13 Investigates: Big money for little airports

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Bob Segall/13 Investigates

August update: The runway resurfacing project at Peru Municipal Airport has been delayed. Originally scheduled for May, the project was postponed several times due to rain. Now it is delayed again as contractors decide what materials to use, according to Peru mayor Jim Walker. "We're working with the FAA now trying to figure out the type of asphalt we need," Walker said. "Nothing has been done yet, but we're hoping to get started by early September."

Original story:

Miami County - Peru Municipal Airport in Miami County has a runway, hangars and landing lights. What you won't see at the airport is lots of airplanes.

"We usually get at least one or two [planes] a day, but some days we don't get any," said Harry Denham, president of the Peru Board of Aviation .

Yet the small-town airport has received nearly $3 million in federal airport improvement grants in the past five years, including funds for a major runway resurfacing project scheduled to begin next week.

13 Investigates found across Indiana and the nation, small airports like this one receive hundreds of millions of dollars annually despite infrequent use and close proximity to other airports.

"Get it fixed or…"

Every time you purchase a commercial airline ticket, you pay a federal tax that helps fund the Federal Aviation Administration's Airport Improvement Program. The program is designed to develop our nation's airports, and last year it provided U.S. airports with $4.5 billion in grants, including $89 million to airports in Indiana.

Most of the money is directed to improvement projects at airports in small communities, like the runway project at Peru Municipal Airport.

"The cracks in the runway aren't safe and it continues to get worse," said Peru aviation board member Bill Mallow.

Because of those cracks, state inspectors determined most of the 4400-foot runway was in "poor" condition when they inspected the airport in 2009. The FAA responded earlier this year by approving a $1.2 million AIP grant to resurface 4000 feet of the runway.

"All they said was we had a time limit. Get it fixed or we close the runway," Mallow said.

The runway project is the latest improvement for an airport that has received $2,957,798 in AIP funding since 2005. The federal dollars have been used to also build a full-length taxiway, to resurface the airport's apron and to update the facility's master plan.

But most Peru residents interviewed by WTHR say they have never used the airport, some didn't realize the city has an airport, and others wonder why it's receiving millions of dollars.

"Seems like an awful lot of money. I'm not sure that airport gets much use," said Peru resident Neal Black.

How many flights?

The Indiana Department of Transportation reports Peru Municipal Airport had 5514 takeoffs and landings in 2008, when the state agency conducted its most recent airport traffic count.

That number may be much too high, according to local airport officials.

INDOT's 5514 traffic count recorded two years ago is equivalent to 106 takeoffs and landings per week. "We don't get anything like that," said Mallow, who said he believes the airport averages "three or four airplanes a day." Airport manager Ronnie Jett told WTHR the airport runway services "ten or twelve planes a week."

The airport does not maintain its own official traffic count. "I don't know the exact numbers. We don't even keep record of it," said Denham.

WTHR observed traffic at Peru Municipal Airport on three separate days. On two of those days, three planes took off and landed at the airport.

Bob Welch, a retired aircraft mechanic and inspector, was one of the pilots who used the airport. He took a flight in his light sport aircraft, which he houses inside one of the airport's hangars.

"This is more or less for recreation purposes," said Welch, who's been flying for more than 40 years. "Some days it's just me out here, but it's what I love to do."

On the third day of observation, WTHR did not see any planes using the runway.

WTHR staff spent at least eight hours at or near the airport during each day of observation.

The traffic counted by Eyewitness News is consistent with information provided by airport staff and board members and significantly lower than the number cited by INDOT.

INDOT public information officer Will Wingfield was unable to explain the discrepancy.

"They're statistics and with any statistic there's a margin of error," he said. "At the same time, we think the method we use to count is found to be accurate and is the best practice in the industry."

How it's counted

State transportation officials conduct an air traffic count at each of Indiana's 67 public use airports every three years. "We use an acoustical counter that listens for the RPMs of an engine running at full throttle to essentially tell when an aircraft is taking off," Wingfield explained. "The device converts that analog noise to a digital recording that's analyzed, and there's an assumption that there's a landing for every takeoff."

The difference between numbers provided by INDOT and the airport may be partially explained by limitations in the counting device. Wingfield said INDOT's counter cannot differentiate between a traditional takeoff and one conducted during a "touch-and-go" landing in which a plane briefly touches the runway during a landing, then immediately takes off again without coming to a complete stop. WTHR observed a pilot conduct five "touch-and-go" landings at Peru Municipal Airport in late June. Despite involving one aircraft, INDOT would consider that to be ten takeoffs and landings when calculating its traffic counts.  

Peru Municipal Airport is due for another INDOT traffic count next spring, and that count will show whether the airport's traffic continues a downward trend that began more than a decade ago. According to INDOT, Peru's airport traffic declined 65% over the past twelve years, dropping from 15,800 takeoffs and landings in 1996 to 5514 takeoffs and landings in 2008.

