Recently one of our pundits who doesn’t live here anymore wrote about the airport. The airport is a huge infrastructure project that has been worked on since World War II. The airport has the infrastructure to facilitate commercial air travel, private airplanes, some industrial businesses and, currently, the drone project. It has always been the goal of Pendleton to attract business to the airport area — business that would employ large numbers of workers.
In order for that to happen it takes infrastructure and that is expensive. A lot of the pieces to the puzzle have been put in place. Do you abandon that now or finish? There have been some leases signed recently that lend hope and fruition to all the efforts. An extension of water and sewer is the most recent project.
The airport derives revenues from many sources. Real property leases, of which there are four general categories, include aviation land and facilities rental, terminal space rental and concession fees, commercial land and building rentals, and farmland operation (contracted out). Residential has been completely phased out. The buildings were beyond their financial life and have been demolished. The UAS range — one of only three on the west coast — is anticipated to become a large revenue generator for the industrial park. The airport receives grants and entitlement funds from the Federal Aviation Administration for airport capital improvements. The FAA pays 95 percent of improvements with the city covering the remaining 5 percent. The airport also receives $4.50 per passenger ticket sold. The airport was awarded a $1.6 million grant/loan package by the state of Oregon for the purpose of constructing facilities to lease. All new lease revenue will go to the industrial park/airport. The Pendleton UAS range is currently part of a $3.5 million grant request for the state’s 2015-16 biennium. If awarded, Pendleton is slated to receive $800,000 for range operations.
Government revenues for fiscal year 2015-16 are $2.2 million. Aviation rent, UAS range rent, commercial rent, landing fees, terminal rent, farmland operations, fuel flowage fees and passenger facilities charges are $400,000.
Inter-fund loan proceeds are $2,341,000. Total airport and business park income is $5,038,000.
The airport fund provides funding for staffing, administration, business management, operation maintenance, planning, development, regulation, security and promotion of the airport/industrial park. Administrative and business management operations include short- and long-term leasing of properties.
The department also operates and maintains the airfield itself. The airfield consists of over 100 paved acres of runways, taxiways and aprons, lighting systems, the terminal building and parking areas. There are 36 other city-owned buildings located on the airport property. There are 14 pieces of major equipment including rolling stock, several hundred acres of non-farm areas and vacant lots. The objective of the airport fund is to contribute to the growth of the community economic base through industrial development.
Expenses for 2015-16 are:
Personal — $264,000; Materials & Services — $293,830; Capital outlay — $2,253,240; Debt Service — $2,323,000.
Total Expenses — $5,150,000.
Taking out capital outlay and debt service means the general budget must subsidize approximately $112,000. This is actually getting better than it was in previous years and could break even in two years. It could be profitable by the year 2019-2020.
We have several leases that have been signed recently with delayed payment schedules. Progress has been made and the trend is now in a positive direction. We have invested several million dollars over the last decade, but it looks as though we will start receiving a return on investment relatively soon. None of this takes into consideration deferred maintenance on infrastructure. In addition, there are the industrial buildings and hangars. It is going to take more time to address these issues, but we are making progress.
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