BUENA VISTA, Va. – A financial dispute is over after causing one local city problems for a decade.
10 News has learned that a federal judge has dismissed a lawsuit against the city of Buena Vista.
The dispute is over payments for the Vista Links Golf Course, which a city-appointed authority runs. ACA Financial, the firm based out of New York that insured bonds to finance the golf course, has been paying $660,000 a year since 2014 because the city said it couldn't pay the debt.
ACA threatened to seize control of city hall, which was listed as collateral.
But a federal judge sided with the city, saying the debt is a revenue bond with “moral obligation” and the city only has to pay it if it chooses to appropriate the money. The judge handed down the lengthy, 37-page decision late Thursday afternoon.
Brian Kearney, the city attorney, said Buena Vista has been hoping for this ruling for a year.
"It's relief because you never know. We always anticipated this but you never know. So we were very happy to see the judge's ruling," he said.
He said the city felt it couldn't sacrifice enough of its other obligations.
"They determined that they could not do that without affecting the core services that the city was going to provide its citizens," he said.
Kearney said it's not like the city has been hiding money.
"The golf course has never made money," he said.
Even with the lawsuit behind the city, Kearney says it’s still not in a great position financially.
"The city is struggling, as many small cities are. They have (a) limited economic base. There are lots of good things happening in this city but we're not flush and rolling in money," he said.
Business owners we talked to are happy to hear about the ruling. Becky Fairchild has owned a bridal store downtown for 35 years.
“We are ecstatic over that," she said. "I'm so glad that burden has now been put to rest."
Antonetta Scire has owned a downtown restaurant for 17 years.
“That makes me feel good. And I hope everything gets better a little bit at a time," she said.
ACA sent 10 News a response Friday afternoon, which says in part, “We intend to appeal the decision. In the meantime, we will continue to press the City to meet its promise to pay on these bonds.”
This is the first lawsuit of its kind ever filed in Virginia, according to Kearney, meaning a locality has never been sued for not paying under a moral obligation.
The golf course is still open and Kearney said the city is not currently discussing any changes to how it's operating.