Benjamin H. Klein

L AW O FFICES OF P AUL A. L ANGE , LLC 80 Ferry Boulevard Stratford, CT 06615 Phone: (203) 375

- 7724 Fax: (203 ) 375

- 9397 bhk@lopal.com

UNITED STATES DEPARTMENT OF TRANSPORTATION FEDERAL AVIATION ADMINISTRATION

WASHINGTON, DC

Pro

- Flight Avia tion, Inc.

Complainant, v. Docket No. 16

- 15

- 03 City of Renton, Washington

Respondent. / PRO
- FLIGHT AVIATION, INC .’S REPLY TO RESPONDENT’S ANSWER Complainant Pro

- Flight Aviation, Inc. (“PFA”), by and through the undersigned counsel,

a nd pursuant to 14 C.F.R. § 16.23(e) and the FAA’s Augu st 13, 2015 Order granting an extension of time, hereby files this Reply to Respondent City of Renton, Washington’s (“City” or “Respondent”) Answer to the Complaint (“Answer ”), and in support thereof, st ates as follows: INTRODUCTION In January 2015, PFA filed a Part 16 Complaint (“Complaint”), alleging that Respondent violated several of its grant assurance obligations when it misled PFA about the availability of a parcel adjacent to its FBO

– the 760 Pa rcel

– in order to ensure that it was leased to the Boeing Company (“Boeing”) , a non - aeronautical, through the fence operator at the Renton Municip al Airport (“RNT” or “Airport”). Specifically, PFA has asserted that in April and May of 2013, Respondent int entionally concealed from PFA , the sole full

- service FBO on the field, that the2

760 Parcel was available for lease and that Boeing was negotiating with the Airport for its lease , despite the fact that PFA had, since January 2011, repeatedly expressed it s in terest in leasing the parcel once it became available. In June 2013, a fter PFA discovered that the 760 Parcel was , contrary to Respondent’s representations, available and that Boeing had in fact already submitted a lease application for both the 760 and 770 Parcels, PFA announced its intention to submit its own application. In response, PFA was told by the Airport manager not to bother submitting an application , and that the City had already decided to award the lease to Boeing. Based on these facts alone , Respondent’s actions violate its grant assurance obligations and would be sufficient to warrant not only corrective action by the FAA, but also other relief , under common law tort principles, in the courts of Washington State . Respondent’s conduct is made all the more egregious, however, by the fact that : (1) the 760 Parcel is specifically designated as “General Aviation” on the Airport Layout Plan; (2) Boeing

– a through the fence operator tha t manufacturers 737 aircraft offsite and tows them onto the Airport for stora ge before departing for Boeing F ield

– is not engaged in general aviation or aeronautical activity at the Airport, and unlike PFA, provides no aeronautical services to general avi ation operators at the Airport ; and (3) by the City ’ s own admission, the Airport is largely built out, and there are no other parcels that are cur rently available for an aeronautic al user or service provider to lease

. In response to the Complaint, on April 17, 2015, Respondent filed a Motion for Summary Judgment (“MSJ”) , seeking judgment as a matter of law on all claims brought by PFA. PFA filed a detailed Answer to the MSJ on June 4, 20 15 (“MSJ Answer”)

. 1 By Order dated July 17, 2015

1 Giv en the extensive briefing that occurred during the motion for summary judgment ph ase of this matter, the parties have had the opportunity to articulate both the legal and factual basis for their respective positions, and Complainant will not waste th e Director’s time simply restating the arguments as to fact and law that have already been made. Accordingly, PFA hereby incorporates the entirety of the MSJ Answer herein, and will summarize and refer to specific portions thereof where necessary.3

(“MSJ Order”), the FAA denied Respondent’s MSJ, as well as Respondent’s motion seeking leave to file a reply brief, finding, among other things, that “Respondent failed to persuade there is no genuine issue as to whether Boeing’s use under its lease is an aeronautical use as determined by the FAA,” or “whether the disputed parcels ...are the only airport property available to meet the public’s interest and aeronautical needs of the airport.” MSJ Order, pg. 2. The MSJ Order directed Respondent to file an answer by July 27, 2015, which was extended without opposition from Complainant until August 7, 2015. Respondent offers no evidence in its Answer that should persuade the FAA that Boeing is engaged in aeronautical activity, or that the needs of aeronautical users and service providers are bein g met at the Airport. In fact, Respondent takes much the same approach in its Answer as it employed in it s MSJ. It continues to insist , i ncredibly, that not only is Boeing engaged in aeronautical activity at RNT, but that this activity falls under the classificatio n of “General Aviation.” In deed , Respondent ups the ante in its Answer, and takes the position, for the first time, that Boeing actually provides aeronautical services at the Airport

– an assertion that Respondent does not even attempt to support with evidence . N one exists. The Answer provides no evid entiary support for Respondent ’s other justification for denying PFA the le ase

