Wednesday, August 14, 2013

Cutbacks hurting Tupelo Regional Airport (KTUP), Mississippi

TUPELO, Miss. — Tupelo Regional Airport Executive Director Josh Abramson says struggling finances and fewer passengers require a change in the financial relationship between the airport and the city of Tupelo.

The Northeast Mississippi Daily Journal reported that after meeting in closed session Tuesday about a lease at the airport, City Council members did not take any action.

However, Abramson said the airport needs more financial support from the city.

The facility needs at least $700,000 for repairs to a runway to support landings for Universal Asset Management. The company brings in large retired aircraft, takes them apart and recycles materials. Universal Asset Management has a 20-year lease at the airport.

“We’ve lost $850,000 in funding in a year with no trend of it coming back,” Abramson said. “The airport has to be a part of the city’s capital plan.”

With an operating budget of $4.9 million this year, the airport has a $40,000 operating surplus. However, the balance sheet starts to look red when factoring the airport’s $2.6 million debt to the city.

Currently, Tupelo’s airport has a separate budget from the city’s annual budget. However, the city provides an allocation for the airport listed under community services. In fiscal year 2013, the city allocated $158,500.

The city has little oversight related to funding at the airport. Beyond the mayor appointing airport authority members, there is no other role.

Abramson declined to disclose how much funding the airport needs but will turn in his formal request to the city for fiscal year 2014 funding next week. Mayor Jason Shelton and city finance leaders are preparing a budget proposal for the City Council.

With the airport losing commercial services connected to Memphis, fewer passengers have flown out of Tupelo.

The airport anticipated a $1 million Federal Aviation Administration grant this year to help cover runway costs but received $150,000 only because of funding tied to passengers.

Universal Asset Management employs about 80 people, including workers at a warehouse in Verona. The company has landed more than 60 retired aircraft in Tupelo. A Boeing 747 is scheduled to land Thursday.

Abramson also said the airport will likely look into asking other entities for funding, such as the Lee County board of supervisors.

“The airport is regional and impacts more than just the city of Tupelo,” he said.