FAA

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October 13th, 2010 Letter to the FAA

Dear Ms Kathryn Vernon,

As you are aware, the new $160 million St George Airport is slated to open in 4 months. You may not be aware of the following:

  • Only one General Aviation lease has been signed
  • No commercial leases have been signed as of today
  • One FBO lease is slated to increase from $8,000.00 per year to over $100,000.00 per year
  • 1,200% increase in the middle of a recession
  • It appears that Fed Ex will not be making the transition to the new airport.
  • FedEx can not afford to pay the high lease rates at the new airport. This speaks volumes to the predicament of the FBO’s and others.
  • Sun Valley, Jackson Hole and Grand Junction airports were used as lease comparables in the financial feasibilty study (see attachment)
  • The airports listed above have 4 to 5 times the number of enplanements and very different use case profiles (see attachment)
  • The updated Airport Financial Feasibility study, completed  August 2009, appears to not address the current recession, declining enplanements, 10%+ unemployment and the most difficult business climate in 50 years.
  • I have not seen the full report, only the executive summary.
  • In 2009 enplanements at St George dropped by 16% to 39,000 (see attachment)
  • Sky West has lost money on their St George operation for 20 years, but remain here because of their unwavering commitment to this community, jobs and families.
  • Remarkable in light of traditional Wall Street corporate strategies.
  • 727’s and a population of 500,000 in the next 10 to 20 years is most unlikely.
  • There are no other commercial airlines interested in opening operations at the new airport, now or anytime in the foreseeable future.
  • Current challenges with blue clay soils make the selection of comparatively equal build-able lots for hangers and business locations very challenging.
  • The GA sector may be the key variable and opportunity to make the new airport a commercial success in the future.
In light of the depressed economy and the need to save jobs and businesses, would the FAA be open to exploring the following?
  1. A 12 month or longer soft transition to the new airport facility
  2. There are current airport leases in place until 2016. None of these leases have been renegotiated.
  3. Leases that reflect the realities of  a very difficult economy.
  4. No rent increases for the first year or two.
  5. Leases based on similar and “current” airport enplanement and pumped fuel data, and not on the need to service debt or a 10 year payback requirement.
  6. Future lease increases tied to objective financial indicators such as CPI etc. When business improves my lease increases.
  7. Leases designed to help business survive through these tough times and not drive them out of business.
  8. Very unfair to hold the GA community and Sky West responsible for the current gaps between expenses, revenues, projections, spending $50 million for the land, blue clay soils and the collapsed economy.
  9. Can we agree on objective decision making criteria, such as preserving jobs, stimulating business growth and the long term success of General Aviation
  10. These more pressing priorities will help the various parties find creative solutions to the more technical aspects of safely operating two airports within 7 miles of each other.
  11. People First!
  12. My understanding is that this is safely done at many close proximity airports across the country.
 

…..  sponsor’s responsibility to make the airport available on reasonable terms and without unjust discrimination. This guidance is primarily economic and focuses on charging comparable rates to similarly situated aeronautical users. Issues of unjust discrimination arising from access restrictions are addressed in chapters 13, Airport Noise and Access Restrictions, and 14, Restrictions Based on Safety and Efficiency Procedures and Organization, respectively. It is the responsibility of the airports district offices (ADOs) and regional airports divisions to advise sponsors on their obligations in this area.

 

Kind Regards
Ra Puriri
St George, Utah 84790
435-817-6555

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