A buyer has been landed for the runway property at the Marion Airport, moving the airport to fully private ownership and saving the airport itself from potential closure.
The Marion City Council approved a resolution Thursday to accept a proposal from 530 Investments LLC to purchase the runway property from the city for $500,000, including contingencies for improvements to the property.
The proposal also includes a request for $50,000 in property tax rebates, which will be “staggered over a period of time,” city manager Ryan Waller told the council.
After discussing the proposal with the Federal Aviation Administration for regulatory compliance, the city will prepare real estate documents and the matter will return to the council for final approval, with an anticipated sale closing date of June 25, Mr. Waller said.
Marion Ward 2 council member Grant Harper, the council’s liaison to the Marion Metropolitan Airport Committee and the Airport Visioning Team, noted that the primary objective of the plan is to “maintain the airport in its operational condition,” even after the city exits its ownership stake.
“In this case, it’s simply returning it to essentially private ownership,” Mr. Harper said. “But the key aspect is that the airport maintains its operational status.”
The city had first issued a request for proposal (RFP) to purchase the runway on Feb. 7, with a minimum purchase price of $875,000 and a deadline of March 3, but the deadline passed with no proposals being submitted. The RFP included a mandate that the buyer continue to use the property as an airport runway.
As a result, the Marion council voted unanimously March 6 to initiate the process of closing the Marion airport runway – which would have effectively led to the closure of the airport itself.
However, the council voted unanimously March 20 to reissue an RFP to find a buyer for the runway, with new criteria.
Under the plan, the runway would have been closed June 30 if a buyer wasn’t found, marking the latest step in a years-long process of evaluating the city’s relationship with the airport.
The decision came after an extensive review process that began in November 2021, when city officials met with officials from LuxAir Aviation to negotiate new lease terms for the airport and address long-term cost concerns.
LuxAir, a private firm, purchased most of the airport property in June 2015 and is responsible for daily fixed base operator (FBO) operations, but the city purchased the airport’s runway and FBO building for $1.5 million.
The Marion airport has long been unique in Iowa in that it’s been owned as part of a public-private partnership. The council approved a new lease agreement with LuxAir in April 2022, providing for annual payments, creating safety inspection requirements, and setting a one-year process for an Airport Visioning Team (AVT) to research a potential operating structure for the city’s future involvement in the airport.
The visioning team, comprised of residents, pilots, members of the Marion Municipal Airport Committee, and two council members, met eight times and submitted their findings to the full council, indicating that an operating budget for the airport would be “break even at best” and provided analysis of the financial impact of future runway ownership on Marion taxpayers.
The committee also conducted surveys with residents and business leaders to gauge the airport’s community importance as compared with other priorities.
“The results of that were no clear, compelling need for business use of the airport,” Mr. Waller said.
The council then reached a consensus in February 2024 to exit the airport’s runway ownership, and at that time, LuxAir officials said they would be interested in purchasing the runway from the city. LuxAir and city officials met eight times to discuss options, but the city rejected two proposals from LuxAir – one for the city to donate the runway to LuxAir, the other for the city to continue to assume financial risk and liability for the airport’s operations – and provided “a few counter-offers.”
“To date, the city has spent over $4.5 million, but again, does not have a sustainable revenue stream to offset those costs and to continue operations,” Mr. Waller said.
Attempts to reach 530 Investments LLC and its registered agent, Peg Morris of Springville, for more information on the purchase and future airport plans were unsuccessful as of Friday morning.
