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November 24,2015 

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CLIENT/MATTER NUMBER 

103341-0104 

Rc: Skydive Myrtle Beach, Inc. v. Horry County Dep 't of Airjlor/s 

FAA Docket No. 16-14-0~ 

Dear Sir/Madam: 

On behalf of Respondent Harry County Department of Airports, please find enclosed for 

filing an original and three copies of the following documents in the above-referenced matter: 

I. Respondent Horry County Department of Airports' Reply to Complainant 

Skydive Myrtle Beach, Inc.'s Appeal of Director's Determination; and 

2. Certificate of Service. 

We are also filing an electronic copy of these documents pursuant to the procedure set forth 

in 14 CFR § 16.13(h). 

Thank you for your attention to this matter. 

DYB 

Enclosures 

cc: Robert G. Eastman, Esq., Attorney for SDMB (via electronic mail and certified mail) 

Patricia Apone, Director of Airports (via electronic mail) 

BOSTON 

f3RUSSElB 

CHICAGO 

DETROIT 

Jason Terreri, Assistant Director of Airports (via electronic mail) 

JACI\SONVII_l_F: 

LOS ANGELES 

MADISON 

M!AMI 

MILWAUKEE 

NEW YORK 

ORLANDO 

SACRAMENTO 

SAN DIEGO 

SAN FRANCISCO 

SHANGHAI 

SILICON VALLEY 

TALLAHASSEE 

TAMPA 

TOKYO 

WASHNGTON, D.C. 

4838-0027-2171.1 
:FOLEY 

FOLEY & LARDNER LLP 

Office of the Chief Counsel 

November 24, 2015 

Page 2 

Arrigo Carotti, Esq., County Attorney (via electronic mail) 

H. Randolph Haldi, Esq., Deputy County Attomey (via electronic mail) 

Jeffrey R. Blease, Esq., Foley & Lardner LLP 

Jaclyn V. Piltch, Esq., Foley & Lardner LLP 

4838-0027-2171.1 
FEDERAL AVIATION ADMINISTRATION 

OFFICE OF THE CHIEF COUNSEL 

SKYDIVE MYRTLE BEACH, INC., 

) 

) 

) 

) 

) 

Complainant, FAA Docket No. 16-14-05 

v. ) 

HORRY COUNTY DEPARTMENT OF 

AIRPORTS, 

) 

) 

) 

) 

Respondent. ) 

___________ ) 

RESPONDENT HORRY COUNTY DEPARTMENT OF AIRPORTS' 

REPLY TO 

COMPLAINANT SKYDIVE MYRTLE BEACH, INC.'S 

APPEAL OF DIRECTOR'S DETERMINATION 

Respectfully submitted, 

HORRY COUNTY DEPARTMENT 

OF AIRPORTS, 

David Y. at ard, ' q. 

Jeffrey R. Blease, .. s . 

Jaclyn V. Piltch ·sq. 

FOLEY & LARDNER LLP 

Ill Huntington Avenue 

Boston, MA 02199 

Tel: (617) 342-4000 

Fax: (617) 342-4001 

dbannard@foley.com 

jblease@foley.com 

jpiltch@foley.com 
OPENING STATEMENT 

Pursuant to 14 CFR § 16.33(d), Respondent Horry County Department of Airports 

("HCDA") hereby submits its reply to Complainant Skydive Myrtle Beach, Inc.'s ("SDMB") 

appeal of the October 7, 2015 Director's Determination in this matter. As an administrative 

appeal, the grounds for the appeal are found solely within the Part 16 rules, specifically 14 CFR 

§ 16.33(e), which provides four specific grounds for appeal. SDMB's appeal should be denied 

because it fails to recite any of these four grounds of appeal. Even when the purported issues 

presented by SDMB are evaluated within the ti·amework of the four controlling grounds, they 

still fail to provide a basis for anything other than the issuance of a final decision that affirms the 

Director's Determination. This is because the FAA's review of infonnation (a) from its infonnal 

investigation and (b) provided by HCDA at the FAA's request was in full compliance with the 

provisions of Part 16. In contrast, SDMB's accusations of ex parte connnunications are based on 

a misinterpretation of a later section of Part 16 that is inapplicable to the instant proceeding. 

