U.S. Department of Transportation Federal Aviation Administration August 8, 2016 Via Federal Express Konrad Kuczak Office of the Associate Administrator for Airports

130 West Second Street, Suite 1010 Dayton, OH 45402 Rachel Owlsey Bethany A. Breetz Stites & Harbison, PLLC 400 West Market Street, Suite 1800 Louisville, KY 40202 Re: FAADocket No. 16-13-02 Dear Mr. Kuczak, Ms. Owlsey, and Ms. Breetz: 800 Independence Ave., SW. Washington, DC 20591

Enclosed is a copy ofthe final decision and order ofthe Federal Aviation Administration (FAA) with respect to the above-referenced matter. In arriving at a final decision onthis Appeal, the FAA has reexamined the record, including the Director's Determination, the administrative record supporting the Director's Determination, the Complainants' Appeal, and the Respondent's Reply for consistency with applicable law and policy. Based onthis reexamination, the FAA Associate Administrator for Airports affirms the Director's Determination. The Associate Administrator concludes thatthe Director's analysis and conclusions are supportedby a preponderance ofreliable, probative, and substantial evidence, and is consistent with applicable law, precedent, and FAA policy. The Complainants' Appeal does not have persuasive arguments sufficientto reverse any portion ofthe Director's Determination. The reasons for upholding the Director's Determination are set forth in the enclosed final agency decision. Sincerely,

# /<:~(k_

# r**f/~~-** 6Vxevin C. Willis, Acting Director Office ofAirport Compliance

and Management Analysis EnclosureUNITED STATES DEPARTMENT OF TRANSPORTATION FEDERAL AVIATION ADMINISTRATION WASHINGTON, DC

SPA Rental, LLC DBA MSI Aviation,

v. Complainant/ Appellant

Somerset

- Pulaski County Airport Board, Respondent/ Appellee

FINAL AGENCY DECISION I. INTRODUCTION FAA DocketNo. 16-13-02

This matter is before the Federal Aviation Administration (FAA) Associate Administrator for Airports on appeal filed by SPA Rental, LLC, d/b/a MSIAviation (Complainant, SPA, MSI, or Appellant) from the Director's Determination ofSeptember 1, 2015, issued by the Director ofthe FAA Office ofAirport Compliance and ManagementAnalysis, pursuant to the Rules ofPractice for Federa!ly Assisted Airport Enforcement Proceedings found in Title 14 CFR part I6 (Rules ofPractice). Complainant argues in its appeal and briefdated October 27, 2015, to the Associate Administrator for Airports that the Director's Determination contains errors inthat: A. Itfails to recognize that the Board, by amending the lease to Somerset Regional Aviation, LLC., (Somerset) Somerset's Limited Fixed Base Operator (LFB0) 1 Agreement, and by amending theAirport Minimum Standards the Board unjustly discriminated in favor ofSomerset to the detriment ofSPA. FAA Exhibit I, Item 24, p. 1.

1The term "Limited Fixed Base Operator" is not defined bythe FAA; it is analogous with the term "Specialized Aviation Service Operations" (SASO). SASOs are sometimes known as single service providers or special FBOs performing less than full services. These types ofcompanies differ from a full service FBO in that they typically offer only a specialized aeronautical service such as aircraft sales, flight training, aircraft maintenance, or avionics services for example. Advisory Circular (AC) 150/5190·7, Appendix 1par. l.l(n).B. It concludes that Minimwn Standards ofOperation comply with grant assurances as long as the Minimwn Standards are uniformly, but indiscriminately applied to operators engaged in dissimilarbusinesses. FAA Exhibit 1, Item 24, p. 2. Somerset

