The company at the center of state and federal fraud charges still owns the operating license at the Northeast Kingdom International Airport in Coventry thanks to a deal back in 2012.
Ariel Quiros, business partner of Bill Stenger, owns the company that holds the license, Q Resorts, and it’s one of the defendants named in the fraud cases brought by the Securities and Exchange Commission and the state of Vermont this month.
Chris Cole, the secretary of the Agency of Transportation, said Q Resorts bought the fixed base operator contract in 2012 from Lakeview Aviation, a local company that had been managing the airport for years. Q Resorts then renewed the contract in 2014.
Cole said the state approved Q Resorts’ original purchase of the contract in large part because the company planned to keep Lakeview Aviation on as a subcontractor to handle operations at the airport. There was no bidding process as part of the change in operator.
He said the renewed contract is set to expire June 30 and that he will not seek to renew it — although he said his team still needs to speak with the court-appointed receiver in the SEC case.
“It’s an understatement to say it’s been extremely difficult to get (Q Resorts) to be responsive,” Cole said. “It hasn’t been a great business relationship in terms of their responsiveness, but I don’t feel that we’ve tied up the state’s assets.”
In addition to the fixed base operator agreement, Cole said, Q Resorts has leased a portion of the airport’s land from the state of Vermont. He said the company built a structure on that land that wasn’t part of the lease, and the company did not cooperate with the state’s efforts to update the lease.
Cole said the relationship between Q Resorts and the state “all seemed to be moving in the right direction” at first. And he said the lack of responsiveness was “a sign to me of an organization that isn’t well-managed, but it wasn’t a sign that something else (was) going on.”
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Cole said he wants the selection of a new operator to be handled differently this time.
“We’re just beginning to have that conversation (about changing operators), so I will see what flexibility we have,” Cole said. “What I intend to do is have a bid process and find out who is qualified to be the fixed base operator at that airport.”
Between 2012 and 2015, the Federal Aviation Administration spent $19.8 million through the Airport Improvement Program upgrading the airport, according to data from the federal government. Vermont would have spent less than $2 million at the airport, according to Cole.
The improvements included lengthening one runway to 5,000 feet.
Stenger unveiled drawings in July for a 10,000-square-foot, $20 million terminal. At an event in November, Guy Rouelle, the aviation director for the Transportation Agency, said the terminal would be home to 100 new jobs. Construction was said to be planned for this spring.
Patricia Sears, chair of the local committee that pushed for improvements at the airport, credited Stenger in November for helping her “get the puck down the ice” on landing the federal grants and getting the runway extended. She says she is still optimistic about the future of the airport.
“The good news is it’s an asset that was recognized and developed,” Sears said. “It is designated as a foreign trade zone hub, so there is space there on the airport property for bonded warehouses or other businesses.”
Paul Monette, mayor of the nearby city of Newport, is also optimistic. “You have to remember the runway expansion, the taxiway, that’s funded by state and federal money,” he said. “This is just a blip in the economic development. It will come around. It’ll get built.”
Cole said the state is fine for now with the small terminal it already has and officials can figure out how to move forward with any plans for a new terminal.
“I don’t think they’re going to build us a terminal, so we will figure out an appropriate terminal based on our needs,” he said.
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