Dispute over airport is costing Carroll County $1,000 a month

Commissioners refuse to pay company for building 7 hangars

March 01, 2000|By Brenda J. Buote | Brenda J. Buote,SUN STAFF

The Carroll County commissioners and the developer of corporate hangars at the county airport are in a dispute that is costing Carroll more than $1,000 a month in lost revenue and threatening local economic development efforts.

The $3.3 million construction project has been stalled since October, when the three-member Board of Commissioners refused to make a final payment of $164,000 to Hangar Corp. of America for building seven hangars at Jack B. Poage Carroll County Regional Airport north of Westminster.

"Within the last couple of weeks we have lost [tenants] for three of the hangars [due] to the County's delay" in making payment, Daniel M. Haug, president of Hangar Corp., wrote the commissioners Feb. 10. "We will continue to lose prospective tenants if this situation continues."

The hangars, with a longer runway and a new fuel station, are part of an improvement program that county officials hope will establish the airport as a favored stop for pilots flying over the mid-Atlantic states.

Under a contract signed in 1998, Hangar Corp. agreed to develop and then manage the hangars for 40 years, with the county receiving a share of the company's revenue from leasing space to corporate tenants. During the contract's first five years, the hangars were projected to generate at least $15,000 annually for the county. Over the life of the agreement, Carroll expects to receive more than $3 million.

Hangar Corp. was the only company to bid on the project and hired Argubright Construction of Northridge, Calif., to do the construction. Scheduled to be completed in August 1999, the project was five months late because Haug was delayed in securing building permits from the county.

Four of the hangars have passed county inspection, but none has a paying tenant. Haug has refused to finish the hangars' $30,000 heating system until his company is paid in full. However, the construction firm is continuing to work while Haug and the commissioners try to resolve their differences.

The project is the latest in a series of improvements county officials hope will draw corporate customers and make the airport the centerpiece of the county's economic development effort.

A fuel station was recently built at the airport, which has 82 smaller hangars and about 30 outdoor tie-downs. In 1994, the runway was widened and lengthened. At 5,100 feet long, it is Maryland's sixth-largest nonmilitary runway.

To make the airport more attractive as a base for corporate airplanes, the county is working to speed the arrival of a Global Positioning System satellite link, which would guide aircraft in inclement weather. But the Federal Aviation Administration has said the system will not be installed at the Westminster airport until 2008.

Haug has repeatedly asked the commissioners to make the final payment of $164,000, plus $250,000 for what he characterized as unanticipated expenses. That figure includes paving, permit fees for the 70,000-square-foot structure and installation of fire walls.

None of the three commissioners would comment on the project, noting the possibility of litigation. "I can't comment because there may be legal action," said Commissioner Donald I. Dell.

The contract requires Haug to submit a written report to the commissioners after "substantial completion" of the project, before receiving final payment. That report has not been submitted, despite repeated requests by county officials, sources knowledgeable about the dispute said.

Reached at his home, Haug refused to comment on the dispute.

"I have no comment because we're hopeful we'll be able to amicably resolve this situation," he said. Hangar Corp. has offices in Los Angeles and Springhouse, Pa. In December, the two parties agreed to shorten the duration of their contract to 30 years.

The contract dispute is the latest in a long line of problems at the airport. The airport operator, WestAir II, has struggled with management problems and unpaid bills, including $90,000 owed to the county in rent and fuel revenues.

In May, the county commissioners voted 2-1 in favor of renewing its contract with WestAir -- a partnership of Dr. Richard Jones, a physician who performs medical exams for pilots at the airport, and June M. Poage, who has run the airport since 1979. Under the agreement, WestAir profits from hangar rentals and fuel sales. It pays the county rent and a portion of the fuel revenue.

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