Airport Authority Agreement Passes Also Extending $500,000 Grant

It is one of the most controversial planks in economic development - going on for years - but now it has officially taken off albeit shorter in an industry where size matters.

At Monday evening's Council meeting the agreement which will allow the transfer control of the municipal airport o the Moose Jaw Municipal Airport Authority (MJMAA) was approved.

Under the terms of the agreement the City will lease the municipal airport to the MJMAA for 99 years for $1. The deal will also see the MJMAA receive rental revenues from the adjacent farmlands as well as a conditional grant of $500,000 from the City's Land Reserve Fund.

As part of the agreement the City agreed to extend the conditional matching $500,000 grant to MJMAA until 2023. The final terms and conditions were hammered out in-camera or behind closed doors at the October 15th Executive Committee meeting.

The grant is suppose to serve, along with a $500,000 interest free loan from unnamed sources, as the City's share for a proposed lengthening of the runway from 2954 feet ti 4000 feet in length with the assistance from infrastructure funding from upper levels of government.

The MJMAA applied for federal government infrastructure funding to lengthen the runway and other related airport upgrades but despite claiming they had secured $2 million in upper level government funding were ultimately turned down. Extending the conditional grant to 2023 effectively allows the MJMAA to lobby for infrastructure funding in the next federal election cycle.

Additionally under the terms of the agreement the municipal airport is to operate as a civilian airport. During its formation a lobbying effort was made that the airport would be used for the NATO Flight Training Program at 15 Wing Moose Jaw. Claims which the Department of National Defense said were false in interviews with MJ Independent.

The provincial government has provided funding for various municipal airport upgrades and there was an announcement a Memorandum of understanding was signed to develop a drone program between CAE (the lead contractor at 15 Wing), the City, MJMAA and Sask Pyrotechnic.

CAE denied it actively lobbied the City regarding the municipal airport and any participation by its staff was done solely as a private citizen.

Despite the years of lobbying and the final deal between the City and MJMAA hammered out in-camera Councillor Brian Swanson requested a re-vote on the issue.

During discussion Councillor Swanson argued against the $500,000 grant to MJMAA pointing out how Administration had recently submitted a report calling for an infrastructure levy whereas the MJMAA will receive an outright grant - if infrastructure funding is sourced from senior levels of government.

“Most citizens of Moose Jaw would like that fee reduced by taking money out of reserves,” Councillor Swanson said, adding the City wants residents to dig into their pockets for infrastructure repair but “if you are at the municipal airport it is just transferred to you.”

He felt the MJMAA should rely upon an airport levy charged to users as done by other airport authorities and not rely “on the municipal tax base” for airport improvements.

Councillor Swanson said the four year extension agreement for the $500,000 grant tied the hands of the next Council by extending into three of the four years of their term.

“Let's put it towards our infrastructure….there are potholes which need repair. There are still roads that need repair,” he said re-iterating his point that users of the municipal airport should fund their own infrastructure upgrades.”

Councillor Chris Warren spoke in favour of the lease and the $500,000 conditional grant.

“This has gone on for some time…it is an economic driver,” Councillor Warren stated.

Airport authorities in other communities were receiving tax incentives to help with their infrastructure upgrades, he said.

“It's another piece of the funding model we cannot forget,” Councillor Warren stated.

Rebutting the argument Councillor Swanson said the tax incentives given by Regina to its airport authority were designed to bring an American carrier with an American destination back to Regina.

There was a difference between Regina and Moose Jaw because in Moose Jaw's case the City does not receive property taxes.

It needs to be noted under the terms creating the MJMAA the RM of Moose Jaw will also contribute $30,000 annually.

Regarding the MJMAA Councillor Swanson said the City was “going from $30,000 a year to a $140 000 a year operating subsidy” and the no interest loan he claimed woukd in reality be paid for by taxpayers over five years.

‘We are using taxpayer's dollars to pay back this loan…the legacy of this council is the municipal airport…it benefits very, very few at the expense of others “

In a 5 - 2 recorded vote with Councillors Dawn Luhning and Swanson opposed the $500,000 conditional grant was approved.