In the ongoing battle over the fate of Santa Monica Airport, a group of aviation organizations and businesses has accused the coastal city of imposing illegal landing fees, diverting airport funds to non-aviation uses and setting unfair leasing policies to force out aeronautical tenants.
In a complaint filed late Friday with the Federal Aviation Administration, the group alleges that the city has pursued plans for years to make it increasingly difficult for aviation businesses, pilots and aircraft owners to operate at the famous airport that was once home to Douglas Aircraft Co.
"Simply put, the city has created a financial structure which imposes enormous, ongoing, unsustainable — and clearly impermissible — financial burdens and deficits on the airport, which historically has operated on a break-even or near-break-even basis," the complaint says.
The action is being taken by the Aircraft Owners and Pilots Assn.; the National Business Aviation Assn.; Kim Davidson Aviation Inc.; Bill's Air Center; Justice Aviation Inc.; and Mark Smith, a local pilot and aircraft owner. Their attorney is Richard K. Simon.
They allege the city has violated FAA regulations, the terms of its federal airport improvement grants and a 1948 agreement that transferred the airport from the U.S. government back to the city after World War II. Under the later agreements, the general aviation hub must remain open at least until 2023 if not longer.
The far-reaching complaint triggers an administrative process in which both sides present evidence to the director of the FAA's Office of Airport Compliance. Any ruling can be appealed twice within the FAA and later in federal court if necessary.
Santa Monica Deputy City Atty. Ivan Campbell, who handles airport matters, declined to comment, saying the complaint was still under review Monday afternoon.
The group contends that the city set excessive and unreasonable landing fees for Santa Monica-based aircraft in 2013 based on improper methodology, impermissible charges for airport expenses and other inadequately documented costs.
It claims the city approved the fees without economic justification or adequate notice to airport tenants, denying them the opportunity to be heard.
The complaint notes that the city has made millions in loans to the airport, much of them at interest above market rates and restrictions set by the FAA. The interest, which reached as high as 8%, allegedly resulted in the illegal diversion of airport funds to city coffers.
The group further contends that the documentation for airport loans was often missing and inadequate. In one example from the complaint, the city purportedly charged the airport interest for borrowings made more than six years before the date claimed in the loan documents.
In addition, the city has denied long-term leases to aviation-related businesses at the airport while granting them to non-aviation users at lower rents, such as Santa Monica College. According to the complaint, certain aviation tenants now rent on a month-to-month basis, leaving those businesses without any formal leases since July 2015.
The group has asked the federal government to force Santa Monica to return all diverted revenue to the airport and put the city on notice that it could lose its federal transportation funding.