AOPA Australia has urged the Federal Government to stop grant funding for Bathurst Airport until outstanding issues over leaseholds at the airport are resolved.
In a letter sent to Deputy Prime Minister and Minister for Infrastructure and Transport Michael McCormack on 6 August, AOPA CEO Ben Morgan says the Bathurst Regional Council wants "extortionate rates" for leaseholds and backflipped on a promise to take AOPA recommendations to the next council meeting.
It also claims the council is asking for more funds for a second hangar precinct development when existing sites stand vacant.
"At this time, there are a number of businesses and leaseholders who have been struggling for the past 5 years to obtain lease renewals," Morgan said in the letter. "It has been reported to AOPA Australia that under these lease agreements, there is a contractual legal obligation to obtain an independent valuation should a stalemate dispute occur between Council and the leaseholder.
"We are advised that this obligation has been refused by council for the past five years during which time the leaseholders have been forced to pay rate increases of up to 350%. Furthermore, leaseholders who have applied to council for an independent valuation have either been ignored or threatened to accept the rate increases or pack-up and leave the airport."
Airport stakeholders met with members of the council on 25 July this year to discuss lease issues at the airport. According to Morgan, Bathurst mayor Graeme Hanger promised to take AOPA's recommendations to the next council meeting, but the council denies giving any such undertaking.
"Council has met with leaseholders at Bathurst Airport and representatives of AOPA to discuss airport operations," General Manager David Sherley told Australian Flying. "Council at that meeting agreed to investigate the establishment of an Airport Advisory Group. A report will be presented at the Council meeting on August 15 to discuss the establishment of a Airport Users Group and its structure.
"At no time did Council give the undertaking that AOPA has claimed."
In the letter to Minister McCormack, Morgan claims that the council already used government funding to set up a GA business sub-division, which he says is still 98% vacant, and therefore further funding to build a second precinct would be "rewarding a Council for poor planning and inappropriate investment decisions."
Sherley believes the airport leaseholds are already well patronised, but admits the council is seeking to apply benchmarked commercial lease rates.
"Council currently has 25 leasable sites at the Bathurst Aerodrome, although this number will increase as the next release area becomes available," he said. "Bathurst Airport has not seen a decline in private operators. Currently only one out of the 25 leasable sites is currently vacant.
"As leases come up for renewal Council has resolved to apply market rate in line with other Council leases. The terms of market rate were included as a provision in the renewal leases. Market rate was informed by independent consultants engaged by Council and evidenced by recent new leases at the airport."
AOPA pointed out in the letter that nearby Orange Airport is asking $6-7 per square metre, whereas Bathurst wants $13 per square metre.
Bathurst Regional Council has also denied the AOPA claim that leaseholders' requests for independent evaluations have been blocked.
"Council has also re-iterated to local lease holders at the airport that it will support the appointment of an independent arbitrator to finalise current lease negotiations at the airport that remain unresolved, as provided for under existing lease agreements, which the leaseholders have always had the ability to enact," Sherley said.
Bathurst Regional Council says it plans to spend $1.8 million on improving the airport this year, including construction of additional leaseable hangers, taxiway upgrades and more CCTV.
"With assistance from the Federal Government, Council is investing over $6 million dollars in infrastructure upgrades to the airport," Sherley said. "This will help to ensure the long-term viability of the airport and deliver levels of service that are necessary in a regional airport such as that in Bathurst."