Even if that section were applicable, however, the conespondence and other information HCDA 

provided to the FAA was not made to a "decisional employee" and thus cannot constitute ex 

parte communications as defined in Part 16. Finally, all statements and docwnents that SDMB 

submits that relate to events occuning after January 14, 2015- the date of the parties' final Part 

16 submission- are an inappropriate attempt to submit new issues and evidence without the 

required petition or good cause shown, and should not be considered on appeal. For these 

reasons and as discussed more fully herein, SDMB's appeal should be denied, and a final 

decision should issue affim1ing all findings of the October 7, 2015 Director's Determination. 

4851·9913-2203.4 
LEGAL STANDARD 

An initial Director's Determination is rendered "[a]fter consideration of the pleadings and 

other information obtained by the FAA after investigation." 14 CFR § 16.31 (a). This 

investigation may include "[a] review of the written submissions or pleadings by the parties, as 

supplemented by any informal investigation the FAA considers necessary and by additional 

information fumished by the parties at FAA request." 14 CFR § 16.29(b )(1 ). 

"On appeal, the Associate Administrator will consider ... any issues accepted in the 

Director's Determination using the following analysis: 

(1) Are the findings offact each supported by a preponderance of reliable, 

probative, and substantial evidence contained in the record? 

(2) Are conclusions made in accordance with law, precedent and policy? 

(3) Are the questions on appeal substantial? 

(4) Have any prejudicial errors occurred?" 

14 CFR § 16.33(e). "Any new issues or evidence presented in an appeal ... will not be 

considered unless accompanied by a petition and good cause found as to why the new issue or 

evidence was not presented to the Director." 14 CFR § 16.33(t). 

ARGUMENT 

I. SDMB Does Not Raise Any of the Four Grounds for Appeal. 

SDMB raises two "issues on appeal": (1) whether the FAA violated SDMB 's due 

process rights when it purportedly "received evidence ex parte" from HCDA and "refused 

SDMB's FOIA requests for all documents in FAA possession relating to CRE parachute 

operaiions," and (2) whether the Director's Determination was "arbitrary and capricious and an 

abuse of discretion in violation of the S'h Amendment due process clause of the U.S. 

Constitution, APA 5 USC§ 557(d) and 14 CFR § 16.303 when it relied on facts and evidence 

2 

4851-9913-2203.4 
not properly submitted into the Part 16 proceedings and received ex parte." Appeal Br. at 1. 

Neither of these "issues" falls within the four available grounds for appeal of a Director's 

Determination. See 14 CFR § 16.33(e). Because SDMB's appeal fails on its face to state an 

appealable issue, the Director's Determination should be affirmed. 

II. All Fom· Grounds for Appeal Support Affirming the Director's Dctet·mination. 

To the extent the Associate Administrator considers SDMB's "issues on appeal" within 

the framework of the four available grounds for appeal, the Administrator must reach the same 

result and affirm the Director's Determination, for the following reasons. 

A. The Director's Findings of Fact Are Each Supported by a Preponderance of 

Reliable, Probative. ami Substa_mlill...l;l;yjdence Contained in the Record. 

The October 7, 2015 Director's Detennination is a sixty-seven page, well-reasoned 

decision, based on the substantial pleadings submitted by the parties and the FAA's own 

investigation. The "Chronological Background" section alone comprises fourteen of these pages 

and contains 126 citations to the record. DD at 5-18. The Director's compilation and analysis of 

safety incidents at HCDA comprises seven full pages. I d. at 45-51. SDMB has not argued that 

the Director reached incorrect conclusions or that the factual findings in these or other sections 

of the Detennination are not supported by the evidence contained in the record and, as such, the 

first of the fom available grounds for appeal does not exist. 

