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Squawks & HeadlinesLetter to Tennessee Governor Bill Haslam in Opposition of Government Competition with Private Business

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Letter to Tennessee Governor Bill Haslam in Opposition of Government Competition with Private Business

Submitted
Dear Governor Haslam: I am writing to bring to your attention a national issue affecting our transportation infrastructure that has, in recent months, become centered in the state of Tennessee. This issue concerns airport owners, which are usually arms of state and local government, creating an unlevel playing field for the private companies that do business at their airport. . . (www.nata.aero) More...

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zcolescott
Being an Airport/FBO Manager that is owned & operated by a small local municipality in the State of Tennessee, I can see that these is a time and a place for this sort of thing to happen, but there should be absolutely no reason for it to happen at an airport the size of KCHA. In my particular case, the local city sees the advantage of having a professional looking (and run!) operation at their local airfield. People weren't exactly beating down the door to privately run it anymore, which is the case at MANY of the airports around the country which used to be supported by mom & pop operations. Because of this, the city started granting operating costs as part of their yearly budget, and the airport I run today is but a shadow of its former self...for the good I might add. We have worldwide manufacturing facilities within 5 miles of the airfield that regularly utilize the airfield and employee thousands in our community. It's a good payback for the average citizen, even if they don't realize it. However, that being said, when you already have privately run FBOs at an airfield, why on Earth would you think that this is acceptable?!? I can't see how this utilization of taxpayer money created an added benefit at KCHA. Especially since a brand new airport is almost completed nearby that will support more of the GA traffic visiting Chattanooga and the surrounding areas. Can I see both sides of this argument? Yes. But I can't agree with what the airport authority has done here. I'm honestly surprised that it was approved for grant money by the State considering its intended purpose. Tennessee is a Block Grant state, and the Department of Aeronautice & TDOT apportion both state and federal grant money. I may have to check into this further...I'll report back if I discover any inside info...
meeverett
This is almost exactly what I was thinking. There is a time and a place for a municipally-run FBO; for that matter I think there is a time and a place for a government-run FBO to 'compete' with private enterprise. I'm certain this isn't it.

For the record I did all my training at KTYS where TAC Air operates as FBO, which I assume is much like KCHA, and I just can't see another FBO, even one built with grant money, being necessary nor being able to properly sustain itself. It seems more like both FBOs would end up going broke. Especially when you consider that the MKAA operates as FBO at KDKX, the nearest GA field and the differences in fuel prices there vs. KTYS are almost negligible, certainly not the $1.00 a gallon referenced by the CMAA president in the piece Loren Lintner links to.

sandylns
Brian Lager 7
Governments job is to govern. It provides, via regulations, tax incentives etc, the right enviroment for private enterprise to flourish. This is the case wether it is in aviation or any other business. History has shown that governments are lousy at running any kind of business. They become bloated with civil servants. And, to keep those sinecures intact, further regulations are inacted. In that enviroment benefits become rights and job security is paramount over the day to day operating of the business. That's why there is no profit in a government enterprise.
Taxes used to run an enterprise competing with private companies is inherantly unfair.
erictuff
Eric Tuff 0
Agreed! We have that in Baltimore, where the city decided to go in the hotel business, raised lodging taxes on all other hotels and still losing money!
ljlintner
Loren Lintner 2
Found this opposing view.

http://wilsonair.com/news/flying-high-facility-improving-operations-airport/

Still not sure I have enough information to form an opinion. This argument, however, indicates the incumbent FBO was built in a similar fashion, not paid for by the business itself.
beinsweet85
Christine Lewis 1
This is untrue. Not a single TAC Air leased hangar was built with gov't money. From my understanding private companies built these hangars for their flight departments.
ljlintner
Loren Lintner 1
Thanks. Just our of curiosity who are the Chattanoogans for Fair Aviation? Like the two battling parties, they don't appear to be an independent, third party that would keep their own bias out of a report.
staceyharrison747
We need to spread the word to every pilot we know that they should not make use of any FBO type facility that is propped up with government dollars. In that respect, the free market will decide the fate of such facilities and competition amongst private businesses will set the standard. I just wish the government would realize that it is good at only 3 things: killing people, blowing stuff up and wasting money. They should concentrate on the first two and leave the rest to privatization.
ljlintner
Loren Lintner 1
I'm confused. Looking at AirNav and the CMAA website I see two FBO chains advertised. Both appear to have multiple locations across the country and neither appears to have any direct connection to the airport authority. What is missing here?
ibpilot72
ibpilot72 1
What's missing is that CMAA built the facilities with 100% fuel tax $$$. No private $$$ was used to built those facilities. CMAA contracts with Wilson to manage the facility. The problem is TAC Air is not offered those same fuel tax $$$ to make improvements to facilities and such. TAC Air has to use their own money, which affects their bottom line, whereas the CMAA uses money it doesn't have to repay to build facilities. How can private enterprise compete with a government agency who doesn't have a responsibility of making a profit to survive? In the opposing article, I highly doubt that the other facility was paid for 100% by taxpayer $$$. Dont get me wrong, we enjoy the lower fuel prices, but what happens to "competition" and the price of fuel, when the CMAA undercuts prices so far that the competition has to leave the field, leaving the CMAA as the only fuel provider?
EricClark
Eric Clark 1
Wonder what the Governors stnad would be if I was able to get Government grants and build new new truck stops across from the Pilot oil truck stops. If I was only having to pay 5-10% of the cost I could under cut his families business.
genethemarine
Gene spanos 1
Welcome to the Daley Store - here at O'Hare!!!
ljlintner
Loren Lintner 1
Highly doubt? I plan to keep my reaction based on information that is available, and not read something that may or may not be there.

I have experienced FBOs built with private funds on airport or public land. In those cases, the tradeoff for investing in building facilities from the ground up, the FBO paid substantially reduced fees for a period of the lease to amortize the value of the buildings. Once the value was offset, the fees went back up. I have also seen an airport pay millions of dollars to an FBO for such facilities when their lease wasn't renewed and there was still unrealized value. This is all to say if you are not aware of the lease/contract provisions of the two FBOs in question, you are speculating like the rest of us.

As for getting worked up over what may happen if someone goes out of business, guess everyone will have to wait and see.
GLF5Pilot
GLF5Pilot 1
Wilson contracted with the CMAA to manage the FBO at CHA.
pwerglide
The prospect of the CMAA entering the FBO business is dishearting at best. The only thing that has occurred is that Wilson Air (CMAA sponsored FBO) has made a concerted effort to rob Tac Air of its customers. There have not been any new customers generated by the establishment of the new FBO. I don’t see how the CMAA could justify the amount on money they have spent on the new FBO while the facilities at the CHA airport facilities go down the drain.