– that other suit able space was available to PFA

– and this claim is belied by Respondent ’ s own statements on this point

. Although the City suggested that PFA could lease the 820 Parcel in 2011, it was not offered again until after the Complaint was filed, and after it had already promise d to Boeing. Fact State ment of Respondent in Support of Answer4

(“Respondent Statement”) ¶ ¶ 28 , 29 . Even if the offer in March 2015 was sincere 2 , the 820 Parcel is completely impractical for PFA with Boeing’s occupation of 760/770, since there is no way to transpo rt PFA customers across those parcels (Boeing will close them off) to its FBO on 750

. The only “alternative” site that PFA was legitimately offered i s , by the admission of the City, the site of a former restaurant, which is outside the Airport fence, over 650 yard s from PFA’s facility, and has yet to be developed. Respondent Statement ¶ 26. Thus, since it was rejected for the lease of the 760 /770 Parcel s in 2013, PFA has been offered no credible alternative site to house its flight school or transient aircraft. In addition, Respondent still does not provide any evidence to refute the timeframe and record documentary evidence supplied by PFA surrounding the application process for the
760 /770 Parcel s

– evidence that unequivocally demonstrates that the City behaved in an unjustly discriminatory manner when i t negotiat ed with Boeing for the space while representing to PFA that it was not available for lea se . Instead, Respondent simply states that the Airport manager at the time, Ryan Zulauf, is no long er in the City’ s employ, and so Respondent is not in the position to offer any evidence in response to PFA ’ s allegations other than by issuing unsupported, conclusory denials. PFA respectfully submits that c onclusory denial s should be insufficient to defeat PFA’s claim s of willful misrepresentation and unfair discrimination , which are supported by both documentary evidence, and sworn declarations. The City also continues to in sist that Boeing was awarded the lease for the 760 Parcel because it was determined to be in the “best interest of the City,” and points to, among other

2 It was not: as Boeing claims in a declaration sub mitted in support of the Answer it requires, and in fact will be leasing, the 820 Parcel through 2019. See Declaration of David K. Shineman, dated August 7, 2015 (“Shineman Dec. ¶ 9). Boeing claims that it requires 7 spots for 737MAX parking, and that the only way to secure these 7 spots is by lea si ng 760/770/820. Id . ( “ Since Boeing estimate[s] a need for 7 new s paces, the loss of any one parcel, or the substitution of another property for either 760 or 770, jeopardizes Boeing ’ s ability to deliver its 737 model airplanes on time. ” ).5

justifications, PFA’s alleged request for a “long

- term lease,” which was not as attractive as Boeing’s proposal for a “short

- term lease.” A review of PFA’s application undermines this post

hoc justification for PFA’s denial: PFA did not seek a “long

- term lease” in its application ( see Complaint, ex. 7), but only ment ioned a long

- term lease as a demand during pre

- complaint negotiations in August 2014, over a year after Boeing had been awarded the lease for the 760/770 Parcels

. Moreover, PFA later , and in writing, backed away from this demand significant ly in the hope of resolving th is matter before the Complaint w as filed

. All it reques ted was the ability to retain i ts 9 tie

- down spots on the 760 Parcel; it was willing to cede the remainder to Boeing. Complaint, Ex. 6h, pg. 3. The City, however, was unable to deliver. A new approach taken by Respondent in the Answer , but perhaps not a surprising one, is its decision to : (1) play a technical game of legal “gotcha” in order t o incorrectly suggest that
PFA now lacks standing to bring its Complaint ; and (2) distort facts in order undermine PF A ’s very real status as the sole FBO on the field providing full s ervices to general aviation aircraft and operators. First , even if Respondent succeeds in stri p ping PFA of its operating permit in retaliation for bringing the Complaint, PFA will still very much have standing (all the more so, in fact) to bring these claims , as PFA is “directly and substantially” affected by Respondent’s continuing and ever increasing non

- compliance. Second, despite Respo ndent’s clear desire to have the FAA believe that the re are other operators on the field that provide the same services as PFA, and that therefore, all is well for aeronautical users of the A irport, there are not and it is
not . I f PFA were forced to leave the field tomorrow, general aviation activity at the field would come to a grinding halt. There would be no one supplying fuel, no place to purchase charts and pilot supplies, and nowhere to park a jet and have it serviced

.6

Finally, Respondent continues to assert wi th one breath that Boeing is engaged in general aviation activity at the Airport and thus, its lease of the 760 /770/820 Parcel s does not v iolate the ALP, and with the next, implies that if the FAA disagrees, Respondent can simply amend the
A irport Layout Plan, as ne eded. This would defeat the very purpose having an Airport Layout Plan, which, “reflects the agreement between the FAA and the sponsor regarding the proposed allocation of airport areas to specific operational and support functions.” and is a pre - requisite for receiving federal money for airport development projects. FAA Order 5190.6B § 7.18 Presumably, the FAA and the local ADO , which is aware of Boeing’s presence on the field, carefully reviewed the ALP , which was updated with federal funds in 2009 , to ensure that Respondent was allocating sufficient space to actual aeronautical users of the Airport, as opposed
to over

