ST. CLAIR CORRECTIVE ACTION PLAN

March, 26, 2013

Amy Ludwig

Administrator of Aviation:

Missouri Department of Transportation

Jefferson City, MO

Dear Ms. Ludwig;

On December 21, 2012 the City received two sets of correspondence from your office regarding various operations and maintenance items, with recommendations for correction.

On December 28, 2012 the City received a communication from the Federal Aviation Administration noting three specific areas of correction for necessary to continue the closure process.

Following is the response of the City to these aggregate correspondences. For clarification each correspondence is noted separately.

Because these correspondences contain reference to communication the City received from Millicent Parker in February, 2012, those items are addressed as well. Because that correspondence was chronologically received first, those items are addressed first.

Routine Maintenance items (M. Parker 2/29/12):

1.       Grass & weeds in cracks on runway & apron: Pavement cracks are sprayed annually. Out contract season begins April 1st and these items are addressed at that time. This standard maintenance operation has been undertaken annually since the inception of the airport, and will continue so long as the airport remains open.

2.       Airport/Facility Directory information: Updated information was provided regarding he

              A/FD in October 2011.  

3.       Incorrect NOTAM’s:  NOTAM’s were corrected on March 7, 2012.

4.       Rotating beacon inoperative: Repairs completed February 7, 2013. Verbal report of broken green lens              inspected March 5, 2013 and found inaccurate. Airport lighting shall be maintained so long as good faith   negotiation continues toward closure. Upon termination of positive discussion regarding closure only those repairs and upgrades for which appropriate documentation can be provided will be considered.

  

5.       Fuel tank needs marked out of service; trash: Fuel station markings No Fuel and trash removed March 20,   2012.

6.       Windsock shredded & non-functional: Visual inspection on March 8, 2012 confirmed windsock in good repair and all lights functioning. Visual inspection on January 24, 2013 confirmed windsock in good condition and all lights functioning. The basic windsock will be maintained as long as the airport remains open.

7.       Runway lights broken and mounted improperly: Lighting repairs completed January 22, 2013. All runway lights operational and mounted in accordance with regulations. Airport lighting shall be maintained so long as good faith negotiation continues toward closure. Upon termination of positive discussion regarding closure only those repairs and upgrades for which appropriate documentation can be provided will be considered.

8.       Confirm REILS mounts are frangible: Ken Hebb, FAA Airway Transportation Systems Specialist, confirms that the RIEILS are the property of the FAA and under their control for maintenance. He further confirms that the mounts are frangible.

9.       Backfill erosion pits, two locations: This has been completed on two occasions. There is continued erosion     and full repair will require replacement of the entire drainage structure, Because this structure drains under the taxiway and runway and repairs will require cutting trenches across both, the City recommends continuing to fill the erosion pits with rock and soil as needed.

10.    Yellow warning paint on. Drainage pipe at Hangar 3: Completed Match 20, 2012.

11.    Correction to hold sign at runway end: Completed June 14, 2012.

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Informal compliant correspondence A. Ludwig 2/21/12:

At their regular meeting on 1/7/13, the Board of Aldermen voted to reset fixed wing leases at the 2012 level, for 2013. The City has been in active negotiation with local tenants throughout February and March, and on March 25, 2013, successfully completed negotiation to arrive at a mutually acceptable lease which is due and payable for the period January 1 — March 31, 2013 not later than April 1, 2013 without imposition of late fees, and with April payment due April 1 and considered late and subject to late fees on April 15, 2013.

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Compliance plan correspondence (A. Ludwig 12/21/12):

Item #1; Fiscal Records: On January 21, 2013, the Board of Aldermen approved entering into a management agreement with Steven Broadbent, CPA, to create and manage a separate bank account for the City of St. Clair on behalf of St. Clair Regional Airport. On February 5, 2013, Heartland Bank Small Business Checking Account #366201441 was opened under the name of St. Clair Regional Airport. A copy of the Letter of Engagement from Mr. Broadbent is attached.

