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Budget review spotlights fuel‑based airfield cost recovery and hidden subsidy to flight‑training operators
Summary
Staff reported FY2027 budget and rate structure: fuel sales provide most revenue through an embedded airfield cost recovery fee. Board discussion flagged a subsidy estimated at ~$460,000 covering two flight‑training tenants and debated landing‑fee options for transient aircraft and potential adjustments to the ACR fee.
Ken Warner, Senior Director of Finance, told the board that aviation fuel accounts for roughly 70% of airport revenue and that the airport uses a fuel‑embedded airfield cost recovery (ACR) fee (currently $0.75 per gallon) to recover airfield operating costs. Warner presented five‑year capital and cash‑flow projections and said the Authority currently carries no debt and uses cash and investment income for capital needs.
Warner reviewed modeling of a transient landing fee and found that a $5 per 1,000‑pound landing fee for transient jets would generate an estimated $2 million annually; extending a landing fee to all users would approach $4 million, while a $10 fee on light piston aircraft would yield only about $66,000 — small relative to a $40M revenue budget. Commissioner comments focused on preserving revenue neutrality if new fees are adopted and on whether the ACR fee could be rebalanced because fuel sales are trending higher than budget.
Vice Chair Crease and other commissioners raised a separate audit‑style finding: staff analysis identified an estimated ~$460,000 annual subsidy absorbed by the Authority that benefits two commercial flight‑training tenants on Avgas (UL94) pricing and related service costs. Commissioners raised legal and FAA grant assurance concerns about diversion of airport revenue for private enterprise and requested staff follow‑up and consultations with tenants on alternatives. Staff committed to present specific actionable items about the UL94 subsidy, tenant billing and potential rate adjustments to the board by next month.
