The Covington City Council approved spending $3.1 million on the purchase of 86 acres of land to be used for the development of the Covington Municipal Airport at their Monday night meeting.
The motion, brought forward by outgoing Mayor Sam Ramsey, to spend $3,135,848 from the proceeds of the sale of Covington Cable on the purchase of 85.77 acres from the Newton County Industrial Development Authority passed unanimously.
The purchased acreage includes 72.06 acres purchased from Nisshinbo Automotive Manufacturing Inc. in 2002 by the IDA and 13.71 acres purchased from Nisshinbo in July 2007.
According to a letter sent last week to the city council by Frank Turner Jr, secretary of the IDA, the IDA financed the purchase of the 72 acres by issuing bonds in the total principal amount of $1.95 million.
Those bonds, backed by the credit of the city of Covington, have accrued interest at a yearly rate of 5.01 percent. To date the IDA has paid $489,818 in interest on the bonds.
The recent IDA purchase of the 13.71 acres cost $696,030.
The $3.1 million approved by the council reimburses the IDA for the two separate land purchases plus interest accrued.
The 72 acres have been set aside for future economic development of the airport. According to the letter, of the 13.71 acres, 2.15 acres are intended for the use of a second access road leading into the airport, 4.06 acres are for a taxiway linking the 72 acres to the airport and the remaining 7.5 acres are set aside for future economic development.
City Councilman Roger Tingler made the motion to approve the payment saying, "Just paying off a loan."
In other airport news
The city council approved a contract with architectural and engineering firm PBS&J for a five-year Airport Capital Improvement Plan.
The plan to be submitted to the Federal Aviation Administration at the end of the year includes a tarmac rehabilitation project for 2008 for $879,000, a 2008 project to install a new ILS approach for $450,000 and a 2009 project to build a terminal for $1.56 million
The total cost of airport projects in the CIP over the next five years is $27,241,060. Much of that money ($24.3 million) is anticipated to come from the federal government. The city's local match over the next five years is $2,290,000 and the state's is $640,000.
Federal funding for all of the projects on the CIP is not assured. The amount of federal funding approved for the development of the airport will likely dictate which projects the city is able to pursue.
A previous proposal by Ramsey to spend roughly $2.2 million on running utilities and a road from the newly purchased land to the airport is not included in the CIP. Ramsey previously stated that there are no matching funds available for these projects, but they are, in his view, essential to have to convince the federal government that the city is committed to developing the airport.
Mayor-elect Kim Carter told the city council she was looking into co-sponsorship with Newton County for an economic development study of the airport.
A letter of intent from the president of Epic Air Center requesting a ground lease to operate a full-service Fixed Base Operator at the airport was received by the council.