Asbury Park Press from Asbury Park, New Jersey • Page 4

A4 Asbury Park Press Sunday, April 14, 1996 PRESS EXCLUSIVE: Lakewood Airport, under a cloud 1 N. Flit Phots Prominent Republican Richard S. Sambol, a partner in the company that sold Lakewood Airport to the township, did not respond to requests for an interview. $8.5 million paid for Lakewood's 50-year-old airfield 1.. 1 1 ii i J.

.1 1 i v. 1 -t. l(- v. 1 v. iitV' dicative of how we expect to remain competitive in attracting certain types of industry to this state," Wilson said.

Lakewood Township Manager Gregory C. Fehrenbach said the airport is important because it provides jobs, helps local businessmen, gives the township "name recognition" and provides for recreation, among other reasons. "I do not have any political or party affiliation. There is an airport. The airport is important to Lakewood.

The owner of 16, 17 years says it's time to liquidate the assets," said Fehrenbach, who's listed as an independent on voter rolls. The Lakewood Township Committee is all-Republican. State and local leaders say it's merely a coincidence that one of the first beneficiaries of their new airport preservation program is one of the area's most influential Republicans. From page Al next to the airport for industrial or commercial development. New Jersey law says the state transportation commissioner must approve using state aviation money for a nonaviation purchase but Commissioner Frank J.

Wilson said he wasn't aware of that part of the transaction. Local and state officials repeatedly said most of the money for the airport purchase would come from the federal government. In reality, most of the money came from the state. The state's stepped-up efforts to preserve small airports with state and federal tax money included creation of a special $10 million state account to acquire and save such facilities. But it's unclear whether small airports such as Lakewood are an economic boon to local communities, although the aviation industry and state government officials are bullish.

If nothing else, the Lakewood sale shows how far state government is willing to go to accommodate businessmen in flight jackets. State aviation officials decide which airports get money with little oversight when they spend money from Washington. Asked for comment on the Lakewood sale, Federal Aviation Administration officials in New York repeatedly said states receiving federal aviation block grants are trusted to spend the money according to federal guidelines. "We have no involvement after we give them the grant money," said FAA spokeswoman Lorraine Carra. "It's up to the state to administer the money They have to follow our rules and regulations." Or, in the words of Emmett N.

O'Hare, deputy director of the state Division of Aeronautics: "We are the FAA I wear two hats. I am the FAA and I am the state." Timing is everything' Last year, state lawmakers and administration officials cobbled together a multimillion-dollar fund to buy and improve airports, An Ocean County partnership with deep Republican roots was at the front of the line for money. Richard Sambol, a home builder and former Ocean County resident who moved to Middle-town Township, is a philanthropist and major Republican contributor. Appointed by former Gov. Thomas H.

Kean, he served on the New Jersey Highway Authority, which runs the Garden State Parkway and owns the Garden TIM MC CARTHYStaff Photographer Damaged taxiway indicator lights at Lakewood Airport have been replaced in some cases by less-costly reflectors. Many airports Lakewood Airport is one of three in a 15-mile radius. Atlantic Ocean Middlesex Monmouth Lakewood I 111 Mercer I Airport w' jAliaire" R. J. Miller W.JW1 Airport Airpark jf" gjr Ocean said.

"I can assure you that that had absolutely nothing to do with this "Once in awhile you get lucky, the alignment of the sun, moon and the stars. Timing is everything," Gluck said. Whitman said through a spokeswoman she knew nothing about the sale. More federal funds in doubt Only recently have officials revealed the state's full role in financing the airport sale. Lakewood officials told residents the airport purchase would be financed primarily with federal money.

State-drafted documents also show the FAA paying nearly $8.1 million to meet the airport's $8.5 million price tag. In reality, only $2.5 million in federal funds were used to buy the airport a fact O'Hare and his superior, aeronautics division executive director John S. Penn, now acknowledge. Lakewood leaders say they were told the state would loan $5.6 million to Lakewood, and the loan would be repaid with federal aviation grant money. But state aviation officials now acknowledge no loan exists.

According to an agreement between Lake-wood and the state, Lakewood will pay $5.6 million back to the state only if federal money becomes available. But there's no guarantee future federal funds will materialize. The federal aviation block grant program expires this fall and hasn't been renewed by Congress. Also, a report released last month by the U.S. General Accounting Office questions New Burlington State Arts Center in Holmdel Township.

Sambol's original partners in the company that owned the airport were Lakewood lawyer Lawrence E. Bathgate II and two home-building brothers from northern New Jei'sey Philip and Daniel Solondz of Union Township. Each of the partners originally owned 25 percent of the airport. Bathgate, a former chairman of the Republican National Finance Committee, hasn't been involved with the airport for about seven years. He transferred 25 percent of his interest in the airport to his ex-wife in their 1985 divorce, and the rest to Sambol in an unrelated business transaction in 1989.

Bathgate said he "didn't get any money" from the recent airport sale to Lakewood Township. Neither Sambol nor the Solondzes returned phone or fax inquiries. The airport's remaining owners netted about $7.6 million from the sale to the township, compared to' their investment of $475,000 nearly 17 years ago. The story behind the airport deal began on a mild day in December 1991, when Dan Solondz traveled to Trenton and discussed with state aviation officials "the possibility of the sale of the airport to a municipal government," according to a memo written by O'Hare of the state aeronautics division. It was not the first time the airport owners had toyed with unloading the marginally profitable facility.

Solondz acknowledged at the time that he and his partners could find no other buyer, O'Hare said. From then on, O'Hare and other aviation officials said they worried the airport was imper-. iled. On Dec. 19, 1991 a week after the initial meeting Solondz telephoned Trenton to say the owners "would be willing to accept" $50,000 an acre for the airstrip and surrounding land for a total of $7.5 million, according to O'Hare's memo.

