Thursday, July 18, 2013

City evicts largest airport tenant: Border City Aviation - Lloydminster, Alberta, Canada

Unless a new lease agreement can be signed, Border City Aviation will be finding its self a new home, and that home may not even be in the Lloydminster airport, a place they have been at since 1985.

Negotiations between the city and the aviation company could not result in a completed new lease agreement, and during negotiations Border City Aviation’s previous lease went into an over-holding position, resulting in the company moving to a month-to-month payment. The city exercised its right and has evicted its largest tenant from the airport, and Border City Aviation must be vacated by July 31.

“I stalled in negotiations with the City to expand my business,” said Steve Watt, owner of Border City Aviation. “I was negotiating some more property at the airport and we were kind of going back and forth. As negotiations broke down my previous lease lapsed and the city has exercised its right to terminate my being here.”

Border City Aviation is multiple businesses in one, offering a flight school for potential pilots, a maintenance facility for over 70 aircrafts, charter flight services and aerial surveying. Watt bought the business in 2010 from the original founder and has expanded the business from two employees to seven, and said he has outgrown the facility he currently has at the airport.

One of the major sticking points in the negotiations was the right to sell fuel at the airport. Watt said that currently the city has given out exclusive rights to a single organization for the rights to sell fuel, and despite having the facility to store their own fuel, Watt added the city has communicated to him in the latest lease proposal that Border City Aviation must buy their fuel from the single fuel provider. 

“I think if there is more than one fuel provider it would promote competition and better fuel pricing,” said Watt. “Like anything, it’s always better if there’s competition there. There isn’t enough margin in my little aviation business to be getting dictated who I buy my fuel from. If I’m forced to buy from them and can’t shop around for a better price it will affect my bottom line.”

A 30-day notice of termination was given to Watt, leaving him little time to come up with a plan for the future. While he still wants to remain in Lloydminster and continue working out of the airport, his business may need to move down the road to Vermilion if a new lease can’t be made with the city, and for that, Watt hopes the public will get involved. But if nothing can be signed in the next 15 days, Vermilion is the next option.

“The skies are pretty blue and the waters are pretty smooth down there,” said Watt of the option to Vermilion. “They would love to have an organization such as ours move into town. They are just ready to embrace it with arms wide open.”

Sixty per cent of the flights out of the airport come from Watt’s company he added, a result that not only would hurt the air traffic out of Lloydminster, but also the employees at the airport who depend on the aircrafts Border City Aviation provides.

It also could result in NAV Canada, who owns and operates Canada’s civil air navigation system, leaving the airport as well due to the lack of flights coming in, Watt said.

“This affects a lot of people,” said Watt. “We are the life blood of the airport as far as I am concerned. Seven full-time staff here and five staff in the control tower that will be affected at some point.”

At this time, the city has only issued the following statement about this matter after the Source requested an interview.

“The City of Lloydminster is working with legal counsel regarding this matter. The City of Lloydminster believes they have complied with the terms of the lease.”

A new lease would include two lots at the airport for Watt to expand his business, including adding more flight training and maintenance. He will continue to fight for his place at the airport and the opportunity to remain in the community and provide the flight service, but he is ready to move if needed.

“There is tons of opportunity here,” said Watt. “I’m fighting to stay here. At the end of the day if the city decides they don’t want me to be here then I’ll move.”


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