@ US. Department a Federal Aviation Administration 10101 Hitwoos Parkway commotion ‘Arpots Division, Southwest Region Safety and Fon Worth, Texas 76177 Federal Aviation Standards Branch ‘Administration May 24, 2018 Mr, Henry L. Thompson, A.A.E., IAP Director of Airports Shreveport Airport Authority 5103 Hollywood Ave. Suite 300 Shreveport, LA 71109 Dear Mr. Thompson: Shreveport Downtown Airport Land Use Compliance Inspection ~ Feb 27-Mar 1, 2018 Shreveport, LA. A representative of the Federal Aviation Administration conducted a land use inspection of the Shreveport Downtown Airport February 27, 2018 through Mar 1, 2018. The purpose of the inspection ‘was to ensure that the airport was comy ith the terms of its Federal obligations dealing specifically with the use of airport property, aeronautical leases and nonaeronautical leases as well as airport safety. The inspection consisted of a review of aeronautical leases, an airport property tour, inspection of hangar- use and finally an airport safety inspection including the entire aircraft operating arca, The inspection revealed the Downtown Airport Management staff are doing an exceptional job in the realm of safety compliance, including airport daily self-inspections of the aircraft movement area and airport maintenance. However, there were several deficiencies related to grant assurances, Grant Assurance 5 (Preserving Rights and Powers), Grant Assurance 23 (Exclusive Rights), Grant Assurance 24 (Fee and Rental Structure) and Grant Assurance 29 (Airport Layout Plan) were rated deficient, requiring further attention by the sponsor. ‘These areas are detailed within the attached report and require the sponsor to develop and submit a Corrective Action Plan for FAA approval. Failure to remedy those areas deemed deficient could negatively affect future grant funding. We appreciate your cooperation during the inspection. | look forward to working with you as we resolve these issues, Please call me at (817) 222-5671 if you have any questions. Sincerely, a flus, A.A.E, Airport Compliance Program Manager FAA Southwest Region (ASW-625) 10101 Hillwood Parkway Fort Worth, TX 76177ce: Division of Aviation Louisiana Department of Transportation and Development P.O. Box 94245 Baton Rouge, LA 70804-9245 ASW-640 ACO-100 Attachments: 1) Post Inspection ReportSouthwest Region Airports Division FY-2018 Post Inspection Land Use Report Shreveport Downtown Airport, TX (SHV) Prepared by: Gary J. Loftus ] Airports Compliance Program Manager | Airports Division, FAA Southwest Region 10101 Hillwood Parkway ___| Fort Worth, TX 76137 [Date of Inspection: _ February 27, 2018 — March 1, 2018 [Inspection Site Location: | Shreveport Downtown Airport : ‘Airport Owner___| City of Shreveport, Louisiana FAA Representatives | Gary J. Loftus, Airports Compliance Program Manager, Southwest | Region, Fort Worth, TX City /Sponsor Contacts: | Ollie 8. Tyler, Mayor of Shreveport Henry Thompson, A.A.E., Director of Aviation William Cooksey, C.M., Deputy Director of Aviation Stacy Kuba, A.A.E., Manager of Shreveport Downtown Airport : 1. Purpose of the inspection: In response to a General Accounting Office report issued in May 1999 entitled “Unauthorized Land Use Highlights Need for Improved Oversight and Enforcement” and language in Senate Report No. 106-55, also issued in May 1999, the Federal Aviation Administration (FAA) adopted a program to conduct annual land use and grant assurance compliance inspections at various airports. The data collected by these inspections is compiled and included in the Annual Airport Improvement Program Report to Congress. This report lists airports that are not in compliance with grant assurances or other requirements with respect to airport lands. 