SDMB argues that some ofthe evidence in the record was gathered in violation of its due 

process rights, referring to this evidence as "ex parte documents." See Appeal Br. at 4-5 (listing 

conespondence between the FAA and HCDA from April 2015 through September 20 15). This 

argument is flat wrong, and stems from a misreading of Part 16. Contrary to SDMB's allegation 

that the collection of infmmation by the FAA after the parties had concluded Part 16 briefing 

was clone ex parte in violation of Part 16, § 16.29(b)(l) specifically allows the FAA to conduct 

3 

4851-9913-2203.4 
"laJ review of the written submissions or pleadings of the parties, as supplemented by any 

informal investigation the F.4A considers necessary and by additional information furnished 

by the parties at F M request." (Emphasis added). Section 16.31 (a) further provides that the 

Director's Determination will be rendered "[a]fter consideration of the pleadings and other 

information obtained by the FAA after investigation." (Emphasis added). 

Separate and apart from these two provisions, the FAA is charged under federal law with 

oversight of aviation safety. In the instant case, as part of these responsibilities, the FAA's 

Director of Airport Safety and Standards and the local FAA Flight Standards District Office 

(FSDO) sought information fi"om HCDA regarding reported runway incursions and related safety 

incidents at Grand Strand Airport (also referred to by its airport code "CRE"). See, e.g., DD at 

13-15, 17-18, and Items 29-31; Appeal Br. at 4-5. HCDA responded to these requests, but did 

not provide any such infom1ation directly to a decisional employee with respect to the Part 16 

proceeding. !d. As part of its oversight, the FSDO also sought information from SDMB, but 

SDMB refused to cooperate. See DD at 15-16. In addition, the FAA conducted its own internal 

analyses of the incidents relating to skydiving operations at CRE. See, e.g., id. at 15 (referencing 

ATO Memorandum); 45-52 (compiling safety incident data based on reports from both the 

County and FAA). The FAA also included in the record various materials created by neither the 

FAA nor the parties, but instead by the U.S. Parachute Association. ld. at Items 23, 24A, 24B. 

All of these materials are appropriately included in the oftlcial record supporting the 

Director's Determination, which pursuant to Part 16 can include: the "written submissions [and] 

pleadings ofthe parties," information developed through the FAA's "informal investigation," 

and "additional information furnished by [HCDA] at FAA request.'" See§§ 16.29(b)(l); 16.31. 

4 

4851-9913-2203.4 
B. The Director's Conclusions Are Made in Accordance with Law, 

Precedent and Policv. 

Though SDMB claims that the FAA's "receipt" of "ex parte evidence" and "refusal" of 

SDMB's "FOIA requests for all documents in FAA possession relating to CRE parachute 

operations" somehow violated its "due process rights" under the "5th Amendment due process 

clause of the U.S. Constitution, APA 5 USC§ 557(d) and 14 CFR § 16.303," (see Appeal Br. at 

1, 7) such argument once again stems from a misinterpretation of Part 16. 

Section 16.301 provides that "from the time a proceeding is noticed for hearing ... No 

interested person outside the FAA ... shall make or knowingly cause to be made to any 

decisional employee an ex parte communication relevant to the merits ofthe proceeding." 1 With 

its expansive reading of this provision, SDMB appears to take the position that once a Part 16 

action against an airport sponsor is initiated, the FAA may no longer communicate with that 

airport on any matter outside the presence of the opposing party. This would, of course, be an 

untenable interpretation. In any event, the documents to which SDMB objects are not ex parte 

communications as defined in§ 16.301. These documents are conespondence between HCDA 

and the FAA's Director of Airport Safety and Standards and the local FAA FSDO- neither of 

which are "decisional employees" of the FAA with respect to a Part 16 proceeding. In addition, 

as discussed supra,§ Il.A, because all of this correspondence was either collected as part of the 

FAA's '·informal investigation" or furnished "at FAA request," both of which are specifically 

allowed by § l6.29(b )(I), none of it can be considered "ex parte." Regardless, the provisions of 

SDMB mistakenly references § 16.303, which discusses the procedures that a decisional employee who 

receives an ex parte communication must follow. In addition, the incorrect quote attributed to§ 16.301 and 

reference to § 16.307 on page 8 of the Appeal Brief make it seem as if SDMB mistakenly referenced a prior version 

of Part 16 for all its citations. 

