The city of Marion is making another attempt to find a buyer for the city-owned Marion Airport runway, after a previous request for purchase proposals passed with no submissions, leading to a council vote to begin the process of closing the runway.
The Marion City Council voted unanimously March 20, with Mayor Nick AbouAssaly’s abstention, to reissue a Request for Proposals (RFP) to purchase the runway, with new criteria.
The city had issued the RFP 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, according to city manager Ryan Waller. 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 sole runway at the Marion airport – which would lead to the closure of the airport itself.
The current plan calls for the runway to be closed by June 30 if a runway buyer isn’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.
The Marion airport is unique in Iowa in that it’s owned as part of a public-private partnership. 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 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.
At the March 20 council meeting, city attorney Kara Bullerman told the council that no RFP submissions met the city’s criteria before the March 3 deadline. The RFP process is required because the runway was purchased with bond proceeds, and because the city is required to sell the property for fair market value, she said.
“City staff is recommending that we revise and reissue the RFP with new criteria in order to meet our goals of fulfilling the city’s legal obligations, as well as selling the property to a buyer who intends to continue using the property as a runway,” Ms. Bullerman said.
An informal proposal to purchase the runway was submitted March 6, but it didn’t meet the RFP deadline or the minimum purchase price, Ms. Bullerman said, so the city is required to issue a new RFP to consider the offer or any other potential purchase offer.
The new RFP is expected to be posted by early April, with a 30-day window for responses, city officials said. The council would then consider any proposals at a future council meeting.
