Johnson Aviation extends contract with city

The City of Newton extended its contract with Johnson Aviation, Inc. to continue operating and overseeing the Newton Municipal Airport for another eight years and also agreed to requests by Ethan Nasalroad, president of Johnson Aviation, of additional compensation for managing the airport.

Several amendments were proposed, and subsequently approved by the Newton City Council at its June 3 meeting, that affect the airport’s management contract, fixed-base operation lease and fuel fee agreement with the city.

“As a manager (of the Newton airport), we wanted to make sure that we were included in the minimum standards that were passed a year or so ago,” Nasalroad said. “Our compensation needed to increase due to our cost of labor. So we asked for that, and the city was all for it. We appreciate the support from the city.”

Revisions to the management contract require a representative of Johnson Aviation, most likely Nasalroad, to make an annual presentation to the council every January, rather than submitting a written plan and report. References to the recently approved airport rules, regulations and minimum standards were also added.

Adjustments to the annual compensation rate for the management contract, currently set at $32,220, were also approved, including a minimum 2 percent increase every July 1. Beginning this year, the annual base compensation rate would increase to $35,474.

The city’s point of contact for the airport will also change from the public works director to the community service manager. The airport management contract, as well as the fixed-base operation lease and fuel fee agreement, will be extended through June 30, 2027.

Johnson Aviation proposed the annual rental fee drop from $8,000 to $5,000 over time. For instance, it would drop to $7,000 on July 1, 2019, and then drop again by another $1,000 increment the next year until the proposed $5,000 amount is reached. Again, references to airport rules, regulations and minimum standards were added, while language references of “Johnson” will change to “operator.”

Staff estimate the costs to the city due to the contract changes are estimated to be $3,771 for the first year. Subsequent years will drop to about $1,709 and $1,724. The total cost increase for the first three years of the revised contracts is an estimated $7,204.

Before the council’s approval of the contract, a lengthy discussion followed between citizens, council members, city staff and Nasalroad himself.

Two citizens in particular, Fred Rhodes and John Beck, disagreed with the airport’s business model and asked the city to reevaluate or rethink the minimum standards — tailor-made rules and regulations that are often unique to each airport to fit the needs of its business — be set on the facility.

Rhodes had even described the airport as “dead.” Nasalroad opposed that notion, arguing “there is so much going on” at the airport; though he did concede that, if anything, Newton’s aviation market has decreased due to nearby competitive airports.

Brian Laube, community services manager for the City of Newton, said Johnson Aviation takes in about $41,676 a year from this contract; apart from capital improvement projects, the airport cost the city about $1,700 a year to operate during the past fiscal year. However, the requested contract revisions, Laube added, are to keep up with Johnson Aviation’s increasing costs.

In a written statement for the city council, Nasalroad said, “With the labor costs for our maintenance responsibilities alone increasing $20,000 since the last renewal in 2013, we feel this new contract is a great value to the taxpayer but more importantly we look forward to continuing the airport operations in a professional, cost-effective manner. It is a pleasure to operate our business here at Newton and we consider it an honor to be trusted with representing our community.”

Contact Christopher Braunschweig at 641-792-3121 ext. 6560 or cbraunschweig@newtondailynews.com