|
Friday, January 4, 2008 Whose
airport is it anyway
Airport rent lowest in region The Hollister (CA) Pinnacle With cracked pavement
and hangars in various states of disrepair, Hollister Municipal Airport is a
World War II relic. It is a hobbyist airport that supports a handful of small
businesses. Airport
users, Hollister officials and developers all agree that it could be more. "It's a
big piece of what we'll be looking at next year to bring Hollister out of this
economic slump we're in," said Doug Emerson, Hollister's mayor. Hollister has
the only airport south of the Mineta San Jose International Airport that has so
much land around it available for development, he said. Airport users
say they are not against development, if it is handled properly. There is
active opposition among airport users against Bill Gere, the airport manager.
Gere is the man charged with transitioning the airport from its financial
slumber to an economic powerhouse. Recreational
users at the airport are important, but the airport does not exist solely for
the benefit of its users, Emerson said. "The
airport belongs to Hollister," he said. "It should serve the citizens
of Hollister." Some of the
buildings at the airport date back to World War II, Gere said. Those
buildings are in obvious need of repair. Building 19
looks more like an old barn than a hangar. It is a tan wooden structure with
gaps in the wood panels. In large
patches, blue and red paint from old paint jobs is seeping through. The tin
roof is rusted. Buildings 20
and 21 are much the same. The Weatherly
building is a large hangar with 15 tenants, according to documents from the
airport manager. "There's
mold and rot inside the rooms," Gere said. "It's in need of a lot of
maintenance." It also in
need of work on the roof, the plumbing and the electricity, Gere said. The airport's
budget is independent of the city's general fund, said Robert Galvan, the
administrative services director for Hollister. The airport is an enterprise,
he said. "An
enterprise is a city owned entity that functions as a business," he said.
"That means that the revenue from the airport should cover the day-to-day
cost of maintenance, plus long-term costs, including any repairs." The airport
does not have enough money for long-term maintenance and repairs, Gere said. Clint
Quilter, Hollister's city manager, agreed. "It just
barely covers expenses," he said. "It just barely gets by." The airport
should be able to pay for long-term expenses, Galvan said. "That's
how everything needs to operate," he said. The total
budget for 2005-2006 was a little less than $545,000, according to documents
from the finance department. Expenses totaled a little less than $515,000,
according to the documents Revenues at
the airport did not always exceed expenses. The deficit
goes back to the 2002-2003 financial year, Galvan said. The airport lost
$200,000. In 2004-2005,
expenses exceeded revenues by a little more than $140,000, according to
documents from the finance department. In 2005-2006, expenses exceeded revenues
by a little less than $216,000, according to the documents. In 2006-2007, the
deficit was a little less than $71,000, according to the documents. When the
airport is over-budget, there are several options, Quilter said. Officials can
borrow money from other funds, carry the debt over and hope to make more next
year, or borrow money from the city's general fund, he said. "It has
never been paid for out of the general fund," Galvan said. The airport
has a subsidiary fund, he said. The subsidiary fund consists mostly of grant
money from the FAA, he said. Money from
the subsidiary fund was used to cover the airport's deficit, he said. That money
might need to be paid back, Galvan said. Whether the
airport's fund owes money to the subsidiary fund, "still has to be
resolved," Galvan said. The airport
makes money on the sale of fuel, but most of the airport budget comes from
renting hangars, according to documents from the finance department. "The
rents have not been increased in several years," Quilter said. In 2006-2007,
rents from hangars totaled a little more than $507,000, according to the
documents. In the same year, the airport budget only included a little more
than $14,500 for repairs and maintenance, according to the documents. Airport
projects can cost hundreds of thousands of dollars. In 2005,
airport officials received a grant from the Federal Aviation Administration
(FAA) to install a security fence around the airport, said Ian Gregor,
spokesman for the FAA. The grant was
for the security fence was for $450,000, he said. There are two
types of leases at the airport, a ground lease and a building lease, Gere said.
A tenant who holds a ground lease pays money to rent land at the airport on
which he constructs a building. When the
lease expires, ownership of the building reverts to the city, Gere said.
Tenants pay less for a ground lease than a building lease, he said. At Hollister's
airport, tenants who hold a ground lease pay between 1 cent and 6 cents per
square foot, based on computations by the airport manager. Those users
include Gavilan College, the Hollister Elks Lodge and P.L Enterprises,
according to documents from the airport. P.L.
Enterprises is a business whose lease is held by Jerry Gabe. Gabe is a critic
of the airport manager. A tenant who
holds a building lease pays to rent a building, much like any other renter,
Gere said. At the South
County Airport in San Martin, hangars rent for between 44 and 59 cents per
square foot, said Larry Feldman, business manager for the South County airport. At
Hollister's airport, hangars rent for between 16 cents and 29 cents per square
foot, according to computations by the Gere. The only
building that costs more than 29 cents per square foot is the Ding-A-Ling Cafe,
a restaurant at the airport. The owners pay 80 cents per square foot, based on
computation by the airport manager. Most hangars
cost between $103 per month and $407 per month, according to documents from the
airport manager. Excluding
business owners, the majority of the tenants at the airport are from outside
San Benito County, according to the documents. "Most of
the people we're giving breaks to, they own mansions in Saratoga," Gere
said. There are a
little more than 50 tenants who rent hangars for non-business purposes,
according to documents from the airport. Thirty of
those tenants are from outside San Benito County, mostly San Jose and Santa
Clara County, according to documents from the airport. Renters from
Hollister and unincorporated San Benito County were split evenly. "That's
pretty revealing," Emerson said. Emerson
seemed surprised that so many tenants were from outside the County. "I would
look at the tenants outside of Hollister and San Benito County a little
differently," he said. "I think the question that has to be asked is,
'what are they providing the city of Hollister other than the small rent that
they provide?'" Critics of
Gere say that he has not applied for any grants since he became airport
manager. Hollister
officials have received two grants since Gere became airport manager three
years ago, said Gregor, a spokesman for the FAA. In 2005, the
airport received the fencing grant for $450,000. In 2007, the airport received
a grant for $427,500 for various projects, Gregor said. The airport
manager intends to apply for another grant in 2008, Gregor said. |
