Wednesday, August 11, 2021

Federal Aviation Administration pauses federal funds to Sedona Airport (KSEZ)

The Federal Aviation Administration (FAA) has paused federal grants for the Sedona Airport until the airport submits a plan for coming into compli­ance with three of 39 grant assurances required for airports receiving federal funds.

The development could be significant for the airport’s long war with Sedona Air Tours, possibly raising the cost of shutting out the helicopter tour company by millions of dollars in future federal funding.

On July 29, the FAA released a decision in a four-year-old complaint filed by Sedona Air Tours. In the complaint, the company alleged that the Sedona-Oak Creek Airport Authority was unfairly denying it access to the airport by refusing it a lease, selecting a competitor to be an exclusive helicopter tour operator, and charging Sedona Air Tours the $75 landing fee charged to transient aircraft.

The airport can submit an appeal within 30 days of the decision.

Kevin Willis, the director of the FAA’s Office of Airport Compliance and Management Analysis, sided with Yavapai County, the airport sponsor, and the Sedona-Oak Creek Airport Authority on four out of eight issues in Sedona Air Tours’ complaint.

But on four other issues, the FAA office determined the airport had violated assurances included in past grant agree­ments, as well as the “covenants included in the United States Government Deed of Conveyance,” the document that trans­ferred ownership of the airport land from the U.S. govern­ment to the county. This deed contains a reverter clause, which means the county could theoretically lose ownership of the land if it violates the conditions of the deed.

Between 1982 and 2020, Sedona Airport received about $14 million in FAA funding, according to the decision document.

The federal government says that it subsidizes the devel­opment of airports to promote safety, security, and “the development of civil aeronautics.”

The assurances the FAA claims the Sedona Airport violated fall in the latter category.

The assurances violated and their definitions from FAA code include:

■ Economic Nondiscrimination. “[The grantee] will make the airport available as an airport for public use on reasonable terms and without unjust discrimination to all types, kinds and classes of aeronautical activities, including commercial aeronautical activities offering services to the public at the airport.”

■ Exclusive Rights. “[The grantee] will permit no exclu­sive right for the use of the airport by any person providing, or intending to provide, aeronautical services to the public.”

The FAA also determined that Yavapai County was in violation of the “Preserving Rights and Powers” assurance by allowing the Sedona-Oak Creek Airport Authority to violate the other assurances.

The ball is now in Yavapai County’s and SOCAA’s court.

SOCAA’s board of directors is convening a special meeting on Friday, Aug. 6.

The county and airport have until August 28 to appeal the decision or submit a Corrective Action Plan to the FAA. If the plan is approved — or an appeal is upheld — the FAA’s recommended hold on federal grants will be lifted.

This is the second time in 20 years the FAA has found Sedona Airport in violation of economic nondiscrimina­tion and exclusive right rules. In 2002, the FAA ruled that the airport violated the assurances when it failed to offer Skydance Helicopters Inc., a helicopter tour company that no longer does business in Sedona, a lease that would enable it to build a hangar and office at the airport.

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