Brainerd City Council: Budget discussions begin
The Brainerd City Council Tuesday held its first of multiple budget workshops, with the intent of getting a closer look at the city's budget. Kicking off things on Tuesday were two representatives from the Brainerd Lakes Regional Airport - Jeff W...
The Brainerd City Council Tuesday held its first of multiple budget workshops, with the intent of getting a closer look at the city's budget.
Kicking off things on Tuesday were two representatives from the Brainerd Lakes Regional Airport - Jeff Wig, airport manager, and Andy Larson, airport commission chair. The airport is jointly owned by the city and Crow Wing County.
Both the city and county provide annual funding to the airport, a practice that has gone on since the airport's inception in the 1940s, Wig said. The financial support "augmented the significant revenue that we generate also on our own."
For the 2015-16 fiscal year, the airport is requesting a 5 percent increase in the funding it receives from the city and county. The annual funding amount has remained flat for seven years, Wig said, and in the meantime, the purchasing power of the funding has fallen, due to inflation.
"That has an impact on a facility that's growing, and attempting to better serve the needs of the community," Wig said.
The airport currently receives $155,500 annually from the city. A 5 percent increase represents a $7,775 increase.
"It will not, of course, make up for lost ground, from frozen appropriations," Wig said. "But it will help us build capacity."
Larson said airport staff know federal, state and local funding will diminish in the future, which is why the airport is working to become as self-sustaining as possible. Wig said he had sent the same request to Crow Wing County, but had not heard back from them yet.
The airport is one of the most self-sustaining airports of its size in Minnesota, Wig said, with most of its funding coming from revenue it generates. The local funding accounts for 30 percent of the airport's budget, according to figures Wig provided to the council.
"We receive most of our day-to-day funding, our operating budget, from revenues we generate," Wig said. "Hangar rents, user fees, landing fees, fuel flowage fees, we have the majority of our revenue coming from those sources."
The airport currently has 95 rented tenants on its airfield, Wig said, including 12 tenant businesses or organizations. A recent survey of those businesses revealed those businesses provided more than 90 year-round jobs, including airport staff.
"That was even higher than I thought," Wig said.
The upcoming 2016 trunk water and sewer line project, planned to run water and sewer lines out to the airport along Highway 210, will only make the airport more attractive to prospective businesses, Wig said. One current tenant is considering expanding, he said, and a potential tenant is considering locating at the airport.
"There's just no way we can expand or develop the business park concept out there without that kind of water," Larson said.
In order to remain as self-sufficient as possible, Wig said the airport tries to handle as many repairs and training sessions in-house. Instead of sending the entire staff out for training, one staff member is trained as a trainer and can then train the rest of the staff at a lower cost.
Council member Mary Koep asked Wig about the airport's revenue streams, and whether the airport is maximizing those revenues.
"I'm always interested in groups such as yours who have the ability to raise revenue," Koep said "I'm interested in what you're doing about that."
Larson said Wig has done a good job of making hangar rents consistent and "building a business sense into our rental policy."
The hangar leases have annual increases built into them that are based on the consumer price index, Wig said, which can range from 1.5-3.5 percent. Koep responded the airport should increase them by 5 percent, "because that's what you're asking for."
If the airport doesn't get its requested funding increase, Wig said, it would most likely have to cut back on staff training.
In order to maximize revenue streams, Wig said the airport has been speaking with Central Lakes College's natural resources program about the timber located at the airport. Together, they'll work to develop a timber harvesting program, in order to develop "relatively regular revenues from a sustainable harvest of our timber."