On February 12, 2008 the Village Board voted unanimously (6-0) to commission $61,800 for “Engineering Services for phase 2 existing conditions and recommendations for repairs of the Schaumburg Regional Airport Runway.” The SFC would have opposed it.

SFC’s Recommendation

Do not expand or fix up the Schaumburg Airport at the taxpayers expense. Sell it, expand zoning of the land, and increase economic freedom to allow for future residential, commercial, or industrial development. This, in addition to the potential of it remaining as a privately funded airport with an equal property tax burden as other Schaumburg businesses.

Savings for Schaumburg Taxpayers

Short Term Tax Savings

• $61,800 for line item engineering solutions expense

Long Term Tax Savings

• $1.5 million per year in Schaumburg Taxpayer subsidies for airport (average 2004-2008)
• $750K per year reduction in property taxes through elimination of special property tax exemption (Schaumburg airport currently pays no property taxes at all)

Additional Benefits

• Creation of 1,600 jobs for local economy
• $150 million in additional annual economic activity

Political Corruption Watch

Mayor Larson has received at least 16 donations totaling $4,880 from the Northwest Flyers, who are headquartered at the Schaumburg Airport, since 1999.

The Northwest Flyers are an Air Charter Service that benefits greatly from the massive tax subsidies and property tax exemptions granted by the Village of Schaumburg.

It is inappropriate for Mayor Larson to be accepting campaign donations from ANY company who receives financial subsides in the form of taxpayer dollars or special property tax breaks.

Why privatize Schaumburg Airport?

With O’Hare Airport less than 10 miles away from Schaumburg, there is no pressing air travel shortage or any need for a taxpayer financed airport and a special property tax exemption.

Despite the Village of  Schaumburg’s “effort” in promoting economic development through taxpayer subsidies, any property tax breaks the Village’s policies of command and control economic policies at the Schaumburg Airport costs the local community in excess of 1,600 jobs and over $150 million dollars in lost economic activity every year.

Justifying these taxpayer subsidies and special property tax breaks for the Schaumburg Airport Mayor Al Larson recently said “We (the Village of Schaumburg) are in the business of long-term economic development.” Really?

Looking back on Schaumburg’s past when the Airpark was in “danger” of becoming an industrial park in 1994, the Village of Schaumburg led by Mayor Larson stepped in, outbid an industrial park developer, and purchased the facility using taxpayer funds. Mayor Larson claimed in 1995 that the Schaumburg Airport “revenues from fuel sales, hangar rentals and business leases will more than offset operating costs.” This rosy prediction has turned sour as Airport users, two-thirds recreational flyers, have financed only 48.9% of the $12.8 million in total costs over the last 5 years.

The Village of Schaumburg has gone to great lengths to make up for the losses at Schaumburg Airport by forcing the taxpayers to pick up the bill. Over $20 million dollars in local, state, and federal taxpayer dollars have been used for capital investments on the property during its 14 year history. Recently, Mayor Larson requested an additional $1.84 million in federal stimulus money for runway rehabilitation and energy conservation at the airport.

Additionally, the Village of Schaumburg has enacted a special property tax exemption for the facility, possibly worth an additional $8-10 million since 1994. This causes property taxes for schools, libraries, and other essential services to be disproportionately shouldered by other residents and businesses.

While the taxes have certainly been costly, the effects on job creation are much greater. According to the 2000 U.S. Census and Village of Schaumburg documents, Schaumburg’s 1,079 industrial park acres provided 15,748 manufacturing jobs at a rate of 14.6 jobs per acre. In comparison, a 2006 survey by the Village showed that Airport and on-site tenant employees only totaled 50 full-time and 54-part time employees, or only 0.89 jobs per acre. The 16.4 to 1 industrial park to airport job creation ratio is a startling reminder of the costs of Schaumburg’s command-and-control economic policies.

The Village of Schaumburg claims that the airport generates $10 million dollars in economic activity every year, or approximately $96,000 per airport job. This suggests that an average performing 117-acre industrial park in Schaumburg, with its estimated 1,700 jobs, would create well over $160 million dollars annually in economic activity for the local economy.

In comparison to what market-based policies could have brought Schaumburg, Larson’s agenda has created a comparative economic desert. Most of the effects of bad economic policies go unnoticed by the public because we can’t see the manufacturing businesses prevented from ever coming into existence at the site that now houses the Schaumburg Airport.

Larson may believe the free-market needs “checks and balances”, but the case of the Schaumburg Airport shows the Village’s economic policies are the ones in need of serious re-examination. This diminishing of economic freedom has created an unseen devastation to the local economy. The cumulative costs of Schaumburg’s airport policies over the last decade-and-a-half certainly surpass more than a billion dollars in lost economic prosperity for its citizens. A change in policy is long overdue.

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