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ffi EB W 

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UNITED STATES DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, DC 

RDM, LLC, 

Complainant, 

V. 

TED STEVENS ANCHORAGE 

INTERNATIONAL AIRPORT, 

Respondent. 

Docket No. 16-09-14 

REBUTTAL ^ 

' .3 

Respondent State of Alaska, Department of Transportation and PiiUlic 

Facilities, ("Alaska DOT&PF") in its capacity as sponsor and operator of the Ted 

Stevens Anchorage International Airport, ("ANC") hereby rebuts Complainant RDM, 

LLC's ("RDM") Reply to TSAIA Answer ("Reply"). In the accompanying Reply to 

RDM's Answer to Motion to Dismiss, the Alaska DOT&PF further supports its request 

for dismissal with prejudice, and hereby incorporates those arguments also into this 

Rebuttal. 

The dispositive issues in this matter are as follows: 

A. RDM has no standing under Part 16 because as RDM has not 

demonstrated that either RDM or AGLAD are, or proposed to be, an 

aeronautic user or provider of aeronautic services. RDM is a real estate 

developer, and AGLAD proposed to be a real estate developer. 

B. RDM has no standing as it was not "directly and substantially affected" by 

the alleged actions of the Alaska DOT&PF with respect to AGLAD 

Postmark, LLC ("AGLAD"). 

C. Contract terms not prohibited by law or grant assurances, but agreed to by 

AGLAD as a matter of contract, are not proper subjects for review under 

Part 16. 

D. RDM has not carried its burden of proof that AGLAD was similarly 

situated to FedEx UPS or CargoPort, which it was not. 

REBUTTAL 

RDM, LLC V. ANC 

Page 1 of 42 

Docket No. 16-09-14 
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E. RDM has not carried its burden of proof that the terms and treatment 

AGLAD received from the Alaska DOT&PF were not reasonably 

justified, which they were. 

F. The specific statement in RDM's Reply do not provide material support 

for its allegations. 

It may fairly be noted here that both RDM's Complaint and Reply are replete with 

assertions unsupported by any evidence whatsoever, and that RDM quite consistently 

fails to meet the well-documented facts presented by Alaska DOT&PF. 

A. RDM has no standing under Part 16 because RDM has not demonstrated 

that either RDM or AGLAD are, or proposed to be, an aeronautic user or 

provider of aeronautic services. 

RDM's Reply brought into clear focus an issue not readily apparent from 

its original complaint, but which may be fully dispositive of this matter: The issues in 

this case all relate to real estate development by a real estate developer, which is 

arguably not aeronautic use subject to Part 16 at all. 

In its Reply to RDM's Answer to Motion to Dismiss, Alaska DOT&PF 

discusses at some length DeSciose v. City of Long Beach, FAA Docket No. 16-99-12 

(December 13, 2001) (Final Decision and Order) (as well as the February 20, 2001, 

Director's Determination), and argues that RDM and AGLAD are and were real estate 

developers, not aeronautic users entitled to protection under Part 16.' Alaska DOT&PF 

incorporates by reference here the arguments of its Reply to RDM's Answer to Motion 

to Dismiss. Having incorporated those arguments, Alaska DOT&PF will not restate 

' It is important to note that Alaska DOT&PF never distinguished between 

AGLAD, CargoPort or any other lessee or lease applicant based on it being perceived to 

be a real estate developer rather than a proposed aeronautical user. Alaska DOT&PF 

endeavors, to and believes that it does, treat all applicants and tenants fairly and, to the 

extent similarly situated, consistently in compliance with 49 U.S.C. §47107(a) and the 

Sponsor Grant Assurances—except as justified by relevant differences between lessees, 

projects, businesses, timeframes, circumstances, etc. It was only RDM's description of 

itself and the AGLAD development, together with the DeSciose case, that suggested the 

assurances may not, strictly speaking, apply. In any event, Alaska DOT&PF believes it 

treated AGLAD in complete compliance with the grant assurances whether they apply 

or not, and, as more fully argued below, RDM's allegations of disparate treatment are 

either unfounded, or the differences were fully justified by dis-similar situations. 

REBUTTAL 

RDM, LLC V. ANC 

Page 2 of 42 

Docket No. 16-09-14 
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them here in full, but will note the facts that indicate RDM is, and AGLAD proposed to 

be, a real estate developer rather than an aeronautic users: 

1. The banner across the bottom of the stationery of RDM's managing member, 

Debenham Properties, LLC, reads: "^ real estate development company." See 

Exhibit C to RDM Reply (also provided as ANC-AGLAD-0198-0199) (emphasis 

added) 

2. "RDM's management company, Debenham Properties, LLC owns over $40M of 

investment real estate in Alaska, Utah and Nevada. Debenham Properties 

specializes in development, acquisitions and property management of industrial 

space." RDM Reply at 2 (numbered paragraph 5) (emphasis added); 

3. Description of ""the development process," referring to the "post-construction 

phase" as "management of the project" (as opposed to operation of an 

aeronautical service business) and referring to pre-construction as "efforts to 

court and sign tenants." RDM Reply at 9-10 (numbered paragraph 6) (emphasis 

added); 

4. Assertion that "the development" existed, even though it remained only a 

proposed and planned idea, description of ''how developments occur," and 

discussion whether "tenants should come to the land lease signing with their 

developments pre-leased," and the "time needed to court and negotiate with 

prospective tenants." RDM Reply at 10 (numbered paragraph 9) (emphasis 

added); 

5. Reference to Pegasus Aircraft Maintenance as "a major anchor tenant to 

AGLAD's development." RDM Reply at 11 (numbered paragraph 9-10) 

(emphasis added); 

Reference to Cathay Pacific Airways Limited as "a major anchor tenant to 

AGLAD's development." RDM Reply at 12 (numbered paragraph 9-8) (emphasis 

added); 

Comparison of its "prospective project" to "on in which a developer controls 

prime real estate," effectively equating AGLAD to "a developer" but without 

control of the property until it signed the lease. RDM Reply at 20 (numbered 

paragraph 19-3.J (emphasis added)); 

Reference to fact that "Long-term financing is always the hardest financing to 

secure for a development." RDM Reply at 22 (numbered paragraph 19-7.e) 

(emphasis added) 

"If developers are going to invest millions of dollars into projects at TSAIA they 

need to know that TSAIA is not going to willfully price-undercut them." RDM 

Reply at 25 (numbered paragraph 19-1 Lb) (emphasis added). 

6. 

7. 

8. 

REBUTTAL 

RDM, LLC V. ANC 

Page 3 of 42 

Docket No. 16-09-14 
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To the extent neither RDM nor AGLAD were aeronautical users protected 

by the grant assurances, this matter is not subject to Part 16 jurisdiction. 

B. RDM has no standing as it was not "directly and substantially affected" by 

the alleged actions of the State of Alaska with respect to AGLAD. 

Having incorporated by reference here the arguments of its Reply to 

RDM's Answer to Motion to Dismiss, Alaska DOT&PF will not restate the argument 

that RDM has no standing as it was not "directly and substantially affected" by the 

alleged actions of the State of Alaska with respect to AGLAD. 

Suffice it to state here that the RDM's only direct dealings with Alaska 

DOT&PF were not on behalf of AGLAD as a holder of an ANC lease, but on behalf of 

either Debenham Properties, LLC or RDM as a prospective purchaser of Alaska Global 

Logistics Airpark Development, Inc's majority interest in AGLAD. Thus, the State of 

Alaska dealt directly with Debenham or RDM only as potential purchasers of a 

controlling interest in an airport tenant. Yet RDM makes no allegation that it had rights 

under law or the grant assurances in that capacity, and no allegation that any other 

similarly situated prospective purchaser of a controlling interest in an airport tenant 

received more favorable treatment from Alaska DOT&PF. 

All of RDM's allegations of wrongful conduct go to the lease terms and 

treatment of AGLAD. Although terms and decisions of Alaska DOT&PF may have 

affected AGLAD, any impact felt by RDM was necessarily secondary and indirect, 

depending on whatever direct effect AGLAD experienced. RDM cannot dispute that 

truth. No action by the Alaska DOT&PF that is subject to Part 16 review had any direct 

and substantial effect on RDM. RDM has no standing. 

C. Contract terms not prohibited by law or grant assurances, but agreed to by 

AGLAD as a matter of contract, are not proper subjects for review under 

Part 16. 

Having incorporated by reference here the arguments of its Reply to 

RDM's Answer to Motion to Dismiss, Alaska DOT&PF will not restate the argument 

that Part 16 review is not appropriate for terms and conditions not expressly contrary to 

49 U.S.C. §47101 and the Sponsor Grant Assurances, and to which AGLAD agreed by 

REBUTTAL 

RDM, LLC V. ANC 

Page 4 of 42 

Docket No. 16-09-14 
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• • 

contract. Suffice it to say here that if an aeronautic user's lease term or treatment were 

alleged to have directly contravened 49 U.S.C. §47107(a) or a grant assurance without 

reference to any a term or decision applied to any other tenant, then perhaps it would be 

subject to Part 16 review—even if the complainant had agreed to it. But where the only 

issue is disparate treatment between tenants, then even for aeronautic users, "agreeing to 

differences in rights, restrictions, responsibilities and rents in agreements among 

existing FBOs necessarily supports the conclusion that the parties are not similarly 

situated for purposes of finding unjust economic discrimination." 41 North 73 West, Inc 

V. County of Westchester, FAA Docket 16-07-13, (September 18, 2009) (Final Decision 

and Order, pp. 28) (emphasis added). 

D. RDM has not carried its burden of proof that AGLAD was similarly 

situated to FedEx UPS or CargoPort, which it was not. 

Differing treatment of different tenants over time is not in and of itself 

improper: 

[N]o Federal obligation requires a sponsor to forgo improved 

business practices or efficient allocation of airport property in 

order to avoid differing terms and conditions among users of 

the airport. The airport sponsor can pursue agreements that 

more nearly serve the changing interests of the public with 

the more recent leaseholders. 

Maxim United, LLC v. Board of County Comm 'rs, FAA Docket No. 16-01-10 (April 14, 

2003) (Director's Determination, p. 22) (citing Wilson Air Center v. Memphis and 

Shelby County Airport Authority, FAA Docket No. 16-99-10 (August 30, 2001)(Final 

Decision and Order); see, also Asheville Jet, Inc. v. Asheville Regional Airport 

Authority, FAA Docket 16-08-02 (October 1, 2009) (Director's Determination) 

(identical tone and posture not required toward all competitors with different records 

and history with sponsor (citing Rick Aviation v. Peninsula Airport Comm'n, FAA 

Docket No. 16-05-18 (May 7, 2007) (Director's Determination at 16)); grant assurance 

does not require identical lease rates and terms to leases negotiated at different points in 

time (citing Aerodynamics of Reading, Inc. v. Reading Regional Airport Authority, FAA 

Docket No. 16-00-03 (July 23, 2001) (Final Agency Decision)); Bisti Aviation, Inc. v. 

