Airport Authority eyes $8 million bond issue for West Star Aviation expansion
Two corporate jets already have appointments in December 2014 for a yet-to-constructed paint hangar at West Star Aviation Inc.—the next step in West Star’s expansion at Grand Junction Regional Airport.
Those expansion plans were to get a vote this morning from the Grand Junction Regional Airport Authority, which is considering issuing $8 million in bonds for the hangar, which will make it possible for West Star to service the biggest of corporate jets, including one still on the drawing board.
Grand Junction Regional Airport submitted the best offer to West Star, which has locations across the nation, for the new hangar, West Star CEO Bob Rasberry said Monday.
West Star’s plans include eventually adding as many as 150 new jobs to the existing workforce of about 400 at the company’s complex of hangars and shops on the east end of the tarmac.
The Grand Junction Economic Partnership estimated West Star’s expansion could deliver up to $76 million in direct and indirect economic benefit to the immediate vicinity, $279 million to Mesa County, and $273 million to the state.
“When I saw this opportunity, I knew it was something we could really jump into,” said Airport Authority Chairman Denny Granum.
“This may be the biggest economic development project in 30 years,” said Jay Seaton, publisher of The Daily Sentinel and chairman of the GJEP board.
The new hangar would give West Star in Grand Junction a powerful selling point for owners of large corporate aircraft, Rasberry said.
Already West Star Grand Junction can handle most of the work needed for aircraft undergoing regular, required inspections, but all that work has to be done in a single place.
With the addition of the new hangar, the final piece of the puzzle—the ability to paint large corporate aircraft—will be in place, Rasberry said.
It’s all or nothing and “If you can’t paint, you can’t get the inspection,” Rasberry said.
With paint, however, comes the ability to perform other maintenance, including airframe and engine, sophisticated avionics, high-gloss cabinetry and other services.
That kind of work can take weeks or even months. Aircraft crews typically stay in the area to oversee the work, and owners drop in for status updates.
The new hangar could result in more than 1,000 new, and often well-heeled, aviation customers coming into the Grand Valley every year, officials said.
The new hangar will accommodate the Global 8000, “which hasn’t been built yet,” Rasberry said.
West Star hopes to complete construction of the new hangar in just over a year and is now beginning to schedule inspections back from the already-set December appointments, Rasberry said.
Construction requires a labyrinth of underground ductwork and other equipment needed to manage the painting process, Rasberry said
The new hangar will dwarf the existing hangars, the largest of which on Monday housed 10 aircraft in various stages of maintenance.
At 45,500 square feet, however, the new hangar will accommodate two large aircraft at once, one in preparation and one in the painting section.
West Star will hire 40 people as the project ramps up and plans to eventually have 150 people working on large corporate jets. That would amount to a $6 million payroll increase at West Star.
Once West Star’s new project is in full swing, the company estimates it will have pumped $100 million in total payroll into the Grand Valley economy.
Granum was involved three decades ago when Sundstrand located an aerospace business in Grand Junction, the first major industry to move into the city after the 1982 oil shale bust.
The Grand Junction offer bested those of other communities in which West Star operates, Rasberry said. “It took a very competitive package to win this bid.”
The Airport Authority will issue $8 million in bonds for the hangar project, which West Star will pay back in double-payments. The company will pay 100 percent of the payments to the authority and place an equal amount in escrow, speeding the payoff. Once all the bonds are paid, the Airport Authority will own the hangar, then lease it back to West Star at fair-market value.
Airport Director Rex Tippets was instrumental in crafting the financial arrangements for revenue bonds to finance the new hangar, Granum said.
Just when it appeared the deal might have gone sour, Granum got a 5 a.m. call from Tippets in which he outlined the framework of the deal for revenue bonds for the project.
“It was his ingenuity as he sits behind the scenes and gets the job done,” Granum said.
A paint job on a large corporate jet can cost as much as $380,000, Rasberry said, but the associated inspection and maintenance costs can run significantly higher.
Other West Star operations bid on the hangar, but the Grand Junction had more to offer than an attractive financial arrangement.
Grand Junction’s dry climate will allow the hangar to operate 24 hours a day, seven days a week.
“You can’t do that anywhere else,” Rasberry said, adding: “This deal works because of the people here. I can’t tell you the kinds of letters I get” from customers pleased with their treatment in Grand Junction.
Once an employee drove a customer and his family to Aspen when the family was unable to fly there, he said.
West Star has operated at the airport since 1952. The company operates under the same name in Aspen, East Alton, Ill., Dallas, Columbia, S.C, and Chesterfield, Mo.