June 26--MORRIS -- Morris Municipal Airport will profit an additional $79,000 per year beginning in December once it pays off 30 of its aircraft hangars.
Airport will see profit after paying off hangars
Morris airport houses 72 airplanes in its hangars, charging pilots a rental fee for the plane storage space.
"All of that money goes directly to pay our leases. The little money that's left over is used for maintenance of the hangars," Morris Municipal Airport manager Jeff Vogen said. "All the money returns back into those hangars. They are self-sufficient."
All rental revenues are put toward the city's lease payments for the hangars, which are owned by a private bank and leased to the city of Morris per a lease buyback program.
The lease agreements have a 20-year life, with a renewal every five years.
After 20 years of payments, the city owns the hangars, and can begin pocketing the rental revenues formerly spent on lease payments.
This is the case for 30 of the airport's 66 hangars, which will have been there for 20 years in December. The rental revenues from these hangars is estimated to be about $79,000 per year, Vogen said.
"With those additional funds, we've discussed either building more hangars or banking the money to pay the leases of the remaining hangars off sooner," Vogen said.
After December, Morris will have 36 hangars left to make payments on, including one large space designed to house corporate jets.
This July will mark the five-year renewal of those remaining lease agreements, which were unanimously approved Tuesday by the Morris Airport Committee.
Morris Mayor Richard Kopczick said the city received an interest rate of 4.75 percent, which is lower than previous five-year agreements.
If the agreements are approved by the City Council at the July 7 meeting, the city will pay quarterly payments of $5,221 for the corporate hangar and $20,914 for the others.
"The interest rates have dropped, and we're getting a better rate than we have in years past," Kopczick said.
Kopczick said the previous rates were somewhere near 6 percent, but was not sure of the exact amount.
The remaining hangars are only 10 years old, but could be bought back sooner thanks to the lower rates and added revenue stream.
Likely, the city will build additional hangars in the future to help accommodate the growing demand for the coveted spaces.
"Right now, we have a waiting list," Kopczick said.
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