2017 Airport Master Record Statistics (November 1, 2017): Based aircraft ~347 (277 single-engine) (62 multi-engine) (8 jet aircraft) Operations ~ 55,591 (278 military)SHREVEPORT DOWNTOWN AIRPORT, LOUISIANAShreveport Downtown Airport Shreveport Downtown Airport (Airport) is public-use airport owned by the City of Shreveport and operated by the Shreveport Airport Authority. The Airport, located three nautical miles north of Shreveport, Louisiana, is classified as a reliever airport with 347 based aircraft and 55,591 annual operations. ‘The Airport has two runways, Runway 05/23, a 3,200 foot long by 75 foot wide asphalt runway, and Runway 14/32, a 5,018 foot long by 150 foot wide asphalt runway. In 2003, the airport had 211 based aircraft and a total of $0,391 operations. In 2008, based aircraft decreased to 142 aircraft conducting 58,608 operations. By 2017, the total reported based aircraft number increased by 205 to 347 based aircraft. However, even with the addition of 205 aircraft in the nine years since 2008, reported flying operations at the Shreveport Downtown Airport reduced by 3,000 to 55,591 ‘operations in 2017. ‘The Shreveport Downtown Airport Manager maintains and updates the Aircraft Registry Data Base information for the airport. Prior to the inspection, the DTN Airport Manager had begun an audit of all hangars and based aircraft for comparison with information in the Aircraft Registry Data Base. At the time of this report, the audit was not yet completed. Il. Federal Land Transferred to the City ‘The Shreveport Downtown Airport was deeded to the City of Shreveport in 1949 by the United States, through the War Assets Administrator, pursuant to Reorganization Plan 1 of 1947 (12 F.R. 4534) and the powers and authority of the Surplus Property Act of 1944, as amended. Consequently, the City of Shreveport has nondiscrimination obligations pursuant to Title VI, Civil Rights Act and obligations to comply with statutory exclusive rights prohibition under the surplus property conveyance documents In addition, the planning and development of the Shreveport Downtown Airport has been financed, in part, with funds provided by the FAA under the Airport Improvement Program (AIP), authorized by 49 US.C. § 47101, et seq. The Shreveport Airport Authority has entered into numerous AIP grant agreements with the FAA since 1982. The Sponsor has received a total of $15,719,819 through fiscal year 2017 in Federal Airport Development assistance directly from the FAA for the Shreveport Downtown Airport. Total federal investment in the Shreveport Downtown Airport exceeds $17,300,000. Prior to 1982, $1,586,000 in Federal assistance was provided to Shreveport Downtown Airport. A. FAA Releases of Property None B. Land Releases by City Without FAA Release None C. Grant Acquired Land None ReportedD. Airport Improvement Program-Noise Compatibility Land None E. Sponsor Donated Land None F, Federal Commitment and Investment a, Total Federal Airport Improvement Program (and legacy Acts) Funding: $ 17,306,016. b. Funding used for airport survey, airport design, airport planning, paved surfaces construction, airfield lighting, various navigational aids, drainage projects, apron expansion, fencing, perimeter road rehabilitation and runway and taxiway extension, repair and rehabilitation, TIL. Funding Snapshot Shreveport Downtown Airport (DTN) Shreveport, LA (NPIAS G/ P/ ¥/3) FAA Site #: 07739.*A. Funding/Grant History FYR | Agency | ST/Local(S) | Federal(S) Diseretionary(S) | Project Description 1955 | FAA 8,018 8,018 0 Medium Intensity elevated marker Tights on Rwy 14/32 and vault modernization 1959 | FAA 14,204 14204 0 ‘Construct connecting taxiway between souith end of ‘NIS runway and SE end of NEISE runway. Pave 40” to Rwy 32 1964 | FAA 24,800 245900 0 Construct 50° Twy from 18/36 to Runway 23 approach 1968 | FAA [142,115 138,260 0 Construct taxiways, reconstruct ranway 14/32 edges, install HIRL Runway 14/32. Install Twy lighting 1976 [FAA | 720,169 720,169 0 Overlay Rwy 14/32 (incl marking), relocate access road, reconstruct Twy A, consiruet Rwy I4holding apron 197 | FAA 20,576 205,576 0 Reconstruct parking apron, Reconstruct Twy D. 1979 [FAA | 100,375 401,500 0 Construct and mark parallel taxiways to Rwy 14/32 and 5/23 1982 | FAA 2,965 33,570 0 ‘Conduct Airport Master Plan Stud FYR | Agency | ST/Local(S) | Federal(S) Fed Discretionary | Project Description 1987 | FAA. 0 456,050 45.606 Rehabilitate runway, Rehabilitate taxiway, Install Apron Lighting 1990 | FAK 35,000 7 75,000 Rehabilitate runway, Rehabilitate taxiway, Improve Airport Drainage. 