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City Beat: Council approves $9M in airport funding

Officials cite COVID-19 for 93% year-over-year plunge in daily passengers

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Springfield City Council members unanimously greenlighted a nearly $9.3 million grant for the Springfield-Branson National Airport as part of the Coronavirus Aid, Relief and Economic Security Act at their May 18 meeting.

The federal funding is part of $10 billion allocated nationwide for airports in the coronavirus relief bill. Disclosed in April, the funding required council’s approval.

Brian Weiler, director of aviation, told council members at the meeting that the Springfield-Branson National Airport board plans to use a portion of the funding in the next fiscal year to help offset revenue losses in parking, car rentals and concessions. He also cited plans to cover debt payments on the terminal and employee salaries and benefits.

One of the conditions of accepting the federal aid is continued employment of at least 90% of an airport’s workforce through the end of 2020, Weiler said. He noted there were no plans to lay off any of the local organization’s 96 full-time employees.

The airport recorded a daily passenger drop of 93% year-over-year in April, Weiler said. Flight activity was coming off a record year of nearly 1.2 million passengers in 2019, according to past Springfield Business Journal reporting.

“We are, in May, starting to see slow but steady increases,” Weiler said. “There is no doubt, though, this is going to be many months and likely years to fully recover from that.”

Airport spokesperson Kent Boyd said in an email following the council meeting that it’s too early to outline how much of the funding will be allocated to each of the areas outlined by Weiler. The airport has four years to use the CARES Act funding.

“The airport entered the crisis in a good financial condition and right now looks like we’ll have enough income to meet operating expenses,” Boyd said. “The spending of the grant money is something that will be figured out over time as we get a better handle on the financial impact of the [COVID-19] crisis.”

Boyd said the airport had not determined the amount of revenue losses by press time because it analyzes its revenue and expenses on a fiscal year basis. The fiscal year runs through June 30. He noted the financial impact of the crisis will play out over the coming months and years. Boyd said through February, the airport’s operating revenue was running ahead of budget by 10% but, as of April, is now only ahead of budget by 2.5%.

The aviation industry has suffered a significant blow worldwide amid the coronavirus pandemic as travel has nearly come to a halt. The Airports Council International, a global aviation association, reports the decline in airport revenues worldwide is estimated to exceed $39 billion in the second quarter and $97 billion for the year.

According to an SBJ.net poll the week of May 18, 45% of 606 voters do not plan to travel even with stay-at-home orders lifted. In addition, 28% of voters said they plan to travel regionally, 21% plan to travel nationally and 6% are planning international trips.

IDEA Commons
Council also heard a tax increment financing proposal for the IDEA Commons redevelopment plan.

It calls for a 30,000-square-foot expansion of Missouri State University’s Jordan Valley Innovation Center building, a public parking garage and a 100,000-square-foot office building developed by The Vecino Group LLC, as well as public improvements to sewer, stormwater infrastructure and roads.

The $55 million project is projected to generate $3.3 million in local TIF revenues over the 23-year collection period and $11 million in state TIF revenues, said Sarah Kerner, director of economic development for the city. Funding for the project will come from MSU, the city, The Vecino Group, tax credits and loans.

Kerner also said MSU and the city are set to receive $6.2 million in reimbursements over the course of the TIF.

The proposed bill also seeks to declare the redevelopment areas as blighted. One such example of blight was the 424 Boonville Ave. building that caught fire May 12. Formerly home to nightclubs Touche and The Edge, it was slated for demolition to make way for the planned 100,000-square-foot office building, according to past SBJ reporting.

On May 20, the Springfield Fire Department determined the fire started by accident, said Kevin Trogdon, chief of community risk reduction for the department. He said officials could not determine the exact cause of the fire because there was too much damage. However, he said several people who appeared to be homeless were seen fleeing the scene when the fire started, likely seeking shelter overnight. Some of the building is still intact after the fire, though the city’s department of building development services has identified it as a dangerous situation, said Kerner.

“Some portions of the building did have to be removed for structural stability lack thereof,” she said at the meeting. “Because we are using this as evidence of blight for this TIF project, the developer is not planning on completely removing the building until the TIF is approved.”

Council members expressed support for the plan.

“This is a positive thing for the city,” said Councilman Abe McGull. “It’s going to improve our downtown development footprint, remove blighted areas, bring in jobs and not to mention the ancillary business that will occur as we improve the downtown area.”

Mayor Ken McClure also shared excitement of the project.

“Missouri State has worked a long time on this. To me, this is a key part of our development under the economic vitality umbrella as we go north to the square,” he said.

Construction is expected to begin in early June on the JVIC expansion, said developer Danny Collins of The Vecino Group. It’s set to be complete in July 2021. The office building and a central commons area are slated to be complete in December 2021.

Council is scheduled to vote on the TIF plan and redevelopment June 1. The bill that would initiate the tax collections was tabled until April 30, 2021, to allow a portion of the project to be complete before activating the plan. Kerner said waiting until just before the project is completed will maximize the tax collections.

COVID testing
Katie Towns, assistant director of the Springfield-Greene County Health Department, presented a request to council to accept up to $364,000 in grant money from the Missouri Foundation for Health.

Towns said the first round of funding to the Health Department would equal $84,000 to acquire 13,000 COVID-19 test kits.

“We’re going to be using this only as a key for investigation,” said Towns. “As we continue to investigate cases, we will be using internal testing to evaluate close contact of these cases and test them in the incubation cycle that we’re learning more about.”

She said the test kits also would be used to learn more about asymptomatic cases and attempt to locate where the virus may appear next in the community.

By press time, 110 cases of COVID-19 had been confirmed in Greene County and seven deaths were recorded, according to the Health Department website.

Council is slated to vote on the grant June 1.

Other action items
•After discussion of budgetary concerns, council members unanimously passed a request for $2 million from the Public Works Department for stormwater improvements of Fassnight Creek at the Springfield Art Museum. Council members Phyllis Ferguson and Mike Schilling expressed concern of using money that could be set aside for a later date if further coronavirus relief is necessary. Public Works Director Dan Smith pointed out the nearly $500,000 in state grants council accepted May 11 for the improvements would be wasted if the project was not fully funded.

•Council also approved $1.5 million plans for stormwater improvements in Beechwood Heights and accepted a bid from utility contractor Hamilton & Dad Inc.

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