- Pulaski County Airport Board (Respondent, Board, Sponsor, orAppellee) filed a Response dated December 18, 2015, to the Complainant's Appeal stating that it developed Minimwn Standards after consulting with the FAAAirport District Office that established an Incentive Program whichprovided incentives to aircraft maintenance LFBOs. Respondent further states that SPA mischaracterizes the Incentive Program to obtain preferential treatment. Respondent argues because SPA is not similarly situated with the targeted aircraft maintenance LFBOs it cannot claim that Respondent unjustly discriminated against it in violation ofthe grant assurances. Respondent states that it offered to make the Airport available to SPA onreasonable terms and did notunjustly discriminate against SPA. Respondent requests that the Associate Administratorissue a Final Agency Decision affirming the Director's Determination. FAA Exhibit 1, Item 29, p. 13. Upon an appeal ofa Part 16 Director's Determination, the Associate Administrator will use the following analysis: (1) Are the findings offact each supportedby a preponderance ofreliable, probative, and substantial evidence contained in the record? (2) Are conclusions made in accordance with law, precedent, and policy? (3) Are questions on appeal substantial? (4) Have any prejudicial errors occurred? 14 CFR § 16.33( e); see also, e.g., Ricks v Millington Municipal Airport, FAA Docket No. 16-98-19, December 30, 1999, Final Decision and Order, p. 21. In arriving at a final decision onthis Appeal, the FAA has reexamined the record, including the Director's Determination, the administrative record supportingthe Director's Determination, the Complainant's Appeal, and Respondent's Reply in light ofapplicable law and policy. Based onthisreexamination, the FAA affirms the Director's Detennination. The Associate Administrator concludes that the Director's Determination is supported by a preponderance ofreliable, probative, and substantial evidence, and is consistentwith applicable law, precedent, and FAApolicy. The Complainant's Appeal does not contain persuasive argwnents sufficientto reverse any portion ofthe Director's Determination. This decision constitutes the final decision ofthe Associate Administrator for Airports pursuantto 14 CFR § 16.33(b). 

### II. SUMMARY OF THE DIRECTOR'S DETERMINATION In its Complaint and Reply, SPA alleged Respondent violated Grant Assurance 22, EconomicNondiscrimination; Grant Assurance 23, Exclusive Rights; and GrantAssurance 24, Fee andRentalStructure. The Complainant claimedthat Respondent engaged in

2economic discriminationby demanding SPA enter into tbe newproposed LFBO lease with objectionable conditions. SPA further alleged that Respondent demanded that SPAperform a minimum often (10) tbird party annual aircraft inspections per annum. SPA alleges tbat Respondent is forcing SPAto alter its fundamental business by engaging in a business which it has notheretofore engaged. Finally, SPA alleged that Respondent was failing to creditthe number ofannual inspections performed by SPA's managing member, Walter Iversen,2 on aircraft ownedbyhimself, his spouse or SPA against the 10 third party minimum. FAAExhibit 1, Item 20, p. I. The Director determined tbat tbe following issues required analysis to provide a complete review ofRespondent's compliance witb applicable Federal law and policy: 1. Whether Respondent is in violation ofGrant Assurance 22, Economic Nondiscrimination, byrequiring tbat Complainant (SPA) agree to a set ofnew Minimum Standards for Fixed Base Operationthat would require changes to SPA's business model. 2. Whether Respondent is in violation ofGrant Assurance 23, Exclusive Rights, by requiring that Complainant meet tbe terms ofrevised Minimum Standards in order to receive incentives and subsidies. 3. Whether Respondent is in violation ofGrant Assurance 24, Fee andRental Structure, by offering a financial incentive programto increase business attbe airport. FAA Exhibit I, Item 20, pp. 16-17. Witb respect to tbe first issue, the Directorfound that Respondent hadjustified changes to the minimum standards, when Respondent explained that attracting, developing, and sustaining meaningful tbird party maintenance services would facilitate growth at Lake Cumberland Regional Airportby attracting more users and allowing the Airport to generate additional revenue streams. Regarding the second issue, the Director concludedtbat SPA itselfwas neither a certificated aircraftrepair stationnorhad the ability to conduct annual inspections. Thus, it could not hold itselfoutto tbe public to conduct annual inspections. It was reasonable to conclude that SPA was not a traditional Fixed Base Operator (FBO? but an aircraft refurbisher and

2 The FAA Record contains references to Mr. Walter P. Iversen with his name being spelled "Iversen" and "Iverson." It appears that Mr. W. Thomas Halbleib, Jr., used the spelling "Iverson" in his letter dated February 13,2013, addressed to "Wally Iverson." FAA Exhibit 6, Item L. He further uses that spelling in bis e-mail dated January 27,2013, to Ms. Winter R. Huff. FAA Exhibit 6, Item N. The Director uses the spelling "Iverson" thirteen times in non-quoted references in the Director's Determination. Numerous citations omitted. The Associate Administrator accepts "Iversen" as the correct spelling because that is the spelling contained in Mr. Iversen's Affidavit. FAA Exhibit 1, Item 24, Exhibit A. 3 A fixed-base operator (FBO) is a commercial entity providing multiple aeronautical services such as fueling, maintenance, storage, ground and flight instruction, etc., to the public. FAA Order 5 I90.68, Appendix Z, p. 314.