REBUTTAL 

RDM, LLC V. ANC 

Page 5 of 42 

Docket No. 16-09-14 
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• 

City of Farmington, FAA Docket 16-07-01 (December 4, 2007) (Director's 

Determination at 21) ("Federal grant obligations do not require Alaska DOT&PF to use 

antiquated leasing practices just to ensure that a prospective tenant today gets the same 

treatment another tenant got in the past.") 

As noted at page 33, paragraphs 14.d and .e, of RDM's Reply, the FAA 

has held 

In order for the Director to sustain an allegation of unjust 

economic discrimination, the record must show the elements 

of unjust economic discrimination under grant assurance 22. 

In a Part 16 proceeding, the Complainant has the burden of 

proof to establish the elements of unjust discrimination. ..., 

the record must show that another party similarly situated to 

the Complainant received preferential treatment denied to the 

Complainant in similar circumstances. ...The FAA has 

acknowledged that several factors can distinguish parties that 

a sponsor can justly treat differently, without violating its 

Federal obligations. Such factors may be: period of lease, 

business plan proposed; location of facilities, level of service 

and amenities, scope of services, investment, market 

conditions, and reasonable actions by the sponsor to promote 

and protect its ability to continue to serve the interests of the 

public in civil aviation, including the enlistment of prudent 

business practices that may change over time. 

Grayson v. DeKalb County, FAA Docket No. 16-05-13, (February 1, 2006) (Director's 

Determination); see, also JetAway Aviation, Inc. v. Montrose County, (July 2, 2009) 

(Director's Determination at 46). 

RDM alleges that AGLAD was similarly situated with FedEx, UPS and 

Alaska CargoPort. Presenting effectively no legitimate evidence whatsoever, RDM 

merely cites generally similar proximity and "similar development patterns of 

developing both hardstands for aircraft servicing and building space for industrial use" 

Reply, page 14, paragraph 14. See, also. Reply, page 15, paragraphs 17-18 ("All four 

developments rely extensively on aircraft parking hardstand [sic] to service aircraft. 

Additionally,, all four developments rely extensively on warehousing facilities to 

service goods and services;" and "All four developments involve constructing and using 

REBUTTAL 

RDM, LLC V. ANC 

Page 6 of 42 

Docket No. 16-09-14 
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aircraft parking positions and a building facility where office, warehouse and cargo 

transfer/sorting can occur."). RDM's "point" is only that "by and large, all four 

developments are similar in size and use." Reply, page 15, paragraph 18. 

Presenting no other evidence of similarity, RDM responds to Alaska 

DOT&PF's catalog of differences in its Answer at Exhibit A, paragraph 18 by saying 

"[a]ll of [those differences] may or may not be true but it does not excuse TSAIA from 

fulfilling their obligations to Title 49 United States Code §47107(a) General Written 

Assurances." Reply, page 15, paragraph 18.A.1-9 and page 16 paragraph 18.B.1-8. It is 

certainly true that differences between tenants and projects and circumstances do not 

excuse an airport from compliance with the law or grant assurances, but as many, many 

Part 16 decisions demonstrate, the degree which tenants and their projects are or are not 

similarly situated determines of the degree to which the law and grant assurances 

require similar terms or treatment. 

By failing to dispute the differences set out by Alaska DOT&PF, RDM 

effectively concedes that AGLAD was not, in fact, similarly situated to any of FedEx, 

UPS or CargoPort. Looking only at construction and physical functionality, but not at 

all on business model, RDM completely fails to recognize how completely dis-similar 

AGLAD, as a real estate developer proposing to develop a multi-tenant lease facility in 

2005, was from FedEx and UPS as Signatory Air Carriers constructing facilities for 

their own use to meet their own needs more than 15 years before. The utter 

dissimilarity between AGLAD, FedEx and UPS completely negates all of RDM's 

comparisons between those "developments." 

Although CargoPort's situation as a real estate developer for multi-tenant 

use, was somewhat more comparable to AGLAD's than FedEx or UPS, the differences 

noted at Alaska DOT&PF's Answer at Exhibit A, paragraph 18.B, and not reflited by 

RDM, preclude a finding that AGLAD and CargoPort were similarly situated, either. 

As noted in Roadhouse Aviation, LLC v. City of Tulsa, FAA Docket No. 16-05-08 (June 

26, 2007) (Final Decision and Order) at page 20, footnote 3, "two operators may not be 

considered essentially similar even though they offer the same service to the public." 

REBUTTAL 

RDM, LLC V. ANC 

Page 7 of 42 

Docket No. 16-09-14 
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• 

{ciiing Aerodynamics of Reading, Inc. v. Reading Airport Authority, FAA Docket No. 

16-00-03,Final Decision and Order (July 23, 2001) and Adventure Aviation v. City of 

Las Cruces, FAA Docket No. 16-01-14, (August 7, 2002) (Director's Determination). 

The following are the differences between CargoPort and AGLAD as noted in Alaska 

DOT&PF's Answer at Exhibit A, paragraph 18.B: 

1. CargoPort's original members included Lynxs Holdings, LLC, an 

experienced developer and operator of air cargo facilities, and MAPCO 

Alaska Petroleum, Inc. ("MAPCO"), which refined and sold large 

volumes of jet fuel to airlines at ANC—neither AGLAD nor any of its 

members has never developed an air cargo facility or done any other 

airport business; 

2. CargoPort's member, MAPCO, was a mid-major oil company with a stake 

in jet fiiel sales at ANC, a strong financial track record and ready access to 

both major debt and equity markets for financing and provided its 

corporate guarantee of the CargoPort project—AGLAD's members had 

no stake at ANC other than AGLAD, no financial track record shared with 

Alaska DOT&PF, no ready access to financial markets; RDM declined an 

invitation to guarantee the AGLAD project; 

3. Despite substantially greater capacity to finance a large-scale 

development, and despite—or perhaps because of—its members' 

respective air cargo development and airport business experience, 

CargoPort initially began its development more conservatively on roughly 

23.9 acres—AGLAD, despite its limited access to financing and despite— 

or perhaps because of—its complete lack of air cargo development and 

airport business experience, took a highly aggressive development posture 

by leasing and committing to develop 40.5 acres from the start; 

4. When the CargoPort development began in 1997, ANC was beginning to 

run low on easy-to-develop land, and there had been multiple applications 

for the subject parcel; CargoPort obtained its lease by competitive sealed 

bid with no ability to negotiate terms of the land lease agreement that 

required up-front payment of a year's rent and a mandatory performance 

bond in the amount of $10 million—by the time AGLAD signed its lease, 

the various areas of undeveloped land at ANC all posed varying 

challenges, making preferred land all that much more scarce; yet AGLAD 

applied in 2002 for virtually all of the remaining land suitable for 

development, ultimately leasing substantially all of the remaining 

strategically-located land on the east side of the north-south runway in 

2005 under terms it negotiated with Alaska DOT&PF without any proof 

REBUTTAL 

RDM, LLC V. ANC 

Page 8 of 42 

Docket No. 16-09-14 
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5. 

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of financial responsibility, and substituting a stipulated timeline for being 

on track for and securing financing for performance bond; 

When the CargoPort development began in 1997, ANC had become an the 

international air freighter hub for only FedEx and UPS, and very little 

other cargo trans-loading, see March 1, 2000 Letter from Ken Lythgoe 

[ANC-CargoPort-0179-0180]—by the time AGLAD signed its lease, 

ANC was the third largest airport in the world for cargo tonnage 

according to data from the Airports Council International, with a 

Northwest Air Cargo hub operating at CargoPort and DHL competing 

strongly with FedEx (the Northwest Air Cargo hub has more recently 

been eliminated since the merger with Delta Air Lines, and DHL has 

dramatically reduced its activity in U.S. markets); 

When the CargoPort development began in 1997, the Alaska Department 

of Transportation and Public Facilities ("DOT&PF") had not updated its 

relevant airport regulations since 1979—by the time AGLAD signed its 

lease in 2005, leasing at ANC was subject to DOT&PF's International 

Airport Regulations, 17 AAC 42, adopted in 2001; 

When the CargoPort development began in 1997, foreign air cargo 

carriers were significantly limited in cargo transfer rights at ANC by 

principles of cabotage—^by the time AGLAD signed its lease in 2005, 

Section 808 of Public Law No: 108-176, Vision 100-Century of Aviation 

Reauthorization Act, signed into law December 12, 2003, had enacted 49 

U.S.C. 41703(e), see [ANC-0012], allowing foreign air carriers 

unprecedented cargo transfer rights at ANC, increasing both the demand 

for air cargo services at ANC and the demand for air cargo development 

land at ANC. 

8. When the CargoPort development began in 1997, Alaska DOT&PF had 

not yet begun its terminal redevelopment program and the Alaska 

International Airports System had outstanding bond debt in a principal 

amount of less than $50 million. By the time AGLAD signed its lease in 

2005, the Alaska International Airports System was servicing bonded 

indebtedness of more than $400 million, and was preparing a February 

2006 bond issue to add $239,735,000 in new debt, greatly constraining 

any availability of airport revenue for support of tenant development 

RDM's reply to all of those distinctions was that they "may or may not be true," 

followed by a wholly unsupported and unexplained assertion that they did not matter. 

But "Part 16 precedent supports the conclusion that lease terms, negotiations, 

agreements and timing of agreements matter when determining similarly situated 

competitors." 41 North 73 West, Inc v. County of Westchester, FAA Docket 16-07-13, 

REBUTTAL 

RDM, LLC v. ANC 

Page 9 of 42 

Docket No. 16-09-14 
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(September 18, 2009) (Final Decision and Order, p. 28). RDM has failed to satisfy its 

burden of proof that AGLAD was similarly situated with CargoPort. Indeed, RDM 

cannot satisfy that burden because the distinguishing factors are too many and too 

distinct. 

E. RDM has not carried its burden of proof that the terms and treatment 

AGLAD received from the Alaska DOT&PF were not reasonably justified, 

which they were. 

