Airport facility under threat of funding failure

By John Guevara 

ROCKFORD — The downtown Amerock hotel project isn’t the only major area expansion with questions hanging over its funding today.

One of the crowning achievements of Chicago Rockford International Airport Authority Director Mike Dunn, the AAR company’s Maintenance and Repair facility (MRO), could dig deeper into local taxpayers’ pockets than expected.

The MRO project began as the brainchild of Dunn. The Authority and AAR entered into a lease agreement in the summer of 2014 which was executed in early 2015 as Dunn lined up money from a number of sources including Rockford’s City Council; the Winnebago County Board; the City of Loves Park; $10 million in grant funds promised by Democratic Sen. Dick Durbin from the federal government; and $15 million in state grant funds promised by then-Gov. Pat Quinn.

Quinn’s defeat in 2014 changed things. The Authority approached local bankers who agreed to extend a line of credit up to $17 million to avoid delaying the construction of the facility.

And the proposed funding from Springfield was tied to the federal funds via a so-called legislative trigger that would only see the state’s money released once the federal government came through with their portion of the obligation.

“There was never any money in the budget for the MRO,” Senator Dave Syverson said. “It was one of those projects that Quinn promised before the election without a line item in the budget or the revenue to fund it. Thankfully, Gov. (Bruce) Rauner saw the value in the project and agreed to find the resources.”

Syverson says he was recently approached by the Authority to ask Rauner to change the terms of the state grant monies.

“The original agreement was that the state could not, or would not, put money in without the federal funds,” Syverson said.

“Asking to change the terms implies that something happened to the federal funds. I don’t know if it’s totally out or if the way they were going to fund it is out.”

“Asking to change the terms implies that something happened to the federal funds. I don’t know if it’s totally out or if the way they were going to fund it is out.”
–State Sen. Dave Syverson

Syverson was asked to petition the administration to waive the requirement that the Authority receives federal funds first.

“The project has local bipartisan support,” he said. “I’m confident that the state money will come in when the resources are available. The money will come in.”

Sources say the real problem is if there is no money to pay the bonds used to fund the project. If no money is available, property taxes will increase automatically through a process called “backdoor referendum.”

Before issuing a bond, government bodies conduct hearings for the public to object to backing the bonds with a tax increase. A lack of objectors from the public at the bond hearing translates to public approval of a tax increase, however much it might be.

A backdoor property tax increase was precisely what former Republican county board majority leader John Sweeney was trying to avoid before the body approved its $8 million contribution to the project.

“I wanted to make sure the sources of funding to pay off the issued bonds were in place,” Sweeney told The Times.

“It became evident that they were not in place because there wasn’t sufficient documentation. My main concern was that if the funding sources were to fall apart and the bonds were issued, that property taxes would go up through a backdoor referendum. This is a project that I wanted to support but I was elected to represent county taxpayers and county government, not Mr. Dunn.”

Sweeney ultimately paid for his stance at the ballot box, losing a Republican primary in District 16 to a candidate recruited by and promoted in part by Dunn, Jean Crosby.

Winnebago County Board member and Economic Development Committee Chairman Fred Wescott is confident the funds will be available at some point.

Wescott says he would vote for using additional host fees to prevent triggering a back door property tax increase.

Gary Jury, the board’s Operations and Administrative Committee Chairman, isn’t so sure.

“They’d have to really convince me,” Jury says. “I mean, where does it stop? I’d really have to see the plan. They need to lock in the foundation of their funding before I’d vote for more host fees. If they do that, I would vote for them to stop a property tax increase.”

The County Board’s Majority Leader, David Boomer, doesn’t agree with the back door referendum at all. Asked if he would support using host fees to prevent a property tax increase from the Authority, Boomer said simply, “No.”

Community leaders have pointed to the Woodward Governor expansion in Loves Park as an example of how public monies can be invested with the full faith of the public.

Calls to Dunn for comment were not returned. Durbin, who advocated for the federal funds, is out of the country on senatorial business.

You might also like

Enjoy The Rock River Times? Help spread the word!