Airport Wants to Sell Land to County Panel
Posted on: Wednesday, 12 April 2006, 09:00 CDT
By Don Spatz, Reading Eagle, Pa.
Apr. 12--Reading Regional Airport earns $350,000 a year from leasing 165 acres of industrial land that, along with a similar amount of undeveloped land, it wants to sell to the Berks County Industrial Development Authority.
But before it gains the required Federal Aviation Administration approval for the sale, the airport has to prove the deal will earn it far more than that $350,000 a year, the airport authority said Tuesday.
That may be tough because the airport is limited in how much it's allowed to earn on investments, airport authority member Gerard G. Johnson said.
Two years ago, it floated bonds for 2.8 percent. Now, it's allowed to earn no more than that 2.8 percent interest on investments.
The rule is in place to keep nonprofit agencies such as the airport from borrowing money at low interest to invest at higher interest.
But to keep the $350,000 coming it, the airport would have to get more than $12 million for the land.
And airport authority members said since it's selling twice as much land as is currently being leased, the airport should get more than the $350,000. But that may raise the required selling price to more than $17 million.
Still, that may be achievable, said Thomas C. McKeon, BCIDA executive director.
He and Johnson said the airport and the authority have a draft agreement in place and are negotiating its final terms; the main one is money.
The undeveloped land has been appraised at $5 million, and the county has been promised $3.5 million in federal funds toward that purchase, McKeon said.
Meanwhile, a consultant is valuing the worth of the developed land.
"Then it will be a matter of negotiations," McKeon said.
The industrial land is well below the altitude of the airfield and considered not useful for aviation purposes.
The county wants to use a portion for its long-planned research and technology center for the food industry, McKeon said.
What the county may do is reach an agreement for all the airport's industrial land, he said, but buy it in small pieces as the money becomes available.
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Source: Reading Eagle
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