Tax options bring to mind Tulsa tenant rent rates
June 14-- Different tax options are flying around as to how to fund $254.4 million in city airport industrial complex improvements.
The situation has many Tulsa residents asking: How much do the tenants who would benefit pay in rent?
The simple answer to glean from a complex web of numbers on a spreadsheet is: Not a lot.
The complex to the east of Tulsa International Airport has 76 buildings spread across 639 acres and includes many structures that date back to the World War II-era.
Tulsa Metro Chamber and government officials have said it is critical for the facilities to be repaired and modernized so they are marketable regardless of who currently occupies them.
But they have admitted that some of the improvements needed would benefit specific tenants, such as American Airlines, to protect the thousands of jobs the companies provide.
Eight tenants are in the complex: American Airlines, Spirit AeroSystems, IC Bus of Navistar, Oklahoma Air National Guard, FedEx, Bio-Energy System Tech, Ameristar Fence and Imperial Coffee.
However, the improvements included in the proposal only would be for the buildings occupied by American, Spirit and IC Bus, Airports Director Jeff Mulder told the Tulsa World.
One project was being discussed for the Air National Guard, Mulder said, but he is unsure whether it is included in the tax proposal.
Chamber officials have refused to break down the list of improvements for the Tulsa World to specify which companies they would impact, citing nondisclosure agreements.
There is no regular money in the airport budget for maintenance of the industrial complex buildings, Mulder said.
All of the leases are written, he said, so that the tenants are responsible for all maintenance.
The lease arrangements are:
American Airlines: Pays $8,148 annually to the city for a large storage building adjacent to Air Force Plant No. 3.
It also pays $179,832 annually to the Tulsa Municipal Airport Trust, which sends the payment to Tulsa Airport Improvement Trust for access to the airfield.
The city does not charge the airline rent for the maintenance base buildings.
The Tulsa Municipal Airport Trust issues bonds on behalf of American Airlines to fund ongoing improvements for which the airline pays the debt service at a cost of about $19 million annually.
Employees: 7,000
Spirit AeroSystems: Pays $14,211 annually to the city for its portion of Air Force Plant No. 3 and other buildings. It used to pay $1.6 million annually until 2009 to pay back improvements that were made.
Spirit also pays a $623,646 market rate for another series of buildings south of the American Airlines maintenance base to the Tulsa Airport Improvement Trust.
Employees: 2,700
IC Bus: Pays $1 per year to the city for the half of Air Force Plant No. 3 that it occupies as long as it maintains 1,200 employees.
Employees: 1,200
Oklahoma Air National Guard: Owns the buildings it has in the airport industrial complex. It pays $143,326 to the Tulsa Airport Improvement Trust for access to the airfield.
Employees: 462
Past public help for American Airlines
Vision 2025: Voters approved $22.3 million in 2003 for equipment purchases at its maintenance and engineering base.
State and local: The state's Opportunity Fund in 2007 provided $5.7 million, while $4.3 million in 2006 city third-penny funds were used to build Hangar 80, an aircraft overhaul and repair facility.
Tulsa Metropolitan Utility Authority: The city's water board in the summer of 2003 approved a 10-year incentives package that included building a 36-inch sewer line to American Airlines' maintenance base. The line was funded with a $3 million loan from the Oklahoma Water Resources Board.
The board also dropped the water rate for the airline from $1.45 per 1,000 gallons to $1 per 1,000 gallons.
Also as part of the deal, the city purchased for about $3.5 million the former Builders Square building at 525 N. Memorial Drive, which the airline has leased since 2001 for its wheel and brakes facility.
The city lets American occupy it for $1 per year.
Possible improvements, upgrades and replacements at the airport industrial complex
Airport industrial complex improvements, upgrades and replacements that could be funded by a proposed tax package total $254.4 million. Of that total:
$122 million for facility and infrastructure requirements:
--$15.2 million for heating, ventilation and air-conditioning
--$23.5 million for roof maintenance and replacement
--$13.5 million for electrical upgrades and replacement and lighting upgrades
--$19.7 million for pavement repairs and replacement (aircraft ramps, roads and parking lots)
--$11.4 million for hangar modifications and building repairs (exteriors)
--$4.5 million for utility repairs and upgrades (facility water lines)
--$21.5 million for environmental capacity upgrades (plating shop and waste water)
--$10.3 million for building remediation and demolition
--$2.4 million for other equipment upgrades and replacements (docking, tooling, bridge crane)
$132.4 million for equipment upgrade and replacement requirements:
--$15 million for engine test cell upgrades
--$60 million to build next-generation engine test cell (supports next-generation GENEX engines for Boeing 787)
--$9 million for next-generation engine tooling and training
--$5.6 million for machining equipment (for engines, landing gear, machine shop)
--$4.7 million for component repairs (avionic test equipment, electric generator test cell)
--$2.6 million for wheel and brake center (replace antiquated and inefficient equipment)
--$6.9 million for landing gear equipment (replace antiquated, obsolete and inefficient equipment)
--$1.2 million for auxiliary power unit test equipment (expand capabilities)
--$0.5 million for LCFM engine test equipment (needed for disc inspection)
--$8.5 million for avionics test equipment (allows in-house testing of later-generation aircraft)
--$18.4 million to consolidate and expand composites repairs (next generation aircraft/technology)
Brian Barber 918-581-8322
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