1990 | FAA 0 0 72,000 ‘Conduct Airport Master Plan Stud 1991 | FAA. 0 40,023 579,831 Improve runway safety area FOR Rwy 14. 1992 | FAA, 0 0 489,082 Tnstall runway lighting, install miscellaneous NAVAIDS, Rehabilitate Taxiwa) 1994 | FAA 34913 0 SADE Install miscellaneous NAVAIDS, Improve Runway Safety Area 1999 | FAA 440264 999,571 Extend runway, improve access road, extend taxiwa 2000 | FAA 75,000 B2a5T 319,118 Rehabilitate runway — overlay Ruy 1432FYR | Agency | ST/LocalS) | Federal) ] Federal @) Project Deseription = Encidement | Discretionary 2001 [FAA | 8,000 80,000 Conduet Airport Master Plan Stady [2003 [FAA [45,000 450,000 Rehabilitate Apron : 3004 [FAA | 104,888 53,277 Rehabilitate Apron, Install guidance signs, 2006 | FAA | — 16.550 130,182 Rehabilitate Taxivay F . 2007 | FAA | 54.449 303,470 ORI Improve Airport Drainage 2009 FAA | 5,334 1213412 Rehabilitate Taxiway F Lighting to Med Intensity, I ‘Now Vault, New Lighting Control Panel 3010 [FAA | 10,347 103,747 : Rehabilitate Runva 2011 [FAA | 9.219 917,183 7739 | Rehabilitate Runway 2012-| FAA —| 8,736 87,316 Rehabilitate Taxiway ND, E Phase 1 DESIGN 2012 | FAA 5,000 44,978 Conduct Miscellaneous Study Rwy 32. RSA 2013 | FAA | 82,000 658,626 Rehabilitate Taxiways N, D,E Phase 2 WORK 2014 | FAA 1,986,152 habiltate Tava - 2013 | FAA. 162,019 Rehabilitate Taxive 2016 | FAA 1,847,884 800,000 Rehabilitate Taxiway | [016 PAA 400,000 Extend Taxiva (2or7 [Raw 150,000 | — Extend Runway STATE/LOCAL $ 1,597,758 FEDERAL DISCRETIONARY $ 5,488,567 FE RAL ENTITLEMENT. $11,817,449. TOTAL ALL FUNDING SOURCES: $ 18,903,774 ings Sponsor management practices do not meet the obligatory requirements for a federally obligated airport and could negatively affect future airport grant funding. Although the airport sponsor implemented comprehensive and detailed operating standards in a document titled, “Minimum Standards and Requirements for Airport Operations for Shreveport Downtown Airport” effective March 1, 2004, the airport sponsor is not enforcing these standards. ‘The Airport sponsor does not appear to maintain adequate control of the Shreveport Downtown Airport evidenced by the lack of enforcement with airport minimum standards. Specifically: 1. Section 3.5. Non-Compliance with Minimum Standards 2. Section 4.1 Vehicle Parking on Airport a. This standard prohibits individuals from leaving vehicles parked on the Airport. b, Several vehicles, motor homes and trailers were observed parked on the Airport. 3. Section 4.9 Commercial Aeronautical Operations and Section 4.14 Hangar Space a. This standard restricts commercial operations to only those tenants that have authority to act as a commercial operator. See Section VI. A. below. b. The standard states, “No entity may offer for hire, lease or sublease any hangar or open-air shelter for aircraft unless it is a qualified commercial operator offering such services with the approval of Shreveport Airport Authority.”4. Section 5.6 Sublease a. This standard requires Airport Authority for all subleases and assignments. b. The standard states, “No entity shall sublease or sublet and premises leases by such entity... or assign such lease without prior written notification of the Shreveport Airport Authority. c. There was only one sublease authorized. See Section V.B. and V.E. below. Prior to the inspection, the sponsor provided a Commercial Standard Lease and Standard Non- Commercial Lease sample for review by staff from FAA Southwest Region and Airports Compliance Division, Washington DC. The lease templates provided met the requirements and intent of the Airport Compliance Manual, FAAO 5190.6B. The inspection revealed however, that the sponsor was not requiring the tenants to comply with the terms and conditions of leases related to adherence to Airport Minimum Standards, subleasing and reversion, The sponsor was also allowing individuals to reside in hangar homes directly violating the FAA Hangar Use Policy that went into effect on July 1, 2017. Please refer to Section VI.A Analys ‘The sponsor stated the airport is continually operating in the red. One source of revenue to offset the variance between expenses and revenues is the implementation of escalator clauses. The