City Council is split on hangar proposal

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— Steamboat Springs City Council is split over the question of whether to borrow $1 million to build new hangars for private aircraft at Steamboat Springs Airport.

Council stopped short Tuesday night of making a formal vote on the proposal by the Northwest Colorado Aviators. The group of about 75 local pilots is asking the city to construct three new hangars that could house 12 to 15 aircraft. The project, which would go forward in several phases, also entails creating new parking aprons for aircraft tie-downs. The aviators say there are 39 people on the waiting list for hangar space, and the rent from the new hangars would more than offset the cost of borrowing to develop them.

Some members of the City Council praised the plan as a way to gradually make the airport less of a drag on the city budget. Others said they aren't about to incur more debt at the airport, which hasn't had commercial service since 1994.

"I said before, if this represented a positive cash flow, I'd support it," Councilman Paul Strong said. "This is debt that pays its own way. I think we have room for this in our debt ceiling."

Jack Dysart of the aviators group presented council with spreadsheets he said show that after 30 years of making payments, the city would have realized a net cash flow of $1.67 million, after debt service and hangar maintenance were deducted. His figures were reviewed by Finance Director Karen Feeney, at council's request.

But Council President Kevin Bennett said it will take too long for significant cash flow to come in on the city's investment. The spreadsheets provided by Dysart show the city would realize about $700 in cash flow the second year. That amount would grow to $7,447 by the fifth year and almost $20,000 in year 10.

"I don't see any positive cash flow for about eight years on a million-dollar investment," Bennett said.

He added that he couldn't justify incurring more debt for the airport, which has been "the source of so much debt and so much negative cash." He was referring to the fact that the city is still making large debt payments on its airport terminal, which is largely unused. Bennett speculated the question of whether to borrow for the hangars would never pass a public vote.

Councilman Bud Romberg saw the issue differently.

"I would take a different approach," Romberg said. "There has been a call from the community for something to happen at the airport that would make it pay for itself. I would be in favor of the proposal."

Councilwoman Arianthtettner suggested that developing new hangar space at the airport should be the role of the private sector.

"Were the city to take on more debt, I would be more inclined to go forward with affordable housing," Stettner said.

Councilman Ken Brenner said he's keeping an open mind on the possibility the hangar proposal could be a worthwhile project.

But Councilman Jim Engelken advised against the city spending any more money on its airport.

"I believe the county airport is our future," Engelken said. "I don't think that putting any more money in the city airport is a wise investment. I'm waiting to see what the county wants to do. I'd hate to see the county develop hangars at a lower rate than ours."

Councilwoman Kathy Connell said she disagreed with Engelken. She sees "wonderful opportunity" at the city airport in the future.

"I think we need the hangars," Connell said. "I just don't think we've found the right structure, and I don't think the city should be taking on the debt."

In the end, City Council decided to delay any formal decision on the fate of the hangar proposal until city staff has time to advertise for a partner from the private sector to take a major role in the future of the airport.

Bennett said council will never know, unless it asks, if there is a business person who would like to occupy the mostly empty terminal and invest in the airport.

Council directed Deputy City Manager Wendy DuBord to move forward with a plan to issue a broadly worded "request for proposals" and ask for responses from interested parties by sometime in June.

To reach Tom Ross call 871-4210, or e-mail tomross@amigo.net

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