- designating space for “ a irc raft m anufacturing,” a clear, unequivocal re ference on the
ALP to Boeing. Thus, i f the FAA determines that Boeing is not engaged in general aviation activity , the solution is not, as the City suggests, merely to take out the eraser and insert “aircraft manufacturing” in t he place of “general aviation

. ” In sum, a nd as further detailed below, in its Complaint , and in its MSJ Answer , PFA has provided reliable, probative , and uncontroverted evidence proving Respondent’s grant assurance violations. Accordingly, Complain ant respectfully submits that the FAA should issue an order granting the relief requested in the Complaint, or, in the alternative, commence an investigation of PFA’s claims pursuant to 14 C.F.R. 16.29.
I. Boeing is Not Engaged in Aeronautical Activity and Does Not Provide Aeronautical Services “The basic federal obligation of the sponsor is to make public landing and aircraft parking areas available to the public.” FAA Order 5190.6B, Airport Compliance Requirements , September 30, 2009 (“FAA Order 5190.6B”), ¶ 12.2(b). “The Airport Compliance Pro gram is7

designed to protect the public interest in civil aviation. Grants [] are in exchange for binding commitments (federal obligations) designed to ensure that the public interest in civil aviation will be served.” Id . at ¶1.5. The parties have alread y fully briefed their respective positions on whether Boeing’s operation 3 at RNT constitutes “aeronautical activity” for the purposes of complying with grant assurance obligations, and Complainant respectfully refers the Director to Section II.A of the
MSJ Answer, for its argument on this point. To reiterate, the FAA does not consider, nor should it consider, aircraft manufacturing to constitute aeronautical activity. Ashton v. City of Concord , FAA Docket No. 16

- 99

- 09 (January 28, 2000) (Director’s Determ ination), 2000 FAA LEXIS 150, *41 (“The FAA notes that the construction of aircraft is not an aeronautical activity.”); BMI Salvage Corporation & Blueside Services, Inc. v. Miami

- Dade County, FL; FAA Docket No. 16

- 05

- 16 (April 15, 2011) (Final Decision and Order on Remand), at 23. In apparent recognition of this stumbling block, Respondent points to Appendix Z of FAA Order 5190.6B, which lists activities such as aircraft storage and aircraft maintenance as

cons tituting “aeronautical activity , ” and argues that s ince Boeing is allegedly engage d in these activi ties at RNT, it should be considered an aeronautical user. While it is t rue that aircraft storage, Boeing’s primary activity on the Airport, may be considered “aeronautical” under certain circumstances, the definitions contained in Appendix Z should not be allowed to cloak explicitly non

- aeronautical activities, such as aircra ft manufacturing, in aeronautical clothing merely because some activities ancillary to aircraft manufacturing are found in Appendix Z. In

3 Through the fence opera tions for aeronautical businesses offering no services to the public are discouraged by the FAA. See FAA Order 5190.6B §12

- 7(d)(2). “If the FAA regional airports division determines that such an agreement lessens the public benefit for which the airport was developed, the FAA regional airports division will notify the sponsor that the airport may be in violation of its federal obligations.” Id . § 12

- 7(e).8

other words, if the FAA does not consider aircraft manufacturing to constitute aeronautical activity, the n aircra ft storage that is directly related to a manufacturing operation should also b e considered “non

- aeronautical.” 4 And , as Respondent readily admits, “Boeing’s activities at the Airport are, of necessity, tied directly to the manufacturing operations going on at its plant across the River...” Declaration of Jonathan Wilson , dated April 17, 2015 (“Wilson Dec. ” ¶ 19 )

. In a new twist, Respondent alleges throughout the Answer that Boeing is, in addition to being engaged in aeronautical activity , also providing aeron autical services to the public at RNT. Answer ¶¶ 2, 47, 51, 56, 67, 68. Respondent does not provide a shred of evid ence in support of this claim. Again, while Respondent may argue that the manufacture of commercial airline transport aircraft constitutes providi ng aeronautical services to “the world at large,” it does not qualify as such when judged against an individual airport’ s grant assurance obligations. The flying public that utilizes RNT, a general aviation reliever airport, is not looking to purchase a 737 when they visit or base their aircraft at RNT. They require fuel, oxygen, lavatory servicing, temporary parking

– aeronautical services that neither Boeing nor any other operator at the Airport other than PFA currently provide s . By leasing the 760 Parcel to Boeing inst ead of PFA, under the guise that the former is engage d in aeronautical activity (and of the general aviation kind, no less) and is providing aeronautical services to the public, Respondent is not “servicing the pu blic interest in civil aviation ” at RNT.

