Oroville – City Attempts Selling Airport Property – Sites Economic Downturn

Land sales at airport considered

By MARY WESTON – Staff Writer

OROVILLE — The Oroville Redevelopment Agency Commission will consider a staff proposal to sell industrial land at the Oroville Business Airport. Staff calls it a win-win scenario in a report, as the money would be used to make the airport more attractive to businesses, but it could require a sizable investment of RDA money, one-half million dollars of which has already been lost to the state budget. The RDA meeting begins after the City Council meeting, which begins at 7 p.m. Tuesday at 1735 Montgomery St. First, the Federal Aviation Administration has to relinquish land to the RDA to sell. "The money from selling industrial land would have to go back to improvements at the airport," said Eric Teitelman, director of community development and public works.

If no one buys the industrial land, the RDA or other city funding would have to make up the difference. This could be as much as the fair market value of the land, which was appraised at $6 million in 2007. (Editor’s Note: Of course that has nothing to do with 2009 and the huge decline in real estate values). 

According to a city report, existing and prospective business owners have asked about buying industrial land at the airport on Highway 162 and Larkin Road over the last several years. The airport has about 100 acres of prime industrial land, according to Teitelman. "This would be land outside the fenced area of the airport."

In 2008, city staff met with the FAA to discuss a land release. The FAA was receptive. In January, the Public Facilities Committee recommended the item go to the City Council. Over the past years, the city has leased areas at the airport to several businesses. Some businesses had concerns because they couldn’t finance expansions or improvements if they didn’t own the land, according to the report.

The FAA process for releasing property is lengthy, but staff has already completed many tasks including surveys and appraisals. Staff is also asking the council to approve looking for bond investors.

The city has already completed a revitalization plan for the airport for short- and long-term improvements. The improvements include upgrades to the fuel system, a new pilots’ lounge, and a fixed base operator building.

Additionally, staff has a capital improvement plan that outlines infrastructure, pavement and drainage improvements that would be needed. "The land relinquishment of the airport property would be a win-win scenario," according to the report. Future business owners would benefit from land ownership, which would help them with future business expansions, and the airport would benefit from the investment and hopefully attract more businesses.

The council meeting before the RDA includes a time for questions and comments about projects that could be funded with 2009/2010 Community Development Block Grant program income. 

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