5 

4851-9913-2203.4 
this section are irrelevant, as a condition precedent under§ 16.301 is that the proceeding must 

first be "noticed for hearing," which never occurred with the instant Pmt 16 proceeding? 

SDMB's FOIA complaint is a red herring. First, SDMB's FOIA request to the FAA is an 

entirely separate proceeding from the Part 16 matter, and not a part ofthe Director's 

Determination that is reviewable on appeal. Second, while SDMB complains that the FAA 

"refused" its "requests for all documents in FAA possession relating to CRE parachute 

operations," Appeal Br. at 2, 3 n.l, 10 n.3, the FAA letter included in SDMB's Appendix belies 

this claim. The FAA letter makes abundantly clear that only SDMB's request for a fee waiver on 

its FOTA request was denied, and provides no basis for SDMB's claim that its request tor 

doctm1ents under FOIA was denied. Br. App'x at 33-35. Third, for the reasons stated infra, 

§ lll, the FOIA request and denial are new evidence that should not be considered on appeal. 

C. The Questions on Appeal Are Not Substantial, and No Prejudicial Error 

Has Qccurred. ----·---

As discussed in more detail supra,§§ II.A and ILB, the Director's Determination 

appropriately included information submitted by the parties and collected from its own infom1al 

investigation, none of this information constituted ex parte communications, and no violation of 

SDMB's due process rights occurred. For these reasons, the questions presented on appeal are 

not substantial, and no prejudicial error has occurred. 

HI. The New Issues and Evidence in SDMB'S Appeal Should Not Be Considered. 

In its appeal brie±; SDMB seeks to introduce new issues and evidence without the 

required petition or showing of good cause. See 14 CFR § 16.33(t). This includes all statements 

in the sections ofSDMB's brief titled "Statement of Relevant Facts," "Ex Parte Communications 

The same result is reached with respect to the cited provision of the Administrative Procedures Act, 5 

U.S.C. § 557(d), which also only applies "when a hearing is required to be conducted in accordance withH the Act. 

See 5 U.S.C. !i 557(a). 

6 

4851-9913-2203.4 
Outside FAA Part 16 Record and Pleadings," and "Relevant Post Decision Procedural Facts and 

Events" regarding events that took place after the date of the parties' final Part 16 sLtbmission on 

January 14, 2015, as well as the majority of documents in SDMB's Appendix. See Appeal Br. at 

3-6; Br. App'x at 1-23 and 33-34. These statements and documents comprise an attempt by 

SDMB to inappropriately supplement the record, and should be disregarded by the 

Administrator. See 14 CFR § 16.33(±). 

So, too, should the Administrator disregard the argument SDMB seeks to raise, for the 

tirst time on appeal, that the Anti-Head Tax Act, 49 U.S.C. § 40l16(b)(l), (4), prohibited HCDA 

from charging SDMB "a percentage based on gross receipts of revenue." Appeal Br. at 10. 

There can be no "good cause" why this purely legal issue "was not presented to the Director" in 

the seven filings SDMB made prior to the Director's Determination (including two Motions to 

Supplement the Pleadings). See 14 CFR § 16.33(1). 

Nor does the Anti-Head Tax Act even apply to SDMB's claims. First, SDMB 

misapprehends the difference between the Anti-Head Tax Act's prohibition of the imposition of 

sales taxes by state and local governments on revenues derived from aeronautical activities, 

including skydiving, and the permissible recovery of the costs of operating an airport by the 

airport authority from the airport's aeronautical tenants. Compare 49 U.S.C. § 40116(d)(2)(iv) 

with§ 401 16(e)(2). Second, the United States Snpreme Court has held that a fcc imposed on 

aeronanticalusers is reasonable if it"( 1) is based on some fair approximation of use of the 

facilities, (2) is not excessive in relation to the benefits conferred, and (3) does not discriminate 

against interstate commerce." Northwest Airlines, Inc. v. County of Kent, Michigan, I 14 S. Ct. 