sponsor has not implemented a rate increase since 2012. At the time of the 2012 rate increase, instead of increasing rates according to the market, the sponsor only increased one-half the value of the market rate. Please refer to Section VI.B. Analysis. As mentioned in paragraph 3, the sponsor did not adequately manage tenant lease requirements and the appearance of sub-leasing without airport authorization is evident. The airport does not have a mechanism in place to oversee compliance with local sub-leasing requirements described in the Airport Minimum Standards and in the lease documents. See Section VIB and IV C. Overall, the sponsor has detailed minimum standards and operating procedures for the Downtown Airport. In addition, the sponsor has a good lease template for both commercial and non-commercial tenants that are well organized and managerially sound. However, the sponsor does not have a mechanism in place for the Airport Authority to enforce approved airport standards. The lack of enforcement of airport minimum standards and lease requirements has resulted in the current management team not being able to meet the obligatory requirements for a federally obligated airport. This could negatively affect future airport grant funding. V. Observations A. Tenant leaseholds were used as storage areas, recreation areas, dog runs and residences. Several trailers, trucks, one out of service fuel truck and one tug, cars, motorcycles, boats, motor homes and one fifth-wheel trailer plugged into electrical utility were observed during the drive around (tour) inspection. Several airport owned T-hangars were evaluated for compliance with the FAA Hangar Use Policy. Although there is a waiting list for T-hangars, one of the hangars evaluated was found to be full of non-aeronautical items.Temporary Residence, Storage Out of Service Fuel Truck Broken Tractor Broken TugInside a T-hangar.........0.0. NO AIRPLANE10 One of several hangar homes. During the visit, a bed mattress was delivered to another hangar tenant leasehold. There are several residences OR the appearance of several residences on the airport. The hedgerow is approximately 5 feet tallu B. There are 114 private built hangars on the airport. Ninety-nine (99) are non-commercial leases and 15 are commercial (business enterprise) leases, ‘The sponsor has approved one sublease. C. Approximately 70 private built hangar leases have termed and according to the original lease, should have either reverted to ownership of the airport or been removed, The Shreveport Airport Authority has not exercised its reversion option on these leaseholds. The failure to exercise this reversion clause, or implement a suitable lease alternative seriously affects the ability of the airport to generate revenue necessary for airport needs. These 70 hangars are now on month-to-month leases at original ground lease rates averaging $100 per month or $1,200 per year for each hangar. Normally, hangar lease that have termed or placed on a month-to-month lease at a higher rate than former ground lease rates. ‘On June 15, 1994 an entity commissioned by the City of Shreveport, The Center for Airport ‘Management, released a review of the Downtown Airport, titled, Shreveport Airport Authority Downtown Airport Review. In this document, the Center for Airport Management stated, “A substantial source of revenue for many GA airports across the country is the rent received for facilities that have reverted to airport ownership.” threveport Downtown Airport has five box hangars housing 12 aircraft. Additionally, the airport has 62 T-hangars housing 62 aircraft. ‘There are currently 347 aircraft recognized on the National Based Aircraft Inventory Listing as based at Shreveport Downtown Airport. ‘There are 181 hangars housing 189 aircraft. Airport staff estimate 22 non-commercial hangar operators are housing an additional 60 aircraft without sponsor approval. As this estimate still only reflects housing for 250 based- aircraft, numbers appear to indicate this VI. Areas Requiring Corrective Action Current airport sponsor management practices do not appear to meet the obligatory requirements for a federally obligated