Airport Authority gets millions
By PAUL KNIGHT
FAIRHOPE - The City Council voted in early March to turn over control of the H.L. "Sonny" Callahan Airport to the Airport Authority and lend that group $8.8 million to expand.
The facility, located near Baldwin County 32 and U.S. 98, has been owned by the city since its inception, but in 2003 - when expansion plans began - the Airport Authority was created to eventually run operations there.
Charles Zunk, chairman of the Airport Authority, said up to this point, the panel has served as an advisory group to the city - similar to a park board. Now, expansion of the airport is key to the economic growth of Fairhope and south Baldwin County, Zunk said. "It's really a question of flexibility. It becomes a lot more sensible to have a stand-alone authority."
Zunk said the authority will continue to work in concert with the city, but not be controlled by it.
The $8.8 million comes from a 2007 bond issue, and the authority will use the majority of that money to purchase about 250 acres of undeveloped land near the airport.
Zunk said immediate use of the land would be for public-use improvements - hangars and eventually a new terminal. The upgrades to the facility will hopefully attract new businesses to the airport area, Zunk said.
City Council President Bob Gentle said those businesses would come from the Mobile aviation industry, or from a growing number of national corporations looking to relocate to places like Fairhope.
Last year, the city hosted a flight festival to recruit businesses to the area. One prospective business, a medical center, was looking to relocate to an area with airport access, but the airport did not have the facilities to accommodate that group. That's when city officials realized the need for more land near the airport, Gentle said. According to the bond agreement, the city will pay interest on the $8.8 million during the first five years of the loan. At that time, the Airport Authority will take over full responsibility of the loan.
The Airport Authority currently has no source of income, and members are counting on quick development of the land to generate revenues to pay back the loan. If the airport cannot pay after five years, Gentle said the city can take back the land.
Part of the $8.8 million will also cover construction costs on new hangars at the airport. Gentle said those hangars will be available to rent, providing an immediate revenue stream.
The city will also pay about $500,000 a year, for the first five years of the bond, to the Airport Authority for general operating costs.
Expansion of the airport began several years ago when the city was awarded $12 million in federal and state grants to upgrade the runway.
The runway was extended to 6,600 feet, about 100 feet longer than the runway at Chicago Midway, and is capable of landing an aircraft the size of a Boeing 737. "We can handle corporate jets all day," Gentle said.
Those corporate jets - and corporate money - are the main target of the airport expansion. Gentle said the airport will also continue to accommodate individuals who own their own aircraft.
A version of this article was previously published in the Baldwin Register.