Sue Brooks' Blog

Sue Brooks January 6th, 2010

Prepared by FCRC CEO Andrew Brien in response to media enquiries and posted here with his permission… I hope this helps in understanding the processes that Council needs to undertake now that we are one region in relation to aviation. At no time do I expect Council to make decisions which do not involve community input so please feel free to voice your thoughts.

Future of Fraser Coast Airports

 It appears that there is a lot of misinformation in relation to the current situation regarding Fraser Coast airports. Much of this is brought about by people speculating on the work that is currently being undertaken by the Council. The purpose of this letter is to outline the work that is currently underway and is already publicly available information.

 The Fraser Coast Regional Council is currently undertaking a “best value” land use assessment of the two airports currently owned and operated by the Council. Underpinning this review is the work that is being undertaken by State Government looking at the Churchill Investigation Area and the existing master plans for the Maryborough and Hervey Bay airports.

 The purpose of the study is to identify the best value land use for the existing sites based on different scenarios. Two of the scenarios being considered are:

 *Retaining either one or two of the existing airports in current locations without consideration of a new airport; and

* Retaining either one or two of the existing airports in current location and the development of a new regional airport in a new location.

 The two scenarios provide an opportunity for Council to fully consider the best way forward in relation to the ownership and management of the sites.

 The timeframes that are being considered are medium to long term, (ie 15 years or longer) however the need to have this work completed before the next stage of master planning is essential.

 There has been much speculation and discussion in relation to the airports and the approach being taken by Council. The Council is looking at the longer term issues associated with the ownership of two airports in close proximity and how the Council can maximise any return on the investment. The costs associated with the operations and maintenance of an airport are high and unless the costs of operating the airports can be recovered from airport users, there is a need to subsidise the costs through general rates.

 Budget

Maryborough airport –

• Total Revenue $25,000
• Total Expenses $133,000 (operational not including depreciation)

 Hervey Bay airport

• Total Revenue $1.48m
• Total Expenses $2.34m (including depreciation and finance costs)

 In addition the Council has allocated $1.09m in capital expenditure for both airports in 2009/10.

 Fees and charges

The Council has recently resolved to change the casual landing fees and carpark charges applicable at its airports. This shortfall in revenue for the airports will now be made up from general rates.

 Flight Training Queensland

The proposed flight training school which was being considered by the former Maryborough City Council and the now Fraser Coast Regional Council was not stopped by Council, but was stopped due to a failure to negotiate a commercial return to Council. The Council was not opposed to Flight Training School, but did not want to be tied to a long term (50 year) lease which was not going to provide an appropriate level of return to Council and the community. The decision not to proceed with the Flight Training School was made by Flight Training Australia and was based in part on not being able to meet the Council requirements. When the matter ultimately became a commercial decision the project did not stack up for Flight Training Australia.

 Leases

The decision of Council not to release more land or enter into long term leases is based on the fact that the Council has not yet made a decision on the long term future of the airports. Once the best value land use study is completed and Council has made a decision on the future of the airports then the Council can look to enter into arrangements which are consistent with the longer term plans for the sites. For example – if the decision is made to construct a new regional airport and close the existing airports, it would not be appropriate for Council to enter into longer term leases with individuals and companies on the existing sites.

 Why undertake a further study?

Prior to amalgamation each Council was responsible for its own assets and how they were managed. Following amalgamation the new Council needed to look at all the existing assets (including airports) to ensure that they were being managed appropriately and providing appropriate returns to the community. The previous studies assumed that there was only a single airport and that this should cater for all uses (ie general aviation as well as passenger services). This is clearly the case as both airports were competing for passenger services as well as trying to bring in more aviation associated industry.

 This approach is considered appropriate and is in line with best practice principles. Under or over utilisation of assets comes at a cost and there is a need to ensure that the use is appropriate and that users contribute towards the management of the asset.

 Future Development of airports

Given that no decision has been made on the future of the airports, at this stage it is unknown what purposes could be appropriate on the two sites. This will be further considered once Council has considered the best value land use report.

 Recent articles

There have been a number of articles in the Chronicle in recent weeks relating to the Fraser Coast airports. Whilst the information provided above addresses most of the issues raised there are outstanding matters to clarify which relates to Commonwealth funding and information requests regarding leases. The following extracts have been provided and whilst they do not include all of the funding received by Council in relation to airports, it does indicate where the majority of funding has been allocated and spent.

 The following are extracts from letters regarding Maryborough Airport

  (sorry images aren’t working)

 The following are extracts in relation to Hervey Bay Airport

 (sorry images aren’t working)

 In relation to specific enquiries from Mr Miller and Mr McNeil, both of these people have been provided with answers in relation to leases and future development opportunities at the airports. In a letter to Mr McNeil in November 2009 it stated:

 I refer to your recent enquiries regarding opportunities for leasing at Hervey Bay and Maryborough Airports.  I am aware from your advices that you had previously made similar enquiries with the Hervey Bay City Council in relation to Hervey Bay Airport prior to amalgamation.

 As you would appreciate, amalgamation of four individual Councils to form the Fraser Coast Regional Council has necessitated a review of Council’s strategic direction in relation to key infrastructure.  Earlier this year, Council directed that a land use study be undertaken in relation to the Hervey Bay & Maryborough Airports in order to establish the future direction of both sites.  This study is currently underway and it is anticipated that the preliminary results will be available for the consideration of Council by January 2010. 

 At this stage, approval has not been granted by Council for the release of new sites for hangar / business development and indications are that this will not occur until after the land use study has been received and a position adopted.  It is anticipated however, that a number of existing leases at Hervey Bay Airport which are due to expire will be advertised for public tender in accordance with the Local Government Act.