In the first seven pages of its Answer, Alaska DOT&PF explained why it 

negotiated financing deadlines—^to which AGLAD did not object and indicated it would 

meet—into the AGLAD lease. In the fall of 2005, AGLAD had not demonstrated that it 

had the financial ability to carry out its project, [ANC-AGLAD-0157] unlike CargoPort, 

which had been required to post a $10 million bond or guarantee. (Bond requirement for 

100% of costs, ADA-30816, Article IX [ANC-CargoPort-0014]; Statement of $10 

million minimum amount, ADA-30816, Article X.D [ANC-CargoPort-0016], letter 

acknowledging receipt [ANC-CargoPort-0111]. 

Under state regulations, at 17 AAC 42.215(b)(5) and 42.240(b), ANC 

staff was required to address financial responsibility of AGLAD to ensure timely 

completion of improvements. AGLAD, did disclose whatever financial backing RDM 

had committed to the project. Alaska DOT&PF had the option of denying the lease for 

failure to demonstrate financial responsibility sufficient to carry out the project, 

deferring a lease until AGLAD could put the financing together, which would have 

required a new competitive public notice, or working out an alternative. With AGLAD 

opposed to either of the first two options but confident it could get the financing 

together in the relative near term, AGLAD proposed a "conditional lease." Lee Nunn 

letter to Richard Wilson, October 24, 2005 [ANC-AGLAD-0157 at 0160]. Thus the 

concept of a financing deadline on which the lease was contingent actually originated 

with AGLAD. It was not as a "take-it-or-leave it" provision, as alleged by RDM, but a 

negotiated work-around to which AGLAD made no objection. Evidence of other 

negotiated provisions is contained in a note to file at [ANC-AGLAD-0162]. 

REBUTTAL 

RDM, LLC V. ANC 

Page 10 of 42 

Docket No. 16-09-14 
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Despite July 2006 indications that a bond sale could close by October as 

required under the lease [ANC-AGLAD-0165 - 0168], by mid August 2006, AGLAD 

requested a waiver of the October deadline. [ANC-AGLAD-0169]. After discussion 

with the bond issuers, ANC staff proposed extension to January 31, 2007, rather than 

waiver [ANC-AGLAD-0171], and AGLAD concurred. [ANC-AGLAD-0171]. In 

January, 2007, AGLAD requested waiver of the deadline again, though indicating that 

an initial bond sale was expected the end of March 2007 "at the latest." [ANC-AGLAD0175 at 0176]. The deadline was allowed to pass, but by December 2007, there had 

been no bond sale, but now came a request for a five-month rent deferral [ANCAGLAD-0180]. Alaska DOT&PF granted a four-month rent deferral. [ANC-AGLAD0182]. Just a month into that deferral, AGLAD asked the newly appointed Deputy 

Commissioner for Aviation for elimination of all interim deadlines and leaving only a 

final improvements deadline of 7 'A years. [ANC-AGLAD-0183-0184] Although the 

Deputy Commissioner did not agree to waiver of all intervening deadlines, but did 

extend them once again. [ANC-AGLAD-0186-0187]. [ANC-AGLAD-0165]. 

Contract that portion of the AGLAD history with CargoPort, which in 

February 1998 requested an extension of its construction schedule [ANC-CargoPort0087], which ANC staff denied. [ANC-CargoPort-0094]. CargoPort also asked for 

financial assistance [ANC-CargoPort-0088], which was also never granted. 

CargoPort's original $10 million of improvements were to be accomplished within three 

year of the October 1997 beginning of the lease term. ADA-30816 Article IV.B and 

Article X.D [ANC-CargoPort-0007 and 0016] and was certified as accomplished by 

July 2000. [ANC-CargoPort-0113]. Unlike AGLAD, it was only after CargoPort had 

accomplished its major original improvements that it was allowed some deadline relief 

as to hardstand construction on an adjacent lease, as described in the Answer, Exhibit A, 

page 35-36, paragraph 19-3.b.ii. 

Although RDM argues that by the time Alaska DOT&PF finally drew the 

line and declined to grant additional extension, the project was on the verge of success, 

that is precisely what AGLAD had been telling ANC staff on a regular basis for years. 

REBUTTAL 

RDM, LLC V. ANC 

Page 11 of 42 

Docket No. 16-09-14 
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• • 

Ultimately a judgment call was required. RDM may belive it was poor judgment, but 

Alaska DOT&PF personnel had to consider the propriety of allowing itself to be strung 

along, keeping the subject land unavailable to any more capable aeronautic user or 

developer in the meantime. Staff even allowed as the lease could be allowed to lapse 

and RDM could reapply, retain all the value of its development effort, but establish new 

terms more to its liking, while also exposing the land to potential competitive interest to 

resolve concerns about the propriety of allowing an private party to retain a lease of 

public land desite such a pattern of performance failures and waivers. [ANC-AGLAD0378 - 0380]. RDM declined. The Debenham family also declined an opportunity to 

put their own resources behind AGLAD. [ANC-0057 - 0060]. 

By close comparison between RDM's poorly supported allegations, the 

well-document facts presented in the Answer and the near complete failure of RDM's 

Reply to actually meet the facts Alaska DOT&PF presented in its Answer, Alaska 

DOT&PF has substantially already rebutted RDM's allegations. Despite RDM's 

allegations that AGLAD received less favorable terms than CargoPort, Alaska 

DOT&PF believes the more a more accurate analysis is presented in two letters from 

CargoPort asserting that AGLAD was receiving unfairly preferential treatment. [ANCAGLAD-0329-0332]. 

F. The specific statement in RDM^s Reply do not provide material support for 

its allegations. 

For the most part, RDM's Reply boils down to a series of restatements of 

RDM's unsupported allegations. To the extent RDM's comments in reply add nothing 

to the unsupported assertions in the Complaint, Alaska DOT&PF relies on the 

documented facts and explanations provided in its Answer, and omits those paragraphs 

below. Alaska DOT&PF rebuts below those Reply statements that are sufficiently 

substantive to warrant rebuttal, beginning with Section 1 of the Reply. In addition, 

inasmuch as many of RDM's Reply statements are word-for-word repetitions of one 

another, once Alaska DOT&PF rebuts one occurrence of a repeated statement, that 

REBUTTAL 

RDM, LLC V. ANC 

Page 12 of 42 

Docket No. 16-09-14 
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rebuttal applies also to all other occurrences of that statement, and the repetition 

paragraph will be omitted. 

Section 1. Rebuttal to Reply to Seven Page Answer 

1. "What tenants 'bring to the table'" is a disparaging way to refer to 

the benefits the airport, the public and the aviation community might gain from a 

proposed project. Nothing in 49U.S.C. §47107(a) or the Sponsor Grant Assurances 

requires a sponsor to ignore such considerations. Indeed, Assurance 22(e) expressly 

states that rules and conditions may take into consideration airline signatory status. 

Assurance 22 doest not prohibit all differentiation, but only discrimination that is unjust; 

benefits to the airport are perfectly valid considerations. Alaska DOT&PF objects to the 

gratuitous and wholly unsupported use of the phrase "alleged culture of corruption." 

None of RDM's allegations even remotely resembling corruption. 

5. RDM and AGLAD were clearly in the real estate development 

business, not in business to provide aeronautical services. Although RDM asserts that 

history later showed the lease deadlines to pose challenges, it does not say AGLAD 

objected to them. In reply to a paragraph about AGLAD in the 2002 timeframe, long 

before RDM even became involved, RDM makes an oddly out-of-place reference to 

bringing the Alaska Native Regional Corporation, Cook Inlet Region, Inc. (CIRI) to the 

table as a potential investor. RDM complains that the airport "continued to refuse to 

work with AGLAD to renegotiate the lease terms." As shown in a November 4, 2008 

email from Jeanette Luckey to Shaun Debenham, airport staff were continuing to work 

toward a solution, but could not blithely "renegotiate" an existing lease of public 

property without public notice as to possible changes, and there was concern about the 

propriety of allowing an entity to acquire a defaulted lease and renegotiate it, rather than 

making it competitively available. See [ANC-AGLAD-0378-0380]. Besides there was 

no right to renegotiate existing lease terms, see 41 North 73 West, Inc v. County of 

Westchester, FAA Docket 16-07-13, (September 18, 2009) (Final Decision and Order, 

REBUTTAL 

RDM, LLC V. ANC 

Page 13 of 42 

Docket No. 16-09-14 
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p. 28), beyond the extensions already granted, and no allegation Alaska DOT&PF gave 

that benefit to any similarly situated tenant. 

6. As it did in its Complaint, RDM again asserts here and several 

other places in its Reply that AGLAD could have initially leased a smaller parcel had 

Alaska DOT&PF allowed it a First Right of Refusal (FROR). RDM ignores the FAA 

guidance, described in Paragraph 19-8.f on page 51 of Exhibit A to Alaska DOT&PF's 

Answer, that airports avoid granting FRORs. See AC 150/5190-6, Exclusive Rights and 

Minimum Standards for Commercial Aeronautical Activities: Advisory Circular, 

January 4, 2007 at 6 

Airport sponsors are better served by requiring that leases to a 

single aeronautical service provider be limited to the amount 

of land the service provider can demonstrate it actually needs 

and can be put to immediate productive use. In the event that 

additional space is required later, the airport sponsor may 

require the incumbent service provider to compete along with 

all other qualified service providers for the available airport 

land. The grant of options or preferences on fijture airport 

lease sites to a single service provider may be construed as 

intent to grant an exclusive right and therefore, the use of 

leases with options or future preferences, such as rights-offirst refiisal, must generally be avoided. This is because a 

right of first refusal can allow an existing tenant, at little or no 

cost, to hold a claim on airport land that could be used for a 

second FBO, then lease that land when there is a prospect of 

competition. 

See, also, JetAway Aviation, Inc. v. Montrose County, FAA Docket 16-08-01, (July 2, 

2009) (Director's Determination at 23): 

A right of first refusal for future occupancy of the same 

leasehold is generally of greater concern because it might 

limit an airport sponsor's ability to change the use of property 

in the future, when the public's interest in aviation may 

demand some other use. This is potentially a violation of 

grant assurance 5. However, the facts in this case are far too 

speculative for a finding of non-compliance in related to grant 

assurance 5. To avoid future problems, the County is well 

REBUTTAL 

RDM, LLC V. ANC 

Page 14 of 42 

Docket No. 16-09-14 
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advised to negotiate the elimination of the right-of-first 

refusal provision in its existing leases. . 

7. RDM's list of all the alleged misconduct by Alaska DOT&PF 

completely ignores and fails to meet any of the facts presented throughout Alaska 

DOT&PF's Answer describing accurate facts demonstrating that many of preferences 

Alaska DOT&PF is alleged to have granted FedEx, UPS or CargoPort are just flat 

erroneous readings of the record with respect to those tenants, who never received most 

of the alleged favored terms or treatment described. 

