Park Rapids Airport Commission supports 20% hangar rent hike

The Park Rapids Airport Commission voted Wednesday, April 2 to recommend raising hangar rents by 20%.

Discussion began with a summary of the airport account as of the end of 2024. City Administrator Angel Weasner reported that after about $265,201 in revenues, the airport was $77,020 under its revenue budget, but an upcoming journal entry moving $78,488 from property taxes into the airport account will put the revenues slightly over budget.

On the expense side, Weasner reported the airport has gone “way over budget” due to capital outlay to purchase snow removal equipment (SRE), since the city did not receive the grant money for the purchase until 2025. “We set it up as money receivable to us,” she said.

Overall, she said, the airport was still running at a loss as of Dec. 31, 2024, with a negative cash balance of $126,110. Again, a lot of that is due to the SRE purchase and will be repaid; however, airport expenses continue to exceed revenue, she said.

Not including capital outlay, the airport had budgeted $342,000 for revenue and expenses on the year, Weasner said. In reality, however, revenues fell short.

For example, Weasner said, hangar rental revenues were budgeted at $170,000, but the city only collected $123,000 – a shortfall of about $46,000. She said some error must have crept into the budgeting process, but she did not know where.

To pay back the deficit covered by Park Rapids taxpayers, Weasner recommended raising hangar rents by $200 per year, estimating this would repay the $78,000 over a 10-year period.

“The council is not comfortable with using taxpayer money to fund the airport,” she said.

“Where are we at in 10 years?” asked commissioner Craig Rossman. “(Costs are) not going down; they’re going up.”

Asked when the city last raised hangar rentals, Weasner said they went up by 3% two years ago.

Commissioner Dan Dyre said $200 per year won’t be enough.

Commission chair Thom Peterson said a typical rent on a 10-by-26-foot storage unit is about $85 per month, or 32 cents per square foot. At that rate, he said, an 1,100-square-foot T-hangar would rent for $352 per month – double what the airport’s tenants are paying now.

Peterson noted that a 20% increase on the average hangar rent of $145 per month would be $29 per month. “I can’t imagine many people complaining of that,” he said.

City council representative Tim Little noted that would be an increase of over $300 per year on the average hangar rent. Rossman said a 20% raise would add a bit less than $500 per year to his rent.

He said he didn’t relish doing that every year for five years, but Peterson argued, “You can’t solve a problem by slapping little Band-Aids on it.”

Commissioners also discussed seeking Hubbard County’s financial support for the airport. Dyre and Rossman noted that it benefits the county’s residents at least as much as the city’s.

County board representative David De La Hunt said it’s reasonable to ask, but the airport commission would need to present a long-term plan.

De La Hunt warned that the county has “a lot of things that are spinning right now,” but upcoming capital needs could be put on the county’s long-range plan. “The county could contribute some; I just don’t know how much,” he said.

He also recommended defining what benefit the airport brings to Hubbard County.

Weasner said the airport only needs help getting ahead of expenses, to maintain it in working condition while continuing to apply for grants.

Asked how other airports in the area can afford to charge less for hangar rents, Airport Manager Scott Burlingame noted that Park Rapids has two runways to maintain, while most others only have one. Commissioners also noted that some of these airports have county funding.

Rossman said everything has gone up in cost since 2020 by at least 20-25%. “The phone’s going to ring” with concerned callers, he said, “but 20% is a good starting point. Ten gets you nowhere; 20’s a start.”

Dyre made a motion to increase rents by 20% per year. The motion passed 6-0.

Weasner said the city will send notice of the increase to tenants while working on the ordinance change making it official.

The commission also voted 6-0 in favor of recommending an amended airport master lease, changing a sentence in the paragraph on “Use of Leased Premises” from “Non-aeronautical equipment shall not be stored in the hangar” to the following:

“Non aeronautical equipment may be permitted provided the items: 1) Do not impede the movement of the aircraft in and out of the hangar or impede access to aircraft; 2) Does not displace the aeronautical contents; 3) [Do] not impede access to aircraft or other aeronautical contents; 4) Do not violate airport rules and regulations, lease provisions, building codes or local ordinances. If the non-aeronautical equipment violates these conditions, the equipment shall not be stored in the hangar.”

Weasner noted that a fifth point of the Federal Aviation Administration’s five-point rule for storing non-aeronautical items in hangars was omitted. The rule, prohibiting hangars to “be used to conduct a non-aeronautical business or municipal function from the hangar, including inventory storage,” doesn’t apply to the issues the airport is dealing with, she said.

Weasner said upon review by the city attorney, the amended lease language will be brought to the city council for approval.

In other discussion, the airport commission:

• Heard Weasner report that work continues on the taxilane reconstruction project.
• Heard Weasner report that the city is still waiting for the airport hangar loan program, with construction of additional T-hangars remaining on the airport capital improvement program along with a runway reconstruction.
• Heard Weasner report that the city was not awarded a grant to update the airport’s arrival-departure (A&D) building. Project Manager Matt Gustafson with TKDA said they will try again, with at least one year of the program left. “I think, last year, there were $8 billion in applications for $1 billion,” he said. “It’s still a long shot, but we might as well keep applying for it.”
• Discussed lobbying state legislators and U.S. Rep. Michelle Fishbach for A&D funding.
• Heard Burlingame report on the progress of replacing the airport’s Jet A fuel tank, noting the tank has been ordered and prices quoted for some concrete work. 

The airport commission’s next meeting is scheduled for 9:30 a.m. Wednesday, July 2 at Park Rapids City Hall.