That same month, the owners' held talks with Lakewood Township's tax assessor arguing in a tax dispute the land was worth only $10,000 an acre. The owners disputed the township's assessment of the airport's value at $23,000 an acre. They eventually agreed on $20,000 an acre. Township leaders began to study acquiring the airport, while state aviation officials rummaged for money to finance the project. In 1993, state aviation officials began receiving about $3 million a year in federal block grants to preserve and improve smaller airports.

But with all of the state's other aviation needs, it became clear there wouldn't be enough federal money to meet Lakewood Airport's sale price of more than $8 million especially since the owners said they wanted I JO A P'4 Scale i in miles Atlantic A different kind of commuter After 10 minutes of pre-flight checks, taking care not to smear oil on his dress slacks, Bob Koenig, 49, steps up on the wing and into the cockpit of his twin engine Piper Seneca. He taxis the small plane down the length of the Lakewood Airport runway, bumps over the alligator cracks in the pavement and swings the aircraft toward West Chester, Pa. Koenig, of Oceanport, owns a company that installs pollution control equipment a few minutes' drive from Lakewood Airport. Before the sun sets, he will pick up a client in West Chester, fly to eastern Pennsylvania cities Williamsport and Pottstown for sales conferences, then head back to Lakewood. By car, the trip would have taken 2Vi days, he said.

"I used to do 70,000 miles a year on my car. Now I do 14,000," said Koenig, who flies out of Lakewood three days a week on business. Koenig and other aerial entrepreneurs are the reason Lakewood Airport must continue operating, government proponents say. They say Lakewood Airport is a key asset to businessmen in the surrounding industrial park, the state's second largest. Only 35 years ago, pilots could touch down at nearly 100 airports throughout New Jersey many of them small, family operations where income came from a crop duster running low ort fuel, or a seasonal banner tow plane.

Now only 50 airports remain, the rest sold off to developers. One to two airports are lost a year. State aviation officials say Lakewood Airport is the first of eight small, privately held airports around New Jersey that local governments are considering buying with state and federal tax money. That ultimately could cost taxpayers tens of million of dollars. This policy contrasts with a major Whitman administration initiative turning public facilities over to private operators.

A commission appointed by Gov. Whitman last year recommended privatizing more than 20 government and functions, including Newark International Airport. General aviation airports like Lakewood "provide an awfully powerful magnet for certain kinds of industrial, commercial use," said Wilson, the state transportation commissioner. "People want to be located near a general aviation airport to conduct their business "This kind of transaction at Lakewood is in- I payment in full, and Lakewood officials wanted to buy an adjacent undeveloped 30-acre parcel. In 1994, Lakewood Democrats who didn't hold a single seat on the Township Committee tried to force a public referendum on the airport purchase, but were rebuffed.

That year, the Township Committee appointed a citizens advisory committee to study the issue. The four-member citizens panel was composed of two township officials, the former director of the local chamber of commerce and James Knipper owner of the pharmaceutical company J. Knipper based in Lake-wood's industrial park. Knipper was chairman. Despite public 'assurance's by Township Manager Fehrenbach that panel members were unbiased, records indicate Knipper's company has a plane tethered at the airport and that his company contributed $2,000 last year to a political fund-raising committee that endorsed the airport's acquisition by the township.

In 1995, state aviation officials came up with a source for the lion's share Of the Lakewood Airport sale convincing the Republican-controlled Legislature to carve $10 million for airports out of the state's Transportation Trust Fund. The trust fund was set up 12 years ago to build and fix roads, and to improve the state's mass transit system. After that, the deal came together quickly. Nearly four years after Solondz's first meeting with state officials, he and the partners agreed last July 10 to the sale. The deal became final Feb.

1. The airport's net value to the owners was about $7.6 million $8.5 million minus nearly $900,000 in costs the owners agreed to pay. Those costs included airport safety improve- ments and offsets for lost local tax revenue. Spending tax money to preserve smaller airports "is a good public policy. Aside from the clients I think it's the right thing to be doing," said Hazel Gluck, the Republican lobbyist who represented the private owners in the Lakewood deal.

Gluck is Whitman's former campaign co-chairwoman. She also was state transportation commissioner from 1986 to 1989. Gluck emphasized she began working on the airport sale before Whitman became governor in 1994. Involvement in Whitman's campaign was unrelated to the airport deal's success, she SOURCE: Lakewood Airport Staff graphic But more than a month after the Lakewood Airport sale was final, Wilson said he wasn't aware money had been used to buy property for a nonaviation purpose. "I'd have to look at it carefully," Wilson aid.

"If there's anything unusual about it, then they would have to talk to me and get my concurrence I haven't seen that plan, so I don't know whether it would violate the intent or the actual literal provisions of the law." Philip Brito, manager of the FAA's New York airports district office, said federal officials have "mixed feelings" about using federal aviation grant money for a nonaviation purpose. "We'd be concerned about investing money in property that would not be needed for the airport," Brito said. Please see Lakewood, page AS Jersey's plan to buy small airports with federal money, calling it "a relatively low priority that probably would not be funded." While closing the Lakewood deal, state aviation officials also bypassed some state and federal rules. Under New Jersey law, if a municipality receives state financial aid to buy airport property, the property can't be used for "any nonaviation purpose" without approval from the state transportation commissioner. Yet $1.3 million of the purchase money went to buy 30 acres adjoining the-airport a tract the township plans to develop and lease to industrial or commercial users.

O'Hare said the purpose of that purchase was to generate "sufficient revenue to make the airport.