The issue continues to frustrate everyone involved.
Those frustrations were the topic of much of the conversation during Monday's Airport Advisory Board meeting.
The sublease of 17,500 square feet of space at the Augusta Municipal Airport has been the focal point of controversy since May 6, 2009 when the city council agreed to the deal.
The sublease in question is between ARTDG (the Advanced Research and Technology Development Group - a real estate firm owned by State Senator Ty Masterson and Jerry Speer) and NIAR (the National Institute for Aviation Research based at Wichita State University).
The cause of contention among airport tenants and members of the Airport Advisory Committee is the disparity between what NIAR pays ARTDG and what ARTDG then pays the city.
According to the lease, ARTDG pays $1.40 per square foot a month to the city. NIAR subleases the same space for $5 per square foot.
Another complicating factor is that at the May 6, Augusta City Council meeting, councilors were advised by Speer that the city needed to act quickly on the matter, as it was time sensitive.
The council vote resulted in a tie with Mike Wallace abstaining because he didn't believe the council had been given enough time to consider the agreement.
That forced Mayor Kristey Williams to break the tie - which she did in favor of ARTDG.
After the meeting, Mayor Williams said ARTDG and NIAR have been a great addition to the airport community.
"'The City's arrangement with ARTDG is simple -- to provide lease space for the NIAR KC-135 structural testing project through the Department of Defense," Williams said. "ARTDG has been an excellent tenant at our airport and has fulfilled all of its contractual obligations. It is disappointing some would attempt to undermine the progress that is currently taking place at our airport."
The mayor said the difference between the rates NIAR pays ARTDG and the lease ARTDG has with the city is based on services ARTDG provides its client.
"NIAR would not be at the Augusta airport without ARTDG bringing them to the table and providing for their daily operations. ARTDG provides both brokering and consulting services to NIAR which is included in NIAR's lease rate - not the city's lease rate," Williams said. "The city's lease rate is based on the square footage available and is one of the best lease rates the airport currently has, especially in terms of long-term potential and presence. What ARTDG subleases the space for is based on more than just square footage. It includes the services ARTDG provides NIAR. The difference in the two lease rates is significant, but there is a valid reason - the numbers do not represent the same thing."
Dave Dewhirst who leases space at the Augusta Airport and other local airports pointed out during the meeting that NIAR has stated that they will only lease land through ARTDG. He also said that Sen. Masterson has a part in controlling some NIAR funding through his position in the Kansas State Senate.
"The fact that NIAR only wants to work with ARTDG resembles a quid pro quo," Dewhirst said.
Assistant City Manager Josh Shaw said it was his understanding that Masterson had asked for an ethics commission ruling on the matter.
In fact, on Jan. 21, 2010, the ethics commission found that according to the information they had been provided, the NIAR funding for the sublease with ARTDG actually came from federal Department of Defense money and thus, no conflict existed for Masterson. The commission did ask for additional information before making a final ruling. However, based on the facts at hand, it found no violation.
Another point of contention in the dispute has been the fact that NIAR does not provide services necessary to the airport's operation. They do research projects and do not sell airplane parts or provide services to working aircraft.
The airport board has clearly stated its belief that this is a problem.
However, when Shaw took their concerns to the FAA, he was told that the agency had no interest in subleases between tenants as it pertains to grant assurances. It is outside their normal scope of work.
That action - or inaction - did not satisfy the airport board, however.
So Board Chairman A.J. Hefel said he would like to be on the March 3, City Council Agenda to recommend that the council renegotiate the contract with ARTDG in light of information that has been received so that the citizens of Augusta, and specifically the airport, could benefit from higher lease rates paid by NIAR.
Councilor Mike Huddleston was at the meeting as an interested observer and took the floor telling the board that the issues involved are very complicated and a few of his fellow council members preferred simple solutions.
"This situation isn't a choice A or B issue," Huddleston said. "I think the council has become frustrated because the issue has dragged on and they want to know why it won't just go away."
Hefel said the issue won't just go away.
"This is a publicly funded airport," he said. "The revenue generated here should benefit the city and the airport. Right now it is just benefiting ARTDG. That's why we think the contract should be renegotiated."
Huddleston said the reason the city had to move so quickly on the contract during the May 6 meeting had never been made clear to him.
"It seemed like a car salesman attitude of having to get the deal done that night," Huddleston told the board.
Hefel said he believed the council acted without regard for the airport board's advice. He said he had asked the board to table the item until it could be studied more and they did not take his advice.
Despite his previous experience, Hefel said he is willing to speak to the council again to ask them to renegotiate the ARTDG/NIAR lease. He said he would contact City Manager Bill Keefer to reserve a spot on the March 3 council agenda.
Augusta, Kan. —
