Airport FBO privatization plans in holding pattern

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— The city has put into a holding pattern a handful of proposals for privatizing fixed-base operations at Bob Adams Field, waiting for new airport manager Matt Grow to have a chance to review them.
Earlier this summer, the city put out a request for proposals from companies and services interested in setting up shop at the airport, hoping to find an arrangement that could reduce its heavy subsidy load.
The city is looking for a business operation that could use some of the approximately 16,000-square-foot passenger terminal the city built in 1993 when the airport still serviced commercial airline passengers.
"We were hoping to find some company or operation that could use that terminal building, that is largely being unused, for a business purpose that didn't interfere with airport operations," said Deputy City Manager Wendy Dubord.
Of the five proposals it received before a June 9 deadline, the city did not find an ideal match, though two companies have sent in somewhat appealing proposals.
The city, interested in acting on the two offers back in July, decided to wait in order to allow Grow to have a look at the proposals before making any moves. Grow began working at the airport July 10.
"We really don't want to rush into anything right now," Grow said. "We want to look at every angle of privatizing the FBO (fixed-base operator) business before moving on this. I don't want to make any decisions my successor will come to regret.
"Long-term, I think the airport is sitting fairly well," he added.
Grow and Dubord will be meeting with a Broomfield Company called BJC this month to discuss its proposal. BJC is one of the two companies whose proposals the city believes are worthy of further consideration.
Within 30 days, they will also meet with Mountain Flight Services, which already operates an air charter service and air ambulance at the airport.
Both BJC and Mountain Flight Services have proposed combinations of new hangar development, marketing and FBO services. The FBO would sell aviation fuel, among other things. The companies are willing to contract to provide the services or create a joint venture.
The city, however, already runs an FBO, which happens to be the airport's main source of revenue. Privatizing the FBO, Dubord said, might not be in the city's best interest.
The city currently subsidizes the airport's debt accrued after the city built the new, $2.8 million terminal in 1993. In 1994, the airport lost commercial service and has not been able to replace it, aside from a start-up airline's four-month stint in 1997.
The debt schedule allows for the payments to gradually decrease until 2008, when the debt should be completely paid off.
The city also helped finance an asphalt overlay for the runway this year, spending $110,000 out of its general fund to partially match a grant.
"It's a difficult nut to crack," City Council President Kevin Bennett said. "How to effectively use the airport resource when it was designed, of course, for commercial service. And how we as a community can leverage this asset. Use of the airport has been a concern of many councils since the creation of the debt on the terminal building."
Bennett asserts that although the airport is an important asset to the community, it should start paying a little more for itself.
"We ought to continue to try to reduce the expenditures we pay on the airport out of the general fund," he said.
"Unless an airport has commercial service there's no way to make money," Dubord said.

To reach Avi Salzman call 871-4203 or e-mail asalzman@amigo.net

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