3reseller. The Director explainedthat Grant Assurance 23, Exclusive Rights, does not preclude a sponsor from modifYing minimum standards to reflect changing needs and to protectthe public interest. The Director compared this analysis to that in the analysis of Issue 1, and concluded thatthe grant assurances do not require sponsors to develop and implementminimum standards. However, FAA policy specifies that sponsors choosing to establish minimum standards should apply them objectively and uniformly to all similarly situated on-airport aeronautical service providers. FAA Exhibit 1, Item 20, pp. 24-25. Regarding the third issue, the Complainant argued that the incentives the Airport Board providedto Somersetwere dramatically disproportionate to those offeredto SPA. The Director found that SPA was not similarly situatedto Somerset. He further found no evidence that Respondent had required SPA to change its business model. He found no sufficient evidence to support Complainant's claimthat Respondent offered incentives to Somersetthat were dramatically disproportionate or different to those offered to the Complainantto sustain a Grant Assurance 24 violation. FAA Exhibit 1, Item 20, p. 27. The Director found that Respondent was currently not in violation ofits Federal obligations with respect to Grant Assurance 22, EconomicNondiscrimination; Grant Assurance 23, Exclusive Rights; and GrantAssurance 24, Fee andRentalStructure. FAA Exhibit 1, Item 20, p. 2. III. PARTIES A. The Airport The Lake Cumberland Regional Airport (KSME or Airport) is a federally-funded, public use, general aviation airport owned and operatedby Somerset-Pulaski County, Kentucky. The 288-acre facility is located three miles south ofSomerset, Kentucky. As ofMarch 31, 2016, ithad 29 based aircraft. The Airport had 36,628 operations for the 12-monthperiod ending July 24, 2013. The airport has one pavedrunway approximately 5,800 feet long. FAA Exhibit 1, Item 32. The development ofthe Airporthas been financed, in part, with funds provided to the County as the Airport sponsorunder the Airport Improvement Program (AlP), authorized by the Airport andAirway ImprovementActof 1982, as amended, 49 U.S.C. 47101, etseq. As a result, the County is obligatedto comply with the FAA sponsor assurances and related Federal law, 49 U.S.C. 47101. The mostrecent grants awarded include $82,875 in 2012 and $99,423 in 2014, both for obstruction removal. FAA Exhibit 1, Item 19. B. Complainant/Appellant The Complainant, SPA Rental, LLC, d/b/a/ MSI Aviation, was a LimitedFixed Base Operator (LFBO) under a prior agreement withthe Airport. The companyhas been engaged inpurchasing, refurbishing and reselling aircraft from two privatelybuilthangars that have since reverted to the Airport. FAA Exhibit 1, Item 1, page 1. Operating from KSME since 1986, the Complainant is currently classified as a holdover tenantunderthe hangar leases that expired on December 31, 2011. FAAExhibit 1, Item 6, Exhibits C and E.

