Update: June 20, 2007

Public Subsidizing Private Aviation

Proposal to Tax Property Owners to Fund For-Profit Aviation Businesses

Oregon Senate Bill (SB) 807, sponsored by Senator Betsy Johnson, makes provisions by which surrounding communities may be taxed on behalf of rural airport owners and operators eager to line their pockets at public expense by engaging in flight training, aircraft sales and maintenance, helicopter and fixed wing scenic tours, and various other for-profit aviation activities. This legislation gives no consideration to residents in both urban and rural communities who are opposed to loud, intrusive, polluting aviation activity as well as the safety and security risks that are direct result of aviation growth and expansion.

That the legislature would even seriously consider taxing surrounding communities for airports many residents don't even want and that serve the private owners and operators rather than the public good is galling beyond belief.

Among the provisions in Senate Bill 807 is a section that allows for the Oregon Economic and Community Development Department to "enter into agreements providing for a partial rebate of new property tax revenues to the airport sponsor that operates and maintains the airport within the airport tax increment financing district."

Bob Repine and Public Subsidies for Rural Aviation Expansion

It is noteworthy that in January 2006 Bob Repine was appointed by Governor Kulongoski to serve as the Director of the Oregon Economic and Community Development Department. Prior to that time Repine served in the Oregon Legislature. In this role during the 1997 legislative session he sponsored HB 2605 - now codified under ORS 836 - a piece of legislation that without the courtesy of public meetings or open houses in the communities impacted, declared that hitherto personal use airstrips, residential airparks, and other small aviation facilities were now private rural airports. The sole criterion for pronouncing a property a rural airport was that there were three or more aircraft based on the site in 1994. No consideration whatsoever was given to community livability concerns such as noise impacts, environmental degradation, property devaluation, or safety and security risks. In fact, in the legislature's zeal to cater to aviation businesses, these concerns were barely even raised. The example below illustrates some of the negative fallout that has resulted from Repines ill-conceived legislation.

Washington County and Aviation Expansion

In 2003 the Board of Washington County Commissioners under the leadership of Andy Duyck, an aviation pilot and advocate, passed Ordinance 609. This ordinance initially targeted eight Washington County airports for future expansion - Hillsboro, Stark's Twin Oaks Airpark, Apple Valley airstrip, Meyer's Riverside, North Plains Gliderport, Olinger airstrip, St. Vincent's Medical Center heliport, and Sunset Residential Airpark. Skyport in Cornelius was later added to the list as well.

It was the contention of the board that the enactment of Ordinance 609 was required to bring Washington County into compliance with ORS 836. Despite a recommendation from County Planner Brent Curtis in a 2/25/02 memo, the commissioners opted not to hold open houses in the communities prior to pushing this legislation forward. Two major proponents of the bill were Bob Stark, the owner of Stark's Twin Oaks Airpark, an obvious beneficiary of the legislation and his aviation attorney, the controversial Washington County Fair Board Treasurer, Richard Vial. In fact the county had until their next periodic review to adequately research this legislation but chose instead to rush it through at Stark's and Vial's urging.

Commercial Aviation Expansion in Buxton/Banks/Manning

This subsequently led to enormous community upheaval and widespread opposition in the Buxton/Banks/Manning area when Mike and Jenny Applebee purchased Apple Valley airstrip, formerly TV personality Rod Anderson's personal use airstrip, with the intent of developing it into a commercial facility for flight training, helicopter scenic tours, and aircraft maintenance. This airstrip is located on a 100-year flood plain: a key consideration that both the state and the county chose to ignore when promoting rural aviation development.

Thankfully, Washington County Hearings Officer, Dale Hermann, in December 2006 denied the Applebee proposal. Following that decision, the Applebee's appealed to the Land Use Board of Appeals (LUBA) which on June 7, 2007 remanded the matter back to Washington County for further consideration regarding new aviation uses on the site. LUBA, for the most part, upheld Hermann's decisions related to the question of pre-existing uses on the property. Nonetheless this sloppy special interest legislation on both the state and the county level has insured that this rural community and others throughout the state will remain under assault by aviation interests for some time to come.

Senator Johnson and the Department of Aviation

Senator Betsy Johnson was highly instrumental in establishing the Oregon State Department of Aviation (ODA) as separate from the Oregon Department of Transportation.

Since its inception in 2000, the (ODA) has funneled more than $66 million into the aviation industry - a substantial portion of which came from federal tax dollars. ODA also receives money from the Oregon Department of Transportation.

According to its website, the purpose of the ODA is to advocate for the growth of airports in Oregon and to provide "assistance to aviation constituents, airport owners/sponsors and aviation system users throughout Oregon."

In other words, Oregon has an entire government department designed to channel public funds into private aviation business interests.

What will the Oregon Legislature come up with next - a department to fund golf courses, country clubs, and yachting events?

State Department of Aviation and Corporate Welfare

Transwestern Aviation, a business founded by Johnson and now run by her husband John Helm, sells fuel, offers sightseeing tours, and provides aircraft maintenance. It is located at Scappoose Airport, a facility that has positioned itself on the receiving end of more than a half million dollars of ODA funds over the past 5 years - $144,000 in 2006, $72,000 in 2005, $10,000 in 2004, $59,041 in 2003, $110,000 in 2002, $150,000 in 2001. Clearly Johnson and Helm have benefited greatly from creating a department of government that uses taxpayer dollars to underwrite the private aviation interests of themselves and their cohorts. But they are not alone - other GA airports throughout the area that have also profited from this arrangement include Aurora - over $3 million, Mulino - $823,000, Hillsboro - over $15 million, Troutdale - $695,000, and McMinnville - $1,419,000.

