Aug. 5--TULSA-- A federal magistrate sorted through arguments Thursday on who owns the rights to Grand Lake Regional Airport and deferred a decision.
If it's the new owner, should he repay the grant money used to develop the airport?
Should the airport be sold?
Federal Magistrate Paul Cleary left open the option of sending the decision to a higher court. He recessed the hearing in Tulsa without determining whether the federal marshal's sale of the airport should go forward.
The airport's manager, Paul Staten, in May filed a deed with the Delaware County clerk making him the owner of the airport in the popular resort area in northeastern Oklahoma. The deed had been approved by the Monkey Island Development Authority in March.
The airport was to go on the auction block to satisfy a $99,353 judgment against the development authority, which lost a lease dispute case with Mid-America Ag Network. Instead, Staten took possession of the airport and all the judgments against it.
In court Thursday, attorneys for Mid America and Staten argued that the federal marshal's sale should proceed so the development authority creditors could get paid.
Mid-America attorney Ken Smith argued that the Federal Aviation Administration, which gave the authority about $600,000 in grant money to buy the airport in 1994, should not be considered a creditor and shouldn't have access to proceeds from the sale.
However, attorneys for the FAA and the Oklahoma Aeronautics Commission argue that the grants were given to the development authority to be used to operate a public airport. Staten's possession of the airport removes it from consideration for future public funding and may be a violation of terms of the grants.
"I'm trying to protect taxpayer dollars," said Cathryn McClanahan, a U.S. attorney working on behalf of the FAA. "They are trying to use the airport as a way to make a fast buck."
Attorneys for the FAA and the Oklahoma Aeronautics Commission have argued that public airport should not used to satisfy judgments against a public trust. By transferring the airport to Staten, the development authority also settled four pending lawsuits Staten had filed against it, including a federal civil rights and racketeering case, said Otto Maynard, authority chairman who represented the board at the hearing.
"MIDA doesn't have funds," Maynard said. "It appeared the sale was going to go through, and we had four pending lawsuits that we were going to lose in default judgments because we didn't have money for legal counsel."
Citing pending cases in federal court, Clearly said he had reservations about scheduling the sale.
"I'm a little concerned about going forward with the sale with all these issues pending," Cleary said.
Attorneys from both sides urged him to decide whether or not the FAA had a right to proceeds from the sale of the airport.
"We might as well decide if the FAA has an interest," McClanahan said. "Otherwise we are going to be back here in 30, 60 or 90 days."
"We would like to see this decided," said Robert Skeith, attorney for Mid America. "The longer this goes on, the longer they have attorney's fees and are waiting on decisions."
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