4 In further illustration of this point, u nlike those engaged in aeronautical activities at the Airpo rt itself, Boeing , is primarily a through the fence operator whose only real need at the Airport is access to the runway. Other than runway use, all of Boeing’s activities related to manufacturing, including aircraft storage, could and should occur at its facility off

- airport. Presumably the issue is that Boeing does n ot have enough room t here ; but the problems caused by Boeing’s space constraints should not be shifted onto the aeronautical users o f a federally obligated airport, and Boeing should certainly not be granted preferential treatment over aeronautical s ervice providers such as PFA.9

It is not surprising then that R espondent attempts to downplay the damage that Boeing’s occupation of the Airport h as done to general aviation, b y falsely suggesting that there are many other aeronautical service providers on the field providing the sam e, or similar services to PFA. Declaration of Jonathan Wilson in Support of Renton ’ s Ans wer, dated August 6, 2015 ( “ Wilson
Answer Dec. ” ) ¶¶ 2, 6, 21

. Ra i nier Flight Services, LLC (“Ra i nier”), which Respondent attempts to prop up as a competing “FBO , ” only provides flight training and very limited maintenance services for piston aircraft

. Declaration of Bern ard A. Paholke in Support of Reply , dated September 3, 2015 ( “ Paholke Dec. ” ) ¶ 2

. It does not, as Respondent i ncorrectly states, “provide all FBO

- type services provided by PFA ...with the e xception of aircraft fueling.” Wilson Dec. ¶
6. Ra i nier does not provide transient parking for anything other than small aircraft, it provides no services to turbine aircraft, a nd although it is primarily a flight school, it does not even have a pilot shop; it sends it s students to PFA for supplies. Paholke Reply Dec. ¶ 2

. Respondent admits that Ra i nier provides no fueling services, despite the fact that its agreement with the ai rport requires it to do so

. 5 PFA is the only entity listed as an FBO on airnav.com; if a transient aircraft lands at RNT, it is directed to PFA, as no other entity is equipped to provide transient aircraft with services. PFA is the only airport service provider that
p rovides: fuel, oxyg en, nitrogen, rental cars, pilot store, lavatory services, catering, a GPU, and a pilot lounge

. Paholke Reply Dec. ¶ 3 . Respondent apparently hopes that by merely pointing to other spots on the Airport where tie

- downs can be accommoda ted, or where flight instruction can be obtained, it can convince the FAA that GA is thriving at RNT, and would be fine without PFA

5 Ra i nier has allegedly been negotiating with the prior tenant and lien holder to acquire the tanks that were abandoned over three years ago, and have been sitting on its parcel , with fuel inside, unused and uninspected

. See Wilson Answer Dec. ¶ 2. However, it w ill likely be many more months before Ra i nier, essentially a flight training operation, has the ability to run a fueling operation , despite the fact that its agreement with the Airport requires them to do so

– a contractual provision the Res pondent appears willing to overlook

.10

on the field. Wilson Answer Dec. ¶ 21. It is not, and GA operations at RNT would be significantly diminished , and aeronautic al users severely impacted, if PFA departed the Airport today

. II. Respondent Provides No Evidence i n I ts Answer t o Refute PFA ’ s Allegation

That I t W as Intentionally Misled Regarding the A vailability of the 760 Parcel The facts surrounding Respondent’s unfairly discriminatory trea tment of PFA with regard to the latter’s oft

- stated interest in leasing the 760 Parcel are detail ed in the Complaint, and are also addressed in the MSJ Answer. See generally, Complaint ¶¶ 22

- 30, 43

- 54; MSJ Answer, Section 1.A. These facts include, but are not limited to , the following:

 From 2011 through 2013, PFA’s management repeatedly expressed its interest in leasing the 760 Parcel, which is adjacent to PFA’s current leasehold, and which has been designated on the Airport Layout Plan for General Aviation. Complaint ¶ 22. 6

 Boeing expressed an interest in leasing the 760/770 Parcels as early as February 28, 2012, to accommodate production for the 737MAX. Wilson Dec. ¶ 20.

 The previous occupant of the 760 Parcel defaulted on its lease in or about April 2013, at which point PFA reiterated its interest to Airport management. Complaint ¶ 23.

 On April 15, 2013, PFA wrote to Airport Manager Ryan Zulauf asking for a meeting concerning the 760 Parcel. Complaint, Ex. #6a.

6 The fact that PFA repeatedly expressed interest in the 760 Parcel beginning in 2011 is not in dispute. Answer ¶ 22, Respondent Statement ¶ 12

.11  On April 17, 2013, Respondent sent Boeing a letter stating that the 760/770 Parcels were available for lease and Responde nt met with Boeing on that same day to discuss the matter. At that meeting, Boeing reiterated its interest is securing the lease for the 760/770 Parcels. Complaint, Ex. 15, pg. 2

- 3.

 I n re sponse to PFA’s inquiry of April 15 th
, Mr. Zula uf that the 760 Parcel would not be available for lease until a storm drain pipe could be replaced. Complaint ¶
23. Mr. Zulauf did not indicate to PFA that the Airport was engaged in lease negotiations with B oeing over the 760/770 Parcels. See Declaration of Bernard A. Paholke (“ Paholke Dec .”), ¶ 5, attached to the MSJ Answer as Exhibit A.

