Wheeling, Prospect Hts. call airport ‘jewel’ but fight over control

The municipalities that own Chicago Executive Airport boast about it frequently. But the acting chairman of the airport board says the open squabbling between Wheeling and Prospect Heights is hurting the airport’s potential.

Prospect Heights has sued Wheeling over what it says are inequities in sales tax sharing, the two municipalities cannot agree on a new chairman and dealing with the manager’s serious illness this summer widened the rift.

Leaders of both communities say talking can still resolve the differences. In fact, Wheeling Village President Dean Argiris and Nick Helmer, mayor of Prospect Heights, once served on the airport board together and call each other friend.

But the rift is major. Asked if the relationship can be salvaged, Argiris said, “This is my last session of marriage counseling.”

Money — specifically whether Wheeling owes Prospect Heights sales taxes from businesses on the Wheeling side of the airport such as those that sell airplane fuel — appears to be the big issue.

Argiris said Friday that a recent fourth meeting between the two sides was cordial, and he is hopeful an agreement will be worked out. One hang-up is that the towns’ intergovernmental agreement mentions “revenue sharing” but is not specific, Argiris said.

“We need a clear understanding of what revenue sharing means,” he said. “Is that before expenses, (or) after expenses? I know Wheeling has put $2 million of infrastructure into the airport, and people came and built businesses because of that.”

Conflict has swirled since the two governments took over ownership in 1986, said David Kolssak, acting chairman of the airport’s board.

Kolssak agrees that working out the differences is the best solution, but he thinks that will require rewriting the intergovernmental agreement to give the airport board more power. And if that doesn’t work, he has suggestions that go as far as breaking up the partnership.

The airport board at present is seeking informal feedback from the municipalities on a major change to the agreement — letting the board hire and fire the airport manager, which now requires approval of both municipalities.

Argiris agrees this is a way making the airport more professional and taking politics out of the equation. But Helmer thinks of the airport board as an advisory body, where the major decisions fall to the communities.

“I think we see the board a little differently,” Helmer said of Kolssak. “They run the airport. Issues as to how they should run the airport are decided by ownership.”

He also said that the airport is running well and disagrees that the problems between the owners hurt its potential for development. He does predict trouble when a 3-3 tie arises if there is no chairman to break it. Each municipality appoints three members, with the chairman serving as the seventh and selected with agreement of leaders of the two municipalities.

The board is nearing a year without a chairman. Former chairman Allan Engelhardt’s term ended late in 2011, though he stayed on an additional year.

Argiris supports Kolssak for the position, but Helmer thinks he is too beholden to Wheeling and has nominated candidates of his own. Helmer suggests the parties submit to arbitration if they cannot agree on a candidate for chairman, but Argiris has not signed on to that.

Kolssak’s example of potential thwarted by the conflict is his vision that the airport might expand outside its current borders to lengthen one runway so corporate jets could travel to Japan and the far reaches of Europe without refueling.

Argiris says lengthening a runway is so expensive it will not occur in his lifetime, but he does agree the infighting can hurt development.

Potential investors in businesses at the airport “know there’s friction,” Argiris said. “How would you like to invest millions of dollars in a spot where the partners are fighting?”

Even so, Argiris noted, $20 million of new development went into the airport during the last three years despite a recession.

The development all occurred in the Wheeling part of the airport because the municipality used tax increment financing district funds to install infrastructure and make the site “shovel ready,” he said. In a TIF district, the additional property taxes generated by new building go into a fund to pay for development-related expenses instead of going to local units of government such as schools.

Most of the sales tax also is currently generated in the Wheeling part of the airport. Prospect Heights, which is not a home rule community and therefore has few taxing options to generate income, says it is entitled to part of Wheeling’s share. Helmer said his city filed the lawsuit to find out how much sales tax the businesses generate, and Argiris said his municipality finally got permission from the state of Illinois to disclose that information. Earlier this year Helmer estimated the total at around $1 million.

The joint ownership began in 1986 when the towns’ purchased the airport using federal and state funds with airport revenues serving as the local share. At that time, the tax-generating business was in Prospect Heights’ territory.

“It may well be Prospect Heights did not share as it should have in the early years,” Helmer said, “but when the IGA (intergovernmental agreement) was approved in 2006, we started over at ground zero. Partners are by definition equal partners and should share revenue.”

If Wheeling and Prospect Heights cannot reach agreement they should consider options for splitting up, Kolssak said.

Possibilities include hiring an outside agent to run the airport, letting one municipality run it, having one municipality take over ownership with some sort of settlement to the other party, or setting up an independent airport authority with its own taxing ability.

Ownership is not such a big deal, Kolssak said. Even without ownership, the municipalities would benefit economically from just being close to the airport, as Northbrook does.

But Helmer said his city needs the income from sales and other taxes that only ownership brings.

“Previous administrations made decisions about development that cost the city a lot of money,” Helmer said. “In future years, I don’t want to be the guy who sold out the airport.”

Kolssak said it is frustrating for the airport manager to report to the airport board and the two village boards, and difficult for an airport board that spends a month learning about an issue and choosing a course of action to explain it to two more boards in a presentation that lasts a few minutes.

“I’m kind of in the middle of two parents that don’t like each other,” he said.

Despite the problems and Kolssak’s complaints, Argiris praised the job Kolssak is doing.

“He’s doing a great job,” said Wheeling’s village president. “His heart belongs to the airport, and he acts in its best interest. He’s a no-nonsense businessman.”

Hurt: Manager reports to airport board as well as Wheeling, Prospect Heights board