In shocking news, the regional airport near Wal-Mart headquarters makes almost enough revenue to pay for its own expenses--which is a near miracle for government run and subsidized enterprises. However, turning a profit by running the airport efficiently doesn't seem to be on the minds of the government managers. Instead they want to sell the land around the airport that Wal-Mart helped make valuable:
Alderman Ed Austin said traffic is the biggest problem facing the city of Bentonville, and the best way to alleviate these traffic woes is to extend 28 th Street. It is more important, he said, than keeping the airport.Austin also said Benton County leaders determined that the airport no longer serves the public good, and thus, is no longer tax exempt. "I do know that the city is required to pay some property taxes on the airport," he said. "The question I have is why the city has to pay taxes."
It is not the entire airport that no longer serves the public good, however, it is only the parcels of land on which private property sits. Shirley Sandlin, Benton County tax assessor, said the airport remains tax exempt because it is municipally owned and used. Land that holds private property � hangers, for example � is taxed because that land serves private good, not public good. Until 2003, all airport land was tax exempt.
Stewart Smith, director of finance for the city of Bentonville, said the city paid nearly $8,000 to the county in property taxes in 2004; however the city has not passed on that cost to the lessees.
Chip Gibbons, who leases land at the airport on which he�s built an office and hangers, signed a lease agreement with the airport commission in 2001 to pay $55.60 per year for 1,112 square feet of ground. Although the rent amount seems low, Gibbons said it is comparable to rent at other airports. Regarding property taxes, the lease states that the lessee pays all taxes and assessments on the property. Gibbons said he has never been billed by the city for the newly imposed property taxes.
Airport Commissioner Bill Enfield said he doesn�t think the city�s proposal to close the airport has anything to do with a lack of revenue, traffic or property taxes. Land is the reason, Enfield said: "Mainly they see it as a big windfall for them."
Enfield said land appraised west of the airport several years ago carried a value of $50,000 per acre. He estimates that the airport land is now worth about $70,000 per acre. With 130 acres of land, that�s more than $9 million the city could get by selling to developers.
Andy Sams, an owner of Drake Aviation that operates out of Bentonville Municipal Airport, agrees. "I think the whole issue is to use the land of the airport to sell land to developers and put money in the hands of the city�s coffers."
In order to close the airport and potentially reap the benefits of the airport�s land, the city will have to remove itself from federal and private contracts.
As a recipient of federal funds, the city has agreed to operate for 20 years, said Roland Herwig, Federal Aviation Administration spokesman for the southwestern region. "They can come to the FAA and make a proposal to be absolved from that covenant," he said. "The airport is seen as a national resource. Since there is public money involved, they would have to submit a proposal to be absolved. The proposal would be reviewed very carefully, and that would take place in Washington."
Posted by Kevin on January, 2 2005 at 10:03 AM
