Beaufort County Council's move to increase by 5 percent the cost to rent hangars at the two Beaufort County airports is reasonable and follows a schedule laid out four years ago.
Hangar occupancy at the Hilton Head Island Airport has been high, with a reported waiting list, evidence of strong demand. But the current rates, coupled with the hangar management contract, have not been contributing enough to cover operating costs and debt, proponents of the increase say.
"It's a fee for service," County Councilman Steve Baer said. "That fee, unfortunately, doesn't cover our costs, so the taxpayers of Beaufort County have to make up the difference."
The 5 percent hike follows last year's 5 percent increase. In 2007, when the county set rental rates, it also approved a plan to increase the rates by 5 percent a year.
Airports director Paul Andres noted during the discussion on rental rates last year that construction debt would cause the Hilton Head airport to lose $30,000 a year on the hangars for 23 years if something didn't change.
In addition to paying the hangar construction debt, the county has been supporting airport operations. Through May 31, the amount due the general fund for the Hilton Head airport was about $1.5 million; at the Lady's Island Airport, it was $342,000, according to county financial reports.
County Council has decided that funding the airports is worth the investment, but it doesn't mean council members shouldn't push to close the gap between what the airports bring in through operations and what they pay out.
Councilman Stu Rodman's objection to an increase this year absent a "comprehensive" look at airport funding is puzzling.
If we don't have a good handle on airport funding after all the discussion about hangar rentals over the past four years; a decision last year to reduce property tax assessment rates for aircraft from 10.5 percent to 6 percent; and a detailed master plan that includes plans to spend an estimated $9.3 million to build more hangars at Hilton Head airport, then we're in trouble.
Puzzling, too, is Rodman's statement that raising the rent for hangars when the county had pledged not to raise taxes this year is "bordering on class warfare."
The hangar rental rates started out too high, but then were dropped to be competitive with area airports.
And aircraft owners got a tax break when the assessment rate on aircraft based here dropped from 10.5 percent to 6 percent.
After cleaning up the books on what aircraft actually should be on the tax rolls here, the county billed out $254,130 in 2009 and $98,154 in 2010 (when the 6 percent assessment rate went into effect).
For 2009, it collected $102,526, a 40.3 percent collection rate. As of March 31, the county had collected $51,952 for 2010, a 52.9 percent collection rate. (That money goes to the county's general fund and to other local governments.)
Compare that with the 94.4 percent collection rate on real estate taxes as of March 31. There's clearly room for improvement on aircraft collections, even if it is a very small amount in the grand total of money coming in.
There ought to be a limit to subsidies for the airports, especially when the county aims for self-sufficiency in their operations, and seeking to better balance income and expenses is not "class warfare."