855, 864 (1994). Third, HCDA has an obligation to maintain a fee and rental structure which 

will make the airport as self-sustaining as possible. See Grant Assurance No. 24. Thus, a rental 

7 

4851-9913-2203.4 
structure that charges the greater of a fixed fee or a reasonable percentage ofrevenues derived 

from aeronautical operations is a fair and reasonable means of recovering the costs of the 

aeronautical facilities provided for use by aeronautical users of and tenants at a federally 

obligated airport. 

CONCLUSION 

For the foregoing reasons, SDMB's appeal should be denied, and a tina! decision should 

issue affirming all tin dings of the October 7, 20 15 Director's Determination. 

8 

4851-9913-2203.4 

Respectfully submitted, 

HORRY COUNTY DEPARTMENT 

OF AIRPORTS, 

David Y. an ard, Es f 

Jeffrey R. Blease, Esq. 

Jaclyn V. Piltch, Esq. 

FOLEY & LARDNER LLP 

Ill Huntington Avenue 

Boston, MA02199 

Tel: (617) 342-4000 

Fax: (617) 342-4001 

dbmmard@foley.com 

jblease@foley.com 

jpiltch@foley .com 
CERTIFICATE OF SERVICE 

I hereby certify that I have this day served the foregoing Respondent Horry County 

Department of Airports' Reply to Complainant Skydive Myrtle Beach. Inc.'s Appeal of 

Director's Detennination on the following persons at the following addresses, by electronic mail 

in accordance with 14 CFR Pmt 16 § 16.13(h), and by certified mail: 

Office of the Chief Counsel 

ATTN: FAA Pmt 16 Docket Clerk 

AGC-600 

Federal Aviation Administration 

800 Independence Avenue SW 

Washington, DC 20591 

9-A W A-AGC-Pmt-16@faa.gov 

Dated: November 24, 2015 

4839-8436-27951 

Counselfi;r Skydive Myrtle Beach, Inc. 

Robert G. Eastman, Esq. 

Eastman & Associates, LLC 

P.O. Box. 180 

Charleston, SC 29402 

robertgeastman@msn.com 

I 

I 
Long, Sharon (FAA) 

From: 

Sent: 

To: 

Cc: 

Subject: 

Attachments: 

DBannard@foley.com 

Tuesday, November 24, 2015 5:06 PM 

9-AWA-AGC-Part-16 (FAA) 

'robertgeastman@msn.com'; Patricia Apone (aponep@horrycounty.org); Terreri, Jason 

(terrerij@HorryCounty.org); Carotti, Arrigo (CarottiA@HorryCounty.org); Randy Haldi 

(haldir@HorryCounty.org); JBiease@foley.com; JPiltch@foley.com; DBannard@foley.com 

Skydive Myrtle Beach, Inc. v. Horry County Dep't of Airports, FAA Docket No. 16-14-05 

Letter to Office of the Chief Counsel, FAA- 11-24-15.pdf; Horry Co. Dept. Airports' 

Reply to Skydive Myrtle Beach's Appeal of Director's Determination.pdf; Certificate of 

Service. pdf 

Please accept the attached documents for filing in the captioned matter. 

David Y. Bannard 

Foley & Lardner LLP 

111 Huntington Avenue 1 Suite 2500 

Boston, MA 02199-7610 

p 617.342.4033 

Cell (9781844-4149 

Email: QJ20J\Di"!I~L@JQ!§:~L<;::QI.U 

View Mv Bio 

Vts'tt Foley.com 

FOLEY 

From: Piltch, Jaclyn V. 

Sent: Tuesday, November 24, 2015 4:58PM 

To: Bannard, David Y. 

Subject: FW: Skydive Myrtle Beach, Inc. v. Horry County Dep't of Airports 

Jaclyn V. Pi Itch 

Foley & Lardner LLP 

111 Huntington Avenue 1 Suite 2500 

Boston, MA02199-7610 

p 617.342.4083 

From: Rezek, Anton J. 

Sent: Tuesday, November 24, 2015 4:58 PM 

To: Piltch, Jaclyn V. 

Subject: Skydive Myrtle Beach, Inc. v. Horry County Dep't of Airports 

The preceding email message may be confidential or protected by the attorney-client privilege. It is not intended 

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