Oceanside Airport- Not So Fast on Costco Plan

Wednesday, October 4, 2006
Oceanside airport officials question Costco idea; critics say FAA won’t allow store near airfield
By DAVID STERRETT
The San Diego (CA) North County Times

OCEANSIDE — Supporters of the Oceanside Municipal Airport predicted Tuesday that a city plan to use a vacant northern portion of the airfield to make way for a Costco store won’t fly with federal regulators. City officials said last week that they were working to bring Costco to town as part of a possible compromise that would result in more plane hangars on the south side of the airport and more sales tax revenue for the city from the valuable airport property off Highway 76.

Development of the airport has divided the City Council over the last year, but council members who want to use the airport land to generate more revenue and those who would prefer to expand the airfield appear to have lined up behind the Costco scenario.

But Ron Cozad (Editors Note: Ron is also the CALPILOTS Director-at-Large in the region), the attorney for the Oceanside Airport Association, said Tuesday that the plan won’t work because the Federal Aviation Administration helped the city buy the land and won’t allow it to be used for a big-box retailer.

“This is just not something the FAA usually allows,” Cozad said. “The FAA is very protective of airports they help pay for.”

Cozad said the federal administration gave Oceanside a $2.5 million grant in 2002 toward the $2.7 million purchase of 14 acres on the north side of the airport. The grant came with a stipulation that the land “has to be used in perpetuity for aviation purposes,” according to FAA spokesman Ian Gregor.

Even so, he said, “anyone can make an application to the FAA to release them from the obligation.

“The FAA has a strong historical position of supporting the continued operation of airports and supporting the use of airport land for aviation purposes,” Cozad said. “But it’s premature to say the compromise wouldn’t fly, because we haven’t received an application yet.”

Oceanside officials said they have talked with Costco about building a store on a 7-acre, city-owned site north of the airport and west of Foussat Road. Costco officials said this week it was the company’s policy not to comment on any potential site until a deal is complete.

The proposed site for the Costco has a drainage pond that would have to be moved to the vacant northern portion of the airport property the city bought with the federal grant.

As a trade-off for taking away part of the airport property, city officials said, they would build up the south side of the airport. Plans for that part call for spending about $6 million to replace 22 old hangars with 40 new ones, and adding offices and stores or restaurants.

“It’s a complicated proposal, but it’s potentially doable,” said Jane McVey, the city’s director of economic development and redevelopment. “The possible outcome is too beneficial for the city not to at least try.”

A Costco could generate about $1 million in sales tax revenue each year for Oceanside, and the airport won’t be able to pay for itself without increasing the number of hangars, city officials said last week.

Mayor Jim Wood said has urged his council colleagues not to rush into a decision about the airport until after economic study of the property is complete.

A 36-page preliminary report prepared by consultant Keyser Marston Associates shows the property could be sold for more than $20 million if it were to be used for homes and more than $6 million if it were used for offices or businesses.

City officials said a final version of the report will be provided to the council by the end of this month. Wood said the council and public’s opinion about what to do with the airport could change when they see the value of the city-owned property if it were used for something else.

Wood questioned the timing of the proposed Costco compromise —- just before the Nov. 7 elections —- implying that it was a political move. Council members Shari Mackin and Rocky Chavez are up for re-election and councilwoman Esther Sanchez’s is facing a potential recall.

“I think the (rest of the) council is getting ahead of itself by making some sort of agreement before the general public knows what the property is worth,” Wood said. “There are so many stumbling blocks on this idea.”

Even if the FAA allowed the city to use the 14 acres for something other than an airport, the city would have to pay back the loan and any increase in the value of the land, Cozad said.

When the city bought the property from the Deutsch Co., a clause was included that allows Deutsch the option to repurchase the property before the city sells it to anyone else, Cozad and city officials said.

In addition to agreements with the FAA and Deutsch, the San Diego County Regional Airport Authority may oppose putting a Costco near the airfield, Cozad said.

The regional airport agency, which is charged with safety around public airports, is in the process of creating plans about what type of developments are appropriate around specific airports.

Keith Wilschetz, director of systems planning for the airport authority, said the agency’s recommended plan for Oceanside would be complete next spring, although he added that the city could decide not to follow the recommendations.

The airport authority is one of many hurdles the city proposal could face, said Ben Meyers, the president of the Oceanside Airport Association.

“Some huge issues have to be solved here,” Meyers said. “There are a lot of big ifs.”

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