Consequences of Airport [Fuel] Tax Diversion –

Springfield, IL. (ECWd) –

Following up on our article related to the aircraft fuel sales tax in Springfield, Illinois, and the FAA’s requirement of airport-related use of those tax funds not grandfathered in (the increase of sales taxes), the Springfield Airport Authority’s attorneys sent a memorandum to the city of Springfield in 2016 explaining the consequences of diversion of those sales tax revenues.

As we noted in a previous article, this appears to be headed for litigation between the airport and the city of Springfield.

Some of the listed consequences are:

• maximum $50,000 civil penalty to the airport
• civil penalties equaling three times the diverted revenue (the airport claims as much as $800K has been diverted)

Other types of revenue diversion include:

• making airport facilities available to the community, local government, or other non-airport use for less than fair market value
• making airport facilities available at no charge to other units of local government
• undocumented airport expenditures or failing to collect revenue
• using airport funds for off-airport development projects
• not documenting sources or use of funds
• leasing non-aeronautical property at less than fair market value

The deadline for compliance was December 8, 2017. It has come and gone without compliance, according to the airport authority.