4IV. BACKGROUND AND PROCEDURAL HISTORY 

### A. Background SPA describes itselfas "engaged inthe business ofpurchasing, refurbishing, and re-selling aircraft" from two leased hangars, Hanger B-3 and Hanger B-4, at the Lake Cumberland Regional Airport. FAA Exhibit I, Item I, p. I. SPA constructedboth hangars, sharing one common wall, atits own expense. Hanger B-3 is a 2,400 square foot structure completed in 1988. Hanger B-4, completed in 1992, is 3,200 square feet. The hangars became the property ofthe Airport Board on January I, 2009, upon expiration ofthe ground leases between SPA and the AirportBoard. FAAExhibit I, Item 5, pp. 4-5. Walter Iversen is anFAA aircraft maintenance technicianholding anAirframe and/or Powerplant (A & P) certificate accredited with an Inspection Authorization. He has provided mechanical repairs, including airworthiness inspections, to aircraft owned by SPA, himself, and his spouse, from the leasedhangars. Three aircraft, owned Mr. Iversen, the managing director ofSPA, andhis spouse, are stored inthe two hangars. During its history at KSME, SPA mechanics have neverperformed, in any 12-monthperiod, more than three I00-hour or annual inspections for aircraftbeing refurbished and held for resale. SPA did not provide details ofthe number ofaircraft ithas purchased, refurbished and then sold from its hangar facilities at KSME. SPAhas not conducted airworthiness inspections of aircraft to the general public. FAA Exhibit I, Items I and 5. SPA's last "Limited Fixed Base Operator" (LFBO) agreementbecame effective on June 30, 2009. As stated in the LFBO Agreement, automatic renewal required that SPA continue to meet all ofthe required qualifications contained in the Agreement. The Agreement states that SPA "shall operate a limited fixed base operation (aircraft, engine and accessories maintenance) in a 40 x 142 foot airplane hangarknow as Hangar B3 and Hangar B4."4 The Agreement also specifies that SPA "may also store two (2) non-owned aircrafts and manage said aircraft[s] for another byproviding pilots, light maintenance and upkeep." In addition, the Agreement states that SPA "shall comply with all ofthe Minimum Standards for Fixed Base Operations at the Lake Cumberland Regional Airport as they are amended from time to time." FAA Exhibit I, Item I, Exhibit A. By letter dated November 29, 2012, Respondent provided SPAnoticethat all three agreements (LFBO and two hangar lease agreements) terminated on December 31, 2012, and that SPA must vacate the hangars by that date. FAA Exhibit I, Item 6, ExhibitE. Since January 1, 2013, SPAhas continuedto occupy Hangar B-3 and Hangar B-4 atthe Lake Cumberland Regional Airport as a holdover tenant. FAA Exhibit 1, Item 5, p. 9. Effective March 24,2012, the Board approved Somerset Regional Aviation, LLC, (Somerset) to establish an LFBO at the airport, operating from a 4,800 square foot hangar (Hangar I0), for the purposes ofperforming aircraftrepairs, maintenance, and airworthiness

4 The LFBO Agreement lists the total square footage ofthe Hangars B-3 and B-4 as 5,680 square feet. FAA Exhibit 1, Item 1, Exhibits A and C.

5inspections ofaircraft. FAA Exhibit 1, Item 1, pp. 2-3. The one-year LFBO and Hangar 10 lease agreements both include a provision allowing Somerset to extend the LFBO Agreement and Hangar Lease for two successive periods ofone year each. The fee for each year ofthe LFBO Agreement was one dollar. For the Hangar 10 Lease, the Airport Board waivedrental fees in considerationfor the on-site maintenance services that Somerset agreed to provide to the public under the terms ofthe LFBO Agreement. In addition, the Airport Board agreed to reimburse Somerset for the lease-mandatedpublic liability insurance premiums in an amount notto exceed $8,000 pertwelve month period. FAA Exhibit 1, Item 5, p. 5 and FAA Exhibit 1, Item 6, ExhibitF. On April4, 2012, Mr. James H. Williams, FAAMemphis ADO, wrote to Ms. Kellie Baker, Airport Manager, Somerset-Pulaski County Airport, seeking clarificationregarding the new LFBO Agreement with Somerset. Specifically, Mr. Williams sought clarification ofthe following:

• Has an existing FBO atthe airport expressed a desire to exercise a contract continuation clause? Ifnot, specifythe reasons for not renewing the contract.

• Why did the newspaper advertisement seeking an FBO not mention the availability ofa less than marketrate incentive package?

