Fullerton Airport – City Looks at Airport Financials

Tuesday, July 8, 2008
Uses for Fullerton airport analyzed; Last general aviation airfield in the county is losing money.
The Orange County (CA) Register

FULLERTON – The Fullerton Municipal Airport — Orange County’s last general-aviation airfield — is $3.9 million in arrears for city franchise payments. Founded in 1927, the city-owned airport started paying a franchise fee in 1982 after officials determined local government was financing many airport services, including police, fire, accounting, employee recruitments and benefits and the ordering of goods. “The initial payments were $200,000 and kept constant until 1992, when it was decided the fees should increase to keep up with inflation according to the consumer price index,” said Glenn Steinbrink, the city’s finance director.

For fiscal year 2008-09, which begins July 1, the payment will be $320,000, which Steinbrink said the airport will be unable to make. (Editor’s Note: The “financial creativity” of many municipalities making inappropriate charges to their airport is well known and ought to be reviewed here).

“If the airport weren’t there and there was some other use, the city could bring in property taxes and other taxes such as retail sales tax or hotel-transient occupancy tax,” Steinbrink said.

He said general aviation slowed after 9/11, and revenue for tie-downs hasn’t increased as fast as expected.

Those considerations figured into the City Council’s recent request for an in-house look at the best uses for the 86-acre site.

Although the report won’t be ready for nearly a month, city officials said early indications show the facility could stay as is or could be used exclusively as a heliport or for a mix of uses, possibly including building industrial businesses on the airport’s fringes.

City officials also said the chances of the airport closing are extremely slim.

Part of the financial problems erupted when a hangar construction project fell two years behind, and costs increased more than expected, Steinbrink said.

In 2005, a $6.2 million, 15-year loan was secured at a 4.15 percent interest rate. Payments were set at $569,000 annually.

Airport director Rod Propst figures that the loss in rent from most of the 149 new hangars over the two-year period amounted to approximately $240,000. The project was completed in March.

Propst said every time the city and the Federal Aviation Administration sign a contract for a federal grant, there are assurances Fullerton will continue to operate as an airport for 20 years.

Suggestions for a heliport have been discussed for years. The Orange County Fire Authority, California Highway Patrol, Anaheim Police Department and television/radio personality Commander Chuck Street lease airport property for their operations.

Propst said the Fire Authority’s needs are one example of why Fullerton is a preferred site. “It’s hard to get in and out of John Wayne Airport in a hurry,” he said.

Retired pilot Stan Rhodes, 75, learned about the airport analysis Tuesday.

“I flew in and out of Fullerton for 11 years,” said Rhodes. “I want it to stay like it is; it’s been here forever and has always been a good, central location from which to fly.”

Weston Sanchez, 58, of Buena Park said he didn’t care if it were an airport or heliport, “as long as no one loses his job.”

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