airport and could impact future grant funding. Specifically, assurances related to Grant Assurance 5 (Preserving Rights and Powers). Analysis: The practice of tenants leasing out personal hangar resources without sponsor authority violates airport minimum standards and lease agreements. This action deprives the airport sponsor from meeting their obligatory assurances of Grant Assurance 5. During the visit, it was evident some tenants do not adhere to standards and airport ‘management does not enforce standards, Individuals were residing (living) on the airport (hangar homes/apartments) in violation of the Hangar Use policy effective July 1, 2017. Also, tenants are subleasing without airport sponsor approval; tenants refuse to honor reversion clauses and the sponsor does not exercise reversion clauses to assume ownership of resources available to the airport. The lack of movement on the sponsor’s part has resulted in the sponsor’s failure to ensure compliance with Grant Assurance 5, which states:12 The airport will not take or permit any action, which would operate to deprive it of any of the rights and powers necessary to perform any or all of the terms, conditions, and assurances in the grant agreement without the written approval of the Secretary. The airport will act promptly to acquire, extinguish or modify any outstanding rights or claims of right of others, which would interfere with such performance by the sponsor. FAAO 5190.6B 6.3 Additionally, the sponsor’s failure to exercise reversion clauses in leases has contributed to forfeiting their rights and powers as well as their ability to move closer to self-sustainability ‘The sponsor does not have a mechanism in place to assume title (exercise reversion clause) of the hangar at the termination of the lease. Even though all leases have a reversion clause, the specifics of reversion whether at the term end of the lease or at the end of negotiated lease period extensions was unknown, The airport has never exercised this portion of the lease agreement. Again, there are more than 70 hangar leaseholds this affects. Currently, these leases are active on a month-to-month basis awaiting a new airport lease. Requirement: ‘The sponsor will submit for FAA approval, a corrective action plan detailing the actions planned with timelines, to ensure the airport meets the requirements of Grant Assurance 5. The sponsor will also complete the audit of all hangars on the airport, determine who has established residences and take actions to comply with the FAA Hangar Use Policy effective July 1,2017. The sponsor's response will include projected residence vacated dates. Corrective Action Plan Due Date: August 1, 2018 Deficiency: Current airport sponsor management practices do not appear to meet the obligatory requirements for a federally obligated airport and could impact future grant funding. Specifically, assurances related to Grant Assurance 24 (Rates and Charges). Analysis: Although the majority of cause and effect of this deficiency could be covered in the previous deficiency (Section VI. A.), the sponsor has also failed to exercise lease options related to the escalator clauses in the current airport leases. The last increase in rates was voted on in 2011 and implemented in 2012. Additionally, the sponsor has requested assistance evaluating cost controls and issues that ‘would allow the sponsor to move the airport from a negative annual balance to a positive. Grant Assurance 24 provides the avenue for a sponsor to meet obligatory expectations related to rates and charges. Specifically, the sponsor is expected to recover its costs through the establishment of fair and reasonable fees, rentals, or other charges that will make the airport as. self-sustaining as possible under the circumstances at the particular airport. ‘The airport estimates more than 100 aircraft are operating on the airport without charge and limiting the airport’s ability to recover its costs. Not only do these aircraft create a challenge for the ainports rates and charges table, they also pose a risk to the airports compliance with federal obligations in that an Exclusive Rights violation has been inadvertently