our levy is no longer needed, especially because the port did not want to double tax port district voters," Rumbaugh said.

According to the Coos County Assessor's Office, the Airport District has until Sept. 15. The levy is expected to generate approximately $746,000.

LeTellier said the Airport District Board of Directors is expected to discuss certifying the levy at this month's meeting and it is expected the board will move ahead with the tax.

The port will be permanently unable to certify the final year of its levy if it skips the current year but that doesn't concern Rumbaugh, who said the levy had only one aim.

"The only purpose for the levy was to help run the airport," he said. "Now that the airport district is going eventually to take over the airport, we don't need that tax levy."

That may be one of the strongest indication yet that negotiations are nearing completion.

While LeTellier said he is waiting for the expiration of a 30-day deadline to appeal decision before celebrating, he's also begun contacting bankers and accountants, hoping that the resolution of the lawsuit will make it easier for the district to borrow financing to get it through November, when property taxes are collected.

Banks had expressed skepticism at loaning the district money with the suit ongoing but LeTellier and the district are hopeful those issues can now be resolved.

"Of course we're going to wait the 30 days to see if there are any appeals," LeTellier said. "We're pleased with the decision. We thought it was a good opinion."