The hole and the hill. Dirt from the hill that rises above the runway must be moved into the hundred-foot valley next to it. Photo by Scott Robertson
By Scott Robertson
The Tri-Cities Airport Authority moved forward in February with plans to spend the money necessary to begin site work for the next phase of Aerospace Park, even as a state legislator sought to take over the process.
At its Feb. 22 meeting, the authority approved several resolutions allowing it to spend existing dollars and to issue bonds that will allow grading work to begin on two portions of Aerospace Park along the far side of the main runway from the terminal.
“We now have a number in hand as far as the city and county partnership of $8.5 million, the TVA grant of $350,000, and then in January we were given notice of award of $4.1 million of state Aeronautical Economic Development Funds,” Airport Director Patrick Wilson told the authority. “All that together is approximately $13 million. Our goal for the complete site was $17 million, so we’re still $4 million short, but $13 million is a significant amount, a significant achievement and is going to move the site forward in a significant way.”
Knowing the full $17 million is not available, the authority asked its contractor, Atkins, to come up with an approach that would maximize the available developable land. That approach (see rendering on page 11) breaks down the next phase of development into two separate lots. “We will be working on the north end and the south end, taking some dirt from the south end and filling in the north,” explained David Jones, director of operations. “We have a fairly substantial, 100-foot hole in the middle of the project. The whole intent of the project is to knock off the top of the hill and put that into the bottom of that hole along Hamilton Road, filling the hole and having everything ready to go. Since we are $4 million short, we have that section in the middle we can’t get to, but we will have the maximum amount of acreage.” The work on those two segments of the project will run into 2020.
The authority then set about the process of moving the dollars that would allow it to move the dirt. The first step was the creation of a debt management policy. Rick Dulaney, managing director with Raymond James & Associates, the municipal advisor to the authority, explained to authority members, “It is a requirement of the state of Tennessee that has been imposed upon all jurisdictions that issue debt as of 2010. A lot of what is in the policy is driven to transparency to make sure that you’re fully disclosed and fully transparent.”
The second of three steps was adoption of an initial authorizing resolution (also required by statute). “This is a notice, if you will, that based upon the authority within the master resolution, the board has authorized the sale and issuance of bonds. This is published in the newspaper of local jurisdiction,” Dulaney said.
Once the debt management policy resolution and the initial resolution were passed, the authority moved on to the bond resolution itself, with the money from Bristol, Johnson City, Kingsport, Sullivan County and Washington County. “This authorizes the sale and issuance of not-to-exceed $8.5 million for purposes of the development of Aerospace Park and all associated activities that are included in that process,” Dulaney said.
The plan is to sell the bonds at competitive public sale in mid-March with revenues delivered to the airport around March 29. “We should be able to get a credit rating,” Dulaney told the authority. “That would be a first for the airport authority. It would be predicated, based off the ratings of the guarantors. In this area of Northeast Tennessee you are very fortunate because each of the five sponsors have a rating of AA2 from Moody’s Investor Service, which is stellar. So we think we should be able to pull that through and secure that whole transaction with that AA2 credit. Anytime you can sell AA bonds, you do that all day long.”
Next, the authority moved to accept the $4 million in TDOT Aeronautical Development Grant funds when they become available. “In January we received a letter of notice of award with the grant amount,” Wilson said. “We have not received the grant documents yet. TDOT has cleared the path to issue this grant. They have made a request from us because the $4.1 million is short of the $8.1 that we requested, they have asked us to rework our numbers in the application and get that back to them next week. So we’ll be doing that. They indicated they should be able to get a grant document to us by April. So this will authorize us to formally execute those grant documents when they come to us.”
The authority then voted to allow its chair, Jon Smith to accept any other grant funds, as it does every year. This year, that vote had a special emphasis, Wilson said, because, “We’re going to go after any other grants we can get our hands on relative to Aerospace Park.”
The authority has sent a letter to Tennessee District 7 State Representative Matthew Hill asking that he cease pushing a bill to give himself and a handful of his colleagues in Nashville ultimate power over all airport authority activities, taking that power from the local representatives who make up the authority. House Bill 2602, which Hill sponsored, would create an “executive board” to oversee all actions of the airport authority. That board – quoting the bill – “is composed of the general assembly members that represent the municipalities and counties participating in the regional airport commission.” The bill states the airport authority could “not take any action without first obtaining the approval for such action from the executive board.”
The authority’s letter to Hill stated its appreciation for the legislative delegation’s efforts in attaining the TDOT grant, but added, “This regional partnership has successfully operated the airport since 1934. The airport authority has a long history of safely operating the airport, providing modern facilities and maintaining a sound financial position.”
The letter, sent under Chairman Smith’s signature, then states the authority’s opposition to Hill’s bill and asks him to not move it forward.