• Giventhat the Airport Board received two proposals in response to the ad, explain why the continuedpresence ofSPA in conjunction with the interest oftwo potential FBO's did not negate the needfor incentives? Mr. Williams cautioned Ms. Bakerthat "fees and hangarrental well below fair market value violates the grant assurances and couldbe considered as 'Revenue Diversion."' Mr. Williams further explained that "theseterms would make itunreasonably costly or impractical for the airport to have more than one fixed-based operator because they would be subjectto the same rates, fees, rentals as the other tenants making same or similar uses of the airport." FAA Exhibit 1, Item 6, Exhibit G. On April 19, 2012, SPA filed aninformal complaintin the form ofa letter from Winter Huff, an attorney representing Complainant, to James H. Williams, FAA, citing refusal of the Boardto renewthe LFBO agreement with SPA while providing incentives to Somerset. In its informal complaint, SPA alleges that: (1) the Sponsorhadrefused to renew the LFBO Agreement with SPA; and (2) the Sponsorhad offered "discriminatory incentives to Somersetto the detriment ofSPA." FAA Exhibit 1, Item 1, p. 3; and Item 1, Exhibit E. OnApril23, 2012, John T. Mandt, an attorney representing the Somerset-Pulaski County Airport Board, replied to Mr. Williams' letter ofApril4, 2012, answering the questions posed in the April 4 letter, detailing the rationale for the new LFBO Agreement, and providing background onthe incentive plan. Inreply to Mr. Williams' first question, Mr. Mandt explainedthat the Airport Boardnotified SPAthat it's LFBO Agreement and Hangar Lease, set to expire onDecember 31, 2011, "would expire as written." Mr. Mandt also maintainedthat SPA "has no maintenance customers and has not for many years."

6Responding to the second question, Mr. Mandt statedthat the requirement for incentives originated with the bidders, rather than the Airport Board. Addressing the third question, Mr. Mandt reiterated that the need for incentives originated with the bidders. He also clarified that SPA "did not submit a bid and to the Board's knowledge none ofthe present users ofthe Airport do business with him." FAAExhibit I, Item 6, Exhibit G. OnMay 9, 2012, the FAA Southern Region Memphis Airports District Office (Memphis ADO) issued a finding addressing the allegations raised in the informal complaint The Memphis ADO determined that "this lease agreement fails to meetthe Terms and Conditions ofAccepting AlP Grants as stated in Grant Assurances 24." FAA Exhibit I, Item I, Exhibit D. The Memphis ADO further wrote that "inits opinion, the incentives included in the lease agreement make itunreasonably costly orimpractical for the airport to have more than one fixed based operator. Therefore, we request that you terminate this lease agreement ormodified (sic) itto show compensationbased on fair market value." FAA Exhibit l, Item I, Exhibit D. The FAA specifiedthat the Airport Board should respond with a course ofconective action to the Memphis ADO no later than May 31,2012. FAA Exhibit 1, Item 1, Exhibit D. OnMay 18, 2012, Mr. Tom Halbleib, counsel for the Airport Board, replied to FAA's conespondence from May 9, 2012, and agreed to respond with a planofconective action. FAA Exhibit I, Item 6, Exhibit 

### H. On July 23,2012, Mr. Richard Van Hook, Chairman ofthe Airport Board's Maintenance Committee wrote to FAA's Mr. James Williams, outlining a conective action planto address FAA concerns. The letter explained the proposed incentive program was developed to ensure availability ofmaintenance services at the Airport, and describing the source of funding from the local occupational license fee. Mr. Van Hook described the subsidy incentive as consisting of"the deferral ofrent for no more than one hangar leased from the Airport Board and the reimbursement ofcertain insurance costs (up to $8,000 toward the cost ofa general commercial liabilitypolicy that names the Airport Board as an additional insured with limits in an amount not less than $1,000,000)." The funding source ofthe incentive program Mr. Van Hook advised was viaPulaski County assessing an occupational license fee on all people working in the county. He confmned that the fee is not related to the use ofthe Airport, nor would itbe subject to FAA's Revenue Use Policy. FAA Exhibit I, Item 6, ExhibitB. Additionally, Mr. VanHook explained that giventhe Airport Board's interest in establishing and maintaining a meaningful volume ofthird party paid maintenance on the Airport, the Board would armually confirm that any recipient ofincentives had completed no fewer than ten (10) third party armual inspections. He further advised that any incentive recipient failing to meetthe inspection volume threshold, would be required to paythe rent as well as reimburse the Airport Board for the insurance. FAAExhibit 1, Item 6, Exhibit B. Mr. Van Hook also stated that ifthe proposed corrective action plan satisfactorily addressed FAA concerns then, pending Airport Board approval, amendments to the Hangar 10 Lease,

