City won’t renegotiate airport lease agreement

The Naples City Council concurred today that it would not pursue increasing the rent that the Airport Authority pays to lease out city land.

At the joint council-authority workshop council members said there is too much on the city's plate right now to be debating the contentious subject of increasing the $1-a-year lease agreement.

The city and authority entered into a 99-year agreement in 1969 in which the authority pays the city this token amount to lease out the 700 acres of city-owned property for the Naples Municipal Airport.

Some residents want the authority to pay much more than that - perhaps millions a year through fees on pilots - to boost city coffers.

For several months, the debate has lingered, as the city and authority lawyers came out with different opinions whether the Federal Aviation Administration would consider this move illegal "revenue diversion."

Last week, the council agreed to formally ask the authority whether they would be willing to renegotiate the lease.

But as three of the five authority members sat in front of them on Monday, council members didn't ask.

In fact, the council agreed to make a formal decision at its regular meeting on Wednesday whether to rescind this question.

Because it was a workshop, formal action couldn't be taken.

Councilwoman Penny Taylor brought forth the idea of tabling this subject, at least for now.

"I've been talking to some members of the public, and clearly, the intent of council has mushroomed into something that I just don't think we need to be dealing with right now," she said. "At some point we will discuss this, but right now, with everything that is before us, I think it is too much."

She said the issue is consuming staff's time.

"It is taking the attorney's time. They are writing letters. They are asking for public information requests," Taylor said. "I think now is the time to just say: 'Let's take a deep breath. Let's focus on what is important.'"

Councilman John Sorey praised Taylor's move.

He also thanked the authority members, who are volunteers appointed by the council, for coming to the workshop.

"You are doing exactly what your charter says, and that is to run the airport in an effective way, and you are doing that. You've responded to the noise complaints of citizens," Sorey said.

The council also agreed that a decision would be made at Wednesday's council meeting whether to drop the idea of contacting the FAA's chief counsel to determine whether increasing the lease would be legal.

Councilman Bill McIlvaine said he still supports a joint letter from the city's and authority's lawyer being sent to FAA officials to get this answer.

City Attorney Robert Pritt has said he believes the city could charge "fair market value" to the authority to lease out the land.

But authority lawyer Joseph McMackin said the FAA would likely view this as illegal "revenue diversion."

Naples Airport Authority Executive Director Ted Soliday, who solicited a response from the FAA on this subject, received a letter back May 30, 2006 from the manager for the airports division in Atlanta.

Robert Chapman clearly stated that federal law requires that revenue from airports like Naples Municipal be spent on maintaining and operating the airport.

And he wrote that federal law prohibits grant funds from going to a local government that diverts airport revenues.

"Therefore, we believe that an increase in the lease amount would clearly be an inappropriate diversion of airport revenue from the airport to the city," he writes.

The authority runs the airport as a self-sustaining operation. It brings in millions each year from fuel sales and leases. And authority commissioners have vowed not to ask for tax money to support its operation.

Several hundred residents have signed a petition expressing strong opposition to a proposal to increase the lease payment.

Were the city to charge fair market rent, it would be in the minority.

FAA records show that the vast majority of the airports across the country pay little or nothing in the way of lease payments.

Of the eighteen airports in Florida providing commercial services, only one reported making lease payments to a government entity.

The Gainesville-Alachua County Regional Airport Authority pays the city of Gainesville about $55,000 a year for a lease agreement on an automatic flight service station building, but nothing to lease the land.