City’s business flop: Challenging free market at Lovell Field, losing F$1m

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This graphic from free market operator Tac Air shows losses accruing to city government’s business at the Chattanooga airport

Complaints about millions of dollars of taxpayer waste at the Chattanooga Metropolitan Airport start in that city, make their way to the governor’s office in Nashville and then eventually go to Washington, D.C. There are no results — the complaints only boomerang back to Chattanooga, where they started in the first place.

Apparently, this is a matter that only the nine-member Chattanooga Airport Authority board can do anything about, as far as D.C. and Nashville are concerned.

As Tennessee Watchdog previously reported, the board decided three years ago to use $4 million of state taxpayer money to fund a new Fixed Base of Operations to compete against a privately managed one, TAC Air, which has operated at the airport for 10 years.

Tennessee Watchdog confirmed last year that the government-financed FBO, under the management of Wilson Air, had yet to turn a profit and had, in fact, lost $300,000 since it opened in November 2011.

TAC Air officials took out a newspaper ad last week that said the FBO has now lost $1 million, information that Tennessee Watchdog can’t yet verify.

“The loss of $1 million is something we got straight from a Freedom of Information Act request. It’s their numbers,” TAC Air spokesman Dave Edwards said. Tennessee Watchdog made six unsuccessful attempts to contact airport spokeswoman Christina Siebold about the matter.

Meltdown’s survivor at airport faces city challenge

TAC Air once had other competitors, all privately managed, but economic conditions in Chattanooga worsened, and TAC Air was the only FBO to survive. Members of the airport authority said TAC Air needed competition and used state funds to carry out that purpose.

Complaints on behalf of taxpayers and people in the aviation industry have progressed all the way to Gov. Bill Haslam and the Federal Aviation Administration.

Haslam’s spokesman, Dave Smith, referred Tennessee Watchdog to the Tennessee Department of Transportation after we asked about a complaint last year from the president of the National Air Transportation Association. TDOT was the state agency that presented the $4 million grant money.

TDOT officials, however, referred the matter back to the CAA, saying only that board could address the complaints.

Earlier this year, State Sen. Frank Niceley introduced legislation to deprive the airport of additional taxpayer dollars to use in competition against a private business.

Niceley announced later, however, that he was postponing the legislation as both sides — TAC Air and the CAA — were negotiating a possible resolution. Edwards said those talks amounted to nothing more than “talk about talking.”

CAA board member Moses Freeman announced his resignation this week. Opponents of the taxpayer-subsidized FBO think Freeman’s resignation is an opportunity to put someone on the board who represents their interests — especially with a new mayor, Andy Berke, making the appointment.

“What I would hope to see happen is Mayor Berke will appoint members of the Airport Authority that will resolve this problem so that it doesn’t have to go back to the state legislature,” Edwards said.

Berke’s spokesman, Lacie Stone, did not comment directly on the matter, but two city council members, who will vote to confirm the new CAA board member, told Tennessee Watchdog they will show great interest.

Ken Smith, who is new to the council, said he doesn’t agree with the authority’s actions.

“I can’t speak for other city council members, but seven of the nine were elected in March and have been doing the job since mid-April. There are a number of other council members who have expressed concern over government entities competing with private business, so I would expect this will be an issue that we will take an interest in,” Smith said.

‘Under our purview’

Council member Yusuf Hakeem, meanwhile, said he hasn’t studied the issue in great detail, but he is still keen on the subject.

“I’m not trying to say who is right or wrong, but if there has been an appropriation of money of that magnitude and how it has been spent then I think it would be under our purview to review all of that process,” Hakeem said.

Exactly how long a CAA member may serve is unclear. Stone said state law seems to say the mayor can appoint members to successive terms that range between two to seven years.

According to traditional definitions, an FBO is a company that services general aviation aircraft by providing aircraft fuel, hangar storage and other facilities for airplane crews and passengers. Some are privately operated, while others operate under the authority of a particular airport municipality.

Contact Christopher Butler at chris@tennesseewatchdog.org. Please find out more about Tennessee Watchdog.


Video streaming by UstreamDavid interviews Pam McAllister, general manager of Tac Air in Chattanooga, exploring the dynamics of commercial government and reasoning into its incompetence.

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