McKINNEY (Sept. 4, 2013) — The McKinney City Council authorized the City Manager to sign a binding contract to purchase assets the city does not already own at Collin County Regional Airport. The city currently owns the airport property but not the improvements.
When completed, the city would take over the assets at the airport on Nov. 1. As part of the plan, the city will begin providing Fixed Base Operator (FBO) services such as fueling and handling aircraft with trained FBO staff when the current vendor contract expires on Oct. 31.
“The city has historically subsidized operations at the airport without an opportunity to participate in the economic benefits of hangar leases, fuel sales and other services,” said McKinney Mayor Brian Loughmiller. “The acquisition will allow for a return on investment allowing the airport to be self-supporting as well as providing an opportunity for a single point of negotiation as we compete for corporate aviation and aviation related business development.”
The $25 million purchase price will come from Texas Department of Transportation (TxDOT) funds already owed to the city for airport improvements and approximately $17.25 million in bonds that will be retired from airport revenue. The City of McKinney recently earned AAA bond rating which, along with low interest rates, means that even without additional improvements airport revenue will cover the debt payments.
“Fuel sales are a major revenue source at the airport,” said McKinney City Manager Jason Gray. “By providing that and ancillary services, the city will generate additional income that will pay debt and fund improvements to make the airport a gateway we can be proud of to lure additional corporate aircraft and business to our city.”
“By owning and operating the airport we can package hangar space, fuel and other incentives in a way that cannot be accomplished under the present system,” said Jim Wehmeier, President and CEO of the McKinney Economic Development Corporation. “As the airport generates more revenue, we can use that revenue to make further improvements that enhance the airport’s economic impact on our community. One example of that would be to build a new FBO facility and customer terminal that will compete more effectively than the present facility.”
McKinney is modeling its plans after Sugar Land, Texas, a suburb of Houston, which has built one of the nation’s highest rated FBO facilities at Sugar Land Regional Airport. “We have carefully studied their operations and believe the model will work equally well in McKinney,” said Gray. “We want to achieve the same goal of having an airport that receives high ratings from its customers.”
Airport officials say that there can be a smooth transition when the city takes over in November. “We have an experienced airport manager who has run an FBO before and have the same access to fuel suppliers and other equipment as the current operators,” said Gray.
Officials of the Federal Aviation Administration (FAA) and TxDOT have been briefed on the city’s plans. FAA rules allow municipalities to offer fueling and other services at airports.
“The bottom line,” said Gray, “is that the city has a rare and unique opportunity to acquire a key asset, phase out subsidies and invest future income in a better airport to serve our community.”
McKinney, Texas, is unique by nature. As one of the fastest-growing cities in the United States, McKinney has a current population of nearly 141,000. Incorporated in 1848, the city is located 30 miles north of Dallas and is the county seat of Collin County. McKinney offers rolling hills, lush trees, a historic downtown square and unique neighborhoods and developments. The city ranks No. 2 on the Money Magazine Best Places to Live list for 2012. Visit the city’s website at mckinneytexas.org.