A signed agreement to move forward with negotiations between Stephenville Airport Corporation and KAZ Aviation will probably not happen by summer’s end, as originally stated by the airport corporation.
Stephenville Airport Corporation chair Shawn Tilley says since a letter of intent was signed between the airport and KAZ back in June, progress on signing an actual deal has slowed to a virtual stop.
Mr. Tilley says he feels the corporation fulfilled its commitment to do what they could to see the deal through, doing what he called a “tremendous” amount of work in terms of information gathering. He says they also hired a new person to their staff to put together a package of information their lawyer advised would be needed in their type of deal.
“The vast majority of it, has been ready for over a month,” he says of the gathered information.
But can a deal still be agreed upon and signed by the end of August? Mr. Tilley doesn’t think so. He says there’s been little to no communication with the company, KAZ Aviation, for the last few weeks.
“I don’t think there is near enough time for that to happen now,” he says. “It’s realistically going to come to a point in time where the airport board is going to have to come to, for lack of better terms, fish or cut bait and move on to other concepts.”
Other concepts, he says, would include working from zero again to decide on another kind of divestiture – meaning to hand its assets over to another party to manage or run – to a different operational schedule. Closure, he says, has also not been ruled out.
“We’ve consistently lost money, so our status quo hasn’t cut it,” he says. “It’s hard to go forward when your business plan depends on diverted aircraft due to inclement weather.”
The Stephenville airport, how and if it continues to operate into the future continues to be a source of much discussion in the area and on the internet. Numerous pages have sprung up over the last year on the social networking site, Facebook, where people have discussed everything from what people feel is a lack of government support for the facility to a drive to try and get numerous airlines to operate from the community.
Moving forward
Mr. Tilley says he met with the board and town council last week to discuss what next steps the airport should take. He says the airport and town are fully involved in decision making for the business and they will now work on what they need to do to go forward.
“This includes working on getting new board members, some new ideas or just to understand what the options are if the KAZ deal doesn’t happen by the end of August.”
While he says the airport is not presently in as bad a financial position as it has been in the past, the board needs to figure out how it is going to survive. They are close to having both government-supported lines of credit used up.
“The airport is big – expenses are big,” he says.
Besides completing groundwork for the KAZ deal, Mr. Tilley says the airport has been working on creditor forgiveness for the last number of months – to attempt to settle outstanding debts owing since the airport filed for bankruptcy in 2005. So far, he says, a vast majority of creditors have agreed to settle their differences. If they can get 100 per cent to agree, they may be able to get out of bankruptcy, he says, and then be eligible for funding applications.
“It’s also a nice symbol, to show you’ve turned a corner,” he says.
As the Aug. 30 deadline of signing an agreement with KAZ approaches, Mr. Tilley reflects on the time, effort, and work he says has gone into trying to make something positive happen for the facility.
“August 30th is not just a day,” he says.
“It’s two year and two months.”
Steve Bowlin, the executive with KAZ Aviation responsible for expansions, was contacted about this story but did not answer the Georgian’s questions by press time.
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