County commissioners have refused to lower the monthly lease payment on Apalachicola Regional Airport for fixed base operator Crystal Air of Chattanooga, Tennessee.
At their regular Aug. 19 meeting, Director of Administrative Services and Airport Manager Alan Pierce recommended commissioners reduce the $5,000 monthly payment to $2,500. “His problem is the lease is too high,” said Pierce.
In an interview after the meeting, Pierce said the FBO has been late with rent more than half the time since signing the lease in Oct. 2012. Payments are currently in arrears, he said.
Pierce also suggested the county take back control of the unoccupied corporate hangar.
In addition to reducing the lease payments, effective June 1, Pierce asked to modify the lease to allow the county to give Crystal Air 10 days notice “in the event Franklin County has a use for it. Until Franklin County gives Crystal Air the notice, the corporate hangar will continue to be in their lease and they will continue to pay utilities for the building.
“At this point, Crystal Air is not regularly utilizing the hangar. But, on occasion, does receive rent when a large plane stays there overnight. The consensus of the Airport Advisory Committee is that they would like to get the corporate hangar back.”
Commissioners were critical of the change to the lease. “If there’s a problem, I’d like him (Crystal Air CEO Taylor Newman) to come and tell me there’s a problem,” Chair Cheryl Sanders said.
She asked how long Crystal Air has been FBO. Pierce said they had completed less than two years of a five-year lease.
“He hasn’t been in there half his lease and he wants his rent reduced,” Sanders said.
Commissioner Noah Lockley said Newman has not lived up to his contract, citing the fact the airport ran out of fuel over the Memorial Day holiday weekend. “When you run out of gas, that’s a problem,” said Lockley.
Commissioner Pinki Jackel asked how much Crystal Air makes on the sale of a gallon of gas and how many gallons of gas are sold annually. Pierce said the FBO makes $1 per gallon and sells about 60,000 gallons a year.
Jackel asked if it was customary for FBOs leasing an airport to share fuel profits with the owner of the property. Pierce said that had been the arrangement with the previous FBO, Bill Ruic.
Jackel suggested Crystal Air give the county a portion of their fuel sales. Pierce said sale of fuel is the main source of income for the FBO. He said they also receive revenue from hangar rentals, car rentals and aircraft repair, maintenance and storage.
Lockley asked how often Newman visits the airport.
“That was a complaint we had,” Pierce said. “He’s not there regularly. He has employees. What we’re missing is a corporate presence.
“There isn’t a sense of a business (in operation at the airport)” he said.
“We have some problems out there and one of them is Avcon,” Jackel said, referring to the county’s consulting engineer for the airport. “What value do we get for that? I can’t remember the last time I saw them.”
Sanders agreed. “Avcon said they could promote our airport,” she said.
“I say we get rid of him (Crystal Air) and Avcon,” Lockley said.
He moved not to accept Pierce’s recommendation to alter the lease. Jackel seconded and the motion passed unanimously.
No luck with corporate hangar rental
When Crystal Air signed its lease in 2012, Pierce said the contract “will more than cover the fixed costs of running the airport.” The county was expected to continue to receive additional income from the rental of two commercial hangers at the airport, he said.
But since becoming FBO, Crystal Air has not found a permanent tenant for one of two commercial hangers at the airport. The second, a solar-powered structure built for Garlick Environmental Services, eventually rented to Randall Terry for $1,200 monthly.
In Dec. 2013, Newman told county commissioners occupancy of the airport’s 34 t-hangers had increased from 65 to 80 percent. At the same meeting, he was criticized for not creating a website for the airport and not spending more time at the facility.
When Crystal Air signed its lease, Newman promised to increase and upgrade airport services. For a brief time, he employed two aviation mechanics but now only John Moore, of Port St. Joe, remains employed.
Crystal Air has employed a series of on-site managers, the most recent Jason Puckett, a flight instructor who resides in Quincy. Pierce said he believes the airport has at least three employees.
Crystal Air keeps a small number of Hertz rental vehicles at the airport.
When Newman signed the airport lease, Crystal Air had been FBO for Franklin County Airport in Sewanee, Tenn. since 2003; for Cleveland Municipal Airport, also in Tennessee, since 2007; and for Dalton Municipal Airport in Georgia since 2008. He has provided other services at airports in Sparta and Chattanooga, Tennessee.
According to their website, Crystal Air is no longer FBO in Dalton, Ga.