El Dorado News

Wednesday
August 23, 2017
El Dorado News Times

City council approves purchase of hangar at airport

By Tia Lyons
This article was published April 21, 2017 at 5:00 a.m.

By Tia Lyons

Staff Writer

EL DORADO — The El Dorado City Council approved Thursday the purchase a hangar at South Arkansas Regional Airport at Goodwin, taking the vote after a lengthy discussion with the El Dorado Airport Commission about the need to improve the line of communication between the two groups.

The discussion was tied to plans that have already been approved by the airport commission to purchase a hangar for a new aircraft maintenance service that is looking to operate at the municipal airport.

Commissioner Scott Cowling noted the recent turnover that has occurred on the airport commission, telling aldermen that several new commissioners and a new chairman have come aboard over the past year.

The situation has led to “some disconnects” between the airport commission and city hall, and commissioners would like to bridge those gaps by scheduling a special called meeting with the city council at some point, Cowling said.

“We feel that it’s necessary to recognize the accomplishments of former commissioners, and we could not have done it without the support of the mayor and city council. We’re looking for a collaborative approach to working with each of you,” he assured aldermen.

In February, the airport commission approved the purchase of a hangar for $35,000 to accommodate a prospective airplane and power plant mechanic business at the regional airport.

Cowling said the out-of-town business prospect said the private hangar, owned by Gene Hannegan, would fit the needs of the repair shop.

Cowling, chief pilot for Murphy Oil Corporation, said general aviation pilots often stop by the Murphy hangar at SARA looking for mechanics to repair their aircraft.

“We don’t want that liability, so our

mechanics cannot help general aviation pilots,” Cowling said.

Additionally, an airplane and power plant mechanic is needed to help the city’s new commercial airline succeed by offering timely maintenance and repairs onsite.

The Mississippi-based Southern Airways Express is expected to start flying out of the municipal airport on May 1. Southern Airways was awarded a federal contract to provide Essential Air Service for El Dorado.

Public safety also factored into the decision by the airport commission to purchase the hangar for the A&P business, Cowling said.

“… It’s business that we need at our airport. We negotiated a deal for the hangar, and we feel it’s a good deal. The (return on investment) on this deal is five years,” Cowling said. “We’ve purchased two hangars in the past and we did not come before you. We’re here now (at Mayor Frank Hash’s request).”

He said the airport’s reserve coffers would be used to make the purchase, and the commission was awaiting approval from the city council before finalizing the lease agreement.

Alderman Dianne Hammond expressed concern about the poor condition of the roof of the airport terminal building and how the commission plans to pay for the repairs.

Commissioners have discussed the issue for months, and Cowling explained Thursday that the matter boiled down to either rehabilitating the terminal and rolling the roof repairs into the rehab project, or addressing the roof as a separate issue.

Cowling told Hammond that commissioners have set a deadline of July to see if they could secure funding, including possible grants, for the estimated $2.1 million rehab work or for roofing repairs, which are estimated at just under $200,000.

Airport commissioners and Hash previously agreed that the roof must be repaired before winter to prevent further deterioration.

Hammond mentioned that the city is facing a budget crunch this year, with a $1 million revenue shortfall in the general fund, and city departments have tightened their belts accordingly.

“With those (matching) grants, are you looking at y’all to match them or the city to match?” Hammond asked.

Cowling said the city has historically provided matching funds for grants that were used for capital improvement projects at the municipal airport.

For instance, he said the commission and its engineer, Garver Engineers, are waiting to close out state and federal grants that were used on a terminal ramp expansion project that has been done in phases.

Cowling said that final touches were being done on the project earlier Thursday.

The city stands to recoup 90 percent of a total $655,000 for the grants that were allotted for the project. A payment of $55,500, 10 percent of the state grant, is due by the end of the month, Cowling told aldermen.

He said Hash previously committed to the city taking care of the match for the grants, but in a recent email, Hash cited the city’s “depressed general revenues.”

Hash reiterated those concerns Thursday, saying that in the past, the commission would approach the city for such payments when needed. He also said that because of the budget shortfall, the city has placed capital expenditures on hold.

“There’s no capital money available. We’re not paving streets; we’re not buying fire trucks because the money isn’t there,” Hash said. “I’m just asking for caution to be exercised so that we don’t get way overextended.”

Cowling said airport funds are used for day-to-day maintenance and operations and not for capital expenditures.

He acknowledged that airport expenditures exceeded revenues by $20,000 in 2016 — due in part to a drop in fuel sales that occurred after SeaPort, the area’s former Essential Air Service provider, was ordered to shutter operations as part of a bankruptcy filing.

However, Cowling said the deficit was covered by the airport’s reserve fund, which can cover routine operations for 12 years without airport commissioners having to ask the city for additional funds.

He reported that the airport turned a profit of $13,000 in March.

“I hope this year, it will pick back up, and we will be back in the black. (Airport manager) Tim Johnson is seeing where he can cut back,” Cowling said. “Thirteen thousand may not seem like much, but we’re seeing what we could do with an airline.”

Alderman Willie McGhee said the council also needed to talk about why the airport commission does not oversee operations at the Downtown Airport.

Hash said “personalities got involved” in the matter in previous years, adding that the Downtown Airport does not receive federal funding. He said the airport commission is needed to administer federal and state funds that are granted to South Arkansas Regional Airport.

Alderman Billy Blann made a motion to approve the hangar purchase, saying that the council can hash out the other matters, including needed airport terminal improvements, later. The purchase was unanimously approved.

Tia Lyons may be contacted at 870-862-6611 or by email at tlyons@ eldoradonews.com.

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