 By email dated April 18, 2013, Boeing said that it was securing internal a pprovals and hoped to begin lease discussions for those parcels “in the next 2

- 3 weeks.”
Id

.

 On May 5, 2013, Boeing submitted an application for the lease of the 760/770 Parcels. Answer ¶ 25.

 Despite being aware of PFA’s longstanding interest in leasing th e 760 Parcel, Respondent did not make PFA aware that the 760 Parcel was in fact available and that Boeing had submitted an application for its lease. Complaint ¶ 25.

 In early

- June 2013, PFA again inquired about the availability of the 760 Parcel. PFA was i nformed, for the first time, that the 760 Parcel was available, but that Boeing had already submitted a lease application for both it and the 770 Parcel. PFA was also informed by Mr. Zulauf that the City had already decided to lease12 the space to Boeing, an d he discouraged PFA from submitting an application. Complaint ¶ 25; Paholke Dec . ¶ 6.

 On June 6, 2013, PFA submitted a lease application for the 760/770 Parcels. Complaint ¶ 26.

 On July 24, 2013, Respondent sent PFA a letter informing it that its applica tion had been rejected in favor of Boeing’s. Complaint ¶ 27, Complaint, Ex. 10.

 On July 25, 2013, the Transportation Committee of the City Council met to “deliberate” on a decision that had clearly already been made. Complaint ¶ 28.

 On July 25, 2013, the Tra nsportation Committee voted to approve the Boeing lease application. Id

.

 On August 5, 2013, the City Council approved the Boeing lease application without further discussion. Complaint ¶ 29. PFA’s factual assertions (and Respondent’s admissions) in this r egar d unequivocally demonstrate : (1) that Respondent actively concealed from PFA that the 760 Parcel was available for lease and that Boeing had submitted a lease application before Respondent even acknowledged to PFA that the 760 Parcel was available ; and (2) that Respondent decided to grant Boeing the lease before its governing bodies had officially considered PFA’s competing application

. 7

7 PFA has also asserted, and provided reco rd evidence proving , that the City violated its own leasing policies when it c overtly arranged for the lease of the 760 /770 Parcel s to be awarded to Boeing, and used a process that was anything but “fair, transparent, and uniformly applied.” Complaint ¶ 18

- 20. In response, Respondent has tepidly suggested that the leasing policies provide nothing but “guidance,” and that PFA inaccurately quoted the policies. Answer ¶ 19. Respondent, however, provide s no examples of PFA’s alleged misquotations.13

Respondent offers no evidence to refute the first point. Instead, it simply offers a conclusory denial and states th at since Mr. Zulauf is no longer employed by the Airport, it has no information about Complainant’s allegations in this regard

. Answer ¶¶ 22

- 25. However, current Airport employees, including Airport Manager Jonathan Wilson, were employees at the time s rele vant to these allegation s ; in fact, Mr. Wilson ser ved as Mr. Zulauf’s assistant. Wilson Dec

. ¶
1

. It is s urprising then , to say the least, that Mr. Wilson wo uld have no insight into Mr. Zulauf’s interactions with PFA during this time period, PFA’s oft

- expressed interest in leasing the 760 Parcel once available , or the City’s surreptitious negotiations with Boeing

. In contrast to Respondent’s complete lack of evidence to refute PFA’s allegations of deceitful and misleading conduct , PFA has provided a sworn declaration and detailed facts regarding Mr. Zulauf’s statements and omissions

. See e.g ., Complaint ¶¶ 22

- 29; Paholke Dec. ¶¶
3

- 7. If the FAA finds this evidence insu fficient to meet PFA’s burden of proof on the question of unfair discrimination and disparate treatment , Complainant respectfully requests that the FAA exercise its authority to interview Mr. Zulauf and gather additional eviden ce pursuant to 14 C.F.R. 16.29(b)(2). On the second point

– that the City decided to award Boeing the lease for the 760 /770 Parcel s before its governing bodies officially voted on the matter

– the City is unable to explain
away the rejection letter dated July 24, 2013, which was provided to PFA the day before the Transportation Committee met to vote on the lease applications . Complaint, Ex. 10. Respondent suggests that the letter only contai n s a “recommendation ” that Boeing be awarded the lease, but the letter does not use that word, nor does it suggest that the City’s decision was anything other than what the letter purported it to be