8. RDM's allegation that CargoPort's second lease was not required 

to go out for public notice is simple false. A copy of the public notice is provided 

herewith at [ANC-CargoPort- 0199]. 

9. RDM's repeated allegation that the Airport told RDM that it would 

not meet with RDM unless it had proof RDM was authorized to act for AGLAD, and 

that the Airport met with RDM only after RDM presented its Option Agreement is also 

simply false. Indeed, RDM describes three meetings between October 14 and 

November 27, 2008, yet attaches the Option Agreement dated and signed November 18, 

2008. 5ee Exhibit B to Reply. 

12. It is simply untrue that the November 2005 lease was presented 

"take it or leave it." As noted above, it was AGLAD the proposed that the lease be 

made "contingent" to deal with the financial responsibility question, [ANC-AGLAD0157 at 0160], and a contemporaneous note to file at reflects other negotiated terms 

[ANC-AGLAD-0162]. Moreover, RDM itself notes that the lease was signed "after 

many years of negotiation." Reply at 19, paragraph 19-3.j(ii), and alleges that AGLAD 

was not aware of certain things "at the time or negotiating its lease," see, e.g. Reply at 

22, paragraph 19-8.f. 

15. As described above, AGLAD volunteered to make the lease 

contingent on deadlines in lieu of a bond or other proof of financial responsibility. 

REBUTTAL 

RDM, LLC v. ANC 

Page 15 of 42 

Docket No. 16-09-14 
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There is no indication the deadlines were problematic until they had slipped and been 

extended multiple times, leaving the project fiirther and further behind schedule as no 

fault of Alaska DOT&PF. 

16. The assertion that the AGLAD site had been dewatered in 2008 is 

not true, as described in the Affidavit of John E. Johansen, P.E. filed herewith and 

numbered as [ANC-0050-0054]. 

Alaska DOT&PF had no duty to re-negotiate the lease in the fall of 2008 

to save AGLAD from terms it had been unable to meet despite repeated extension and 

relaxation. Nonetheless, staff tried to find solutions without improperly agreeing to 

completely overhaul its terms, allowing AGLAD to hold the lease despite default and 

without exposing the area again to competitive interest. See [ANC-AGLAD-0378 -

0380]. 

To the best of the knowledge of ANC management, RDM never asked 

whether Alaska DOT&PF "would be able to own the AGLAD development." See 

Affidavit of John Parrott filed herewith and numbered as [ANC-0055-0056]. 

It is true that Alaska DOT&PF owns the taxiways between the various 

leased premises because those taxiways provide access to a different leasehold on each 

side of the taxiway and to other leased premises beyond—which is also true of taxiway 

"U" adjacent to the AGLAD premises on the north. Alaska DOT&PF does not own any 

taxilanes internal to any leased premises, including the east-west taxilane on the north 

side of CargoPort and the north-south taxilanes internal to the FedEx and UPS 

leaseholds. 

17. CargoPort was never granted extension of any deadline on its 

primary lease, ADA-30816. Even on its separate secondary ramp lease, CargoPort was 

given no more total development time than AGLAD, with more incremental completion 

requirements than AGLAD, even though CargoPort had already established a track 

record of successful project completion. 

REBUTTAL 

RDM, LLC V. ANC 

Page 16 of 42 

Docket No. 16-09-14 
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20. Despite RDM's characterization that AGLAD requested 

"advantages commensurate with what others were granted," RDM presents zero 

comparative analysis with respect to the "advantages" requested and granted or denied 

or to the similarity of the situations. In fact, AGLAD requested the unprecedented 

leniency of complete freedom from deadlines, with no supporting financial security. 

21. As demonstrated throughout Alaska DOT&PF's Answer, it appears 

that RDM's frustration over perceived differences in treatment was caused largely by its 

misunderstanding of how the other tenants were actually treated, combined with a 

failure to recognize that quite dissimilar situations that prevailed among the tenants. 

22. Standing issues are dealt with in the accompanying (and 

incorporated) Reply to RDM's Answer to Motion to Dismiss. 

Section 2. Rebuttal to Reply to Answer Exhibit A 

As previously noted, RDM's Reply mostly just restates its unsupported allegations. 

Relying on the documented explanations in its Answer, Alaska DOT&PF omits below 

rebuttal to reply paragraphs that add nothing new, rebutting those reply statements that 

are sufficiently substantive to warrant rebuttal. In some cases Alaska DOT&PF also 

passes over somewhat substantive comments that are, nevertheless, not supported by 

any evidence. A single rebuttal applies also to all other occurrences of the same reply 

statement. 

6. Notwithstanding that AGLAD may well have begun the "development 

process," the site photos at [ANC-0002 - 0009] show that any physical development 

effort "on the ground" was not significant. 

9. ANC has been, by-and-large, developed by aeronautic users developing 

projects for their own use, as FedEx and UPS did. Alaska DOT&PF concedes that the 

real estate development model described by RDM is a-typical at ANC, at least with 

respect to large projects. CargoPort, the most notable example of the real estate 

development model, was accomplished on a similar tight and relatively unyielding 

REBUTTAL 

RDM, LLC V. ANC 

Page 17 of 42 

Docket No. 16-09-14 
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schedule, pre-financed and backed by a performance bond that required construction to 

begin before the project was leased. 

9-l.a. Alaska DOT&PF did not mean to suggest that the Alaska Industrial 

Development and Export Authority or RBC capital Markets "lied" about the AGLAD 

project being on-track for financing—only that the representations turned out to have 

been mistaken. There is no evidence whatsoever that lease deadlines agreed-to by 

AGLAD had anything to do with slippage of the initial bond sale deadline also agreed 

to by AGLAD, much less that Alaska DOT&PF should be blamed for terms agreed to 

by the parties. 

9-2 - 9-10. Alaska DOT&PF would have loved to see the AGLAD facility 

built to meet the needs of each of the prospective sublessees. Unfortunately, AGLAD 

was apparently not up to the task. Alaska DOT&PF did not reduce its aircraft parking 

fee until the AGLAD lease had been terminated, and not only owes no duty to support 

private developer market prices for aircraft parking, but is expressly forbidden by the 

FAA from using market pricing on the airfield. 

10-f. According to the accompanying Affidavit of John E. Johansen, P.E., 

[ANC-0050-0054] the AGLAD site as not been dewatered, regardless what AGLAD 

may have paid to work on the issue. 

14. RDM's allegation of "similar development patterns of developing both 

hardstands for aircraft servicing and building space for industrial use" scarcely meets 

the burden of proving similarly situated as required or Part 16 Grant Assurance analysis. 

Alaska DOT&PF denies the conclusory allegation in the first sentence of the paragraph 

of the Complaint marked as paragraph 14 on Exhibit B of this Answer, but admits that 

there is a rough similarity in location among CargoPort, FedEx, UPS and AGLAD, 

denies that the similarity in size is sufficient that they are similarly situated, denies that 

REBUTTAL 

RDM, LLC V. ANC 

Page 18 of 42 

Docket No. 16-09-14 
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there is similarity of use among FedEx, UPS and AGLAD, and admits that there is 

similarity in use between CargoPort and AGLAD. 

16-a. RDM improperly aggregates the area of two separate CargoPort leases 

developed in series, with the second beginning after the first was substantially complete. 

16-d. RDM notes that UPS preferenfially leased two Alaska DOT&PF 

hardstands. Although it would have been improper for Alaska DOT&PF to 

preferentially lease hardstands to a developer, to then lease to air carriers at market 

rates, the air carriers could have requested preferential leases directly from Alaska 

DOT&PF for use in conjunction with the AGLAD facility. 

18. Please see discussion above under heading D (RDM has not carried its 

burden of proof that AGLAD was similarly situated to FedEx UPS or CargoPort, which 

it was not). 

19-l.d. Although RDM asserts that having no financial requirement for 

AGLAD would have complied with the grant assurances, the opposite is true. But the 

reality is that Alaska DOT&PF already pushed the limits of that notion by allowing 

AGLAD to enter into the lease under the terms that it did. Alaska DOT&PF reduced 

the requirements on AGLAD relative to CargoPort by not requiring a completion bond 

that AGLAD could not provide. The lack of a bond left ANC subject to risk not only of 

the property sitting undeveloped, but also of having a project get half-started and then 

be left dug-up and eroding. As the FAA noted in Brown Transp. Co. v. City of Holland, 

FAA Docket No. 16-05-09, (March 1, 2006) (Director's Determination) page 21: "the 

City can't apply requirements to one party and ignore the risk of the activities of other 

similarly situated parties." Id. at 21. 

It was precisely to avoid unfairly ignoring the risk of AGLAD's 

questionable and unproven financial capacity—an issue that Alaska DOT&PF had 

managed as to CargoPort by requiring a $10 million guarantee that AGLAD could not 

REBUTTAL 

RDM, LLC V. ANC 

Page 19 of 42 

Docket No. 16-09-14 
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provide—that compelled Alaska DOT&PF to impose financing deadlines in the lease, 

and ultimately draw a line. 

19-2.a. The notion that CargoPort got a second lease having failed to fulfill 

its obligations under the first lease is patently false as documented in the Answer, 

Exhibit A, page 35-36, paragraph 19-2.a. CargoPort's original $10 million of 

improvements were to be accomplished within three year of the October 1997 beginning 

of the lease term. ADA-30816 Article IV.B and Article X.D [ANC-CargoPort-0007 and 

0016] and was certified as accomplished by July 13, 2000. [ANC-CargoPort-0113]. 

Only then did Alaska DOT&PF enter into ADA-31043 with CargoPort. [ANCCargoPort-011-0151]. 

19-2.b. It is untrue that every AGLAD hardstand was required to be 

completed by a stated specific date. Originally nine were required in Phase One. There 

was no specification whether or how many of the three remaining (12 total) hardstands 

that paragraph 8 of the Complaint says AGLAD planned, had to be constructed. [ANCAGLAD-0016]. By the time of Lease Supplement 3, the requirement was down to three 

in Stage One and five in Stage Two, with no particular requirement for four more. 

[ANC-AGLAD-0069]. 

19-2.C . As described in the Answer, it appears construction of Hardstands 

7 and 12 was actually accomplished nearly a year ahead of schedule. 

19-2.e. Its curious that RDM can even assert that CargoPort got more 

favorable treatment then it was denied any completion extension until the first $10 

million dollars of construction was done, and was granted others only as more deadlines 

were met, yet AGLAD missed nearly every one of its deadlines, yet kept getting 

extensions without actually getting anything built. 

