City staff are weighing what to do with the financially-strapped Albany Municipal Airport and have come up with four possible options — one of which is shutting it down.
Listed on the National Register of Historic Places, the airport is believed to be the oldest operating airfield in the state. It began operations under private ownership in 1920 and was purchased by the city nine years later for $14,000.
Albany Historic Hangar Watching 03 (copy)
Volunteers and visitors look through the door of a historic hangar at Albany Municipal Airport, which is struggling financially. The city is looking to hire a consultant to advise it on options to maximize its potential — or shut it down.
With a runway about 3,000 feet long and 75 feet wide, it’s a general aviation airport. Most of the activities there involve private pilots flying their personal aircrafts or student pilots getting their licensing, Public Works Director Chris Bailey said at the Monday, Nov. 18 City Council work session.
A deficit
“There aren't many expenditures in the operation and maintenance budget of the airport, but those that are there are rising faster than our revenue is rising, which has resulted in an operating deficit,” Bailey said.
In March, Bailey delivered a presentation of the airport’s revenues, expenditures and deficiencies to the Albany Airport Commission.
The airport is partially funded by grants and transient lodging tax funds. Revenue also comes from the leasing of hangars. Expenditures include personnel costs, operations and management overhead, including human resources and insurance, she said in her presentation.
During the current two-year budget, the airport is anticipating a shortfall of $26,700. However, the true annual deficit was much larger, Bailey said, because the reserve fund that helped plug part of the financial hole is is now depleted. The true deficit is $90,000 annually and is growing, she said.
“We saw this coming, but we didn't anticipate the rate that increased over the COVID years and afterwards,” Bailey said.
Bailey raised the idea of seeking a consulting service at the March meeting to find the “best use” of the space.
She acknowledged that step might feel like “opening old wounds.”
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The Albany Municipal Airport has been operating at a deficit ever since the last of a reserve fund was depleted.
In the late 1990s, the then-city manager, Steve Bryant contacted the Federal Aviation Administration, saying the city no longer wanted the airport to operate.
“That led to a firestorm of concern. And so he withdrew his letter, and the City Council passed a resolution that said the city of Albany commits to supporting the Albany Municipal Airport for the next 20 years,” she said.
A consultation
Among the to-do list during the city’s strategic planning session was an objective to explore options for the best use of the airport for the community.
“So these two factors, the operating deficit and the strategic plan objective, have led us to develop this request for proposals,” she said, in asking the city to hire a consultant.
While the amount involved to hire the consultant might not need City Council approval, Bailey said she felt it important to let councilors know just the same, given the magnitude of any decision they ultimately may make.
Consultants would be asked to analyze the current operating and financial structure of the airport and lay out steps to continue its use, she said. Then they would be asked to identify alternatives for the airport.
The options include:
* Preserving the status quo
* Enhancing the use by attracting more aviation-related activities
* Adding nonaviation-related development, such as lodging and restaurants
* Closing it down
“We're not asking the consultants to make a recommendation to the council, but rather to provide the council with as much information as they can that would support a decision from the council and providing directions to staff on how best to move forward with the airport,” she said.
Bailey wanted to be clear that the action was not an effort to close the airport.
“That is a fear that has been communicated to the council and staff many times over many years. We've identified four options, and there may be more options, and only one of those involves airport closure,” she said.
Closing down the airport would also have a financial impact, Bailey said by phone.
Over the years the airport has received millions of dollars in federal grants, and some portion of those funds would have to be refunded, she said. Bailey is unsure what that dollar amount would be but anticipates to having a clearer picture after the consultants weigh in.
The need for professional analysis was prompted both by the deficit and the objective to identify the airport’s best use, she said. The hope was to find a sustainable path for the airport’s future.
The proposals would likely be received early 2025 and a final report is anticipated to become available summer of 2025, Bailey said.
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Listed on the National Register of Historic Places, the Albany Municipal Airport started under private ownership in 1920 and was purchased by the city nine years later for $14,000.
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