LAWRENCE — Money earned by the Lawrence Airport will now be held in a special fund after federal officials suggested Mayor William Lantigua had compromised safety at the facility by raiding its revenues to beef up the city's general fund.
The Federal Aviation Administration also accused Lantigua of ignoring two requests to produce the airport's financial ledgers and gave him until May 13 to produce them or face a much wider investigation at the facility that could result in an end to federal aid for the airport and other sanctions.
Lantigua complied May 11.
The FAA began asking about spending and revenues at the airport in July, a few weeks after the City Council adopted a budget for the city that included Lantigua's proposal to cut airport spending by 16 percent to $441,140. The spending cut — accomplished by cutting the airport's tiny maintenance crew — created an $85,000 surplus in the airport budget that the FAA said was diverted to the city's general fund in violation of federal law.
"The city is responsible to operate and maintain the airport in a safe and serviceable condition," Bryon Rakoff, acting manager of the FAA's Airports Division in New England, said in an April 27 letter to Lantigua. "The FAA therefore requests documentation demonstrating the airport is adequately staffed and serviced and that any budget cuts, current or proposed, do not adversely impact these requirements..."
Airport Manager Michael Miller referred questions about spending and safety at the airport to Lantigua. Lantigua did not respond for comment.
Robert Nunes, the overseer who is monitoring Lawrence's budget for the state, said the airport revenue that ended up in this year's budget was "a small amount." He responded to a request for details by saying the issue has been resolved.
"We talked to the FAA and they suggested we move to an enterprise fund and the mayor accepted their recommendation and I'm glad to see the council supported it," Nunes said. "So there are no longer any issues with the FAA."
Jim Peters, a spokesman for the FAA in New York, said its investigation is continuing, but would not answer questions about the contents of the ledgers the city turned over to the agency last month.
"We continue to review the information the city has provided," Peters said in an e-mail. "FAA has taken this action to ensure that the city understands its obligations as the sponsor of the airport."
The City Council on Tuesday voted 9-0 to establish the enterprise fund for the airport, which will operate in a fashion similar to the city's special water and sewer funds. The new structure for the airport's finances will allow the mayor and council to continue establishing annual budgets for the airport, but its revenues would be beyond the reach of City Hall.
The $251.5 million budget proposal for the city and its schools that Lantigua presented to the council May 31 would increase spending at the airport 8 percent, to $477,919. The budget proposal also projects revenues will drop 9 percent, so the $85,000 surplus the airport is projected to generate this year would not be repeated.
Unlike the budget he presented for most other city operations, Lantigua's budget proposal for the airport contains no details about how the airport revenues would be generated. But the ledgers he provided to the FAA show about 85 percent of the revenues come from leasing land for hangers and other facilities to private aviation companies.
Before voting to create the enterprise fund, Councilor Mark Laplante called on the city to be more cooperative when other levels of government ask questions about city finances.
"The lack of responsiveness from the city — in this case, the FAA is signaling out the mayor — it's very troublesome," Laplante said. "So whoever is listening to this, we need to make sure we're on top of the ball when we're dealing with other government agencies, whether it be federal agencies or state agencies, because that could come back and make our lives, the city's life, much more untenable."
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