• • • • 

19-3.a. RDM fails to read the lease. The term of ADA-30816 began 

October 1, 1997. Section VLB. [ANC-CargoPort-0007]. The three years for completion 

REBUTTAL 

RDM, LLC V. ANC 

Page 20 of 42 

Docket No. 16-09-14 
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of improvements ran from that term beginning date. Section X.D. [ANC-CargoPort0013]. CargoPort received NO extension of that deadline, and fully satisfied it. The 

letter from Richard Wilson relates to release of the bond due to the work having been 

timely completed. [ANC-CargoPort-0113-0117]. 

19-3.b.ii and iii. CargoPort had a total of seven years to get its last one often 

hardstands finished. AGLAD had seven years to get last five of eight hardstands, plus 

nearly half of its building square footage finished. It is unclear what "luxury" AGLAD 

was denied. 

19-3.h. RDM alleges comparability between the CargoPort project and the 

AGLAD project by collapsing CargoPort's two leases together, but then insists on 

comparing terms and treatment between only CargoPort's secondary ramp lease, ADA31043 and AGLAD's lease. There is not even a pretense of "similarly situated" here. 

Comparing CargoPort's original ramp and warehouse lease, ADA-30816, to AGLAD's 

first phase/stage as originally stated and as extended under Supplement no. 3 looks like 

this: 

CargoPort AGLAD Phase 1 Supp 3 Stage One 

$ 10 Million $25 Million $ 10 Million 

5 Hardstands 9 Hardstands 3 Hardstands 

100,000 sq.ft. bldg 50,000 sq.ft. bldg 28,000 sq.ft. bldg. 

0 3 

3 years 2 5 years 

Minimum Investment 

Work Required 

Completion Extensions 

Total Time to Complete 

19-3.j(iv) The two leases that cannot fairly be compared are AGLAD's lease 

and CargoPort's supplemental ramp-only lease, ADA-31043, which does not include a 

warehouse, and which Alaska DOT&PF never admitted to be comparable to AGLAD's 

lease.. 

REBUTTAL 

RDM, LLC V. ANC 

Page 21 of 42 

Docket No. 16-09-14 
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19-6.d. Alaska DOT&PF gave Mr. Nunn a choice between "free" fill from 

west of the north-south runway where a lowered grade would benefit the airport, or a 

minimal $0.25 per cubic yard from a closer location where lowering the grade would 

not particularly benefit ANC. Mr. Nunn chose the $0.25 per cubic yard option. 

19-7.a. There was no "sale and lease-back" with CargoPort. Alaska 

DOT&PF did not pay anything to CargoPort, but merely agreed to accept title to put the 

facility into government ownership. 

19-7.b. See Affidavit of John Parrott, AAE, [ANC-0055-0056]. 

19-7.d. RDM misunderstands the CargoPort title transaction. Alaska 

DOT&PF did not undertake to agree to any debt "owed on those improvements." The 

bonds were not issued by or for Alaska DOT&PF and are not secured by the 

improvements, but only by the sublease revenue stream that CargoPort can generate so 

long as it remains in good standing under the lease.. 

19-7.e. CargoPort secured its long-term financing only after building the 

facilities with its own resources, which enabled it to attract leases to a finished, rather 

than only a proposed project. 

19-8. See paragraph 6 of Section 1 at page 13, above. 

19-9.a The third paragraph of this section on page 52 of Answer Exhibit 

A, with correct Record Citations, should read as follows: 

Respondent denies RDM's identification of the then-existing 

apron that was subject to the Development Agreement. RDM's Exhibit K 

p.2 includes a black rectangle that RDM incorrectly drew on the drawing 

and that does not exist on the document depicted. Respondent 

affirmatively states that the much smaller portion of the then-existing 

apron subject to the Development Agreement is identified in Article I of 

REBUTTAL 

RDM, LLC V. ANC 

Page 22 of 42 

Docket No. 16-09-14 
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ADA-30172 (F-1) [ANC-FedEx-0064] and that the highlighted areas on 

Respondent's four-page illustrative exhibit at [ANC-FedEx-0194 - 0197] 

correctly identifies the subject portion of the then-existing apron subject to 

ADA-30172 and the Development Agreement. The balance of the thenexisting apron was part of the first right of refusal area and, under Section 

V.E of the lease, not subject to use by FedEx. See ADA-30172 at 9 

[ANC-FedEx-0072]. 

19-9.e.2. As noted in the Answer, the payment incorrectly described in the 

Reply as being paid over 25 years was actually paid in lump sum 19 years ago. It 

should also be noted that Alaska DOT&PF could only charge UPS for the State's share 

of the cost, and nothing toward the AIP portion, because FAA rates and charges policy 

forbids inclusion of any monies provided by the FAA in the rate base for an airfield 

charge. That policy may deter private investment in improvements that are eligible for 

federal participation because, for example, it may not be possible to recover the cost of 

private development if the airport is forbidden from charging market rates and required 

to charge much lower rates for comparable AIP funded-space. But that is FAA policy. 

19-9./. Although it would have been improper for Alaska DOT&PF to 

preferentially lease hardstands to a developer, to then lease to air carriers at market 

rates, the air carriers could have requested preferential leases directly from Alaska 

DOT&PF for use in conjunction with the AGLAD facility. 

19-10 It is true that Alaska DOT&PF owns the taxiways between the various 

leased premises because those taxiways provide access to a different leasehold on each 

side of the taxiway and to other leased premises beyond—which is also true of taxiway 

"U" adjacent to the AGLAD premises on the north. Alaska DOT&PF does not own any 

taxilanes internal to any leased premises, including the east-west taxilane on the north 

side of CargoPort and the north-south taxilanes internal to the FedEx and UPS 

leaseholds. In addition, the AGLAD lease provided for the possibility of making 

REBUTTAL 

RDM, LLC V. ANC 

Page 23 of 42 

Docket No. 16-09-14 
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Taxiway "N" public and the responsibility of Alaska DOT&PF the adjacent land were 

to be leased by anyone other than AGLAD. [ANC-AGLAD-0266]. 

19-11. Alaska DOT&PF did not reduce its aircraft parking fee until the AGLAD 

lease had been terminated, and not only owes no duty to support private developer 

market prices for aircraft parking, and is expressly forbidden by the FAA from using 

market pricing on the airfield. 

19-1 Lb. Alaska DOT&PF did not reduce its aircraft parking fee until the 

AGLAD lease had been terminated, and not only owes no duty to support private 

developer market prices for aircraft parking, but is expressly forbidden by the FAA 

from using market pricing on the airfield. RDM offers no support for its speculation 

that Alaska DOT&PF's cost-center calculation methodology is "just an excuse" for 

setting whatever rate Alaska DOT&PF wants to. 

19-12.b. Alaska DOT&PF contributed millions of dollars worth of wetland 

credits generated at its own cost and without seeking recovery of those costs from 

AGLAD to enable AGLAD to obtain the permit. See Emails from Rich Wilson 

(regarding providing wetland credits to AGLAD at no charge) [ANC-AGLAD-0113], 

and from Scott Lytic (estimating value of wetland credits allocated to AGLAD as $3.44 

million) [ANC-AGLAD-0185]. If appears that Alaska DOT&PF contributed the 

majority of the cost of the permit, and that the permit lost all value to AGLAD once 

AGLAD lost the lease. On information and belief, a Corps permit is better thought of as 

an improvement to the land necessarily abandoned by a defaulting lessee rather than 

marketable personal property of the lessee that the lessor must purchase from a 

defaulting lessee. In addition, as a lessee that defaulted on an obligation to develop over 

$25,000,000 of cargo facilities at ANC, and to pay rent for 55 years, AGLAD has a very 

substantial liability for damages to Alaska DOT&PF. The wetland permit was about to 

expire in April 2009. The actions of Alaska DOT&PF to secure the permit also 

REBUTTAL 

RDM, LLC V. ANC 

Page 24 of 42 

Docket No. 16-09-14 
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prevented it from lapsing and losing all of its value. If nothing else, Alaska DOT&PF's 

action was appropriate mitigation of the State's damages. 

23-1. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx, UPS or CargoPort, that AGLAD objected to the original financing term in 

its lease, or that the financing term was not reasonably justified by AGLAD's lack of a 

performance bond, lack of demonstrated financial responsibility, and lack of experience 

in air cargo development, together with state or federal laws or regulations and other 

circumstances such as competitive demand for the subject property. 

23-2. RDM has not shown that either RDM or AGLAD was similarly situated 

with CargoPort with respect to either ADA-30816 or ADA-31043, that Alaska 

DOT&PF denied RDM or AGLAD extensions that Alaska DOT&PF granted to 

CargoPort under substantially similar circumstances, that AGLAD objected to the 

original deadlines its lease, or that the deadline term and each extension or denial of 

extension was not reasonably justified by AGLAD's lack of a performance bond, lack 

of demonstrated financial responsibility, and lack of experience in air cargo 

development, together with state or federal laws or regulations and other circumstances 

such as competitive demand for the subject property, 

23-3. RDM has not shown that either RDM or AGLAD was similarly situated 

with CargoPort with respect to either ADA-30816 or ADA-31043, that Alaska 

DOT&PF denied RDM or AGLAD extensions based on world/national recession that 

Alaska DOT&PF granted to CargoPort under substantially similar circumstances, that 

AGLAD objected to the original deadlines its lease, or that the deadline term and each 

extension or denial of extension was not reasonably justified by AGLAD's lack of a 

performance bond, lack of demonstrated financial responsibility, and lack of experience 

in air cargo development, together with state or federal laws or regulations and other 

circumstances such as competitive demand for the subject property, 

23-4. RDM has not shown that either RDM or AGLAD was similarly situated 

with CargoPort with respect to either ADA-30816 or ADA-31043, that Alaska 

REBUTTAL 

RDM, LLC V. ANC 

Page 25 of 42 

Docket No. 16-09-14 
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DOT&PF denied RDM or AGLAD an initial term in which to complete improvements 

of similar length as Alaska DOT&PF granted to CargoPort under substantially similar 

circumstances, that AGLAD objected to the original term to complete its improvements, 

or that the term and each extension or denial of extension was not reasonably justified 

by AGLAD's lack of a performance bond, lack of demonstrated financial responsibility, 

and lack of experience in air cargo development, together with state or federal laws or 

regulations and other circumstances such as competitive demand for the subject 

property, 

23-5. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx or CargoPort, that AGLAD objected to the original term that allowed 

default of future development areas for failure to develop earlier development areas, 

that Alaska DOT&PF had ever given any similarly situated tenant terms that allowed 

the tenant to retain later development areas despite default as to earlier in its lease, or 

that the terms granted to RDM or AGLAD were not reasonably justified by AGLAD's 

lack of a performance bond, lack of demonstrated financial responsibility, and lack of 

experience in air cargo development, together with state or federal laws or regulations 

and other circumstances such as competitive demand for the subject property. 

