As a new councilman I have found the situation regarding Tupelo Airport Authority, Universal Asset Management and the city of Tupelo be a very complicated and complex issue.
Some of the facts that have been presented to me will very valuable in my decision-making concerning this issue. These facts are:
• The building that UAM leases is being paid for by the city of Tupelo at $125,650 annually. The city does not receive any revenue from this lease. The remaining balance of this debt is approximately $1.25 million.
• The city is now being asked to fund a loan of $1.2 million for a new “taxiway” for UAM to access its facility. This will cost the city an additional $140,000 per year to fund this request. TAA does not have the funds to pay for this debt service.
The lease between UAM and TAA began June 2011 at $85,000 per year and is now up to $105,000 per year. This does not include use of land outside their lease area or landing fees. Some sources have indicated that these rates are far below market value.
• It should not be a surprise to anyone that a 400,000-pound aircraft would cause severe damage to a 55-year-old runway that was built for 50,000-pound aircraft. I also believe that landing these huge aircraft on our new runway that was built for 200,000-pound aircraft, would severely distress this area over the remaining time of the lease.
• I have been led to believe that this will not be the end of requests from UAM to further repair inflicted by these huge aircraft.
• As for the jobs promised for the next three years (from 70 to 100 employees), I would hate to lose these, but I do not think it should be the mission for the city of Tupelo to ask the taxpayers to pay $2.4 million to provide these jobs. I am sure that many small business owners that have not received financial support from the city of Tupelo would agree.
Finally, my recommendation would be to split the cost of the “taxiway” and to renegotiate this lease to a more acceptable rate and ensure that this lease also defines responsibilities for the lessor and lessee.
I believe this would promote the “partnership” that we all are seeking.
Buddy Palmer is a businessman and he is councilman of Tupelo’s Ward 5.Contact him at (662) 255-1454.