Cortez Journal

Council debates value of MCEDC

June 14, 2001

By Janelle Holden
journal staff writer

Every item on the Cortez City Council’s lengthy agenda was approved on Tuesday, while some of the more contentious issues — such as the value of local economic-development efforts — were debated during the council’s workshop.

The perennial question of whether it is a good investment for the city to continue providing $60,000 a year to the Montezuma County Economic Development Council was raised during the workshop.

Bill Argo, the current director of the MCEDC, has announced his retirement from the position as of July 31. The council’s monetary commitment to the economic council will continue through the budgetary year, but future donations are still being considered depending on how MCEDC reorganizes the office after Argo’s departure.

Jim Mahlberg, president of MCEDC’s board, attended the workshop to gauge the council’s opinion on the matter.

"Is there support out there to have an EDC?" Mahlberg asked.

Council member Jim Herrick said he would like to resolve the question, once and for all, with some hard-and-fast figures. Herrick wants a study completed that proves the economic council’s worth in dollar amounts.

But Herrick admitted marketing Cortez to prospective businesses is a hard sell — especially since Cortez is isolated from any major metropolitan center and lacks transportation, a large, trained work force, and high-speed telecommunications.

"How much money can you spend dressing up your pig?" he asked.

Mayor Joe Keck said he has always been a supporter of the MCEDC but is concerned about spending money on the project if the council does not hire someone who is qualified to make deals with prospective businesses.

The council then considered what would be a fair market value for leasing hangar space at the Cortez Municipal Airport.

The city granted Nielsons Inc. a land-lease agreement in 1977 to construct hangars to house Nielsons’ aircraft. Nielsons agreed to pay $500 and return ownership of the two hangars to the city after 25 years.

Now that the contract is coming up for renewal in 2002, the Federal Aviation Administration requires the city to charge a fair market price for the use of the space.

Russ Machen, the Cortez airport’s assistant manager, conducted a study of nearby airports with the same types of hangar space and found that the closest in size and quality was Moab, Utah, which charges $150 per month for single-engine hangars and $270 for twin-engine hangars.

But Mayor Joe Keck balked at those prices, stating that Nielsons’ "economic benefit" to the community should be considered when negotiating the lease. He advocated negotiating with the Farmington airport’s prices in mind rather than Moab’s.

Machen answered that that would be like comparing "apples and oranges" because Farmington’s prices of $112 were for T-hangars, a type of structure inferior to the one at the Cortez airport.

Larry Kautz, a council member who is employed by Nielsons, defended the lower rates because he said Nielsons has invested $100,000 in the asphalt and hangers.

Mayor Joe Keck said that fair market value is "relative" and emphasized again that the city should consider the economic benefit of the construction company to the community.

But giving Nielsons an advantage based on its economic benefits will likely not past muster with the FAA, which controls much of the airport’s funding through grants.

"We can’t give anyone advantage based on subjective criteria," explained Machen on Wednesday.

Machen’s position was backed by council members Herrick and Cheryl Walkenhorst.

"We don’t want to lose our airport just so that we can cut a good deal," said Walkenhorst.

Machen said he had "no doubt" that others would be interested in renting hangar space at the Cortez airport, particularly because of its proximity to Telluride and Durango.

"You’ve got a different sort of clientele in Telluride and they can afford to rent hangars at double the price," he explained.

Telluride rents hangar space for a single engine for $300 a month, and $550 for a twin engine.

Also during the workshop the council considered a request from the golf advisory board to ban dogs from the golf course (other than seeing-eye dogs). City attorney Jim Hatter advised revising the dog-at-large ordinance if the council decided to pursue the matter.

During the council’s regular meeting, the board approved, on first reading, an ordinance that would require owners of new apartment buildings to wait three years before converting it into a condominium. They also approved several bid results, replats, and a few routine "housekeeping" ordinances.

Copyright © 2001 the Cortez Journal. All rights reserved.
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