23-6. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx or CargoPort, that AGLAD objected to the original terms that lacked rent 

deferral, that Alaska DOT&PF gave rent deferral to FedEx or CargoPort while they 

were in default or missing deadlines or otherwise under substantially similar 

circumstances in which rent deferral was denied to RDM or AGLAD or that the terms 

granted or denied to RDM or AGLAD were not reasonably justified by AGLAD's lack 

of a performance bond, lack of demonstrated financial responsibility, and lack of 

experience in air cargo development, together with state or federal laws or regulations 

and other circumstances such as competitive demand for the subject property. 

23-7. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx, that AGLAD objected to the requirement that it pay back deferred rent 

promptly, that Alaska DOT&PF gave more preferential rent deferral repayment terms to 

REBUTTAL 

RDM, LLC V. ANC 

Page 26 of 42 

Docket No. 16-09-14 
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FedEx under substantially similar circumstances in which similar rent repayment terms 

were denied to RDM or AGLAD or that the terms granted or denied to RDM or 

AGLAD were not reasonably justified by AGLAD's lack of a performance bond, lack 

of demonstrated financial responsibility, and lack of experience in air cargo 

development, together with state or federal laws or regulations and other circumstances 

such as competitive demand for the subject property. 

23-8. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx or UPS, that AGLAD objected to the absence of a right to free fill material 

from the Lessor under the lease, that Alaska DOT&PF gave more preferential free fill 

terms to FedEx or UPS under substantially similar circumstances in which free fill 

material from the Lessor was denied to RDM or AGLAD or that the terms granted or 

denied to RDM or AGLAD were not reasonably justified by AGLAD's lack of a 

performance bond, lack of demonstrated financial responsibility, and lack of experience 

in air cargo development, together with state or federal laws or regulations and other 

circumstances such as competitive demand for the subject property. 

23-9. RDM has not shown that either RDM or AGLAD was similarly situated 

with CargoPort, that AGLAD objected to the absence of a right to sell improvements to 

the Lessor under the lease, that Alaska DOT&PF gave to CargoPort a right to sell 

improvements to the Lessor under the lease under substantially similar circumstances in 

which a right to sell improvements to the Lessor under the lease was denied to RDM or 

AGLAD or that the terms granted or denied to RDM or AGLAD were not reasonably 

justified by AGLAD's lack of a performance bond, lack of demonstrated financial 

responsibility, and lack of experience in air cargo development, together with state or 

federal laws or regulations and other circumstances such as competitive demand for the 

subject property. 

23-10. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx and UPS, that AGLAD objected to the absence of a first right of refusal 

(FROR) under the lease, that Alaska DOT&PF gave to FedEx and UPS more 

preferential FROR rights under the lease under substantially similar circumstances in 

REBUTTAL 

RDM, LLC V. ANC 

Page 27 of 42 

Docket No. 16-09-14 
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which FROR rights were denied to RDM or AGLAD or that the terms granted or denied 

to RDM or AGLAD were not reasonably justified by AGLAD's lack of a performance 

bond, lack of demonstrated financial responsibility, and lack of experience in air cargo 

development, together with state or federal laws or regulations and other circumstances 

such as competitive demand for the subject property. 

23-11. RDM has not shown that either RDM or AGLAD was similarly situated 

with UPS, that AGLAD objected to the absence of a hardstand preferential use right 

under the lease, that Alaska DOT&PF gave to UPS a hardstand preferential use right 

under the lease under substantially similar circumstances in which a hardstand 

preferential use right was denied to RDM or AGLAD or that the terms granted or 

denied to RDM or AGLAD were not reasonably justified by AGLAD's lack of a 

performance bond, lack of demonstrated financial responsibility, and lack of experience 

in air cargo development, together with state or federal laws or regulations and other 

circumstances such as competitive demand for the subject property. 

23-12. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx, that AGLAD objected to the absence of a right to rent or purchase 

hardstands for a low rate under the lease, that Alaska DOT&PF gave FedEx a right to 

rent or purchase hardstands for a low rate under the lease under substantially similar 

circumstances in which a right to rent or purchase hardstands for a low rate was denied 

to RDM or AGLAD or that the terms granted or denied to RDM or AGLAD were not 

reasonably justified by AGLAD's lack of a performance bond, lack of demonstrated 

financial responsibility, and lack of experience in air cargo development, together with 

state or federal laws or regulations and other circumstances such as competitive demand 

for the subject property. 

23-13. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx or CargoPort that AGLAD objected to the absence of a right to have Alaska 

DOT&PF construct or maintain a taxiway for AGLAD's use without charge that Alaska 

DOT&PF gave FedEx or CargoPort a right to have Alaska DOT&PF construct or 

maintain a taxiway for FedEx's or CargoPort's use without charge under substantially 

REBUTTAL 

RDM, LLC V. ANC 

Page 28 of 42 

Docket No. 16-09-14 
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similar circumstances in which a right to have Alaska DOT&PF construct or maintain a 

taxiway for AGLAD's use without charge was denied to RDM or AGLAD or that the 

terms granted or denied to RDM or AGLAD were not reasonably justified by AGLAD's 

lack of a performance bond, lack of demonstrated financial responsibility, and lack of 

experience in air cargo development, together with state or federal laws or regulations 

and other circumstances such as competitive demand for the subject property. 

23-14. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx that AGLAD objected to the absence of a right to have Alaska DOT&PF 

pay for site improvements on AGLAD lease, that Alaska DOT&PF gave FedEx a right 

to have Alaska DOT&PF pay for site improvements on FedEx's lease under 

substantially similar circumstances in which a right to have Alaska DOT&PF pay for 

site improvements on AGLAD's lease was denied to RDM or AGLAD, or that the 

terms granted or denied to RDM or AGLAD were not reasonably justified by AGLAD's 

lack of a performance bond, lack of demonstrated financial responsibility, and lack of 

experience in air cargo development, together with state or federal laws or regulations 

and other circumstances such as competitive demand for the subject property. 

23-15. RDM has not shown that either RDM or AGLAD was similarly situated 

with FedEx that AGLAD objected to the absence of a right to have a hangar built for it 

without charge, that Alaska DOT&PF gave FedEx a right to have a hangar built for it 

without charge under substantially similar circumstances in which a right to have a 

hangar built for it without charge on AGLAD's lease was denied to RDM or AGLAD, 

or that the terms granted or denied to RDM or AGLAD were not reasonably justified by 

AGLAD's lack of a performance bond, lack of demonstrated financial responsibility, 

and lack of experience in air cargo development, together with state or federal laws or 

regulations and other circumstances such as competitive demand for the subject 

property. 

23-16. RDM has not shown that either RDM or AGLAD has any right for Alaska 

DOT&PF not to undercut AGLAD's pricing for tenant use of land or facilities, that 

Alaska DOT&PF did undercut AGLAD's pricing for tenant use of land or facilities, and 

REBUTTAL 

RDM, LLC V. ANC 

Page 29 of 42 

Docket No. 16-09-14 
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that Alaska DOT&PF's undercutting of AGLAD's pricing for tenant use of land or 

facilities was not reasonably justified. 

23-17. RDM has not shown that either RDM or AGLAD has any right for Alaska 

DOT&PF not to obtain possession of the wetland fill permit issued by the U.S. Army 

Corps of Engineers with respect to the former AGLAD lease site or for RDM or 

AGLAD to be compensated for investment in obtaining the permit. 

Section 3: FAA Cases 

RDM presents quotations from a series of FAA Part 16 determinations, all 

of which may make fair statements of FAA requirements, but none of which are 

applicable to the facts of this case.^ Effectively, all the cases demonstrate is that it is 

possible to violate the sponsor grant assurances by applying unjustifiably different rules 

on similarly situated aeronautical users. With that truism, Alaska DOT&PF entirely 

agrees. 

None of the cases, however, supports the notion that differing treatment of 

non-aeronautical users is a violation. None supports the notion that treatment of a nonaeronautical user differently from an aeronautical user is a violation. None supports the 

notion that different treatment based on differences between the nature of use or user 

(developer or air carrier), or the contracting circumstances (competitive bid or 

negotiated) is a violation. None supports the notion that different times, regulatory 

^ RDM fails to note whether it is quoting a director's decision or a final decision, 

or to reference the date of the decision. Though that may be somewhat excusable for a 

non-attorney author, the citation in the decisions themselves demonstrate appropriate 

citation style. Nevertheless, Alaska DOT&PF has gamely worked to figure out the 

correct references. In addition to incomplete citations, the quoted passages include 

numerous quotation errors, missing or erroneous page citations, and RDM quotes 

numerous passages with no apparent possible applicability whatsoever, as if they were 

copied from some digest of Part 16 decisions adverse to sponsors. See, e.g., Reply at 

page 32, numbered paragraphs 13.c and d; pages 34-35, numbered paragraphs 15.c and f 

through h; page 35, numbered paragraph 18.a. In any event, Alaska DOT&PF has 

reviewed and distinguishes each cited case. 

REBUTTAL 

RDM, LLC V. ANC 

Page 30 of 42 

Docket No. 16-09-14 
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changes, financial circumstances of the users or of the airport must all be ignored in 

favor of identical terms and treatment. 

As noted below in Grayson v. DeKalb County, FAA Docket No. 16-05-13 

(Director's Determination) (February 1, 2006) it was RDM's burden to prove not just 

that there were similarities among several tenants and differences in their lease terms 

and treatment, but also that there were no differences among the tenants or the 

circumstances that justified the differing terms and treatments. Rather than meeting its 

burden to disprove the differences outlined by Alaska DOT&PF in its Answer at Exhibit 

A, Paragraph 18, RDM effectively concedes the differences, saying they "may or may 

not be true." [RDM's] Reply to TSAIA Answer ("Reply") at pages 15-16, numbered 

paragraph 18. Rather than meeting its burden to show why those differences cannot 

justify differing treatment RDM ignores FAA precedent by simply asserting that they do 

not matter. 

Though RDM presents no argument to suggest any applicability of the cases it 

cites to the present matter, Alaska DOT&PF will briefly address each in the order cited 

by RDM: 

Leonard Cardinals' Pilot Shop v. Chesapeake Airport Authority, FAA Docket 16-01-

06 (Director's Determination)(October 22, 2002), (cited in Reply at page 29, numbered 

paragraph 38). 