Item #2; Lift Station land rental: The fence confining the lift station space is 40’3” by 37’. The space from the west fence line to the property edge at the roadway is 17’ and provides vehicle access. Presuming fence installation using a standard 12” bore for concrete post reinforcement the full impacted property is 41 ‘3” by 54’6”. For purposes of calculation this has been rounded to 42’ x 55’, resulting in an impacted area of 2,310 ft. One acre of land equals 43,560 ft2. The 80-acre airport tract equals 3,484,000 ft2. The appraised fair market value of the airport is $520,000. The appraised fair market value of the airport for sale is $0.1492537/ft2.   For purposes of calculation this has been rounded to $0.15/ft2. Thus, the annual appraisal-based fair market value of airport land is $0.15, for a calculated area of 2,310 ft, yielding an annual fair market lease amount for the lift station space of $346.50. The lift station was first contemplated in 2008 and construction completed in 2009. For purposes of calculation the entire period has been used as lease basis. The period 2008 — 2013 inclusive is six calendar years, producing a fair market lease fee due and owing to the airport of $2,079.00. This amount was deposited in Heartland Bank Small Business Checking Account # 366201441. The percent change in the Consumer Price Index, Midwest Urban; Size D (Nonmetropolitan [less than 50,000]) will be applied annually to the base lease price of $346.50.

Item #3; Main Hangar storage: Items which can be proved as non-aeronautical have been removed from the facility. All items remaining will be sold at public auction in a sale to be

contracted for management services to Steven Broadbent, CPA. Because it is impossible to provide documentation regarding the actual use of these items, the City has made payment to the Heartland Bank Small Business Checking Account # 366201441 in the amount of $11,700 as payment in full for storage use. This amount is based on a rate of $325 monthly, which corresponds to the rate published for that hangar for the year 2011. The term proposed for storage coverage is three years, based upon a recommendation from MoDOT Aviation and concurrence by Jim Johnson, FAA Kansas City Regional Office.

Item #4: Attached is the 2000 AirEvac lease, at a monthly rate of $150, and copies of letters of support from local service organizations and emergency responders requesting that the City secure a local site for AirEvac’s use. We have not located documentation regarding negotiation of the current lease, which was signed at a monthly rate of $300 with a five year term by Mayor Mindy McCoy in 2005. This lease contained a provision to automatically renew without increase in 2010 for another five years. While this’ does not comply with FAA Order 51 90.6B p9.5.e, the Order was, not brought to the City’s attention by the FAA at the time of original lease issuance, and therefore is not possible to include at this date. When the lease is renegotiated in 2015 the City will include a CPI indexing clause linked to Midwest Urban, Size D (Non metropolitan [less than 50,000]) changes. The City will consider a CPI-based consideration on all lease rates, but not as a sole determinant for any type of lessee. As with any form of lease, the rate must reflect more than simple square footage used. Tenants which require taxiways and runways require more area maintenance than tenants which use neither. Tenants providing and maintaining their own approach lighting require less maintenance than tenants demanding those items. Tenants with 24-hour staffing provide a security presence which tenants using the facility on an intermittent basis do not provide. Tenants who provide their own snow removal cost less to house than tenants needing services. Additionally, we will not insert language from a lease specific to one form of tenant (rotary, fixed, commercial, private, etc.) into leases specific to additional forms of tenant unless the language is directly applicable to each, per 18.2 Lb of the Compliance Handbook noting the appropriateness of lease distinctions based on use.

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FAA letter 12/28/12:

Action 1 (first bullet point): Per the above, we consider these items all addressed to completion as of March 25, 2013.

Action 2 (second bullet point): Per the above, we consider these items all addressed to completion as of March 25, 2013.

Action 3 (third bullet point): The initial Part 16 filling was sent, the City provided a response, the claimant filed a response, and the City filed a response to that response.  City received notice of extension allowing the FAA additional time for review, and establishing a new docket of May 13, 2013.  Further action is pending that instance, and will be complied with as directed.

Per the above re the informal complaint, we consider this issue fully resolved as of March 25, 2013.

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Please convey these responses to Mr. Johnson arid others as appropriate.   The City of St. Clair once again requests release from all past grant obligations, subject to a requirement to un-amortized portion of such grants, and requests closure of St. Clair Regional Airport and repay the authorization to sell the lands, subject to a requirement that the City additionally provide payment to the Federal Aviation Administration of 100% of the full best-use fair market value of the site per the most recent appraisal.

As always, thanks for all of your assistance as we try to stumble out way through this increasingly odd and convoluted process. We will in fact continue stumbling along, and we will in fact prevail compelling in the end, no matter how long it takes to reach that end. The story is just too compelling to let it go now.

Sth c erely,

Rick Childers