Okaloosa County BOCC — April 7, 2015 — Okaloosa County Letter of Inquiry Revenue Diversion 4.1.15

e U.S. Department Southern Region Airports Division of Transportation 1701 Columbia Ave. sl oy (404) 3056700 FAX: (404) 305-6730 April 1, 2015 Mr. Sunil Harman Airport Director Okaloosa County Airports 1701 State Road 85 North Eglin Air Base, FL. 32542 Letter of Inquiry Dear Mr. Harman: It has come to our attention that an article published on nwfdailynews.com, on March 27, 2015 suggests that at least one Okaloosa County Commissioner has proposed using airport revenue to “put a good dent’ in the county’s outstanding stormwater needs.” (see enclosed article). While we recognize that this is simply a media article and not the official position of the county, the suggestion raises serious concerns with the FAA. As a condition precedent to providing airport development assistance under the Airport Improvement Program (AIP), the Secretary of Transportation and, by extension, the FAA must receive certain assurances from the airport sponsor. Upon acceptance of an AIP grant, the assurances become a binding contractual obligation between the airport sponsor and the federal government. The assurances made by airport sponsors in AIP grant agreements are important factors in maintaining a viable national airport system. Title 49 U.S.C. § 47107(b) requires the FAA to receive the county’s written assurance that all revenue generated by the airport will be expended for the capital or operating costs of the airport, the local airport system, or other local facilities owned or operated by the airport owner or operator and directly and substantially related to the air transportation of passengers or property. The county has provided this assurance. This statutory requirement is reflected in Grant Assurance 25, Airport Revenues. To date, the FAA has provided in excess of $85 million in AIP funding to Okaloosa County’s airports. Okaloosa County is obligated to comply with its AIP grant assurances and the statutory requirements outlined at 49 U.S.C., § 47101, ef seq. The enclosed article describes a scenario which, if accurate, may be inconsistent with the county’s obligations. Use of airport revenue for purposes other than the capital or operating costs of the county’s airport system may be considered unlawful revenue diversion subject to sanctions for noncompliance. The FAA’s Policy and Procedures Concerning the Use of Airport Revenue (61 Fed. Reg. 7696; 7722 (February 16, 1999)) requires the FAA to review this matter. As such, we request that the county respond to the substance of the article confirming that, in fact, the county does not intend to use airport revenue for non-airport purposes or, in the alternative, provide a legal opinion as to why the county believes that doing so would be consistent with its federal obligations. We ask that you respond within 10 days of receipt of this letter. Thank you for your attention to this matter. If I can be of any assistance or answer any questions that you might have, please don’t hesitate to contact me at (404) 305-6739. Sincerely, x@ww«% e Deandra Brooks Airport Compliance Specialist Encl. cc: Ms. Winsome Lenfert, Manager, Airports Division, Southern Region Mr. Bart Vernace, Manager, Orlando Airports District Office Office of Airport Compliance Print - Local Page 1 of 3 nwidailynews.com news & information for the emerald coast This copy is 101 your personal, NONCONNNEIcial use only County officials sound off on budget priorities By KARI C. BARLOW | Daily News Published: Friday, March 27, 2015 at 16:33 PM. Okaloosa County’s 2015-16 budget deliberations won'’t begin until mid-summer, but officials are already prioritizing funding needs. @ A majority of the commission has already said it will not support higher taxes — property or otherwise — in the coming year. [ ] 4 “We can live within our means,” said County | W Commissioner Carolyn Ketchel. “People do not have an appetite for increased taxes or user fees or whatever you want to call it.” County Commission Chairman