In an effort to provide for future expansion of McKinney National Airport, the city recently asked residents to approve $50 million in bond funding that would provide for land acquisitions on the airport’s eastern side.
Voters denied the bond funding during the Nov. 3 bond election, a decision interim City Manager Tom Muehlenbeck said was made because residents had not been informed enough about the airport to understand its benefit. Despite not receiving bond funding, city officials are still working to find a way to expand what they consider one of the most beneficial properties the city owns.
Every year the 745-acre airport brings in millions of dollars in tax revenue that supports the city, county and schools, Muehlenbeck said.
“If we ever were to put another north-south runway in, that bond funding would have allowed us to do that,” Muehlenbeck said. “We don’t ever want to become another Addison and be land-locked in on both sides with only one north-south runway. We were trying to get ahead of the curve by acquiring that property.”
Muehlenbeck said although most residents are not actually using the airport, they are still benefiting from its success.
“From a tax revenue point of view, the airport supplies the city with some $600,000 worth of revenue off of the airplanes that are out there,” he said. “It also supplies twice as much revenue to the school district and also supplies tax dollars to the community college and the county.”
Wiegand said since 2003 McKinney ISD collections have totaled $18.47 million.
“The average [total airport tax revenue] per year is about $1.4 million and we are proud of that,” he said. “We are helping to educate our children. We say the airport is good even for people who don’t fly and that goes back to the ad valorem taxes.”
Ascending to new heights
In the mid-1970s the Federal Aviation Administration approached the city and said that since the area was not served by a local airport the city needed to construct one, said Ken Wiegand, executive director of McKinney National Airport.
“They also thought the airport might be the third major airport in the Metroplex,” he said. “The city bought the land, built the airport and received some funding to do so from the FAA.”
The airport officially opened in 1979 and that following year a private developer opened the fixed-base operations, the buildings and retail end of the airport. For years the airport continued to be a hidden asset until the early 2000s when the city found that it could be a tool to bring in new businesses.
In September 2013, the city of McKinney, who has always owned the airport’s land, purchased the fixed base operations for $25 million. With that purchase, the city took ownership of all of the hangars and the terminal. The city received $8 million in state and federal funding and issued the remaining total in short-term debt that did not require voter approval.
Since then, city officials said the airport has seen an occupancy rate increase from below 60 percent to 100 percent, earning a steady stream of income. From October 2013 to September 2014, the airport saw an increase of operations—takeoffs and landings—of more than 10 percent.
“We sell products and services to all of those aircraft, and that’s how we make our money and because of the business we are doing out here right now become completely self-sufficient,” Wiegand said.
According to city officials, financial forecasts are projecting that McKinney National Airport will earn more than $500,000 in profit this year.
“We sold well over a million gallons of aviation fuel last year, which has helped bust out our goals for the year,” Muehlenbeck said. “Every hangar is full and that reflects that the airport is being managed in the right way. We even have a waiting list for hangar space.”
Landing new business
Muehlenbeck said he will continue to look over the city’s budget for financial opportunities at the airport.
To expand the airport without bond money, Muehlenbeck said the city will incrementally prioritize funding for corporate and other hangars that would provide cash flow to the airport.
Now under construction is a $6.8 million apron expansion, Wiegand said it is like a parking lot for aircraft, and is also constructing a 15,000 square-foot aircraft hangar. The hangar, which will be complete in January or February will be full from day one, Wiegand said, adding that additional hangars will be needed within the next five to 10 years.
“The city is really trying hard to get funding so we can build those projects,” Wiegand said. “The addition would bring in more corporate and business aircraft and they would bring more taxes that would go to MISD, Collin College, the city and county.”
Muehlenbeck said in addition to supporting the city’s tax base, the airport provides incentive for companies looking to locate within the region.
“Corporations don’t have to put up with Love Field or [Dallas/Fort Worth International Airport] and their long waits to get out on the runway and taxi off,” he said. “It’s a lot quicker here. They can get out, up in the air and on their way. Every 15 minutes they are sitting on the runway they’re burning fuel and this way it is a lot more efficient for them.”
Abby Liu, interim president of the McKinney Economic Development Corp., said the airport is a common topic discussed with potential businesses.
“When we approach perspective new businesses, which is something we are doing constantly, certain sizes of those companies have corporate jets, and the airport really does become a promotional tool,” Liu said. “It is definitely helpful for attracting new business, but it serves existing businesses as well. We have corporate jets from Texas Instruments, and their headquarters are not even in McKinney.”
Liu said McKinney National Airport serves all of Collin County so even if a corporation does not chose McKinney as its location the city can still reap the benefits of corporate travel capabilities.
“The common reaction is ‘Oh, you have your own airport?’ I can always say confidently that we have our own airport that serves all of Collin County,” she said. “Not all Fortune 500 [companies] have their own corporate jets but they are impressed that we have our own airport. That leaves the door open for me to introduce more to them about our airport.”
Wiegand said throughout the past few years when major corporations moved their headquarters to neighboring cities, the airport saw a 10 percent jump in operations.
“Of course we get all sorts of corporations and private high-net worth individuals using the airport today but I would say that the majority of the increase comes form those major corporation headquarter relocations,” he said.
