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More openness sought for Hilton Head airport finances

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Residents and travelers have seen the public debate at the Hilton Head Island Airport over issues like tree removal and runway length. But behind the scenes, officials on the Aviation Advisory Board and Beaufort County Council have been fighting another battle, over the airport's finances.

Aviation board members say they're frustrated with the lack of detailed financial information available for the Hilton Head airport and that it's hindering their efforts to make sound recommendations about its future.

Members said they were surprised when the county's finance director reported in May that the airport will have to repay $2.5 million in debt the facility acquired over 20 years under county control. The county had given that money to the airport to help balance its finances or pay for projects, but had never been considered "debt" before, members said.

The officials' gripes are somewhat justified, according to an audit released last year. The report cited several areas where the two county airports -- the other is on Lady's Island -- needed improvement, including adding staff to handle finances and cleaning up sloppy bookkeeping at both the county and airport levels.

Aviation board members say they've tried for years to get a handle on the financial picture, even before the audit, and have had little success.

Top county officials said this month they are committed to resolving some of the financial concerns.

County administrator Gary Kubic said he is looking at reorganizing the entire county process to make anyone associated with financial information part of his finance team, which would help improve efficiency. He's already added finance staff at both the county and airport in the past year and put the County Council solely in charge of setting fees at the airports.

"Let's take out the mystery," he said. "We need to get an agreement of, 'These are the numbers.'<2009>"

It's hard to tell, for instance, how much money the airport actually has on hand, and wheth's making money. The expenses for the Hilton Head airport exceed the revenues by $987,310 for the year through May 31.

But much of that deficit -- $540,000 -- is depreciation on assets. The total net assets of the airport are listed as more than $15 million, according to the county's finance records -- a decrease of more than $2 million from the previous year.

The audit also said airport contracts had not been updated, meaning the airport could be missing out on revenue

opportunities.

Not having access to accurate and up-to-date financial data makes it difficult to ensure the airports are running efficiently, aviation board members have said. Longtime member Dick Warden resigned at the Aviation Advisory Board meeting earlier this month, citing in part the accounting inaccuracies, deteriorating financial performance and missed opportunities for revenues at both county airports.

Board Chairman Dave Ames said the time to get a detailed picture of the airports' finances is overdue.

"It's got to be a source of public questioning. What's going on?" he said in a recent interview. "There are county councilmen who want this to be cleared up; the aviation board wants it to be cleared up. I'm sure (director) Paul Andres at the airport wants it cleared up, because it's a distraction. There ought to be answers to these questions and the ambiguities resolved."

Some of that confusion may be from miscommunication.

County Council Chairman Weston Newton said that although finance director Tom Henrikson said he wanted the airport to give back the

$2.5 million, the council has no plans to force the airport to repay that amount.

The airport is paying the county back $1.8 million in tax dollars used for part of the construction of the hangars that opened last year, but that's it, Newton said. So far, the airport has paid four installments of $31,633 toward that debt, Henrikson said.

"With regard to the other facilities that exist at the airport, I don't know whether that discussion (about repaying money) is going to be had or not," Newton said.

Discussion of financial issues was on the agenda for a joint county Public Services and Finance committee meeting Wednesday, but time ran out. The discussion may continue at future Finance Committee meetings, Chairman Stu Rodman said.

To try to improve the situation, aviation board members this month proposed a revision of the board's charter that reduces its size and limits membership to those with a technical background in aviation. The proposed charter revision emphasizes access to accurate and current financial data. Not having the data has hampered board efforts to improve the airports in the past, members said.

Some County Council members, however, aren't eager to hand over all the financial responsibility to the board.

"Money is not a technical issue," Councilman Rick Caporale, R-Hilton Head, said Wednesday at a county meeting about airport issues. "We should be in charge of money."

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