Peru's airport isn't the only community airport in the state to receive millions in federal grant money despite relatively little air traffic. Research by WTHR shows other small airports have received similar funding:

Indiana Airport 2009 Takeoffs & Landings Federal Funding Since 2005
Arens Field – Winamac Airport 4,504 $2,158,409
Kendallville Airport 5,623 $1,060,054
Logansport Airport 7,127 $2,883,771
New Castle-Henry County Airport 5,854 $2,619,987
Peru Municipal Airport 5,514 $2,957,798
Plymouth Airport 5,830 $1,902,829
Jasper County Airport 4,820 $3,508,639

Important tool

Despite infrequent traffic and declining numbers, Peru officials say the airport is vital to the city.

"It's a tool to attract business," said Peru mayor Jim Walker. "If we can land that one corporation because they have access to that airport, it has a value."

The airport has been open for decades. Has it attracted any corporations yet?

"The answer to that would be no," the mayor admitted. "Can we get them in the future? The answer is optimistically yes."

The Aviation Association of Indiana estimates the annual impact of Indiana airports to the state's economy is $5.2 billion, including direct, indirect and induced economic benefit.

The majority of that economic impact, according to the association, is from airports in small towns. A 2005 report published by AAI estimated Peru's airport contributed $4.7 million to the local economy. "They serve rural communities and allow corporate customers to have direct access to businesses in those areas," said AAI's Bart Giesler. "It's a fair question to ask ‘how much access do you really need?' but generally the more access you have to a community, the better you are."

Other options

But for corporations that want access to Peru, there are plenty of other options, including a much bigger airport just a few miles away. Civilian aircraft can fly into Grissom Air Force Base from 7:00 a.m. until 11:00 p.m.

"It's the longest runway in the state of Indiana," said Jerry White, a manager with Montgomery Aviation, the company that manages civil operations at Grissom. "We've got all the pilot aides of a big airport like Indy, but its as congested as somebody's backyard grass strip."

Grissom is seven miles from Peru. And airports in Wabash, Converse, Kokomo, Logansport, Rochester and Marion are all less than 30 miles away. Most of those airports now have (or soon will have) newly-resurfaced runways, too -- thanks to another $12 million in federal AIP funding.

Why does the FAA fund projects at so many small airports that are so close to one another?

"Rehabilitation projects and the need to preserve what we have are a high priority," said FAA spokeswoman Elizabeth Isham Cory. "General Aviation airports play a vital role in our nation's airport system. In addition to relieving congestion at the approximately 500 commercial service airports across the county, the network of over 2800 local airports provide access to air transportation to local and rural communities. These airports provide for critical services such as emergency response, medical transport, mail delivery, flight training and business aviation," she added.

"If we don't get that money here in Indiana, it will go to small airports in other states, or it will go to O'Hare or somewhere else," said Deanne Ross, president of NGC Corporation, an engineering firm that works with Peru Municipal Airport and several other airports in Indiana. "The money is going to go somewhere, and we might as well fight for our share."

Change needed

While Peru's mayor supports his city's airport and likes the idea of multiple aviation choices, he believes the future of aviation in his area may look different.

"We know we need to make some changes," Walker said. "Do we need to consolidate here? Is this airfield needed? Those questions you're asking, they're legitimate questions."

Walker said he is interested in investigating a "tri-county type of aviation authority" that could manage multiple airports more efficiently.

Denham believes Peru's Airport is already one of the most efficient in the state. "We run this whole place for about $75,000 a year. We get by here on the lowest budget of any airport around here," he said.

By comparison, Logansport's airport has an annual budget of $470,000. That airport – now funded by tax money collected through a countywide airport authority -- recently added a new hangar and remodeled terminal, including leather furniture, plasma televisions, a conference room and media center, and showers and a lounge for pilots. Earlier this year, Logansport's airport also purchased its own airplane that can be rented by the public.

"We've almost reconstructed the whole airport," said airport manager Tim Dalton. "We do want to be better than everyone else. We're proud of what we have here. We think we're probably the premier facility in north central Indiana and we welcome people to come here."

To fix or not to fix?

Officials in small communities say, for several reasons, they cannot afford not to perform repairs requested by the FAA.

With aviation-related fees and taxes dedicated from the Airport and Airway Trust Fund, FAA's AIP program picks up 95% of the cost of repair projects. The state pays another 1.25%. For Peru, that means it gets a $1.2 million resurfacing project for only $45,000 – and it split that cost with Miami County.

"That's a win-win – especially in these tough economic times," Walker said. "There's really no financial hardship for the city."

If the city were to choose not to fix the runway, allowing it to deteriorate further, it would be violating an agreement the city made with the FAA when it accepted previous AIP grant money. The city must maintain the airport to acceptable FAA standards or repay millions of dollars in past grants.

"If you have an FAA grant, you're locked in. You have no choice," explained Walker. "I can't fault the FAA because they tell you right up front: once you take that first grant from them, you have to maintain it going forward. You know you're getting locked in. I have to honor that contract."

It's good news for Welch, who likes to land his aircraft on smooth runways.

"I'm in favor of this airport getting some more improvements," he said. "Every town needs a good, clean, useable airport."

Click here to see a list of all Indiana airports and how much money they've received in federal Airport Improvement Program grants.