Westchester County Executive Robert Astorio held a press conference to announce a proposal to develop Westchester County Airport with a new management company on Nov. 3, 2016.
Westchester County Executive Rob Astorino's proposal to lease the county's airport to a private company for 40 years might be a really good deal. Maybe Oaktree Capital Management could produce a more efficient airport that would make passengers and airlines happy, satisfy the airport's neighbors and put some extra cash in the county's coffers. Maybe an updated Westchester County Airport could be an example of the kind of public-private partnership that critics of traditional government often push.
Maybe. But we don't yet know.
It is therefore unreasonable for the Westchester County Board of Legislators to have to decide whether to support the proposed lease by Dec. 27. This is when the board must approve a county budget for 2017. Astorino's budget proposal already includes $15 million from the airport lease deal, which would have to be cut out if the deal is put on hold.
Legislators are looking at a tricky political situation, cunningly crafted by Astorino. But they must put aside the lease deal for now. It should be re-examined in 2017 — after Astorino seeks other bids and lawmakers have the time to fully research the long-term implications of airport privatization.
Astorino unveiled the lease deal earlier this month, giving legislators only a few weeks to familiarize themselves with it, do their due diligence and approve it as part of the county budget. He presented it as a take-it-or-leave-it gambit, telling legislators they would have to fill a $15 million hole in his budget plan if they did not approve the lease. The implication was that the proposed lease was beyond question, a neatly wrapped package that was seamlessly vetted by his office and the best possible economic deal — despite the lack of a bidding process.
But airport privatization is still a fairly new and complex matter, with few examples to study. Questions abound.
Congress approved an airport privatization program in 1996, expanding it in 2012 to allow up to 10 airports to participate. The primary goal was to allow municipalities to reap new revenues from airports for their general budgets, since airport money generally must go back into airport operations. But the program has hardly taken off. Only two airports have privatized, and one has already returned to public control.
A 2015 study by The Wicks Group, an aviation law group retained by the county on airport matters, found that most observers believed privatization to be "a failure" because of the program's restrictions. This is not to say that Oaktree can't make it work in Westchester. But a longer review process, including a request for proposals, is needed before a conclusion should be reached.
The company that has managed the airport for Westchester County since the 1970s, AvPorts, wants a shot at a privatization deal, or another form of management, but has so far been left out of the process.
The Board of Legislators is in the middle of a furious slate of meetings about the lease plan, and has already questioned officials from Oaktree and Canadian Imperial Bank of Commerce, a financial adviser to the county on the deal. Board Chairman Michael Kaplowitz, D-Somers — who leads a majority coalition of seven Republicans, one Conservative and two Democrats — told the Editorial Board: "The more meetings we have, the more questions we come up with. More answers we don't have."
He noted that a pillar of airport operations and the protection of surrounding communities is a voluntary curfew that restricts flights between midnight and 6:30 a.m. But how can a voluntary curfew be included in a contract? Kaplowitz said that lawyers are not yet sure.
On Monday, Kaplowitz asked a lot of tough questions of Emmett McCann, a manager with Oaktree. It was telling that McCann, while defending the deal, conceded that skepticism was reasonable. "If I was sitting in your shoes, I would be asking the same questions," McCann said. "I really would."
If such questions are worth asking, how can the deal move forward before the end of the year? And keep in mind that even if legislators were to approve the lease, the FAA would also have to sign off and would be unlikely to do so in time for the budget.
The county should also consider the advice of the federal Government Accountability Office, which released a 2014 report on the lack of interest in airport privatization. Future plans, the report said, should be focused on "ensuring public-sector due diligence, involving all stakeholders and creating a transparent privatization process." Astorino's approach did none of these things.
If the board tables the lease deal, county budget negotiations will quickly become tense. Astorino has said that he will not produce an alternative proposal. He is committed to not allowing any county tax increases on his watch and does not want to deal with the annual blowback to possible cuts to county staff or nonprofits. But if he sticks to a spending plan that requires a hasty airport deal, he is essentially forcing legislators to create their own budget.
Although not exactly a budget "one shot," the deal would benefit Astorino's tenure most. After $15 million for 2017, the deal would pay the county $5 million annually over the next five years and then an average of $2 million annually for the remainder of the 40-year lease.
Westchester County Airport is an important regional asset. Any plan to alter operations, however minor, draws great interest from passengers and the airport's neighbors. A proposed 40-year privatization plan should not be rushed in the interest of producing a politically expedient county budget.
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