G & H Aircraft Inc., a fixture at El Monte Airport for more than two decades, is being ousted from the airport for what the county says are violations of its rental agreement, and two investigations are under way in connection with the company.
The county ordered the company to leave by Jan. 15 after the Board of Supervisors voted to terminate the firm's rental agreement when G & H missed a deadline for full payment of more than $20,000 in back rent, county officials said. The company paid all but $531 dollars of the rent, but failed to comply with several other terms of the agreement, the officials said.
G & H has operated an airplane dealership, flight school and maintenance shop since 1962 and is the oldest and second-largest aviation concern at the county-owned airport.
Faces Other Problems
The company's owner, Glen Nickerman, faces other problems as well.
Nickerman's business relationship with county Aviation Division Chief Jack Tippie is being investigated by the county administrative officer, according to Tippie and other county officials. Tippie, who said he has bought four planes from Nickerman, said that his dealings with Nickerman have not posed any conflict of interest. Nickerman said he has not received special treatment from the county because of his relationship with Tippie.
In addition, the district attorney's office and the El Monte Police Department are wrapping up a joint, nine-month criminal investigation of Nickerman's business practices, according to authorities. Nickerman has denied any criminal wrongdoing and no charges have been filed.
Nickerman already has been charged by the state Employment Development Department with 10 misdemeanor violations of the state Unemployment Insurance Code involving about $6,500 in unpaid taxes. He pleaded not guilty to the charges on Dec. 6 in Rio Hondo Municipal Court.
Declined to Elaborate
Deputy Dist. Atty. Frederick Stewart, who is handling the district attorney's investigation of Nickerman, declined to elaborate on the case. However, a county memo concerning the case from George Y. Tice, county director of facilities management, quoted board Chairman Pete Schabarum as saying at a Nov. 12 supervisor's meeting that the investigation involves allegations of "fraudulent business practices."
Nickerman, 56, said in an interview this week that the investigation was triggered by customers who complained that he sold them airplanes that had bank liens against their titles without disclosing that information. He said that some of the liens had been paid off before sale of the planes, but that the banks had not removed the liens for reasons he could not determine. Nickerman said he is trying to arrange financing to clear up any remaining problems with outstanding liens on aircraft he has sold.
"Most of the complaints involved banks that never released the liens," he said. They are in the process of being resolved."
Schabarum requested the administrative officer's investigation after Art Gordon, the owner of a flight school and airplane repair concern at the airport, wrote to complain about business dealings between Tippie and Nickerman, said Tom Hibbard, Schabarum's senior deputy. In a letter to Schabarum, the tenant raised the question of whether Tippie was protecting Nickerman from eviction in exchange for work on Tippie's personal airplane.
Supervises 5 Airports
A 27-year county employee, Tippie supervises the operation of the five county-owned airports, El Monte, Compton Airport, Brackett Field in La Verne, Fox Field in Lancaster and Whiteman Airport in Pacoima.
Tippie said he has known Nickerman since before he went to work for the county, when they both worked at the then-privately owned Compton Airport. He said he has purchased four planes from Nickerman in the past 20 years, but said that the transactions have not posed any conflict of interest.
Tippie said that about 18 months ago he bought a twin-engine Cessna 310 from Nickerman. He said he parked the plane at G & H from then until early October, when Hibbard suggested that it be moved to Brackett Field to avoid the appearance of a conflict of interest. Tippie said that during that period the aircraft had been undergoing repairs and he paid no separate tie-down fee for its storage.
"I don't feel there's been any conflict," Tippie said. "I think it would be wrong, if we're trying to promote airports, to go to a non-county airport to have work done. The main thing is he had the airplane I wanted.
"He (Schabarum) asked the CAO to specifically check out my relationship (to Nickerman) because of accusations of some people there have made regarding my airplane and I haven't got anything to hide. I probably should have suggested it myself."
Nickerman said that he did not receive preferential treatment from the county because of his relationship with Tippie.
"Mr. Tippie has a lot of integrity," Nickerman said. "He's got a very important position and he doesn't stand up for me."
Blames Aviation Downturn
Nickerman said he has paid the back rent he owed and already has complied with some of the county's demands. He said he is trying to meet the other requirements and is attempting to persuade the county to reverse its decision. He blamed his problems on financial troubles stemming from a general downturn in aviation business.
Nickerman conceded that "things got a little lax," but added, "I consider myself a good operator."
Details of the county's efforts to oust G & H were contained in memos to the supervisors on Nov. 25 and Dec. 2 from Tice and Public Works Director T. A. Tidemanson.
Airport manager Richard Shaw said Nickerman has since paid his rent through Dec. 1. But when the matter first reached the supervisors on Nov. 12, G & H had slipped $20,477 behind in its rent, according to the Nov. 25 memo.
The county charged G & H $5,108 a month for a 9,600-square-foot hangar and office building and 35 tie-downs for small planes.
The memo said that G & H's rent had been late 47 of the previous 60 months, prompting the county to initiate termination proceedings 12 times. Each time, Nickerman came up with the rent before the matter reached the supervisors' agenda, Shaw said.