The complainant in Leonard was a fixed base operator (FBO) at one airport that 

sought to perform special aviation services at another airport. An FBO is defined as "an 

individual or firm operating at an airport and providing general aircraft services such as 

maintenance, storage, ground and flight instruction. [FAA Order 5190.6A, Airport 

Compliance Requirements, Appendix 51." Leonard at 1, footnote 1. As a specialized 

aviation service operator (SASO) at the respondent airport, the Complainant sought to 

operate a customer pick-up site for its aircraft rental services. Id. at 3. The respondent 

airport, however offered only temporary facilities to the new entrant—and then only 

REBUTTAL 

RDM, LLC V. ANC 

Page 31 of 42 

Docket No. 16-09-14 
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after pressure from the FAA Eastern Region—though an existing FBO occupied the 

respondent's entire terminal without a lease. Id. at 33. 

Obvious differences from this case include the fact that RDM is a developer, not 

an aeronautic service provider, RDM complains about treatment of AGLAD, also a 

developer that has never provided aeronautic services. Those are distinctions enough to 

make the case inapplicable. Indeed, RDM fundamentally complains not that the 

requirements were illegal or even unreasonable, but only that they were less 

advantageous than provided to other tenants. In addition, RDM complains, for the most 

part, about enforcement of requirements to which RDM authorized AGLAD to agree, 

and to which AGLAD, unlike Cardinals' Pilot Shop, agreed as a matter of contract. 

In Leonard Cardinals' Pilot Shop, the FAA noted that "[t]he pivotal question is 

whether the qualifications and standards required by the Airport Authority are 

reasonable and relevant." Id. at 38. Although in that case, those standards were found 

not reasonable and relevant, Alaska DOT&PF's requirements for AGLAD were 

reasonably related to ensuring that airport property would neither be tied up in 

possession of an entity incapable of developing it, or getting it partially developed and 

then left in an incomplete and unprotected state. 

Alaska DOT&PF has shown that AGLAD was not similarly situated with 

comparison tenants FedEx and UPS inasmuch as they were and are Signatory Airlines, a 

special class of aeronautical users. Neither was AGLAD similarly situated with 

CargoPort, which undertook its development subject to a $10 million guarantee, and 

completed it fimely before getting a series of modest accommodations on a subsequent 

adjacent lease. 

Skydance Helicopters, Inc. v. Sedona Oak-Creek Airport Authority, FAA Docket 16-

02-02 (Director's Determination)(March 7, 2003) (cited in Reply at page 30, numbered 

paragraph 10). 

In Skydance, the complainant conducted an aeronautical activity providing 

helicopter sightseeing tours for the public, and was denied a long-term lease unless 

REBUTTAL 

RDM, LLC V. ANC 

Page 32 of 42 

Docket No. 16-09-14 
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subject to a revocable license for its aeronautical operation. Of course, Skydance is 

immediately distinguishable from the present matter based the aeronautical focus of 

Skydance, unlike RDM's real estate development focus. AGLAD had no complaint 

about the term of its lease: 55-years. Neither did Alaska DOT&PF require a limiting 

two-year license as had Sedona Oak-Creek Airport Authority. 

As also noted with respect to Cardinals' Pilot Shop, RDM also complains, for the 

most part, about enforcement of requirements to which RDM authorized AGLAD to 

agree, and to which AGLAD, unlike Skydance Helicopters, agreed as a matter of 

contract. 

Unlike the present case, in which RDM demands that AGLAD should have been 

treated identically to other tenants—which Alaska DOT&PF has demonstrated to have 

been dissimilarly situated—in Skydance the complaint was that it had been treated the 

same as other tenants despite important differences in proposed use. See Skydance at 

28: 

In fact, considering that the Complainant's proposed 30-year 

lease differed from the circumstances of the other 

aeronautical operators' use of the airport, the Authority 

would be required to treat the Complainant somewhat 

differently in order maintain access to the airport on fair and 

reasonable terms. 

Alaska DOT&PF has shown that AGLAD was not similarly situated with 

comparison tenants FedEx and UPS inasmuch as they were and are Signatory Airlines, a 

special class of aeronautical users. Neither was AGLAD similarly situated with 

CargoPort, which undertook its development subject to a $10 million guarantee, and 

completed it timely before getting a series of modest accommodations on a subsequent 

adjacent lease for ramp development. To any extent that AGLAD and CargoPort may 

be considered aeronautic users, Alaska DOT&PF was obligated to treat AGLAD 

somewhat differently from CargoPort in light of the differences between the projects. 

Still, as noted by CargoPort in comment letters included in the record at [ANCAGLAD-0329 - 0332], AGLAD sought, and sometimes received, leniencies and 

REBUTTAL 

RDM, LLC V. ANC 

Page 33 of 42 

Docket No. 16-09-14 
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advantages CargoPort never received, without the bond that had been required of 

CargoPort or completion of successful development as CargoPort had accomplished 

under ADA-30816 before receiving modest accommodations only for follow-on lease 

ADA-31043 for construction of just hardstands. 

Martyn v. Port ofAnacortes, FAA Docket No. 16-02-03 (April 14, 2003) (Director's 

Determination) (cited in Reply at page 31, numbered paragraph 11 and again at page 37, 

numbered paragraph 28.) 

RDM's citation to Martyn, is similarly misplaced. That case found standing (1) 

under the lower standard specially crafted by the FAA with respect to revenue diversion 

(see Martyn pp. 46-47), (2) for an applicant who was an aeronautical user who sought, 

in part, to construct a hangar for his own use and that of his private investors (see 

Martyn p. 12 and 23) and (3) whose direct and repeated efforts to lease airport land 

were denied (see Martyn p. 25), and (4) where the FAA found that the evidence 

demonstrated the airport sponsor's objection was based on a desire to limit growth of 

the airport (see Martyn p. 32). This case presents none of those circumstances. 

Skydive Paris Inc. v. Henry County, FAA Docket No. 16-05-06, (Director's 

Determination) (January 20, 2006) (erroneously cited as FAA Docket 16-02-06 at page 

32, numbered paragraph 12 of Reply) 

Skydive Paris, relates to the aeronautic activity of parachute jumping, not to real 

estate development of air cargo facilities. Alaska DOT&PF has no dispute with the 

cited reference to FAA Order 5190.6A, Par 4-8(b), "Parachute Jumping," but it has no 

application to this case. 

Brown Transport. Co. v. City of Holland, FAA Docket No. 16-05-09 (Director's 

Determination) (March 1, 2006) (cited in Reply at page 32, numbered paragraph 13), 

Brown Transport relates to requirements for self-fueling on an FBO lease, an 

aeronautical issue not presented in the current matter. The complainant in that case, an 

aircraft owner, operator and self-fueler, challenged fueling rules and regulations that 

self-fueling (a right specifically protected under grant assurance 22(f)) required not only 

REBUTTAL 

RDM, LLC v. ANC 

Page 34 of 42 

Docket No. 16-09-14 
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$1,000,000 per tank contamination insurance and $5,000,000 in liability insurance, but 

also an additional $ 1,000,000 secured personal guarantee. That combination of 

requirements, was held to be unreasonable under the circumstances. 

In the present case, on the other hand, RDM is a land developer, member of a 

land development LLC. Alaska DOT&PF reduced the requirements on AGLAD 

relative to CargoPort by not requiring a completion bond that AGLAD could not 

provide. The lack of a bond left Alaska DOT&PF subject to risk not only of the 

property sitting undeveloped, but also of having a project get half-started and then be 

left in a dug-up and erosive condition. 

It is interesting that RDM quotes, without discussion, the following FAA 

observation in Brown: "the City can't apply requirements to one party and ignore the 

risk of the activities of other similarly situated parties." Id. at 21. It was precisely to 

avoid unfairly ignoring the risk of AGLAD's questionable and unproven financial 

capacity—an issue that Alaska DOT&PF had managed as to CargoPort by requiring a 

$10 million guarantee that AGLAD could not provide—that compelled Alaska 

DOT&PF to impose financing deadlines in the lease, and ultimately draw a line. 

Grayson v. DeKalb County^ FAA Docket No. 16-05-13 (Director's Determination) 

(February 1, 2006) (cited in Reply at page 32, numbered paragraph 14) 

In Grayson, a Part 16 complaint was filed by "an airport patron who leases space 

and bases his aircraft at [the County's] airport," and who was, thus "an aeronautical 

user" of the airport. Grayson at 1,2. That aeronautical user was also "the proponent of 

a specific aeronautical development at PDK for the intent of personal and/or 

commercial aeronautical use." Id. at 2. The airport operator (the County) had denied a 

lease to the complaining aeronautical user even though the lease had been finalized and 

recommended for approval by staff, the County had denied the same lease for the same 

parcel 17 months later, and took no positive action toward development of available 

land at the Airport for several years. See Grayson at 12-13. There is no factual 

similarity to this matter. 

REBUTTAL 

RDM, LLC V. ANC 

Page 35 of 42 

Docket No. 16-09-14 
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The first Grayson passage quoted by RDM is not a finding in by the Director, but 

merely language from a report by the FAA's Atlanta Airports District Office. See Reply 

at page 32, numbered paragraph 14.a. 

RDM's second Grayson quotation is a combination of a footnote and text from 

FAA Order 5190.6A, noting an airport sponsor's "obligation to make available suitable 

areas or space on reasonable terms to those who are willing and otherwise qualified to 

offer flight services to the public .. . or support service (i.e. fuel, storage, tie down, 

flight line maintenance, etc.) to aircraft operators." See Reply at page 32-33, numbered 

paragraph 14.b. In this case, however, AGLAD proposed only to develop facilities for 

leasing to various service companies and to air carriers to provide services to 

themselves. 

RDM goes on to quote passages noting the complainant's burden of proof to 

show preferential treatment of another similarly situated party, but passes over the 

FAA's determination that the Grayson record was inadequate to support such a finding. 

Compare Reply at page 33, numbered paragraphs 14.d and e, and Grayson at 11. That 

finding is virtually the sole similarity between Grayson and the present case. Even if 

RDM or AGLAD were deemed aeronautical users, yet were they not similarly situated 

with FedEx, UPS or CargoPort for all of the reasons set out in Paragraph 18 of Exhibit 

A to Alaska DOT&PF's Answer. RDM effectively concedes those distinctions, but 

argues that they don't matter. That argument is just plain wrong, as Grayson extensive 

other FAA case law amply demonstrate. 

