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AIRPORT STILL AWAITS TAKEOFF

October 18, 2009 12:36 am

BY JONAS BEALS

When Stafford Regional Airport opened in 2001, officials thought it would quickly become a revenue engine for the county.

Instead, Stafford has paid a subsidy every year to run the airport--a total of $794,983 since 2002, with another $660,070 in loans.

And this year, the Board of Supervisors appropriated more than twice the normal amount of money in case it needs to cover debt service on airport loans.

At the same time they increased the appropriation, supervisors voted to essentially eliminate the personal-property tax on aircraft--an $84,000 annual hit to county coffers.

Supporters say the move will spur growth at the airport. If all goes as planned, the change will save the county money in the long run by bringing corporate planes--and possibly corporate offices--to the area.

But critics say the move is a desperate bid to create a demand that never existed. Some worry that it is the next step toward what they have long feared: expansion of the airport to handle freight, and a subsequent increase in air traffic.

According to members of the Stafford Regional Airport Authority, the tax rate was the last significant obstacle on the road to success and profitability. Now that it is gone, hangar rentals have increased--only six of the 40 are vacant--and the total number of aircraft based there has jumped from 34 to 56.

Despite growth at the airport, the opening-day promises of 2001 remain elusive. There are many possible reasons, but the simplest conclusion is also the most obvious: The economic downturn has not been kind to airplanes or the businesses that use them.

"We want companies to build corporate facilities," said Airport Authority member Hank Scharpenberg. "We want to bring jobs to the area and have them pay the associated lease rates and taxes. Now is the worst time, because of the downturn, but it won't last forever."

Those same sentiments were expressed when the airport first opened and the technology sector was taking a beating. The familiar refrain has led some residents and officials to conclude that the airport is not simply a victim of economic circumstance, but rather a flawed project that may never succeed on its own.

RELYING ON SUBSIDIES

Even with fuel, water, sewer, three-phase power and improved amenities, the airport has struggled to land corporate clients. There is currently one Life Evac helicopter and a single corporate hangar with 10 aircraft. Absent more of that financial lifeblood, the Airport Authority still relies on subsidies from its three member localities: Fredericksburg, Stafford and Prince William County.

Those subsidies were supposed to be necessary for only three years. Eight years later, however, Stafford's airport appropriation has more than doubled to $248,236--an amount that could include debt service on Airport Authority bonds used to build hangars and upgrade utilities.

Thanks to increased hangar rentals, it appears that the county's annual subsidy may be only slightly higher than the usual $114,285.

So far, Stafford has given the airport $124,116 in the first two quarters of this fiscal year. Anything in excess of $114,285 is considered a loan to be repaid by the Airport Authority. Additional funds will be spent only if the airport requests them.

"We will need some additional funds this fiscal year," said airport Manager Ed Wallis. "But the outlook is positive."

A recent article in USA Today pointed out that large federal subsidies also flow to general aviation airports such as Stafford Regional. According to the report, $15 billion has been shuttled to 2,834 airports over the 28 years of the federal Airport Improvement Program.

The article noted that Stafford Regional Airport has received 17 grants for about $30 million--most of the total cost to build the $36 million airport. In comparison, Shannon Airport in Fredericksburg has received one grant for $36,000.

Manassas Regional Airport received 29 grants for $31 million, and Reagan National Airport received 24 grants for approximately $134 million.

Manassas Regional, which is often mentioned as an alternative to Stafford, is self-supporting, according to Manassas city officials. That airport is operated by the city, not an airport authority. Started in 1931, it has been at its current location since 1964.

Subsidies are just one reason some people still oppose the Stafford airport after eight years of operation.

"They've always promised us they would phase out the subsidy," Supervisor Joe Brito said.

"It kind of bothers me that when the airport was built, 570 acres were taken off the tax rolls of the county," he added. "I think the airport is hindering progress and keeping businesses away from the Centrepoint Parkway interchange."

LURING CUSTOMERS

The airport was built on agriculturally zoned land, and the surrounding property has since been rezoned for commercial and industrial uses. So far, a FedEx warehouse is the only business to move in nearby. But the real estate now brings in, on average, twice the tax revenue it did when it was agricultural land.

Brito still believes the regional airport is a headache Stafford could do without.

He also echoed a recurring public concern about the airport's future. Some residents fear that instead of remaining a relief valve for private plane traffic around Washington, the airport could lengthen and reinforce its runway to handle freight or commercial traffic.

It cannot currently handle such flights. Wallis thinks the expansion would be nearly impossible and would require a public hearing to change the airport's master plan.

He said becoming a freight reliever is something "that's never been discussed by the Airport Authority."

Those statements don't reassure some airport critics.

"They exempted aircraft from the personal-property tax at the same time they're raising it on cars," said David Beiler, a former supervisor. "The aircraft tax acts as a deterrent for freight carriers. The county is laying out the red carpet for freight carriers."

STAYING THE COURSE

Even as the airport currently stands, it could handle more than 10 times the 6,130 takeoffs and landings it supported in 2008.

If things work out according to plan, decreased taxes could mean more planes, more activity, more hangar rentals and more fuel sales, all of which could help the facility operate without a county subsidy.

So far, the first part of the plan seems to be working. Hangar rentals are up. Although fuel sales have been down slightly over the past two years, those numbers should increase along with the number of planes.

Wallis, who started his career at the Stafford airport by mowing the grass along the runway, was recently named the state airport manager of the year by the Virginia Department of Aviation. He said that an additional 14 hangars have been rented since the tax break went into effect, and six new tenants are renting outdoor tie-down spots.

Those rentals mean more income for the airport, but will those planes offset the lost tax revenue, and will corporate tenants move in?

It's still early, and Wallis withheld exact figures for hangar rental fees, but any gains are sure to be measured against the growing subsidy and the $84,000 of annual revenue Stafford collected before the tax rate was cut. Questions about profitability will take time to answer.

"Overall, I think the lowering of the tax rate has been good for filling the available hangars," said Airport Authority Chairman Walt George. "But due to the downturn in the economy, our marketing efforts haven't grown any fruit. We envision it taking up to two years for us to really get back on track."

The big money is in corporate hangars. Not only do they ensure traffic and fuel sales, they provide tax revenue directly to the county. They also can create jobs.

Recent construction projects--site work and an apron expansion--are intended to allow more private hangars. George pointed out that those projects were funded entirely by $2 million from the federal government. Contracts went to regional construction companies.

That sort of project can impact the local economy in a positive way, but it is a stopgap measure to critics who claim the airport has not yet become a magnet for businesses.

"Tens of millions have been spent in that area and you'd think businesses would jump at the chance to locate there," Brito said. "With fuel prices going up and with corporations moving away from their own corporate jets, I don't really envision it being that successful."

Still, there are believers who think the airport will live up to and exceed its early expectations.

"All the infrastructure is in place right now," George said. "We're here, we're growing and we're giving back to the community."

Authority member Scharpenberg is confident that the airport will "get to the point where we don't need a subsidy."

For now, Stafford officials say they have few options beyond keeping the airport running and hoping the lower tax rate brings in more more traffic.

"There's no point in talking about whether it should or shouldn't be here," Supervisor Paul Milde said. "We have an airport and we're going to have to use it. We have an interest in making it profitable to pay the debt service."

Jonas Beals: 540/368-5036
Email: jbeals@freelancestar.com