Airport considers operating budget surplus
September 15, 2020
By TOM LAVENTURE
The board 3-0 approved the $119,432 fiscal year 2021 operating budget. The budget remains the same as fiscal year 2020.
Joe Bonovetz, board chair, and Brandon Snyder, board member, were not present. Patrick Hanson, vice chair, officiated the meeting.
Board member James Lorenson brought up the fact that the airport’s $800,000 in carryover operating funds were part of the budget discussion at the Gogebic County Commission where he also serves as a commissioner. The airport is the only department with $800,000 in carryover funds and he said the funds should, perhaps, be returned to the airport’s partnering counties, Gogebic County, Michigan and Iron County, Wisconsin.
“Personally, I don’t know if we need an $800,000 fund balance,” Lorenson said. “I would return some of that to both counties.”
The funds could be used for deferred maintenance projects, he said. The funds could also go to a building and grounds fund, he said.
There may be unexpected situations where the funds would need to be available, he said. The environmental study looking for the presence of per-and-poly-fluoroalkyl substances (chemicals found in the fire suppression foam that is sprayed on runways in the event of an emergency) is one such scenario, he said.
But that process could take years and involve potential federal grant money, he said.
Airport manager Michael Harma said he suggested moving the funds from the operating budget to the capital expenses fund months ago but the board had resisted. The funds would then be considered dedicated to improvement projects, such as a new hanger.
The funds are a combination of two counties along with state and federal funds, said Tom Laabs, board member.
“If we truly have plans for expansion then designate the funds for those projects,” Lorenson said. “They are a red flag while in the operating budget.”
The board placed the topic on the October meeting agenda. At that time Harma and airport secretary Kristi Freeman would present a list of capital projects that would utilize the funds.
In the manager’s report, Harma said there are lower than normal performance ratings for Boutique Air, Inc., the passenger service that became the airport’s Essential Air Provider on Aug. 1. There were cancelations and delayed flights in the past month, he said.
There were mechanical, operations and weather related problems, he said. No delays or cancellations were due to the staff or operations of the local airport, he said.
The airline is currently negotiating for a maintenance base and space at Chicago O’Hare International Airport, he said. Until then if there are any mechanical issues the pilots must fly a second plane or pilots from Minneapolis-St. Paul International Airport.
“They are in conversation and working on it and I hope they get the bugs worked out before winter,” Harma said. “I feel the formulated plan is not working the way they want it to.”
Harma said he was approached by a property owner adjacent to the airport regarding the logging operations that will start soon. The owner wanted to be sure that enough trees were left to create a natural boundary between the private property and airport property.
The landowner also discussed the possibility of the airport making an offer to purchase the approximately 2-acre property prior to putting it on the open market. Harma said he would have the property assessed and present more information to the board at its October meeting.