Cherry Capital Airport could become an independent airport authority as soon as next year under a recommendation approved by airport commissioners Tuesday that heads to Grand Traverse County commissioners today (Wednesday) for discussion. County commissioners today will also debate a proposal by Chair Rob Hentschel to prohibit the county from doing business with organizations whose political action committees fund local candidates, a move that could impact Traverse Connect and its request for funding to launch a regional economic development organization.

Airport Authority
After eight months of study, the Northwestern Regional Airport Commission (NRAC) – which oversees Cherry Capital Airport – is backing a consultant’s recommendation to reorganize the airport’s governance structure to become an airport authority.

NRAC members voted unanimously Tuesday to ask airport co-owners Grand Traverse County and Leelanau County to approve the transition to an airport authority. According to Consultant Steven Baldwin Associates, the restructuring would give the airport greater autonomy and nimbleness in operations and decision-making, including being able to buy and sell property, control its own zoning, better focus on airport business priorities, and set standards for governing board members, including establishing a criteria of expertise and a process for removing members if necessary.

Under the airport’s existing commission governance structure, the NRAC must get approval from both Grand Traverse and Leelanau Counties before making many of those decisions, and can’t remove board members short of an intervention from the governor. Only 12 percent of airports in Michigan are run as a commission model, according to the consultant’s report; a majority are county-run, while nearly a third are structured as authorities. Those include Detroit Metropolitan Wayne County Airport, Gerald R. Ford International Airport, Bishop International Airport, and Manistee County-Blacker Airport, among others.

The only disadvantages for the airport in terms of changing models, according to Steven Baldwin Associates, is that liability will be assumed by Cherry Capital Airport instead of Grand Traverse and Leelanau counties, the airport can’t impose a millage, and “financial and operational support from counties is harder to gain” when those entities are removed from the oversight process. In response to questions about Cherry Capital Airport having free reign to make decisions without public input, Steven Baldwin Associates notes elected officials from both counties would still serve on the airport board. The airport authority would still be subject to the Open Meetings Act and would face greater reporting and transparency requirements, according to the consulting group, with the move making the airport less vulnerable to “political influence and conflicts of interest” connected to oversight from elected county commissioners.

NRAC Chairman Doug DeYoung says the airport authority model only became an option in Michigan in 2015 after changes in legislation, and says challenges with the existing county agreement prompted NRAC to consider its options. “There are easement problems, there is language in the agreement that doesn’t meet FAA (Federal Aviation Administration) guidelines…so this gave us an opportunity to look at what the right model is for the airport,” he says. No matter which direction the counties decide to go, DeYoung says, the NRAC agreement – which expires in 2040, putting the airport up against a looming deadline as it negotiates 20 and 30-year tenant leases – would at a minimum need to be rewritten, if not dissolved in the case of forming an authority.

The decision to become an authority or to continue as a commission-led airport under a rewritten agreement is ultimately up to Grand Traverse and Leelanau county commissioners. Grand Traverse County commissioners will hear a presentation on the authority recommendation today, with Leelanau County commissioners soon to follow. A decision will not be immediate, however: Airport Director Kevin Klein says the goal is to form a transition group in early 2020 that would guide the process and help develop articles of incorporation and bylaws for a new authority to be presented for approval to commissioners. Cherry Capital Airport could then submit filings with the state and FAA next fall, potentially receiving approval to become an authority by the end of 2020. “From this point forward, it’s in the counties’ hands,” says DeYoung. “At the end of the day, they have to decide how to go forward with this asset.”

PAC
County commissioners will also consider a proposal today from Chair Rob Hentschel to prohibit the county from entering into agreements or expending funds to organizations “materially connected” with political action committees (PACs) that fund election campaigns for local candidates.

Hentschel says his resolution was prompted by Traverse Connect – parent company of the Traverse City Area Chamber of Commerce – forming a PAC and donating to several Traverse City commission races this fall. Traverse Connect has announced its intention to seek funding support from Traverse City, Grand Traverse County, and Garfield Township leaders to launch a new economic development organization (EDO) for the region. Hentschel says he believes the message should be sent that “local government is not for sale” by refusing to do business with groups that back candidates, “creating the perception of a conflict of interest.” Hentschel says the policy would only apply to the current practices of a PAC, meaning that if Traverse Connect’s PAC changed its policy “of funding local candidates next week, they would be eligible to do business with Grand Traverse County.”

Traverse Connect CEO Warren Call says he is puzzled by the resolution, saying the language is “vague” and could put county commissioners “in a bind” when it comes to conducting county business. “I just think if Chair Hentschel is not willing to support funding to Traverse Connect, he could say so and I completely respect that,” he says. Call notes that the feasibility study that led to the proposed EDO formation was funded by Grand Traverse County, with planning led by the Grand Traverse County Economic Development Corporation and input provided by county commissioners and administration. “The whole thing was incubated and birthed through the county…so (the resolution) is a little concerning, because there was always visibility on that plan,” Call says, adding he nonetheless remains optimistic about the EDO’s future.

Call also questions the larger philosophical issue of penalizing organizations for using PACs, a legal form of campaign fundraising used by other local groups – such as the Traverse Area Association of Realtors – and Chambers and EDOs across the country. “We use our right as an organization to promote our best priorities, and we respect everyone else that does that, including positions we don’t agree with,” he says. “I do think we should be able to have our voice in the process, just like anyone else.”