Tenant Writes Lease - The Missourian: Local News

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Tenant Writes Lease

Makes Own Proposal to Pay Lower Hangar Rent at Airport

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Posted: Saturday, March 2, 2013 8:00 am | Updated: 7:42 pm, Sat Jun 22, 2013.

The city has received a letter from one of the St. Clair Regional Airport tenants as well as a draft lease agreement that proposes to lower the monthly hangar rental rate even further than what officials already have approved.

The letter was drafted by Grenville Sutcliffe, one of eight tenants who currently use the hangar to store their aircraft at the facility located on the north side of the city.

Sutcliffe’s letter was dated Feb. 11 and sent to Mayor Ron Blum, who shared it with his board of aldermen during their most recent meeting.

“We, too, are aware that it is going to take a lot of money that the city of St. Clair doesn’t have to bring the airport up to FAA (Federal Aviation Administration) standards before they will even consider allowing it to be closed for retail development,” the letter reads. “The only way for the city to relieve itself of that burden and let the airport to become more self-sustaining is to get more pilots. The fastest way to get more pilots is to set a market rate of rent of $125 per month per hangar.”

The letter goes on to state that “simple math” will show that 10 pilots at $125 per month will bring in more revenue than six pilots at $175 per month.

But, with eight pilots currently renting space at the facility for the city-approved $175 per month, that adds up to more money than 10 pilots paying $125, officials noted.

In January, in response to both a formal and informal complaint filed by a tenant regarding the previously approved increased hangar rental rates at the airport, the city decided to roll back the amount it charges tenants to the 2012 fee of $175.

City officials said they had received no complaints last year about that monthly amount.

The city is attempting to close the airport on the north side of town between Interstate 44 and Highway 47 to make way for retail development. Permission must be granted by the FAA because the city obtained federal grants to make improvements at the facility.

At least since 2007, when airport revenue and expenses were placed in a separate line item in the city’s general fund, the facility has operated in the red and lost money every year. The only revenue for the facility comes through the hangar rental rates.

Now, on advice from the FAA and the Missouri Department of Transportation’s Aviation Division, the city has opened a separate airport checking account.

January’s board action brought hangar rates back down to the $175 per month rate. Late last year during the city’s budgeting process, aldermen increased the rate to $300 in an effort to help the airport be self-sustaining and operate in the black. That prompted the complaints.

Copies of Sutcliffe’s letter as well as his own rewritten hangar space lease were sent to tenants as well as to state and federal officials.

The aldermen were given copies of the current and rewritten leases at their meeting.

“We have no idea how the FAA wants us to handle this,” City Administrator Rick Childers said. “I recommend that the board approve us forwarding this to MoDOT Aviation for review.”

Mayor Ron Blum agreed.

“This is becoming bizarre,” he said. “But I also recommend we forward this to MoDOT Aviation to get their thoughts on how we should proceed.”

The mayor added that it is the city that has the authority to set hangar rates, not the tenants. He compared Sutcliffe’s letter and rewritten lease to an individual who rents a home from a landlord and decides to only pay a portion of the rent each month or to a city resident proposing that he or she only has to pay a portion of a water bill.

Blum also said last week the city has received three rent checks from pilots for the $125.

“They didn’t pay the $175 per month as directed by the board,” he said.

“We are trying to follow the law as best we can here,” Blum told The Missourian. “For every process, there is a defined procedure in order to come to a resolution. We just don’t understand this latest thing from the tenants. It really is just extremely bizarre.”

The earlier complaints were filed with the Federal Aviation Administration by at least one of the pilots, who claimed increasing the rent was “unjustly discriminatory and unreasonable.” St. Clair airport tenant Jim DeVries, who lives in Pacific, has been the most vocal of the small handful of area tenants who are opposed to St. Clair’s attempt to close the facility.

He previously has filed other complaints with the FAA. One complaint stated that the city is “stealing money from the airport.”

None of the tenants who rent hangar space at the airport live in St. Clair.

/local_news