– final. Answer ¶ 27.14

Though Respondent steadfastly clings to the argument that the Tr ansportation Committee, which met on July 25, 2013 (the day after the rejection letter was delivered to PFA) actually considered both applications, again, the record, unbiased evidence suggests otherwise. On July 23, 2013, the day before Mr. Zulauf delive red PFA the rejec tion letter, PFA wrote Mr. Zulau f to ensure that PFA’s lease application would actually be “on the table for discussion,” since the City’s website only listed the Boeing lease application on the Transportation Committee’s agenda . Complain t, Ex. 6c. In sum, the material facts as alleged by PFA surrounding Respondent’s unjustly discriminatory conduct toward PFA provide evidence to prove that PFA was never even considered by Respondent for the lease of the 760/770 Parcels (and was in fact, ac tively misled about such) , and thus, unjustly discriminated against in favor of Boeing. PFA’s factual allegations in this regar d are not controverted by Respondent with anything other than conclusory denials; thus, PFA’s allegation s and the evidence in sup port thereof are more than sufficient to form the basis for a violation of Grant Assurance 22. 8
III. Respondent Has Invented Post Hoc Justifications for its Decision to Award the Lease to Boeing A common theme of Respondent’s , throughout both the MSJ and t he Answer , is that it s decision award the lease of 760/770 to Boeing instead of PFA was reason ed and considered , and ultimately, in the City’ s best interest

. While it is understandable the City would always want to act to further its interests 9 , the re asons it now provides to justify its decision to award the lease to

8 PFA has al so alleged and maintains its claim that Respondent violated Grant Assurance 22 when it failed to make the Airport and its facilities available for public use. See MSJ Answer, Section II.B.

9 Of course, the City’s “interests” and its obligations as the sponsor of a federally

- obliga ted airport may not always align. A federally

- obligated airport exists to serve the flying public , and not necessarily to maximize city revenues or se rve as a source of job creation.15

Boeing we re concocted by Resp o ndent after the fact , and in response to the Complaint, in order to occlude the one obvious and understandable explanation for why the City went with Boeing: it is the la rgest airport tenant and the single largest employer in Renton. While the City alludes to this fact, it knows that this alone cannot serve as its justification for awarding Boeing the lease for the 760 /770 Parcel s , given its federal grant assurance obligations. Therefore, it invents two reasons for awarding Boeing the lease: (1) Boeing requested a short

- term lease, whereas PFA demanded a long

- term lease; and (2) there are other suitable spots on the field for PFA (implying the PF A i s just be ing picky) , whereas Boeing require s both the 760 and 770 Parcels for its operations. Both are without basis in fact. Despite the City’s misrepresentation otherwise, PFA did not request a long

- term lease when it submitted i ts application for the lease of the 760/770 Parcels. See Complaint, Ex.7 (PFA Lease Application)

. Cf. Resp ondent Statement ¶ 16 (“PFA sought a long

- term lease to coincide with the terms of the RGC 35

- year lease on the 750 Parcel”) ; MSJ at 2 (“[PFA] submitted an application for a long

- term lease for both parcels 760 and 770”) . Although PFA did state, as part of an October 2014 settlement demand, that it required a long

- term lease for the 760 Parcel to correspond with its lease for the 750 Parcel, i t made no such request as part of its application; thus, Respondent ’ s claim that PFA ’s “long

- term” requirement played any role its decision to award t he lease to Boeing in July 2013 is disingenuous and factually impossible

. Cf. MSJ at 3 (“[T]he selection of Boeing for a short

- term lease of both Parcels 760 and 770 over a long

- term lease to PFA was a logical and reasonable b usiness decisio n under the circumstances...”). Moreover, even though PFA demanded a long

- term lease for 760 in October 2014 , it dropped16

that demand in December 2014, and stated that it would be willing to settle if it could keep only
t he 9 tie

- downs that it leased on the 760 Parcel. 10 See Complaint, Ex. 6h, pg 3. Respondent further attempts to justify its decision by arguing that other suitable spaces were available to PFA, but that PFA unreasonably rejected them . That is incorrect. As e ven Respondent admits, at most there were only two alternative parcels offered to PFA : the 820 Parcel, and the Old Restaurant site. Wilson Dec.¶ 14. Both supposed alternatives do not, as Respondent well knows, address PFA’s needs, or the needs of aeronauti cal users of the Airport. Although the City states that PFA rejected the 820 Parcel on two occasions, it was only offered it in 2011 after PFA initially br oached its need for additional space. 11 Wilson Dec., Ex.
JW

- 1. Cf . Answer ¶ 36. The other alleged “rejection” of 820 by PFA o ccurred in March 2015, after the Complaint had been filed, and after Boeing had submitted an applicati on for the 820 Parcel, which ha d been preliminarily approved. Jacobs o n Dec

. , Ex. DJ

- 3. Given that the 820 Parcel is over 300 yards away from the PFA building , is inaccessible from the Perimeter Road, and has no restrooms, it was not u nreasonable for PFA, in 2011, to determine that the parcel was not a good fit, and to wait for something more suitable.

10 The City misleadingly insinuates that PFA is responsible for the failur e to resolve this matter prior to filing the Complaint. Answer ¶ 38. That is incorrect. PFA agreed to accept only the 9 tie

- sown spots on 760 , but Respondent was apparently unable to deliver on this proposed resolution, as it has abdicated its rights and powers to Boeing . After PFA agreed to settle the matter for the 9 tie

- down spots, it never heard from the City again prior to the filing of the Complaint. Complaint, Ex. 6h, pg. 1.

