City wants $900k more from airport

Warwick Beacon ·

During their Jan. 9 meeting, the Warwick City Council passed two resolutions with the ultimate goal of getting more money and information from the Rhode Island Airport Corporation (RIAC), which owns and operates T.F. Green Airport.

The first resolution requests the General Assembly to officially petition the airport for $900,000 in lieu of taxes (PILOT) to compensate for emergency services rendered to the airport.

Since Warwick is the host community for the airport, they – along with airport emergency services – are responsible for sending police, fire and rescue personnel to emergencies that happen on airport property. Such was the case during a small garage fire that was quickly handled a couple weeks ago where Warwick fire apparatus were among the first on the scene.

“The state of Rhode Island gets a great benefit from the airport, but the city of Warwick pays a great burden for that,” said Ward 7 Councilman and finance committee member Stephen McAllister during the meeting. “We are very good neighbors to the airport, and I think an increase in the amount in lieu of taxes that the city of Warwick receives, I think is something we should get.”

The city currently receives $500,000 annually from the airport as a means of offsetting costs associated with services rendered. The resolution would petition the General Assembly to enact legislation that would enable RIAC to increase that amount to $1.4 million a year.

McAllister expanded on the purpose behind the request on Wednesday, saying that the airport has expanded and taken many houses off the city’s property tax rolls, so there should be an update to the old figure reflecting the financial impact associated with these developments.

“That number seems really low these days,” he said. “We're always the first responders. That's our thing. The airport is here and it's an economic driver, but we need to make sure that the city is being taken care of for providing those services.”

According to RIAC spokesman Bill Fischer, however, the matter is not so simple.

“We understand Warwick is looking for payments in lieu of taxes [PILOT] and their justification that the airport has taken properties and lowered tax rolls for the city,” he said through a statement. “Although RIAC understands the justification, Congress has prohibited cities and states from collecting PILOT from airports.”

Fischer cites the FAA Authorization Act of 1994, which “specifically prohibited against airport payments for city services unrelated to the operation of the airport, imposed new reporting requirements on airports” and could result in civil penalties of up to $50,000 if violated.

“There can be serious consequences to both the city and the airport if we deviate from these federal mandates,” Fischer said. “We remain concerned that any efforts to seek increased payments to the city will trigger a review of the current agreement and that the FAA would look to ensure current payments are justified.”

Section 112 of the Act outlines that airports are prohibited from providing “payments in lieu of taxes or other assessments that exceed the value of services provided.”

The question then, as the law stands, is how much Warwick is spending for airport emergency services? If it exceeds $500,000 there would be a good case to increase the payments, but if it turns out to be less, that may result in the exact opposite of what the city council is hoping for. It was not clear by press time on Wednesday exactly how much money the city spends annually. Ward 3 Councilman and finance committee member Timothy Howe (who brought forward the resolution) said he has heard figures north of $2 million in terms of cost to the city on an annual basis.

Finance Committee chair Ed Ladouceur said that the costs to the city expand beyond simply emergency services rendered, citing the land that was seized and properties destroyed as part of the airport’s runway expansion. Ladouceur said that he has heard upwards of 3,000 homes were taken off the city’s tax rolls, but that even a more conservative estimate of 2,000 homes would have an approximate impact of $7-8 million in lost property taxes.

“We're talking big money,” Ladouceur said.

Regarding the citing of the federal statute by the airport, Ladouceur said he would have no trouble sitting down with the state’s federal delegation to look into the matter.

“They can hide behind a federal mandate that says this or that or the other,” he said. “I think our Washington delegation would be very receptive to revisiting that law to ensure that the city of Warwick is treated fairly by the Airport Corporation, or anyone else for that matter. Right now, I don't see us being treated fairly.”

A deal reserved for champions?

The second resolution regarding the Airport Corporation was a request for information regarding any financial payments, in-kind offers or incentives given to the New England Patriots by RIAC in order to be the host airport for the team’s two jumbo jets, which can be seen now when driving along Post Road.

Howe said that the plane contributes to fumes and noise going into surrounding neighborhoods, and that “We just want to make sure that the city is getting reimbursed a proper amount.”

Fischer responded to the request in his statement saying, “it is important to note that RIAC has not made any payments to the Patriots. RIAC and the Patriots executed a marketing agreement under which RIAC waives airport fees associated with Patriots activities in return for marketing and advertising – including being designated as ‘The Official Airport of the New England Patriots.’”

“The benefits from this advertising agreement far outweigh the waived fees,” Fischer’s statement continued. “We will be conveying the nature of this agreement to the city per their request.”

Fischer did not respond to a follow-up question regarding the value of the fees waived and the approximated value of the aforementioned marketing benefits received by the airport in return.

Ladouceur was critical of this reasoning from the airport.

“Show me one person who has flown into Warwick so they can get a view of the Patriots plane. Show me one person who has paid taxes in the city of Warwick because they get to take a look at the Patriots plane. The only people I see getting a benefit from the Patriots plane parking there is the New England Patriots,” he said. “I don't see any real value to the taxpayers of Warwick.”