Carroll airport project facing legal turbulence

Officials envision hub for corporate jets, but hangar fight delays plans

April 23, 2000|By Brenda J. Buote | Brenda J. Buote,SUN STAFF

Hoping to develop the economic potential of its regional airport as other counties have, the Carroll commissioners hired a company two years ago to build seven corporate hangars at the airport north of Westminster, heralding the project as a magnet for big business and jobs.

But construction on the $3.3 million project has been stalled since October, and the hangars are the subject of a U.S. District Court case that is costing Carroll more than $1,000 a day as the commissioners and the builder bicker over money. Instead of housing airplanes, the 10,000-square-foot hangars have become giant storage sheds for rakes, shovels, electric generators and cement mixers.

Envisioned as a hub for corporate jets, the Carroll County Regional Airport/Jack B. Poage Field is in danger of becoming a highly subsidized playground for refined aviation buffs.

More than $15 million in federal, state and county funds has been spent on runway improvements and a new fuel storage system in the hope that the airport would become a favored stop for pilots flying over the mid-Atlantic states.

"We didn't pour all that money into the airport for the little fellow. We made that investment to attract corporate clients," said airport manager Steve Brown. "If those hangars aren't filled, we've basically spent millions of dollars to build warehouses."

Businesses from Chicago to California have expressed interest in renting hangar space for their jets at the airport, but none of the hangars has a paying tenant and the airport continues to operate at a loss. Last year, it cost county taxpayers about $83,000.

"A regional airport is as important to a community as an off-ramp is to an interstate -- it provides a connection to the larger transportation network and can be a magnet for economic development," said Warren Morningstar, spokesman for the Aircraft Owners and Pilots Association.

"When businesses are looking for places to establish, frequently they're looking for a location that has an airport within a 20-minute drive," Morningstar said.

Several communities in Maryland and across the country recognize the importance of developing small, business-friendly airports.

Frederick Municipal Airport, home to two corporate hangars, plans to expand its operations within the next five years. In Easton, a landing system that will help guide aircraft in inclement weather is being installed and is expected to attract more corporate traffic. Nearly 300 companies are using the airport, pumping about $16 million into the local economy.

The Maryland Aviation Administration plans to spend $300,000 on runway maintenance and improvements, and as much as $75,000 in marketing.

The goal is to help the state's 34 small regional airports, including Carroll's, to become economic engines for jobs and tax revenue.

Twenty years ago, the Carroll airport was a grassy strip. Today, with 81 small hangars and 32 outdoor tie-downs, it is at the center of a business park that employs nearly 1,000 people and has an annual payroll of about $26 million.

"Airport Drive was a dirt road when I first started working here," said June Poage, who has been overseeing day-to-day operations at the airport since 1979. "I've hung in there all this time, building up the airport and waiting for the additional business the corporate hangars will bring."

Meanwhile, the commissioners are focusing on their legal battle with Hangar Corp. of America, the Pennsylvania firm hired to build and manage the corporate hangars.

Daniel M. Haug, president of Hangar Corp., has filed a counterclaim, seeking $6.3 million in damages and lost profits. Neither Haug nor the commissioners would comment on the dispute.

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. The hangars were projected to generate at least $15,000 annually for the county for the first five years. Over the life of the contract, Carroll would have received more than $3 million.

In addition to the rental income, Hangar Corp. agreed to pay the county $23,500 per month to cover the project's debt service. Carroll was also expecting to see at least $72,000 per year in fuel sales to the company jets.

Hangar Corp. hired Argubright Construction of Northridge, Calif., to do the construction. Scheduled to be completed last August, the project was delayed in securing building permits from the county.

Four of the hangars have passed county inspection, but work on the project came to a halt in October when the commissioners refused to make a final payment of $164,000 to Hangar Corp., claiming the project was not finished.

In March, the commissioners filed suit against Hangar Corp. in Carroll County District Court, seeking possession of the project, termination of the lease and $153,036 for lost rent and late fees. The case, and Haug's counterclaim, was remanded to federal court March 30.

Meekins Construction Inc. of Finksburg, hired by Argubright to do landscaping, road repairs and utility work, filed a separate in Carroll County Circuit Court against the commissioners and Hangar Corp., claiming it is owed $125,567.

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