Lexis Cite:
2005 FAA LEXIS 1
Westlaw Cite:
2005 WL 389218|2005 WL 5311093
Author:
Bennett, David L., Director
Complainant(s):
Jet 1 Center, Inc.
Respondent(s):
Naples (Fla.) Airport Authority
Airport(s):
Naples Municipal Airport (APF)
History:
Affirmed by Final Agency Decision of July 15, 2005. See Determination No. 142.
Holding:
Finding violation in part.
Abstract:
Complainant, Jet 1 Center, Inc., filed a complaint against Respondent, Naples Airport Authority, operator of the Naples Municipal Airport, alleging that Respondent violated Grant Assurances 22 and 23 by (1) improperly invoking the exclusive right to sell fuel; (2) preventing Complainant from selling fuel to its subtenants and others after having allowed this practice in the past; (3) revoking and denying Complainant a fueling permit, thereby preventing Complainant from self-fueling its own aircraft; (4) collecting a fuel flowage fee when fuel was transferred from the Respondent to airport tenants; and (5) charging a lower fuel flowage fee to one airport tenant. The Director found Respondent in violation of Grant Assurance 22.|Exclusive Rights (Grant Assurance 23):|The prohibition against exclusive rights does not apply to airport owners, who may exercise, but not grant, the exclusive right to conduct any aeronautical activity. (p. 12) (citing FAA Order 5190.6A, 3-9d).|Respondent Naples Airport Authority, as the Airport's sponsor, was entitled to invoke the proprietary exclusive right exception even though it was not the owner of the Airport. "It is FAA's intent to allow the public entity having control and responsibility over the airport's operation to invoke a proprietary exclusive right to conduct any of the aeronautical services needed at the airport without violating Assurance 23, Exclusive Rights." (p. 12).|Respondent did not, in the past, properly invoke its proprietary exclusive right regarding fuel sales where it permitted tenants to fuel subtenants using the tenants' employees rather than Respondent's employees and permitted subtenants to take advantage of bulk rates for fuel through the tenants' participation in the Prepaid Fuel Program. (pp. 15-16). However, Respondent cured this defect by amending its Rules and Regulations to eliminate these allowances. Therefore, it was not in violation of Grant Assurance 23. (p. 17).|Respondent did not lose its ability to invoke a proprietary exclusive right by previously having policies inconsistent with that right. "So long as the airport owner or sponsor is not violating any of its grant obligations by doing so, it may invoke its proprietary exclusive right at any time." (p. 17).|Economic Nondiscrimination (Grant Assurance 22):|Respondent did not discriminate against Complainant in violation of Grant Assurance 22 by amending its Rules and Regulations to prohibit airport tenants from providing fuel for its subtenants where the new policies were applied equally to all aeronautical users on the Airport. (p. 20).|Respondent was not in violation of Grant Assurance 22 as a result of refusing to allow Complainant to self-fuel where Complainant's self-fueling permit had been revoked and the revocation had been upheld by state court, and Complainant owned no aircraft. (p. 24).|Respondent was not in violation of Grant Assurance 22 as a result of assessing a fuel flowage fee for self-fueling operations or for collecting that fee at the time the fuel was transferred from Respondent to the aeronautical user. This was a valid business decision. (p. 25).|"Differences in rates may be justified based on many diverse factors, including but not limited to, location, length of lease term, financial commitment by the tenant, risks accepted by the tenant, and timing of the agreement." (p. 27).|Respondent was in violation of Grant Assurance 22 by allowing one tenant to pay a fuel flowage fee of 16 cents per gallon while other similarly situated tenants operating under the same type of fuel permit were paying a fee of 40 cents per gallon. (p. 29).
Index Terms:
Unjust economic discrimination|Economic Nondiscrimination (Grant Assurance 22)|Exclusive Rights (Grant Assurance 23)|Self-fueling|Fuel flowage fees|Proprietary exclusive right|Fixed-base operator (FBO) agreement