By the time the board moved to evict him on Dec. 3, Nickerman had paid all but $531 of the back rent, but had failed to comply with several other terms of its contract with the county, according to the Dec. 2 memo. Nickerman's $1-million insurance coverage of his premises did not cover rented aircraft and therefore was "inadequate" to meet requirements of the county's airport ordinance, the memo said.
$10,000 Security Deposit
Nickerman also told county officials at a meeting that day that he did not have a required $10,000 security deposit, the memo said.
The Nov. 25 memo said that G & H has a business contract to provide public flight instruction, aircraft maintenance, the sale of new and used aircraft and charter operations, but that it "appears that G & H Aircraft only sells new and used aircraft at this time."
The memo said that "numerous auto parts and engines were lying about the (G & H) hangar," and that 11 cars were found parked or stored on the premises, both violations of the rental agreement.
Nickerman said that he has proper insurance and that he has since come up with the money for the security deposit. Nickerman said that he does operate a flight school and has a mechanic who does maintenance, although he said that the flight school is not FAA-approved. "We've trained 27 new students in the last three months," he said. "There has never been a time when we haven't had a licensed A.I. (certified mechanic) in the shop."
Shaw said the county refused to renew G & H's lease in December, 1984, because of its history of delinquent payments and placed the company on a month-to-month tenancy.
Tippie, who is responsible for negotiating and enforcing rental and lease agreements with tenants, said Nickerman was given some leeway because of his longevity at the airport.
"He's been a tenant on the field for 22 years," Tippie said. "When you're an operator on the airport for that long, you get a certain amount of rights."
Nickerman met with Schabarum last week to discuss the matter and said he hopes that he can resolve his problems and remain at the airport. "We still got things going in the negotiating stages," Nickerman said.
But Hibbard said Schabarum "made no commitments whatsoever," adding that it is unlikely that the supervisors will change their minds.
Nickerman's troubles with the Employment Development Department began in mid-1984, when he allegedly failed to file a tax return for disability insurance tax withholdings, said Patricia John, a tax compliance representative for the agency. John said the matter had been handled administratively until the charges were filed on Dec. 6.
"We've been working on him," John said. "We don't file our criminal complaints frivolously."
Each of the 10 alleged violations carries a maximum punishment of six months in jail and a $500 fine, John said. Nickerman is accused of:
- One count of failure to file tax returns for the second quarter of 1984 regarding the withholding of disability insurance taxes for employers and employees.
- Five counts of failure to withhold or pay personal income tax deductions for employees during 1984 and 1985.
- Two counts of failure to remit deductions withheld from employee wages during 1985.
- Two counts of failure to remit employers' contributions during 1985.
Nickerman downplayed the importance of the charges, saying, "I have worked for about a year and a half without a paycheck. I just haven't had a lot of money. When they audit my books . . . a lot of those charges will be dropped."
Nickerman also has crossed paths with federal regulators. Records obtained through the Freedom of Information Act and court files show that the Federal Aviation Administration has cited Nickerman and G & H several times, but the agency has reversed most of its disciplinary actions and dropped one of the cases.
Court records show that in 1969 the FAA suspended Nickerman's personal certificate as a mechanic and G & H's repair station certificate because he cleared an airplane to fly even though the plane had "airworthiness discrepancies and maintenance defects." The certificates later were reinstated after the company passed a subsequent inspection.
FAA records show that in 1974 the agency proposed revoking G & H's repair station certificate after the firm allegedly "failed to exercise the degree of care, judgment and responsibility required." The matter dragged on for six years, but the agency withdrew its case because witnesses no longer were available, an FAA spokesman has said.
In 1981, the FAA ordered the revocation of G & H's aircraft station repair and air taxi certificates, citing 47 violations of federal safety and maintenance regulations. A few days before the order was to take effect, the agency reversed itself and said revocation of the air taxi certificate was "not warranted." A spokesman said at the time that FAA officials met with company representatives and agreed to rescind its order after Nickerman agreed to pay a $500 penalty.
G & H turned in its air taxi certificate in May of this year, saying it had terminated the service, FAA spokeswoman Barbara Abels said.
The FAA revoked the repair station certificates that year for maintenance violations, barring G & H Aircraft from operating a repair station. The company still may hire certified mechanics to perform repairs. However, the individual mechanics--not G & H--are liable for their work, Abels said.
G & H did not apply for renewal of its pilot training certificate in 1981, Abels said. "The company was under heavy pressure," Abels said. "We were intensifying our inspections because of numerous problems that had been reported. They surrendered it (the certificate) before possible enforcement action could be taken." A certificate is not required to train pilots, but FAA-approved schools must follow higher standards than non-approved schools, Abels said.
G & H also was the subject of numerous civil suits alleging that it represented unsafe or ill-equipped planes as airworthy between 1975 and 1984, court records show. Other lawsuits involving financial disputes alleged evidence of fraud. The company lost four of those suits and settled three others, the records show.
"Those problems have all been resolved a year and a half, two years ago," said Nickerman, who refused further comment.