Grand Rapids/Itasca County Airport Commission Challenged to Focus on Airport's Future

Airport Commission Challenged to Focus on Airport's
Future 
Grand Rapids Herald-Review, MN

Wednesday, February 18th, 2004 

To be or not to be, that is the daunting question
currently facing the Grand Rapids/Itasca County
Airport Commission. Whether to remain a commercial
airport or to become only a general aviation/corporate
airport is the challenge. 

The answer lies in the commission’s next few months of
activity. 

There appeared to be no question at the Feb. 10
regular meeting that the majority of the commissioners
wanted the airport to retain its commercial status.
Near the end of their discussion about the airport’s
future, clouded by Mesaba ending its service to Grand
Rapids on March 1, Peter McDermott walked into the
meeting to announce that JOBS 20/20 had formed an
emergency task force that evening to begin exploring
an alternative commercial carrier for the airport. 

JOBS 2020 was formed after the recent paper mill
layoffs to discover ways to revitalize the economies
of the Grand Rapids and Itasca County communities. It
is led by McDermott who also is heading Itasca
Development Corporation. 

Commissioner Sarah Copeland volunteered to represent
her peers on the airport task force which began its
work immediately. 

“This is an action team,” McDermott said. “Commercial
service for the airport is an important issue for the
community’s economic development that needs immediate
action. The task force’s mission is to ensure
scheduled air service for the Grand Rapids/Itasca
County area.” 

In addition to Copeland and Airport Manager Mark
Hoyne, the task force has official representatives
from the city and the county. However, other
interested individuals may join by calling Itasca
Development Corporation. The next meeting will be Feb.
26. 

The importance of this task force is underlined by the
current economic impact of the airport: Hoyne
estimates that as a commercial airport, (GPZ)
generates about $15 million in economic activity and
$925,000 in airport-related employee earnings. 

As a noncommercial airport, GPZ might generate $3.4
million in economic activity and about $550,000 in
airport-related salaries. 

Both of these scenarios show generous returns from an
airport with an annual operations budget of
approximately $420,000. 

A service or an enterprise? 

Concurrent with the task force meetings, the Airport
Commission will host two public hearings to discuss
the future of the airport with general aviation
pilots, citizens, area business people and other
stakeholders. 

“We have to decide if the airport is going to be a
service or an enterprise,” said Commissioner Dan
Erkkila. 

In addition, the commission directed Hoyne, by a
successful motion, to determine if outside
professional services are needed to facilitate public
input and fact gathering and, if so, to apply for a
grant to fund such services. 

We need to move forward and find out what everyone
thinks the airport should be, Erkkila emphasized. “We
need someone to facilitate the process,” he said. 

Commissioner Ted Tinquist cast the only nay vote. 

“I’m all for a study if someone else pays for it,”
Commissioner Rusty Eichorn said before the vote. “I
believe it can be important to our process. The
commissioners suggested asking for funds from the
city’s unused portion of the Blandin Foundation
telecommunications grant or from a Minnesota
Department of Transportation. 

“It is also important that we embrace general aviation
and our corporate traffic after March 1,” Eichorn
added. 

Erkkila noted that the story for general aviation is
not well known. “I’m being asked why we need an
airport if we don’t have commercial service,” he
explained. “Some citizens are afraid that the airport
will become recreational site rather than a commercial
pursuit. 

“People need to be together on a vision for the
airport,” Erkkila continued. 

He added that it’s important to listen to the general
aviation pilots, but that they do not represent all of
the airport’s owners. 

“We must make sure that we hear from all entities that
are part of this puzzle,” Copeland said. 

The commissioners estimate it will take four to six
weeks to redefine the role of the airport and report
to the owners or city and county taxpayers. 

Dealing with 2004 budget shortfall 

The loss of Mesaba’s commercial service translates
into a $76,025 loss in the airport’s 2004 revenues,
creating an overall $10,692 shortfall. 

Hoyne suggested that this could be made up by
increasing revenues through raising rents, the price
of lease land or charges for services, or decreasing
personnel expenses, foregoing construction of T-hangar
16 or reducing services. 

“Our answer is probably a combination of raising
revenues and decreasing costs,” Erkkila observed.
“We’re not going to hit the pilots to make up the
shortfall. 

“We have to realize, too, that the story has not been
entirely told because we are looking at other options
as well as different commercial service,” he said. 

The options include an expanded air taxi service,
ground transportation to nearby airports and other
aviation business, such as creating a tax free zone or
adding more terminal enterprises or courting Minnesota
Department of Natural Resources or law enforcement
aviation. 

Other commissioners had other ideas: Commissioner
Tinquist suggested dipping into the $57,000 fund
balance and cutting professional seminars and
training. He also wanted cuts limited only to
expenses. 

Commissioner Mike Ives strongly disagreed with
Tinquist. “If we are to have a competent workforce (at
the airport) we need to do constant training,” he
said. “You can’t blame them if you don’t train them.” 

Ives asked the commission to direct the airport
manager to come back with specific alternatives on how
to make up the shortfall. 

“Without scheduled commercial service the terminal is
our biggest liability,” Eichorn remarked. 

Hoyne suggested that the commission could go back to
the county and city for an additional $5,000.
Currently, the city gives GPZ $114,000 and the county,
$90,000 for operations. 

Eichorn urged the commission to present a balanced
budget to the city and county rather than ask for more
money. 

Commission Chairman Tim George reiterated the need for
specific suggestions in both revenues and expenses.
“We need options,” he said. “We need to consider our
vested and nonvested owners. We need to look at where
we are and the possibilities for our future. And we
need to see all sides.” 

Hoyne will bring options to the March 9 meeting. 

The capital improvement puzzle 

The commissioners’ last major discussion related to
the airport’s 2004 capital improvement plan. This
$525,000 plan includes land and easement acquisition
($135,000) and engineering/design ($300,000) for the
runway 16/34 extension; completion of the deer fence
($65,000); and repair of runway 16/34 ($25,000). 

The total capital outlay would be nearly $15,000 over
budget and could come back on local government units. 

The city and the county have already pledged support
to the airport’s 2004 capital improvement fund. The
city has given $14,750, but the county refuses to
match the city and contributed only $3,000. 

The commission currently has more than $3 million from
federal and state entitlements and grants in the bank
for capital improvement projects. 

Ives felt it was absolutely essential to go forward
with the runway extension because the commission was
getting 95 cents out of every $1 it spent and the
extension was vital to economic development, providing
an airstrip for larger jet aircraft. 

Eichorn supported the extension with the money already
in hand, but worried about a shortfall that the city
and county might have to cover. It had happened before
and he didn’t want to see it happen again during
current budget-cutting times. 

“I want us to be fiscally responsible,” he said, “and
if we have the entitlement money available we should
go ahead with the engineering and design.” 

The commission would have to go back to the city and
county for their 5 percent shares to use future
federal entitlement dollars, but the commissioners
felt the 2004 funds were secure. 

“We will have to raise additional matches in 2005 and
2006,” said Ives, before making a motion to move
forward with the 2004 capital improvement plan. 

The motion carried with one nay vote from Tinquist. 

George asked Hoyne to bring a list of capital
improvement priorities to the next regular meeting. 

“We’re at a crossroads,” Hoyne concluded. “It’s up to
you as commissioners to provide the leadership for a
clear and common vision for the Grand Rapids/Itasca
County Airport and to guide the city and the county in
their support.” 
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