As the FAA and Stanislaus Grand Jury are investigating the Oakdale Airport and asking for more information about how it charges its rates, city officials decided on Monday, Sept. 15 to enter into a long-term lease with an established tenant that is the focus of the economic discrimination accusation.
Two items were on the city council agenda, both surrounding the airport, that brought passionate comments from members of the public.
The council heard a request by City Manager Bryan Whitemyer to solicit proposals (RFP) for a fixed base operator (FBO) for the airport.
An FBO is a commercial business granted the right to operate at an airport and provide services such as fueling, aircraft rental, maintenance and repair, flight instruction, and tie-down services. The city has not had an FBO for over 10 years.
The council unanimously approved the request, but after Dick Jorgensen and Bill Bradford, veteran pilots and airport hangar tenants, fervently addressed the council with concerns.
Jorgensen suggested that instead of a strict RFP, the city look also into an aviation related business that would use the facilities for flights in and out of the site.
“General aviation is all but dead today,” Jorgensen said. “Until we find someone to provide leadership out at the airport, we’re not going anywhere.”
“An RFP is great,” Bradford said, “but it’s stiff and we’re unlikely to find anyone to meet the standards.”
The majority of the discussion Monday surrounded a proposed lease agreement of three hangars with Sierra West Airlines.
According to Whitemyer, one of the hangar leases would be a five-year lease that would have the option of two additional five-year extensions and the others would be month-to-month as the city sought its FBO that would eventually occupy those sites.
Currently Sierra West rents three buildings at the airport for $3,050 per month. Under the agreement the rent would be raised $250 to $3,300.
In March 2013, the city raised rents for airport tenants announcing it would be billing Sierra West $4,350 per month based on recommendations of the Airport Ad-hoc Committee but later reduced them to the current $3,050.
“How wise is it to enter into a lease renewal if we’re being looked at on how appropriate these rates are?” Councilman Don Petersen asked, referring to both recent investigations.
“I’m confident that at the end of the day, reason will prevail,” Whitemyer responded, explaining that the rates charged to Sierra West were the same square footage charges to other tenants. “The worst case scenario is we’ll receive instruction from the Grand Jury.”
Airport Ad-hoc Committee member Don Gutridge countered Whitemyer’s argument explaining that commercial rates are different than private hangar rates and that the rates proposed were “understated and not in line with the recommendations made by the ad-hoc committee.”
Bradford told the council that Sierra West had underpaid the city for 20 years and ran many other businesses at the facility in disregard of the FAA assurances. He added that commercial square footage charges in the area were 40 cents, not the 20 cents charged by the city.
“Why support a business with poor pilot records, log keeping, and safety history?” Bradford asked. “It’s the only charter (aircraft business) that has its planes in one place and management in the other.”
Sierra West Airlines, on-demand air charter company, is headquartered in Oakdale but its entire fleet is based in El Paso where the airline also operates a 12,000 square foot maintenance facility. The El Paso site also conducts its line level airframe and engine checks, and engine changes.
“Sierra West Airlines is counting on the failure of getting a real aviation tenant to continue their sweet deal,” Bradford suggested. “Do not consummate the lease.”
Whitemyer stated that the city shouldn’t throw out a revenue generating tenant until there was a replacement. He described the lease as a win-win for the city.
Petersen, who took the lead on questioning, asked Whitemyer what would happen in the future if the city found someone to pay “real commercial rates” and the city had the proposed lease with Sierra West.
With the lease, the city would have to wait until the end of the five-year period for the one hangar, but would be month-to-month with the other hangars.
The council voted 3-1, with Councilman Tom Dunlop absent, to approve the lease.
The dissenting vote, Councilman Mike Brennan, was also critical of Sierra West stating they should be kept month-to-month because he didn’t like the way Sierra West had operated over the years.