7the LFBO Agreement, and Minimum Standards would be forwarded to Somerset for execution. Mr. VanHook clarifiedthat SPA and any othermaintenance service provider on the Airport would be offered the same arrangement. Finally, Mr. Van Hook noted that the Airport Board wouldtruncate the LFBO Agreementto one year, allowing the Airport Board to solicit bids, includingthe incentivepackage, for a maintenance provider atthe end ofone year. FAA Exhibit 1, Item 6, ExhibitB. On August 7, 2012, Tom Halbleib forwarded to FAA's James Williamsjustification ofthe proposed threshold ofcompleting ten annual aircraft inspections in orderto qualify for the incentive. Mr. Halbleib explainedthatthe development ofmeaningful third party maintenance services would facilitate growth and development at Lake Cumberland Regional Airportby attracting more users and allowing the Airportto generate additional revenue streams. FAA Exhibit 1, Item 6, Exhibit I. Mr. Halbleib emphasized that based onthe Airport Board's Maintenance Committee analysis settingthe thresholdbelowten annual inspections would riskthe incentive exceeding the revenues generatedbythe incentive. FAA Exhibit 1, Item 6, Exhibit I. OnAugust 21, 2012, Mr. Phillip J. Braden, FAA Manager, Memphis ADO, in a letter to Mr. Van Hook, Chairman Somerset-Pulaski County Airport BoardMaintenance Committee, concurred with the Airport Board's "concept ofproviding incentives to promote additional commercial activities leading to additional airport revenue ... providedthat these incentives are not funded with airport revenue." Mr. Braden advisedthat FAA does not objectto the Airport Boardusing non-airportrevenue as the source offunding for the incentives. Finally, Mr. Braden stressed thatthe incentive program would have to "be applied on an equal basis to all involvedparties." FAA Exhibit 1, Item 6, Exhibit A. On September 21,2012, the Airport Board and Somerset agreedto an amendment ofthe LFBO Agreement, as well as corresponding Minimum Standards, andthe Hangar Lease Agreement. Modifications to the LFBO Agreement include:

• a provisionthatthe Airport Board would advance paymentto Somerset for the cost ofpublic liability insurance "in an amountnotto exceed $8,000."

• a reporting requirement that Somersetreport to the Airport Board "the number of FAA Annual Inspectionthe Second Party [Somerset] performed at the Airport, and for whichthe Second Party collected a reasonable fee, for urrrelated third parties ('Paid Third Party Annuals') during the immediately preceding year."

• a confirmed report indicating that Somerset performedten (10) or more Paid Third Party Annuals during the preceding yearwill result inthe Airport Board forgiving Somerset's obligationto repaythe insurance advance.

• failure to meet or exceedthe armual inspectionthreshold will require Somerset to immediatelyrepaythe insurance advance within ten days ofnotice.

8FAA Exhibit 1, Item 6, ExhibitF. The Amendmentto the accompanying Minimum Standards detailed the new reporting requirements in addition to a new section describing the incentive as follows:

• "Section 10. MAINTENANCE SUBSIDY INCENTIVE. The Airport Board in its sole discretion may from time to time determine that there exists insufficient availability ofaircraft maintenance services atthe Airport and, to incentivize the provision ofsuch services, grant subsidy incentives onthe terms and subjectto the conditions set forth in the attached July 23, 2012, letter from the Chairman of the Airport Board's Maintenance Committee to the Federal Aviation Administration."

• "During any period when such subsidy incentives are offered, they will be offered to all similarly situated providers ofmaintenance services at the airport."

• "The corresponding amendment to the Hangar Lease at Section 7 addresses the insurance premiumprovisions covered inthe amended LFBO Agreement."