11 Whether the 820 Parcel was ever available to PFA after 2011 is an ope n question. In sworn declarations submitted in support of the MSJ, Responden t allege s that as of August 2014, the Airport intended to enter into a lease with Boeing for the 820 Parcel. Declaration of Doug Jacobs o n , dated April 16, 2015 ( “ Jacobs o n Dec. ” ) ¶ 8. Airport staff agreed to recommend approval of the a pplication. Respondent Statement ¶ 28. Boeing, in sworn declarations, has said that it requires the 820 Parcel, along with 760/770 in order to store its 737MAX aircraft. See Declaration of David K. Shineman, dated August 7, 2015 ( “ Shineman Dec. ” ) ¶ 9

. N ow , the City claims that it has decided to lease the 820 Parcel to Ra inier, the other alleged “FBO” on the field, but that Ra i nier has conveniently agreed to lease the spot back to Boeing until May 31, 2019. Respondent Statement ¶ 29. This newly announced ar rangement appears designed to appease the FAA and lessen the unseemly appearance created by Boeing’s occupation of all available general aviation parcels at the Airport for the next four years, despite the fact that all have been designated for, and are sorely need ed by, actual aeronautical users.17

In 2015, after Boeing had been awarded the leases to the 760/770 Parcels, the 820 Parcel became even more u nsuitable for PFA’s operation. Since there is still no access to the 820 Parcel from the Perimeter Road, and because Boeing will seal off the 760 a nd 770 Parcels completely

onc e it occupies them, there is no safe, reasonable way to transport customers or flight training students the 300 yards to and from PFA’s building. See Paholke Dec. ¶¶ 15

- 17. An even less suitable alternative is the Old Restaur ant site. It is not now, nor was it in 2013 when the City “deliberated” on the lease applications, available to PFA or any other aeronautical user . Wilson Dec. ¶ 12. It is an unpaved city park, lo cated outside the A irport fence, and is 670 yards from the PFA building. Paholke Dec. ¶ 1 8; Paholke Reply Dec. ¶ 4

. Even if it were available (and it is not), it does not constitute a reasonable alternative for PFA to house flight training or transient aircraft since there is no practicable and safe way to transport
customers to this locatio n . I f the City believes that the Old Restaurant site constitutes a suitable alternative to the 760 Parcel for PFA, it does not understand (or willfully ignores) the nature and requirements of general aviation requirements at RNT

. In sum, the City’s justif

ications for awarding Boeing the lease of the 760 /770 Parce ls

– that a short

- term lease was preferable to a long

- term one, and that PFA was offered other suitable alternatives

– are premised on a distortion of the facts and the record evidence. Respondent awarded the lease to Boeing because it claimed it required it for the 737MAX program, which would bring innumerable jobs and benefits to the City. 12 Shineman Dec. ¶ 12. While

12 Perhaps the City was also motivated by the type of implicit threats that are contained in the declaration that Boeing submitted in support of Respondent’s Answer. Boeing claims that in developing the pro duction schedule for the 737MAX , it relied on the availability of the 760 and 770 Parcels, and that if it is not allowed to occupy the parcels, “hundreds” of employees may be eliminated, losses could reach in the tens of millions of dollars, and airlines will be forced to fly le ss fuel efficient aircraft, thereby contributing to global warming. Shineman Dec. ¶¶ 12

- 13. In other words, the City may have been directly respo nsible for calamities as sociate d with global war m ing if it had rejected Boeing ’ s lease application for 760/770

– a heavy burden indeed.18

understandable, Responden t’s grant assurance obligations require it to address other considerations , such as providing access to aeronautical users, and promotin g civil aviation at the Airport

– requirements that were violated in the City’s quest to acquiesce to all of Boeing’s alleged needs

. IV. PFA Has Standing to Bring Its Complaint Renton Gateway Center, LLC (“RGC”), a sister company of PFA, is both authorized and contractually obligated to provide certain FBO services at the Airport. Complaint, Ex. 1, S ection 8, pg. 8. It meets this oblig ation through a sub

- lease to PFA, which in turn obligates PFA to perform the FBO services. Complain t ¶ 6, Ex. 3. Because PFA is not a direct Airport tenant , but rather a sub

- lessee, it is required to obtain an Operating Permit in order to provide FBO services. The initial term of PFA’s Operating Permit ended July 31, 2015, but is extendable upon written notice to the Airport ninety (90) days before the termination date. Complaint, Ex. 2, Section 4.2. Due to an oversight, PFA did not inform the Airport of its wish to extend t he term of its Operating Permit ninety (90) days before July 31, 2015

. Paholke Reply Dec. ¶ 5

. However, as

soon as the oversight was discovered , it notified the Airport of its obvious intention to renew the Operating Permit. Paholke Reply Dec. ¶ 6

