Airport Grants Drying Up

PLANNED IMPROVEMENTS MAY BE DELAYED

The new hangar at Springdale Municipal Airport is nearly complete and ready Friday at 1535 S. Powell St. in Springdale. The hangar, paid in part by a grant from the state, has three offices and three hangars. The Arkansas Aeronautical Board recently announced it will restrict grants to be in accordance with Federal Aviation Administration grants, a decision that would eliminate money for hangar construction.
The new hangar at Springdale Municipal Airport is nearly complete and ready Friday at 1535 S. Powell St. in Springdale. The hangar, paid in part by a grant from the state, has three offices and three hangars. The Arkansas Aeronautical Board recently announced it will restrict grants to be in accordance with Federal Aviation Administration grants, a decision that would eliminate money for hangar construction.

— Planned improvements at Northwest Arkansas airports may be delayed after a state agency announced grant cutbacks.

A letter from the Arkansas Department of Aeronautics, dated April 12, said the state Aeronautics Commission was reducing grants because of a decline in sales tax revenue.

The department will only give money to projects at airports that receive Federal Aviation Administration grants. The department will not allocate money to other projects.

Building or renovating hangars is a prime example of a project that would not be approved for an FAA grant, said John Knight, director of the state Aeronautics Department.

“We have received millions and millions of dollars over the years from the state,” said James Nicholson, financial coordinator for Fayetteville Executive Airport. “We are finishing a project to renovate a hangar for a company that wants to expand and move here.”

The renovation is estimated to cost $312,500, which was paid for with a state department grant and local funds, Nicholson said.

The Bentonville Airport planned to repair and expand the apron and update a perimeter fence, said Mike Bender, public works director. The apron was estimated to cost $600,000 and the fence $100,000.

“Those projects will have to wait,” Bender said. “We’ll have to put them off for a couple of years.”

The aeronautics department projected income of $6.9 million this year. The income was down $4.2 million from $11.1 million in the 2011 financial year, which ended June 30, according to the letter.

FAA grants paid 95 percent of a project until recent cuts. The state aeronautics department routinely gave grants to pay the remaining 5 percent.

FAA grants have been reduced to 90 percent of a project. The state portion will remain at 5 percent until revenue stabilizes, according to the letter.

The department’s grant programs included 50-50, 80-20 and 90-10 grants, where airports have to pay the second figure as a percentage of the total cost of a project.

Springdale’s airport has built hangars three times since 2000. The most recent, which is now being completed, used two state grants totaling $600,000, said Wyman Morgan, city director of administration. Revenue at the aeronautics department will have to climb before Springdale will be able to build another hangar.

The city maintains a waiting list for those wanting to lease a hangar. The number of private airplanes based in Springdale is the third largest in the state, after two Little Rock airports, according to the aeronautics department. Tommy Lee, the owner of Gear Up Pilot Shop at the Springdale airport, leases a hangar in Springdale.

“I don’t think losing the hangar grants will hurt Springdale short term,” Lee said. “The waiting list is as short as it has been in years. Long term, in a couple of years when flying picks up, the city will need more hangars to keep growing.”

Other airport projects that usually do not get FAA approval include terminals, fuel systems and security systems, Knight said.

The aeronautics department’s money comes from sales taxes on airplanes, fuel and other supplies, Knight said. When people cut back on flying, the department’s income falls.

“We had a bit of a cushion saved up,” Knight said. “That’s all gone now.”

The department might be able give additional money for projects after the commitment to FAA grants is complete, Knight said, but it all depends on income. Any state grants would be paid for on a priority system, he said.

Safety issues come first with runways, taxiways and aprons following. Security issues would be next in line, Knight said.

The Rogers Municipal Airport used state money to repair its runway and aprons, said David Krutsch, airport manager.

In recent years, Springdale used state money to replace leaking windows in its terminal, Morgan said.

The letter from the department stated it would raise its matching grants on FAA local projects to 10 percent from 5 percent when aeronautic sales taxes climb. That move would allow the projects to be paid 100 percent by the combination of state and federal grants.

The Springdale Airport Commission, in a bid to keep money available for state funded projects, passed a resolution asking the department to remain at 5 percent for its matching grants.

Knight said he understands Springdale’s needs. Following the suggestion would probably help all Northwest Arkansas airports, he said.

“But there are some airports in the state that will not be able to come up with the rest of the matching money,” Knight said. “We want to keep those airports safe, too.”

Morgan said he and Greg Willoughby, commission chairman, plan to attend the next aeronautics board meeting to present the resolution.

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