• "In addition, Section 2 ofthe amended Hangar Lease is modified to include the provision ofrent abatement inthe amount of$400 each month provided that Somerset is able to meet or exceedthe ten ThirdParty Annual thresholds detailed above." FAA Exhibit 1, Item 6, Exhibit F. On October 2, 2012, Mr. Halbleib sent to Winter Huffa form ofhangar lease (for Hangar B-3 only) and a form ofLFBO agreement includingproposed modifications to minimum standards. Mr. Halbleib confirmedthat the forwarded agreements "are substantially identical to those under which Somerset Regional Aviation will operate, upon completion of amendmentsto its Lease and FBO Agreement to conformto the Airport Board's recent actions." Mr. Halbleib further stipulates "[I]fother maintenance providers come onto the Airportbefore the Board modifies its actions, they too will be operatingpursuantto Leases and FBO Agreements substantiallythe same as these." FAA Exhibit 1, Item 6, ExhibitM. OnNovember 29, 2012, Mr. Halbleib, via email to Winter Huff, statedthat this letter constitutes notice ofthe Airport Board's intent to not renew the LFBO Agreement, the Hangar B-3 Lease and the HangarB-4 Lease. Mr. Halbleib clarified "[T]o the extent any of the Agreements have not previouslybeen effectively terminated, all three willterminate on December 31, 2012." FAAExhibit 1, Item 6, ExhibitE. Mr. Halbleib reiterates "Ihave submittedto you proposed amendments for SPA Rental, LLC's consideration. Iunderstand that you continue to assist SPA Rental, LLC, with its consideration ofthese documents. Although the Board remains willing to discuss those amendments until December 31, 2012, ifSPA Rental, LLC, has not reached an agreement withthe Boardbythat date, the Board will expect itto vacate Hangars B-3 and B-4 in accordance withthe terms ofthe leases and

9to discontinue any operations as a fixed base operator at the Airport." FAA Exhibit I, Item 6, Exhibit E. OnJanuary 27, 2013, a number ofemail communications occurred between Winter Huff and Tom Halbleib. Ms. Huffclaims "Since SPAhas no ownership interest in any airplanes, and since the Board is apparently unwilling to include Hangar B-3 in the LFBO arrangement otherwise, ourrequest to change the identification ofthe Lessee is appropriate and reasonable, and would have no substantive effect on your client." FAA Exhibit I, Item 6, ExhibitN. Mr. Halbleib replied that he had notbeen aware that MSI (SPA) had no interest in aircraft, emphasizing "The pre-existing B-3 lease already limits the use ofthe space to the housing ofaircraft owned or leasedby MSI. Should I infer that MSI has beenhousing the Iverson's [sic, Iversen's] aircraft in violation ofthe pre-existing leases?" Mr. Halbleib clarifies "The Iverson's [sic, Iversen's] can then request that the Airport Board lease B-3 to them in the ordinary course ofbusiness, but I'm in no positionto provide any assurance that it would be offered to them or upon what terms it might be offered. IfMSI wants to continue negotiating other arrangements, it will first need to vacate the premises it currently occupies." FAAExhibit I, Item 6, ExhibitN. Ms. Huffcountered in aresponding email, "Itis my understanding that the prior usages of the B-3 hangar were in accordance with the terms and provisions ofthe 2009lease[s], the last one offeredby your client." Ms. Huffstressed "thatthe B-3 and B-4 hangars were both builtby my client at great expense, and we advised you early on that any new arrangement had to encompass bothhangars." Ms. Huffconcludes "Itis notour fault that these issues concerning B-3 have arisen this month- we didn't get a timely lease proposal for B-3 at all, and when we finally did it was neither consistent withthe oldterms or the new, nor, as I understand it, consistent with the square footage ofhangar space being made available to the other LFBO." FAA Exhibit l, Item 6, Exhibit N. OnFebruary 7, 2013, Mr. Walter Iversen submittedto Kellie Baker, Airport Manager, an open record request, seeking copies ofspecific current and expired hangar leases, as well as Somerset's LFBO Agreement. FAA Exhibit l, Item 6, Exhibit L. OnFebruary 13,2013, Mr. Halbleib replied to Mr. Iversen confirming the Airport Board wouldprovide to Mr. Iversen, by February 14,2013, itspublicrecords that are responsive to his request under Kentucky's Open Records Act, KRS 61.870-84. FAA Exhibit I, Item 6, Exhibit L. OnApril25, 2013, Mr. Iversen submittedto Somerset-Pulaski County Airport Board a proposal to enter into an LFBO agreement. SPA proposedto continueto occupy Hangars B3 and B4 for an initial lease term ofthree years with an optionto renew for seven additional one year terms. SPA would pay $400 permonth inrent for the facilities ifthe Airport Board would provide "incentives consisting ofrental abatement and forgivable advance up to $8,000 as indicated in invitation for proposals published on April20, 2013." FAA Exhibit I, Item 9, Exhibit 