. Although the City could have easily waive d the ninety (90) day requirement (in the same manner it has waived the requirement for Rain i er to provide fuel services) , and simply accept ed PFA’s written notice of its intention to renew , Respondent is instead, and presumably in reta liation for PFA’s filing of the Complaint, requiring
that PFA submit a new application for an Operating Permit, and has stated that the approval19

process will take at least three months , and that the outcome is uncertain

. Id

. at 8

. In the meantime, Respondent has allowed PFA to continue operati ng without the permit. 13 Id . at 11

- 12

. “A person directly and substantially affected by any noncompliance” may file a Part 16 Complaint. 14 C.F.R. 16.23(a). A s of the date of this Reply, PFA is operatin g as an FBO on the Airport ; thus , it clearly is directly and substantially affe cted by Respondent ’ s noncompliance and has s tanding to bring the Complaint. Moreover, e ven if Respondent succeeds in denying PFA an Operating Permit and kicking it off the Airport , PFA will not lack standing to bring suit, as it will be directly and even more substantially affected by Respondent’s non

- compliance, and one does
not need to be an airport tenant or operator in order to bring a Part 16 Complaint. See Martyn v. Port of Anacort es, Washington , FAA Docket No . 16

- 02

- 03 (April 14, 2013) (Director ’ s Determination) , 2003 WL 21 0 02099 , *34 (rejecting Respondent ’ s contention the Complainant lacked standing because it was not a current airport tenant: “ [T] he fact that Complainant is not currently paying fees or rentals to the [] Airport does not preclude him from being directly and substantially affected by any alleged noncompliance. ” )

. Accordingly, Respondent’s affirmative defense that PFA somehow lacks standing due to the C i ty ’ s threat not to renew PFA’s Operating
Permit ( see Wilson Answer Dec. ¶ 15) should be rejected out of hand.
V. Respondent is Not Complying With the FAA
- Approved Airport Layout Plan The 760/770/820 Parcels, all of which Boeing intends to occupy through at least 2019, are designated on the ALP for General Aviation. Complaint, Ex. 11. In its Answer, Respondent continues to maintain that Boeing is engaged in general aviation aeronautical activities at the Airport. Answer ¶ 28. This outlandish claim does not square with the fact that certain areas on

13 It is also worth noting that Respondent allowed PFA to operate from July 7, 2011, through March 13, 2013 without an Operating Pe rmit, as it was not signed by the Mayor until the latter date. Complaint, Ex.2, pgs. 3 and 22.20

the ALP

– areas that are , incid entally, all leased by Boeing

– a re designated for “ a ircraft

m anufacturing. ” Although absurd, Resp ondent’s decis ion to defend its po sition that Boeing is a general aviation aeronautical services provider is understandable; otherwise, it would be unable to get away with the decision to lease the only remaining parcels on the A irport designated for aeronautical use to an entity that is not involved in general aviation or aeronautical activity

. See Martyn v. Port of Anacortes, Washington , 2003 WL 21 0 02099 , * 28 ( stating that an airport is obligated to give aeronautical users priority for airport premises, and the non

- a eronautical business are not to displace potential aeronautical users at the airport) ; Asheville Jet, Inc. d/b/a Million Air Asheville v. Asheville Regional Airport Authority , FAA Docket No. 16

- 08

- 02, (October 1, 2009) (Director ’ s Determination) , pg . 13 ( “ Airport projects funded with federal grants are expected to be for the benefit and use of t he aviation public. ” ) ; United States Construction Corp. v. City of Pompano Beach , FAA Docket No. 16

- 00

- 12, (July 10, 2002) (Final Agency Dec ision) ( “ Operating th e airport for aeronautical use is not a secondary obligation; it is the prime obligation. T his prime obligation includes the opportunity for leaseholders to develop airport property for aeronautical use. ” ). Prudently, the City hedges the “general aviation” argument, and states that if the FAA believes that the ALP needs to be amended to reflect Boeing’s use of those parcels, it can simply make changes to the ALP through the current amendment process. Answ e r ¶ 48; Respondent
Statement ¶ 22. PFA will not restate here in the argument it made in response to Respo n d ent ’ s misapprehension of its grant assurance obligations on this point ; rather, it refers the Director to Section II.C of the MSJ A nswer.21 CONCLUSION Based on the foregoing, Complainant respectfully requests that the FAA issue an order granting the relief sought in the Complaint, or that, in the alternative , the FAA commence an investigation of PFA’s claims pursuant to 14 C.F.R. 16.29. Dated September 3 , 2015. Respectfully submitted,

/s/___________________ Benjamin H. Klein L AW O FFICES OF P

AUL A. L ANGE , LLC 80 Ferry Boulevard Stratford, CT 06615 Ph one: (203) 375

- 7724 Fax: (203 ) 375

- 9397 bhk@l opal.com Attorney for Complainant22 CERTIFICATE OF SERVICE I hereby certify that I have this day caused the foregoing Reply to Respondent’s Answer to be served electronically , with prior written consent, on the following:

Zanetta L. Fontes Senior Assistant City Attorney 1055 South Grady Way Renton, WA 98057 zfontes@rentonwa.gov
Dated September 3 , 2015

_/s/_________________________ Benjamin H. Klein