St. Clair Board of Aldermen members unanimously passed two resolutions Monday night during their regular board meeting aimed at continuing the quest to seek permission to close the regional airport.
One resolution officially gave City Administrator Rick Childers permission to open a separate bank account for airport funds while the second authorized payment to that airport fund for lift station lease fees.
Both action items were deemed necessary after St. Clair officials received a letter from the U.S. Department of Transportation in December stating that “the agency will not consider closing St. Clair Regional Airport ... until the city corrects deficiencies at the airport.”
One of the three points listed in the letter was addressing operational and financial issues in relation to a complaint filed with the Office of the Inspector General saying that the city is mismanaging funds at the facility. The complaint was filed by one of the hangar tenants. One of those tenants, Jim DeVries of Pacific, has accused the city of “stealing money from the airport.”
The other two points in the letter are resolving the formal and the informal complaints regarding the increase in tenant rental fees and making adequate repairs at the facility. With Mayor Blum having to break a 2-2 aldermen deadlock, the city last month voted to roll back hangar rent back to the 2012 rate of $175 per month.
The only revenue for the facility comes through the hangar rental rates.
Figures from the city show that the airport has operated in the red every year since 2007, when a separate line item was created in the general fund to track income and expenses at the facility. The city has had to use other monies from the general fund to make ends meet at the 80-acre site.
St. Clair is trying to close the airport located between Interstate 44 and Highway 47 on the north side of the city to make room for retail development. Permission is needed from the Federal Aviation Administration because the city obtained federal grants to fund improvements at the facility.
During the previous board meeting, aldermen agreed to authorize the new account, even though they did not feel it was necessary.
“This resolution formalizes the motion made during the last meeting to create a bank account (for the airport),” Childers said. “It (resolution)was requested by the bank.”
Last month, the aldermen were given copies of the city’s airport financial records from 2009, 2010, 2011 and 2012, which showed the facility lost money in each of those four years. In 2007 and 2008, the same held true.
“These show all our revenue and expenses,” Childers said at the time, adding that the city’s books are audited every year and that the annual audit never has come back with any red flags attached.
“This is already noted by our auditor as separate a fund as it can get,” he said.
During January’s second board meeting, Childers said his recommended solution to address “allegations regarding fund management at the airport,” is to open the separate bank account for it and to contract with a certified public accounting firm not affiliated with the annual city audit “to create and manage a separate bank account in a separate bank for the airport.”
He also said it could cost the city up to $1,200 annually to take the action.
The second resolution authorized a $2,079 payment from city funds to the airport account for lift station lease fees.
The resolution states that the FAA has recommended payment to the airport fund for use of airport land being occupied by a city-owned wastewater lift station, which was constructed years ago.
The resolution also states that the city will back pay fees from 2008 to date.
Childers said an annual lease amount of $346.50 was determined by taking the appraised value of the 80-acre parcel of land and dividing that amount by the acreage while determining the actual size of the lift station and surrounding access points.
Through that process, the $346.50 annual fee was set, and the resolution approved payment of six years of rental fees, or $2,079.
Childers said Missouri Department of Transportation and FAA officials were involved in the process of determining the rate.
The action did not come without some controversy, however. Before the vote was taken to approve the resolution, Ward 1 Alderman Zach Fuchs asked if setting up this rental agreement between the city and the city-owned airport again would be using valuable city funds again to subsidize the airport.
“Let’s choose not to go there,” Childers said in response.
In previous meetings, the city administrator has said sometimes one has to lose some battles in order to win the war. Childers made that statement again on Monday.
But, Mayor Ron Blum then said, “But the answer to the question is yes.”
During the meeting, Childers also noted that repairs are being made at the facility, which addresses one of the three points in the letter.
He provided a list of “routine maintenance items” that have been addressed as well as other issues dealing with the fiscal records, hangar storage and leases.
He said the only maintenance item not completed is the rotating beacon, but said that will be fixed shortly.
“In full cooperation with MoDOT and the FAA, we’re working through this piece by piece by piece,” Childers said. “We’re working on completing every one of these items.”
He said when the process is finished, another document will be sent to the FAA showing compliance to the requests and again requesting closure of the facility.
Last summer, after several years of discussion with the federal organization, Blum sent a letter to the FAA specifically asking that it allow closure of the 80-acre facility. Closing the airport has been at the top of the mayor’s and aldermen’s priority list since he first took office in 2007.
Blum’s letter asked for a decision by Thanksgiving.
The conclusion of the USDOT letter received by the city in December stated that future discussions will be limited to issues related to the city completing the steps detailed in the letter.