Hillsboro Airport

Hillsboro Airport at $15 million tops the list in terms of public funds dedicated to subsidizing a general aviation airport via monies accessed through the ODA. But that amount is just the tip of the iceberg. At the 6/07/07 Hillsboro Airport Issues Roundtable meeting, the Port revealed plans to gouge taxpayers for an additional $13 million in federal funds to build yet another runway at this facility for the express purpose of benefiting the already heavily-subsidized for-profit aviation business sector including but not limited to flight training, private aviation hobbyists, aircraft maintenance and sales, aviation fuel sales, chartered flights, aircraft rental, aerial tours, and the corporate jet crowd. The most recent Hillsboro Airport Master Plan goes even further in outlining the Port's plans to invest over $126 million in federal and state dollars in this airport over the next 15-20 years.

Aurora Airport

Aurora Airport is an aviation facility that could potentially experience additional expansion and development if SB 807 is passed. In the case of this facility it is prudent and reasonable to ask how many legislators supporting SB 807 feel beholden to Columbia Helicopters, one of the major tenants at this airport. According to Follow the Money, a nonpartisan institute that tracks monetary contributions in state elections, over the past five years Columbia Helicopters and others affiliated with it, including the Chairman Wes Lematta and his wife Nancy, President Mike Fahey, and Vice President Max Merlich, donated a combined total of $416,239 in political contributions. The vast majority of these donations have gone to Republican candidates and causes as well as the Republican Party with one notable exception - a $5,000 contribution to Democratic Governor Ted Kulongoski in 2006. Please note that the Governor is responsible for appointing board members and approving the budget of ODA. In any case the contributions of those connected with Columbia Helicopters seems to have paid off insofar as their sponsoring airport has received over $3 million in ODA subsidies since 2000 including $2,644,050 for a runway rehabilitation and lighting upgrade project.

Public Subsidizes Corporate Jets at Oregon's North Bend Airport

David Cay Johnston is a New York Times Pulitzer Prize winning reporter and the author of Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich - And Cheat Everyone Else. In an article published on the front page of the 6/15/07 Oregonian Business section, he stated that "Airline passengers and lottery players are paying for a $31 million expansion of the North Bend Airport to serve the 5,000 business jets that arrive each year, filled almost entirely with golfers. Many of them are executives of publicly traded companies flying at a small fraction of the real cost of their trips; taxpayers and shareholders bear nearly all these costs."

The airport is located approximately 20 miles from the Bandon Dunes Golf Resort which also received generous property tax breaks. Those who support these expansions claim that the developments create new jobs. However, when Johnston did the math he found that each job, which on average pays $36,000 per year, comes at a high price.

"Based on the number of corporate jets flying to the resort, an average four-hour flight time and total costs of $4,000 an hour, the subsidy from taxpayers works out to about $12 million, with shareholders effectively paying about twice that. For the 325 existing jobs, that adds up to an annual total of $37,000 a job."

Conclusion

Over the past several years while lavishing huge sums of money on the for-profit general aviation sector via the ODA and the passage of various pro-aviation related bills, the Oregon Legislature has made severe cuts to programs for children, seniors, the disabled, and the disadvantaged. Education and the social services throughout Oregon have continued on a steady downward spiral. On a per student basis,Oregon ranks 45th in spending for higher education. University and college professors are leaving the state due to low, non-competitive salaries while tuition at state institutions has steadily increased to the point where a significant number of prospective students are understandably choosing to attend schools outside of Oregon.

In 2005 an already miserly $300 in monthly cash allowances allocated for our most vulnerable citizens, many of whom suffer from chronic mental illnesses, were totally cut. In addition, services previously available at community mental health clinics were slashed leading to a situation whereby the uninsured often seek treatment through expensive hospital emergency departments. The Oregon State Hospital system remains a national disgrace due to the inhumane conditions at some of these long neglected institutions. At the same time it has become increasingly more difficult for citizens to be deemed eligible for medical and mental health care through the Oregon Health Plan - a system of health care delivery that was designed to provide for Oregon's poor and uninsured.

Instead of addressing these needs, the Oregon Legislature chose to channel over $100 million into the 2005 Connect Oregon Initiative, a substantial portion of which was earmarked for the well-heeled private aviation interests such as the North Bend Airport discussed above. And this is in addition to the millions of federal and state taxpayer dollars funneled through the Oregon Department of Aviation in recent years.

This same pattern is continuing in the 2007 session. A report in the 6/20/07 Oregonian noted that while the Legislature has managed to tap into $100 million for yet another Connect Oregon non highway transportation initiative, they have come up short in fully restoring cuts to human services that have occurred since 2001. Though some funding was allocated for community mental health and alcohol and drug treatment, many of the tens of thousands of citizens cut from the Oregon Health Plan will remain uninsured and a number of seniors in need of in home assistance will continue to go without.

Oregon residents deserve far better treatment than the Oregon Legislature is delivering. Members of this government body can demonstrate their commitment to their constituents by funding programs that insure that quality education and health care services are available to all Oregon residents rather than sponsoring tax dollar giveaways on behalf of their wealthy aviation buddies. High speed rail should also be generously funded as an alternative to the fossil fuel dependent, carbon dioxide emitting aviation industry.

Those who hold elected positions have the solemn duty to serve the public good not the special interests of a high flying few.