The Lorain County prosecutor is investigating a $1.8 million airport deal engineered by former County Commissioner Michael Ross, who already faces public-corruption charges.
Commissioners voted in 1999 to buy Midwest Air Services, the debt-ridden business that ran the airport's daily operations. Several estimates placed the business's value at no more than half what commissioners agreed to pay, possibly less.
Worse, the county could have acquired the assets for free be cause owner Ray Fuqua was in default on taxes and rent, records show.
The prosecutor's office has subpoenaed records from the title company that handled the sale and has obtained aerial maps and property records from the county auditor's office. Former members of the Lorain County Regional Airport Authority say investigators have interviewed them about the sale.
Prosecutor Dennis Will would not discuss details of the investigation. He would confirm only that "we are looking at the sale at the airport, among other things involving Mr. Ross."
Ross, 42, was indicted on seven public-corruption charges in November in relation to his work as a commissioner from 1997 through 1999. Among other acts, Ross orchestrated a property deal for friend and business associate Larry Jones, who then paid him an undisclosed amount of money, prosecutors allege.
Ross' attorney, James Burge, said he had no information about the Midwest investigation. Fuqua, who lives in Florida, insisted that he sold the county a flourishing business, but others characterize the deal as a business blunder.
In 1995, the airport authority considered buying Midwest but refused to negotiate after reviewing a report from accountants Hausser & Taylor.
The authority is the governing board of the airport, which is funded by the county. Midwest operated the airport.
Fuqua "was asking twice as much as the consultants could justify," said authority member Terry Goode, who headed the committee that studied the deal.
A copy of the decade-old report is not available, but Goode recalls Hausser setting the value of Midwest under $900,000. Others estimated the value of the business and its buildings at $700,000 to $890,000.
Former airport authority member Carl Nielsen recalls the panel trying to talk to commissioners before the sale.
"They weren't interested in talking to us," Nielsen said.
Ross had been in favor of the airport since his first month in office. He and Fuqua had known each other for years, having worked together in 1992 on a countywide program designed to promote better government.
Commissioner Betty Blair, who voted for the sale, said Ross and former Commissioner Mary Jo Vasi convinced her that the county could save money by buying Midwest. At the time, the county was subsidizing airport operations with $240,000 a year.
"I think I went along with them rather than be opposed to it," she said.
If it was a bad deal for the county, it was great for Fuqua, a man in severe debt, records show.
Fuqua and his partner, Michael Zogleman, bought Midwest Air from Cleveland businessman Gilbert Singerman in the mid-1980s and were in financial trouble from the start, according to tax liens and Fuqua's divorce filing.
Zogleman said he and Fuqua owed Singerman more than $100,000 from the sale, though he refused to say how much they paid for the business. Zogleman later split from Fuqua and would not discuss Fuqua's financial trouble.
In the years leading up to the sale to the commissioners, records show, Fuqua was six months late on his $65,000 annual lease and owed more than $41,000 in back property taxes. In 1997, he owed the state and IRS $35,000 in delinquent taxes.
Under the lease, the airport authority could have terminated its agreement with Fuqua and repossessed the property because of his debts.
"What angers me the most was that the county could have had it for nothing," said Thomas Zaffer, a former member of the airport authority. "Why pay millions when you could have gotten it for free? Who does that?"
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