created. This will be discussed in paragraph VI. C.13 ‘The FAA will not investigate the reasonableness of a general aviation airport’s fees absent evidence of a progressive accumulation of surplus aeronautical revenues. Requirement: The sponsor will submit for FAA approval, a corrective action plan detailing the actions planned with timelines to implement increases in lease amounts (escalator) as necessary and a review of all rates and charges in accordance with the FAA Policy Regarding Airport Rates and Charges. Corrective Action Plan Due Date: August 1, 2018 C. Deficiency: Current airport sponsor management practices do not appear to meet the obligatory requirements for a federally obligated airport and could impact future grant funding, Specifically, assurances related to Grant Assurance 23 (Exclusive Rights). Analysis: The airport estimates more than 100 aircraft are operating on the airport without charge and limiting the airport's ability to recover its costs. These aircraft are housed in hangars without Airport Authority approval/coordination of the sublease as previously discussed. Basically, these aircraft only exist in the Aircraft Registry database and do not fiscally contribute to the airport. Although the argument can be made that this action compromises the sponsor’s ability to meet Grant Assurance 5 and 24 requirements, this action also violates Grant Assurance 23 in that it creates and Exclusive Use. Grant Assurance 23 levies the following restrictions on airport sponsors: /t will permit no exclusive right for the use of the airport by any person providing, or intending to provide, aeronautical services to the public It farther agrees that it will not, either directly or indirectly, grant or permit any person, firm, or corporation, the exclusive right at the airport to conduct any aeronautical activities, including, but not limited to charter flights, pilot training, aircraft rental and sightseeing, aerial photography, crop dusting, aerial advertising and surveying, air carrier operations, aircraft sales and services, sale of aviation petroleum products whether or not conducted in conjunction with other aeronautical activity, repair and maintenance of aircraft, sale of aircraft parts, and any other activities which because of their direct relationship to the operation of aircraft can be regarded as an aeronautical activity, and that it will terminate any exclusive right to conduct an aeronautical activity now existing at such an airport. FAAO 5190.6B Allowing some tenants to sublease without permission and others to require a sublease creates an exclusive use. Allowing 100 aircraft to operate on the airport free of charge while all others must pay also can be argued to create an exclusive use. Requirement: The sponsor will submit for FAA approval, an action plan detailing the actions planned with timelines to ensure compliance with Grant Assurance 23, Correetive Action Plan Due Dat August 1, 2018 D. The safety inspection revealed:a, Some taxiway signs needed to be replaced. Signs needing replacement were evaluated and reviewed with Airport Management during the inspection. Target Completion Date: As soon as possible. Sign replacement is on a rotational schedule subject to available funding. E. Grant Assurance 29 requires the sponsor to keep the Airport layout Plan up-to-date at all times, The Property Map page of the Airport Layout Plan conditionally approved by FAA on April 29, 2016, requires amendment to reflect required information for Parcels 2-5 Requirement: The sponsor will submit for FAA approval, an action plan and timeline for completion. Target Submission Date: December 1, 2018 Please provide this office a Corrective Action Plan regarding the aforementioned Areas requiring Corrective Action no later than the due dates herein, If I can be of further assistance, please do not hesitate to contact me. Sincerely, Fa ftus, A.AE. Aitporté Compliance Program Manager FAA Southwest Region (ASW-625) 10101 Hillwood Parkway Fort Worth, TX 76177 Office: (817) 222-5671 ce: Division of Aviation Louisiana Department of Transportation and Development P.O. Box 94245 Baton Rouge, LA 70804-9245 ASW-640 ACO-100