County Council takes key step toward commercial flights at Paine Field

EVERETT — The Snohomish County Council on Monday approved a lease option that could open the door to commercial air service at Paine Field, a topic mired in decades of fierce debate.

Council members voted 3-2 in favor of the agreement with New York-based Propeller Airports.

Once the meeting concluded, Propeller CEO Brett Smith sought out the two dissenting council members and other members of the opposition.

“The next step is — No. 1 — we need to work with the community,” Smith said. “We want there to be as much community involvement as there can be.”

The option to lease gives the company three years to design a passenger terminal and perform environmental studies. After that, Propeller could sign a 30-year lease, with two optional 10-year extensions. The company would pay for building and operating the facility.

Don’t expect anything to be up and running for at least a year, as Propeller talks to airlines and explores potential terminal designs, Smith said.

“We’ve got to do this right,” he said.

Propeller’s lease option will cost the company $3,575 per month. That’s one-tenth of the $35,755 monthly lease if the deal advances. The county also would require a one-time traffic-impact fee of $333,000.

The county will receive 2.5 percent of gross revenue during the first four years after the terminal opens for business, in addition to the lease. After that, the county would receive 5 percent of revenue for the remainder of the lease. That includes money from air service as well as parking.

A two-gate terminal building could be up to 30,000 square feet.

Airlines will ultimately determine which destinations any Paine Field-based flights serve, he said. Locales such as Spokane, Portland, Oregon, or the Bay Area might be possibilities.

The vote came after about 40 people from both sides of the issue addressed the council.

Supporters were dominated by Everett’s business and political power brokers, opponents by people who live in nearby Mukilteo.

Opponents urged the council to wait longer to consider the consequences of their decision, given that details of the potential 50-year lease only became public in mid-February.

“There’s no downside to conducting due diligence to make sure you get this huge decision right — for the county, taxpayers and for your own legacies and political careers,” said Michael Moore, president of the Save Our Communities opposition group.

Supporters said the opposite: That it’s time for county leaders to put an end to stall-tactics.

“Decisions need to be made at some point, and it’s time to move on,” said Jim Langus, a former administrator for the Snohomish County PUD and the city of Everett.

On Monday, Propeller CEO Smith also challenged opponents’ attacks on his company’s track record. The opponents maintained the business has only been around 45 days. Founded in 2008, parent company Propeller Investments has been developing an alternative to Hartsfield-Jackson International Airport in Atlanta, one of the busiest in the world.

Propeller’s chairman, Robert Aaronson, is a former top Federal Aviation Administration official and former executive for the Air Transport Association of America, Smith said. That’s the main industry group for U.S. airlines. Aaronson also has helped manage major U.S. airports, including John F. Kennedy and Newark international.

Other arguments against expansion included the spectre of future growth in the number of flights beyond the current vision of five or so per day. Smith said the area’s population won’t support more than a two-gate terminal, but he didn’t provide a specific number of daily flights.

Paine Field already sees about 300 flights per day, including general aviation planes and jetliners manufactured by Boeing or flown here for maintenance at Aviation Technical Services (ATS).

The Boeing Co. has said that regular commercial passenger flights at Paine Field would not interfere with its Everett factory, where it builds 747s, 787s and 777s. It will also build the future 777X here. The aerospace giant is said to be more worried about the county losing federal funding or anything else that threatens smooth airport operations.

FAA rules require the county to negotiate in good faith or risk losing millions of dollars in grants the airport relies on to keep running.

ATS, the largest business at the airport after Boeing, supports scheduled commercial passenger flights.

“It will essentially make us more competitive, allowing us to grow and expand in Everett,” said Gabe Doleac, the company’s senior vice president of strategy.

A 2012 federal aviation study concluded that noise, traffic and pollution from commercial passenger jets would not harm nearby communities. It looked at 23 passenger flights per day, far more than anything Propeller has suggested.

The proposed Paine Field lease involves land between the airport’s administrative offices and control tower. The area covers about 466,000 square feet.

Propeller first approached the county about a potential lease in June. Serious negotiations began in October.

County Executive John Lovick’s office sent the option to lease to the council on Feb. 13, with a recommendation for approval.

With four council members split on the issue, the tie-breaking vote was left to Councilman Terry Ryan.

The potential for economic development and the risk of losing FAA grants influenced Ryan’s decision.

“I cannot jeopardize future FAA funding for Paine Field, therefore I’m voting ‘yes,’” Ryan said.

Joining him in support of the proposal were Councilmen Dave Somers and Ken Klein.

Council members Brian Sullivan and Stephanie Wright voted against the option to lease. They both represent south Snohomish County communities in the Paine Field flight path. Sullivan also is a former mayor and city councilman for Mukilteo.

“I’d like to see the lease tightened up if this goes forward,” Sullivan said.

Wright, for her part, said she hoped Propeller and the local business community would help to “make the best of this situation.”

“I’m going to be voting ‘no’ to flag concerns,” she said.

Alaska Airlines threw another wrinkle into the discussions Friday by asking council members to delay a vote. The Seattle-based carrier wanted to discuss the lease with county leaders and other stakeholders.

Alaska is “taking a fresh look at (Paine Field) to determine whether the demand exists to service this market, irrespective of whether any other carrier enters the market,” wrote Megan Ouellette, the company’s managing director of government relations.

Alaska in years past has considered starting regular passenger flights from Paine Field but in 2012 said it was no longer interested because of improvements at Seattle-Tacoma International Airport. The carrier, however, suggested its position could change if other airlines entered the picture.

Allegiant Air of Las Vegas also had explored service at the Snohomish County airport.

The city of Mukilteo and Save Our Communities have taken the FAA to federal court over Paine Field passenger service, demanding further environmental impact studies. The case was stayed last year but would be reactivated once a viable terminal proposal moves forward.

Noah Haglund: 425-339-3465, Twitter: @NWhaglund.

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