The Santa Maria Public Airport District Board of Directors cleared the runway for the next fiscal year Thursday by approving the airport’s 2012-13 budget and clearing up a significant CalPERS debt.

After reviewing the budget since its introduction on June 14, the board voted unanimously to approve the spending plan which features a $3.9 million operating budget, an increase of 3 percent over last year.

When the budget was introduced, General Manager Chris Hastert called it a “status quo” budget with a few notable increases.

The airport is investing approximately $28,000 in upgrading its computer support services. Hastert said new software and online records back-up safe guards the airport’s documents and operating systems.

The airport also agreed to provide financial incentives to Allegiant Air to land its new service to Honolulu, Hawaii. In addition to cutting the carrier breaks on landing and fueling fees, the airport will provide approximately $45,000 in advertising for new flights. The increase bumps the advertising budget to $88,000.  The carrier announced last month that Santa Maria, Stockton, Eugene, Ore., and Bellingham, Wash., would join Fresno and Las Vegas as West Coast airports that would offer flights to Hawaii. Flights from Fresno and Las Vegas began this month. Service from the other four airports will begin in November.

The 2012-13 budget sets aside $50,000 for the November general election with four of the five seats on the ballot. The terms of board President Carl Engel, Vice President Don Lahr, Hugh Rafferty and Chuck Adams are all expiring.

Normally only three seats on the board are up for grabs at any one election. But because Lahr was appointed by the Santa Barbara County Board of Supervisors to replace Ted Eckert, who died last year after being elected in 2010, he must run as well, according to Billie Alvarez, the county’s chief deputy registrar of voters.

The district will contribute $27,000 to the Museum of Flight this year for the “Thunder Over the Valley” air show. Only $15,000 was budgeted last year.

The board also decided to pay off the debt incurred by a CalPERS side fund by writing a check for $319,584. The fund was established by CalPERS in 2003 to serve municipal agencies and special districts with fewer than 100 employees, and the district was paying 7.75 percent interest on the 30-year loan.

Engel, who was on the board when CalPERS established the fund, objected to the program saying CalPERS was playing a “shell game” with the district’s money.  He said that the board was never asked whether or not it wanted to participate in the fund nearly 10 years ago when it was established.

District Counsel Ray Biering referred to the debt as a “bad credit card” that was “imposed” on the district, and recommended paying it off to avoid even more interest costs.

Veroneka Reade, district finance and administration manager, reported that paying the debt off now would save the district $480,000 in interest charges over the length of the loan.

The board voted 4-1 to pay the debt, with Engel casting the dissenting vote. 

 

By Brian Bullock/Staff Writer/bbullock@santamariatimes.com    June 29, 20