Saturday, January 14, 2012

Baxter County Airport (KBPK) FBO closes. Mountain Home, Arkansas.

Mountain Home Flight Service at Baxter County Airport closed Jan. 5, adding a new twist to the threat of a civil rights complaint against Baxter County from Lori Benedict, owner of Mountain Home Flight Service and fueling center.

Benedict, who also is the state representative to Arkansas District 82, said Friday she closed the business due in part to a 70 percent decline in fuel sales. The decline, Benedict says, was hastened during the past two years by a lease agreement between the county and a competitive fuel seller for a large part of the county-owned main terminal building at the airport.

"I believe my competition pays $400 a month rent for the terminal building," Benedict said. "I pay more just in property taxes on Mountain Home Flight Service."

Benedict says she or no other prospective renter had a chance for a retail presence in the county-owned terminal building because it was let privately.

"The Federal Aviation Administration calls it 'economic discrimination'," Benedict said.

The Baxter County Airport Commission's Finance Committee discussed the closure of Mountain Home Flight Service during a meeting Wednesday in preparation for a meeting of the commission at 11 a.m. Monday at the airport terminal building.

Airport manager Kathy Frederick told the committee that three Mountain Home Flight Service tenants displaced by the closure have all found other hangars at the airport so there's no net loss in the number of aircraft owners served by the airport.

Benedict said she will abide by provisions of her lease agreement with the airport commission and make lease payments to the airport in lieu of fuel tax collections for the land her buildings sit on. She also said she plans to sub-lease a portion of the leased tract.

The committee also discussed and agreed to move forward cautiously with the greater commission in response to a proposal to reduce monthly lease payments for the airport's sole aircraft maintenance provider.

Les Ives, owner of Ozark Airworks LLC., has asked the commission to reduce the company's lease payments to the airport from $2,000 to $1,500 because of a recession-related slowdown in his business.

Committeeman Rob Finley, the commission's vice chairman, told his peers on the committee that granting the request would not be a good business practice if not for Ozark Airworks' status as an essential service.

The lease payments for the hangar where Ozark Airworks does business are also pledged for debt service on a bank loan used to build the hangar.

The committee took no action following discussion of the Ozark Airworks' request, but agreed that any reduction in Ozark Airworks' lease payments should be justified by reduction the airport's debt service, generally, anticipated in a reorganization airport debt via the issue of public revenue bonds.

A 15-year revenue bond issue is expected to raise $550,000 for the airport at an anticipated interest rate of 3.5 percent to retire existing debt. The new quarterly debt service obligation on the new bonds is expected to be $7,167 less than the airport's current debt-service outlay.

In other business, the committee heard a statement from Commission Chairman Greg Mills regarding the upcoming expiration of his term on the commission and a suggestion from Mills that he may not seek reappointment to the commission.

The committee voted informally to reject any request from Mills to be relieved of service. Bonnie Brown, the commission's secretary/treasurer, said the commission needs Mills' many years of service and knowledge of airport issues, are essential to the commission's work.

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