 As discussed during our telephone conversation, tenders are publicly advertised via print & other media and the onus rests with the tenderer to identify and act on such advertising.  As a courtesy however, I have given an undertaking to provide notification to you via email when airport tender opportunities are next released.  The specific timing of the tender process will be determined by Council’s Property Management unit.

 From the brief details you have advised in relation to your proposal to establish a flying and ground school, I believe these activities could be a valuable addition to the operations of either Airport and would welcome provision of further details following the resolution of the current land use study. 

 In relation to the resolution of the previous Council, it is reproduced below:

 from a Meeting of Council on 20^th November 2007, was moved by Cr Dautel and seconded by Cr Morris and is reproduced below:

 “1.      That in respect of the Bellman Hangar, located at Maryborough’s Airport and currently tenanted by Maryborough Aviation Services, Council resolves as follows:-

 (a)      That Council make application to the Environmental Protection Agency to remove the hangar doors, as it is considered that the cost of repairing the doors is prohibitive,

 (b)      That the Chief Executive Officer be authorised to negotiate a reasonable time frame in which the present tenant, Maryborough Aviation Services, is to vacate the building,

 (c)      That the present tenant is to continue its current month to month Lease arrangements pending finalisation of negotiations; and

 2.       That the Chief Executive Officer be authorised to seek legal advice regarding any implications resulting from the above decision.                  MOTION CARRIED 8/0”

 On Tuesday an extensive list of specific questions was sent to Council seeking responses within a couple hours and the Chronicle was advised that some research was required in order to ensure appropriate and accurate answers. Despite this the editorial and front page the following day were dedicated to the airport. In response to the specific questions that were raised by the Chronicle I have provided the responses below.

 Responses

 Q1. Did the former Maryborough City Council discuss closing Maryborough Airport?

 A. A review of the Council Minutes does not indicate that closing the Maryborough Airport was considered as an option.

 Q2. Does the council still hold documentation on this/these discussions?

 A. As indicated in response to Question 1 there does not appear to be any documents on file in relation to discussions on Council closing the airport.

 Q3. Is the council intending to close the aerodrome?

 A. Council has not yet considered the matter. The future of the Maryborough and Hervey Bay airports will be considered by Council as part of the future strategic planning for the Region. The Council has been advised of options that may be available and these include upgrading of the existing site, changes to the airport and its future uses as an airport and also possible options if it was not to remain an airport. 

 Q4. If so, or if this is a declared option, what will the land be turned over to?

 A. Possible future uses for the airport have not yet been considered. The Council has engaged specialist consultants to undertake a “best value” land use analysis of both Fraser Coast Airports. The outcomes of this study should be available for consideration by Council towards the end of January or the Ordinary Meeting in February.

 Q5. Is Maryborough Airport classed as “strategic”?

 A. There has been some discussion on the significance of the Maryborough Airport as being an airport of regional significance however this is not supported through any documented reports.

 Q6. What is the council’s legal position in alerting the federal government of any future development or alternative uses for the aerodrome?

 A. This is currently being investigated as part of the best value land use study and will form part of any decision on the future use of the airports.

 Q7. What did the council charge for landing/takeoff/parking fees for light aircraft at the aerodrome? Have those fees been waived and if so when? And when will new ones be decided or will the council permanently waive them?

 A. Council adopted its fees and charges as part of the development of the budget for 2009/10. The decision to amend the landing fees was made by Council at the Ordinary Meeting held on 16 December in accordance with the following – “for both Maryborough and Hervey Bay Airports, casual aircraft landing fees be changed from $9.50 per landing to $0.00 per landing for aircraft with MTOW up to 2,000kg”

 The Council will consider fees and charges as part of the development of the 2010/11 budget for Council. No decision has been made on permanently waiving these landing fees. In the event that the Council was to waive these fees permanently these will be a need to make up the shortfall in revenue through other sources such as general rates.

 Q8. What community-oriented/emergency services use the aerodrome for landing and takeoff and refueling?

 A. Maryborough airport is currently used by Royal Flying Doctor and Angel Flight.

 Q9. When will the land use study currently being undertaken be ready and when will the results be made public?

 A. Council will consider a report on this matter in either late January or early February this year. The Council will need to make a decision on when to release the recommendations publicly. Depending on the results of the study it may not be practical or commercially appropriate to release the findings immediately. This is a consideration that the Council will need to make after the Council has considered the report in detail.

 Q10. How much is this land use study costing the council?

 A. The land use study currently being undertaken is incorporated into the Master Planning budget for the airports. Council has allocated $60,000 for this purpose in 2009/10 with the land use component costing less than $20,000.

 Q11. How many outside consultants are/have been involved?

 A. To date the only use of external consultants for the best value land use study has been one company.

 Q12. When will the council’s “position” be adopted?

 A. Refer to response to Q4.

 Q13. Who is on the council’s executive?

 A. Refer to http://www.frasercoast.qld.gov.au/council/Executive%20Team.shtml , however to save time the current Executive of Council is Andrew Brien (Chief Executive Officer), Lisa Desmond (Director Organisational Services), David King (Director Planning Services), Wayne Sweeney (Director Engineering Services) and Peter Smith (Director Community Services).

 Q14. How many master plans/land use studies has this council and former councils been engaged in since 2005? At what cost?

 A. Both the former Maryborough and Hervey Bay City Councils prepared Master Plans for the individual airports. Currently the Council is undertaking the best value land use study which will be used to inform the future master planning for the airports. There has been work undertaken in relation to security plans, upgrades to facilities such as terminals, car parking etc. Some of this work has been doe in house and some has been external. In order to get a response today it is not possible to get accurate budget figures. Current year budget, as outlined in response to Q10 is $60,000.

 Regards

 Andrew

• Council related issues
• Comments(12)