The Queenstown Lakes District Council has announced plans to lease Wanaka Airport to its own Queenstown Airport Corporation in the expectation it will invest in the "strategic'' council asset.
The corporation manages Wanaka Airport at present.
Discussions over governance of the airport have been under way in-committee since April and have involved council staff, consultants, councillors and members of the Wanaka Community Board.
Releasing documents for public discussion yesterday, chief financial officer Stewart Burns said the council's objectives were to improve air services for the district, improve the economic and financial performance of the airport and improve investment decisions.
Mr Burns said a whole range of options "from doing nothing right through to selling the asset outright'' had been looked at through the "better business case methodology'', recommended by Treasury.
The sale of the airport had been "quickly discounted'' when measured against the council's three objectives.
And putting the lease up for commercial tender from other airport operators was discounted "on the basis of the relationship we currently have with QAC and their understanding of air services within the district''.
"In terms of the outcomes we are looking at ... why would you be looking at someone that didn't have the experience that QAC has?''
The consultation plan says the council has $1.5million in its long-term plan for the airport, which was sufficient to maintain the existing infrastructure but was "insufficient'' to handle expected growth over the next decade or more.
Asked about the level of investment the council might expect from QAC, Mr Burns there would need to be "some agreement on the strategic direction that needs to be taken''.
The business case study found the long-term lease arrangement would mean QAC was "better incentivised'' to work towards increasing revenue opportunities.
The case study also found the long-term lease arrangement would ensure:
• Queenstown and Wanaka airports are run in a complementary manner.
• Ownership was retained by the council.
• Control over the future direction of the airport was maintained via lease conditions and a QAC statement of intent.
• The airport remained profitable.
• The sale of the airport remained an option.
Asked whether or not other airport companies should have the chance to tender for the lease, former Christchurch Airport chief executive Jim Boult said yesterday: "There was not a lot of money'' in running Wanaka Airport. So in terms of getting a return on investment, any other airport looking at it would have to take an extremely long-term view.''
Mr Boult said he would be surprised if Christchurch Airport would be interested, and he considered the Queenstown corporation ran "a very tight ship'' and would do "a damn good job'' of running Wanaka Airport.
"I certainly don't think there would be any issue of them trying to curtail the growth of Wanaka to protect ... Queenstown.''
He believed the council had chosen the right option.
The council will decide at its meeting on Thursday whether or not to go ahead with the public consultation process.
Wanaka Airport
The situation
• Owned by the Queenstown Lakes District Council.
• Managed by the Queenstown Airport Corporation (QAC), which is 75.01% owned by the Queenstown Lakes District Council and 24.99% owned by Auckland International Airport.
• Annual earnings $230,000 (before interest and tax) from landing fees and ground rents.
Options
• Status quo.
• Status quo with enhanced planning and governance.
• Sell to Queenstown Airport Corporation.
• Lease or sell to QAC including Glenorchy airstrip.
• Long-term lease to QAC (preferred).
• Public consultation from October 1 to November 18.
• Public hearings in December.