Finally, RDM quotes language noting, correctly, that "[p]ursuing lease terms, 

plans, or managerial processes, that unnecessarily limit the airport's aeronautical utility 

by restricting development is inconsistent with the City's Federal obligations." See 

Reply at page 33, numbered paragraph 14.g, (quoting Grayson at 13(incorrecfly 

identified as 14)). But Grayson involved a flat denial of a lease for "no objective 

reason." Grayson at 15. In this case, Alaska DOT&PF bent over backward to allow 

AGLAD to develop on ANC, agreeing to a lease without a performance bond or initial 

proof of financial capacity, and allowing AGLAD to use millions of dollars worth of 

REBUTTAL 

RDM, LLC V. ANC 

Page 36 of 42 

Docket No. 16-09-14 
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wetlands credits secured by Alaska DOT&PF at its own cost, and three times by 

supplement, and even more times less formally, extending o relaxing lease requirements 

and deadlines. 

Other than the discussion that the FAA will not find unjust economic 

discrimination where the Complainant has failed to prove the similarity of its situation 

to an aeronautic user treated preferentially, Grayson has no application to this case. 

Centennial Express Airlines v. Arapahoe County Pub. Airport Auth., FAA Docket 

Nos. 16-98-05, 13-94-25, 13-95-03, (Final Agency Decision and Order) (February 18, 

1999) (cited in Reply at page 34, numbered paragraph 15). 

Centennial Express deals with an airport operator's total ban on scheduled 

passenger service, clearly a core aeronautic use not at issue in the present matter, and 

clearly an issue the FAA had great interest in reaching through liberal application of the 

principles of standing. Indeed, because the FAA had found a violation early-on, by the 

time of the final agency decision was prosecuting the matter in its own name, 

effectively rendering the standing issue moot as to Mr. Kehmeier as a shareholder of 

Centennial Express, and the discussion concerning that issue administrative dicta. See 

Centennial Express at 9-10. Those differences, plus that fact that Centennial Express 

was originally filed as a Part 13 complaint under an apparently different standing 

standard before Part 16 came into existence, see Centennial Express at 8, footnote 7, 

fully distinguishes that case from this matter. 

There is every reason to apply the standing rules strictly in this matter brought by 

a real estate developer that held less than one-third interest in another real estate 

developer that failed to satisfy airport lease requirements to which it had agreed as a 

matter of contract. This case should be dismissed due to RDM's lack of standing. 

United Aerial Advertising, Inc. v. County of Suffolk Bd. ofComm'rs, FAA Docket No. 

16-99-18, (Director's Determination) (May 8, 2000) (cited in Reply at page 35, 

numbered paragraph 16). 

United Aerial Advertising involved effective grant of exclusive rights by an 

unjustified requirement for hangar rental for the aeronautical activity of aerial banner 

REBUTTAL 

RDM, LLC V. ANC 

Page 37 of 42 

Docket No. 16-09-14 
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towing. Those issues have nothing to do with the present case. Indeed, language cited 

in RDM's] Reply to TSAIA Answer at page 35, numbered paragraph 16.d, 

demonstrates why the exclusive rights claim is wholly inapplicable to RDM: "FAA 

Order 5190.6A defines an exclusive right to mean-"any exclusive right to use the airport 

for conducting any particular aeronautical activity requiring operation of the 

aircraft." United Aerial Advertising at 15 (quoting FAA Order 5190.6A, para. 3-2d) 

(emphasis added). In this case, RDM makes no complaint about restrictions on an 

aeronautical activity requiring operation of an aircraft. 

Moore v. Sumner County Regional Airport Authority, FAA Docket No. 16-07-16 

(February 27, 2009) (Director's Determination, p. 16) (cited in Reply at page 35, 

numbered paragraph 17). 

Moore considered whether the airport sponsor's minimum standards unjustly 

discriminated against a proposed aircraft maintenance and repair business. Neither 

RDM nor AGLAD proposed to operate an aircraft maintenance or repair business. The 

passage quoted by RDM refers to a 2007 FAA Advisory Circular that updated the 

aeronautic activity definition quoted in United Aerial Advertising. AC 150/5190-6, 

Exclusive Rights and Minimum Standards for Commercial Aeronautical 

Activities: Advisory Circular, January 4, 2007 at 8 (Appendix 1. Definition 1.1.a) 

defines aeronautical activity as follows: 

Any activity that involves, makes possible, or is required for the operation 

of aircraft or that contributes to or is required for the safety of such 

operations. Activities within this definition, commonly conducted on 

airports, include, but are not limited to, the following: general and 

corporate aviation, air taxi and charter operations, scheduled and 

nonscheduled air carrier operations, pilot training, aircraft rental and 

sightseeing, aerial photography, crop dusting, aerial advertising and 

surveying, aircraft sales and services, aircraft storage, sale of aviation 

petroleum products, repair and maintenance of aircraft, sale of aircraft 

parts, parachute or ultralight activities, and any other activities that, 

because of their direct relationship to the operation of aircraft, can 

appropriately be regarded as aeronautical activities. Activities, such as 

model aircraft and model rocket operations, are not aeronautical activities. 

REBUTTAL 

RDM, LLC V. ANC 

Page 38 of 42 

Docket No. 16-09-14 
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Although AGLAD proposed to construct facilities on which aircraft could taxi 

and at which they could be refueled and serviced, AGLAD did not actually propose to 

perform any of those services. AGLAD has never performed any aeronautical service 

anywhere for anyone. Neither has RDM or any other member of AGLAD. AGLAD 

proposed to develop facilities to be leased to a range of aeronautical service providers 

and to air carriers where the carriers could receive those services from the other tenants 

or service themselves. 

Even if there was any possibility that AGLAD might have wound up providing 

some aeronautical services had it successfully completed its "development," there is no 

doubt that its business model was that of a real estate developer. In all of its "preconstruction phase" activities, AGLAD worked to sign "leases," not service contracts. 

Carey v. Afton-Lincoln County Mun. Airport Joint Powers Bd., FAA Docket No. 16-

06-06 (Director's Determination) (January 19, 2007) (cited in Reply at page 35, 

numbered paragraph 18). 

Carey involved complaint that, among other things, minimum operational 

standards to be imposed on new businesses proposed to provide fueling and other FBO 

services, but not on a pre-existing FBO, were unjustly economically discriminatory. 

Interestingly, the FAA made the point that it is not unjustly discriminatory to update 

requirements, and to impose them on new ventures but not "retroactively to actions that 

have already been completed," but did find that operational requirements should apply 

to all similar operators. See Carey at 37; see, also, Maxim United, LLC v. Board of 

County Comm 'rs, FAA Docket No. 16-01-10 (April 14, 2003) (Director's 

Determination, p. 22). In the present case, AGLAD did not propose to offer FBO 

services, and there is no allegation that Alaska DOT&PF imposed unreasonable 

operational minimum standards not imposed on others. All of the allegations relate to 

terms for development. Because RDM is, and AGLAD hoped to be, a real estate 

developer, real estate development, not aeronautic services is what this matter is all 

about. 

REBUTTAL 

RDM, LLC V. ANC 

Page 39 of 42 

Docket No. 16-09-14 
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Not only is Carey readily distinguishable from the present case because it 

involves aeronautic users, which AGLAD was not, because it involved minimum 

operational standards, which this matter does not, but also because all the issues in this 

case compare updated business practices under current regulations with those that 

applied to long-completed projects began from more than ten to more than 20 years ago, 

before there the State of Alaska adopted its current international airport regulations. 

Atlantic Helicopters, Inc/Chesapeake Bay Helicopters v. Monroe County, FAA 

Docket No. 16-07-12 (December 3, 2008)(cited in Reply at page 36, numbered 

paragraph 19). 

Alaska DOT&PF found the above case, but it was not the source of the passages 

quoted beneath it, which Alaska DOT&PF was not able to find. The passages RDM 

quotes at page 36 of the Reply, paragraph 19.b, whatever its source, reflects application 

of "similarly situated" analysis. RDM has described AGLAD's similarities with the 

other "developments," because its focus is so limited to "development" that it fails even 

to recognize the total dis-similarity between AGLAD as a developer of multi-tenant 

lease facilities and FedEx and UPS as Signatory Air Carriers constructing facilities own 

use for their own use to meet their own needs. 

That development focus reveals that AGLAD may not be a core aeronautic user 

at all such that real estate developer, RDM, is entitled to have its complaint considered 

under Part 16. But even if the FAA were to deem AGLAD's proposed development a 

proposed aeronautic use, there would yet be no possibility of it being found similarly 

situated to FedEx or UPS. That would leave only CargoPort for the FAA even to 

consider. But RDM alleged similarity between AGLAD and CargoPort only in a most 

general way to begin with, has not bolstered those allegations with any evidence or 

analysis, and has now effectively conceded the distinctions the State of Alaska 

identified in its Answer at Exhibit A. paragraph 18.B. See Reply at pages 16, numbered 

paragraph 18.B,l-8 (admitting that the noted distinctions "may or may not be true"). 

REBUTTAL 

RDM, LLC V. ANC 

Page 40 of 42 

Docket No. 16-09-14 

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Maxim United, LLC v. Board of County Comm'rs, FAA Docket No. 16-01-10 (April 

14, 2003) (Director's Determination, p. 46) (cited in Reply at page 36, numbered 

paragraph 19). 

RDM relies on Maxim's discussion that agreement to contract terms does not 

always bar a complaint concerning those terms. But in Maxim, the issue was not just 

that the complainant was subject to differing standards, but that those standards had the 

effect of preventing the complainant from self-fueling, in direct violation of Assurance 

22(f). Self-fueling by an aircraft owner is a core aeronautic function that is not at issue 

in the present case. 

In addition, Maxim goes on to note that differing treatment of different tenants 

over time is not in and of itself improper" 

[N]o Federal obligation requires a sponsor to forgo 

improved business practices or efficient allocation of airport 

property in order to avoid differing terms and conditions 

among users of the airport. The airport sponsor can pursue 

agreements that more nearly serve the changing interests of 

the public with the more recent leaseholders. 

Id. at 22 (citing Wilson Air Center v. Memphis and Shelby County Airport 

Authority, FAA Docket No. 16-99-10 (August 30, 2001)(Final Decision and Order). 

DATED this 29* day of December, 2009 at Anchorage, Alaska. 

DANIEL S. SULLIVAN 

ATTORNEY GENERAL 

By: '^^^^/<f 

/John L. Steiner 

/ Senior Assistant Attorney General 

ABA No. 8711108 

REBUTTAL 

RDM, LLC V. ANC 

Page 41 of 42 

Docket No. 16-09-14