Airport Authority Bond Issue Games - And Response

Sunday, December 22, 2013

The Chattanooga Airport Authority and their bond issue games to buy TAC Air are very concerning. Private planes at the Chattanooga Airport are serviced by a privately-owned company called TAC Air, and a taxpayer-subsidized operator called Wilson Air.  

The privately-owned company, TAC Air, pays rent to the Chattanooga Airport Authority, and operates without a dime of taxpayer funds.  The TAC Air business model is for profit to survive. If TAC Air operates in the red, they are out of business. 

The taxpayer-funded operator, Wilson Air, has an operating contract with the Airport Authority Board that provides if Wilson Air operates in the red, the operators are not responsible to make up the losses. It gets better - if Wilson Air operates with a profit, they share in the profit. 

To date, Wilson Air has operated in the red to the tune of over $1.31 million.  The Wilson Air business model is if we earn a profit, it is bonus time. If we operate in the red, who cares? The taxpayers pay the tab. What kind of contract is this, share in profit, but not in losses? 

In 2010, the Chattanooga Airport Authority Board voted in favor of a $10 million federal grant to construct a government-subsidized plane facility, Wilson Air that would compete directly with the private plane facility, TAC Air, who pays rent.  The Chattanooga Airport Authority borrowed funds, or leveraged bond issues on airport revenue for the local match of $10 million grant, which is believed to between `10 to 20 percent of the $10 million. 

Interestingly enough, the Chattanooga Airport Authority recently asked the City Council to make the taxpayers of Chattanooga the group that guarantees repayment of the bond issues, instead of Airport revenue.  Of course, our City Council approved this change throwing the taxpayers under the bus. So now, we the taxpayers of Chattanooga, not the Airport Authority revenue, guarantee repayment of the Airport Authority’s bond issues or loan funds. 

Returning to 2010, the Chattanooga Airport Authority built their new government-subsided private plane facility, Wilson Air, to compete directly with privately-owned, TAC Air. At this time, the Airport Authority Board contended that Wilson Air was constructed to create a competitive market at the airport for private plane fuel and services.  However, in 2010, the TAC Air hanger was only utilized to about 60 to 70 percent capacity.  The market demand for additional private plane services simply did not exist. Yet, the Chattanooga Airport Authority proceeded and built additional private plane services where a market demand did not exist. 

Moving ahead in 2013? The very predicable happened. Wilson Air operated in the red and to date has lost over $1.31 million, because there was not an ample market or demand for the additional private plane services or storage. The Airport Authority proceeded regardless of facts. With Wilson Air operating in the red, the Chattanooga Airport Authority, who created this financial debacle, now proposes to buy out TAC Air for over $7 million through bond issues that the city of Chattanooga taxpayers will guarantee.   We the taxpayers are being encumbered for these decisions. 

It is my understanding that the Airport Authority’s motive in attempting to buy out TAC Air for $7 million is to destroy the competition for Wilson Air. But wait a minute, it was just 2010 when the Airport Authority claimed they were creating competition.  Get your story straight, Airport Authority, and stick with it, but pick one. The Airport Authority’s wasteful bond issue games and contracting terms are very concerning. Where would the taxpayers begin to clean up this mess?

April Eidson 

* * * 

The Chattanooga Airport Authority Board is wanting to use Chattanooga city tax money to buy TAC Air and eliminate any competition for Wilson Air, a city owned business. A member of that same board, Mike Mallen, also helped push through the Tax Incremental Financing, aka TIF, for the hedge fund corporation, York Capitol, bond issue for their Black Creek Mountain development.  Black Creek Mountain is advertised as "Resort Style Living" for those that can afford it.  

Many people upon hearing of the TIF did not agree with the money being used that way and at least one lawsuit was filed to stop it. Mike Mallen sits on the board that now wants to spend your tax money to put a competitor out of business.  

Are these ways you wanted your tax money spent or would you rather have it spent on fire and police protection?  

Joe Blevins


David Carroll: Touched By Alzheimer’s, A Thanksgiving Love Story

I want to share a Thanksgiving love story. Those smiles belong to Jim and Andi Erwin of Collegedale, now married 45 years. Jim is 68, Andi is 63.  I met them last summer, and fell in love immediately. Andi is a talker. Full of life, with energy to spare. Jim used to be a talker, an award-winning one. In his youth he was a teacher and pastor, very well-educated. Simply put, ... (click for more)

Roy Exum: ‘Pretty’ Seeking ‘Rich’

The story has been around for a while, long enough for the fact-checking Snopes.com to classify it as a “legend,” which means “great story but lacks validity,” so as we hope Tennessee’s football team can somehow beat 19 th -ranked Missouri in a rough-and-tumble game at Neyland Stadium tonight, allow me to share this because it is delightful just the same. The following is what ... (click for more)

Bradley County Police Investigating Shooting

The Bradley County Sheriff’s Office is investigating a shooting that occurred in the area of Georgetown Road.  A BCSO officer was waved down at the intersection of 25 th Street and Peerless Road by the driver of a vehicle who told the officer a gunshot victim was inside. The officer followed the car to SkyRidge Medical Center. Several people soon arrived at the ... (click for more)

Police Investigating An Armed Robbery On Friday Night At UTC

UTC Police are investigating with the Chattanooga City Police an armed robbery in Lot 4 near Boling Apartments on Friday night. The suspects are described as two black men.  One was six feet tall, wearing a navy jacket, with medium skin tone and short hair.  The other suspect was reported to be 5’ 7”, wearing blue jeans and a long white T-shirt. The second suspect ... (click for more)

Missouri Hangs On, Turns Back Tennessee, 29-21

KNOXVILLE, Tenn. – Missouri pin-pricked Joshua Dobbs’ bubble of invincibility Saturday night at Neyland Stadium. The nationally ranked Tigers drove a stake in Tennessee’s heart with Maty Mauk’s 73-yard touchdown pass to Jimmie Hunt in the fourth quarter, held Dobbs in check most of the game and beat the Vols, 29-21, before 95,821 fans on a chilly night on the banks of the Tennessee ... (click for more)

Mocs Win Big Over Furman, Undefeated In Conference Play

The University of Tennessee at Chattanooga football team put a cherry on top of its 2014 regular season with Saturday’s 45-19 win at Furman (3-9, 2-5 SoCon).  The victory gives the No. 9 Mocs (9-3, 7-0 SoCon) its first ever undefeated Southern Conference slate and its first nine-win season since 1979. Junior quarterback Jacob Huesman led the way with 257 passing yards ... (click for more)