Spending Airport Funds

The uncertainty of these times should prompt county leaders to revisit assumptions about revenue streams at John Wayne Airport and the proposed commercial airport at El Toro. The prudent use of airport-related funds for redevelopment and other purposes has become increasingly important as the controversial planning at El Toro proceeds and as the county reassesses its aviation picture in light of the Sept. 11 terrorism.

Now that planning for the El Toro airport site is at an advanced stage, seeing where the money comes from and where it is supposed to go in development around the site is increasingly important. We know that airports are primarily about getting people from place to place. But there are also other things that go on around airports as ancillary development and, in the case of El Toro, the amenity of parkland.

Cash flow has been central to the planning and promotion of El Toro. Diverting revenue from John Wayne Airport has been a key component of the county’s proposed two-airport system. Money raised at John Wayne Airport has provided funding for planning El Toro, and some of the justification for pressing ahead with the particular aviation plan envisioned for Orange County’s future.

Thus far, county planners have been very generous with John Wayne funds as a source of El Toro planning. But the county also has other obligations, to pay for the John Wayne facility and for some of the cost of making the airport secure. It needs to be certain that these obligations still will be met in the future.

Redevelopment around El Toro poses another challenge.

Recently, planners acknowledged that they would divert property taxes from the base to build a park next to the proposed international airport. This zone, separate from what the county considers in its economic projections for the airport and for its construction, is a substantial sum--an estimated $988 million over 50 years to pay for needs other than the airport.

But if this revenue is diverted from the county general fund into a special fund for airport park land only, its availability for other county needs would be ruled out. The county needs to consider seriously how it will use this money. Unfortunately, the proposal surfaced late and unexpectedly.

In considering what happens to revenue streams at El Toro and John Wayne, the county needs to think through what will happen if rosy projections aren’t met, and if the current funds from John Wayne change.

This task falls not just to airport management but to the Board of Supervisors. They must reassess the overall financial picture in light of recent events. At John Wayne, they need to be sure that are not counting on pots of gold that may not always be there. If an El Toro airport goes forward as planned, county supervisors should be certain that they are not foreclosing options for financing future needs.

This is an uncertain time, when projections and expectations may be subject to change. It calls for fiscal prudence.