### I.

10On June 18,2013, Mr. Halbleib replied to Komad Kuczak, counsel for the Complainant, explaining thatprotracted discussions and negotiations with the Complainant ended when MSI "advisedthe Airport Boardthat it would proceed only ifthe Airport Board allowed Mr. Iverson [sic, Iversen], individually, to lease one ofthe two hangars previously leased to MSI." Mr. Halbleib added, "[T]he Complaint MSI filed with the FAAindicates that MSI intends to use Hangars B-3 and B-4 for maintenance and restoration ofaircraft it owns. MSI has shown no willingness to remedy it's [sic] past failures or comply with generally applicable Airport Boardpolicies. Underthe totality ofthe circumstances, the Airport Board declines MSI's proposal." FAA Exhibit 1, Item 9, Exhibit 2. 

### B. Procedural History The Complainant filed a Part 16 Formal Complaint dated March 27,2013, alleging Respondent violated 49 U.S.C. 40101 

### etseq., 47101 

### etseq., and GrantAssurance 24. FAA Exhibit 1, Item 1. On September 1, 2015, the Director issued the Director's Determination. FAA Exhibit 1, Item 20. On September 15, 2015, SPA filed a Motion for Extensionto File Notice ofAppeal and Brief. FAAExhibit 1, Item 21. On September 28, 2015, the FAA issued an Order extending time for filing Appeal to November 2, 2015. FAA Exhibit 1, Item 22. On October27, 2015, SPA filed its Notice ofAppeal and Briefin support ofits Appeal. FAA Exhibit 1, Item 23 and 24. On November 6, 2015, Respondent filed a Motion for Additional Time to Respond to Appeal. FAA Exhibit 1, Item 25. OnNovember 23, 2015, the FAA issued an Order extendingtime for Respondent's Response. FAA Exhibit 1, Item 26. OnDecember 18,2015, Respondent filed its Response to SPA'sAppeal ofthe Director's Determination. FAA Exhibit 1, Item 27. On December 23,2015, SPA filed a Motion for Leave to File Reply to Respondent's Brief dated. FAA Exhibit 1, Item 28. On January 8, 2016, the FAA issued an Order denying SPA's Motion. FAA Exhibit 1, Item 29. OnMarch4, 2016, the FAA issued a Notice ofExtension ofTime until May 31,2016. FAA Exhibit 1, Item 30.

11OnJune 8, 2016, the FAA issued a Notice ofExtension ofTime until July 31, 2016. FAA Exhibit I, Item 31. 

### V. APPLICABLE LAW AND POLICY The following is a discussion pertaining to (A) the Airport Improvement Program; (B) the FAA compliance program; (C) statutes, sponsor assurances, and relevant policies; (D) minimum standards; and (E) the complaint and appeal process. 

### A. The Airport Improvement Program Section 47101, etseq., ofTitle 49 U.S.C. provides for Federal airport financial assistance for the development ofpublic-use airports under the Airport Improvement Program (AIP) established bythe Airport and Airway Improvement Act of 1982, (AAIA) as amended. Section47107 sets forth assurances to which an airport sponsor agrees as a condition of receiving Federal financial assistance. Upon acceptance ofan AIP grant, the assurances become a binding obligation betweenthe airport sponsor and the Federal Government. The assurances madeby airport sponsors in AIP grant agreements are important factors in maintaining a viable national airport system. 

### B. FAA Airport Compliance Program The FAA discharges its responsibility for ensuring that airport sponsors comply with their federal obligations through its Airport Compliance Program. The airport owner accepts these obligations whenreceiving federal grant funds or when accepting the transfer of federal property for airport purposes. The FAA incorporates these obligations in grant agreements and instruments ofconveyance to protectthe public's interest in civil aviation and to ensure compliance with federal laws. The FAA designed the Airport Compliance Program to ensure the availability ofa national system ofsafe and properly maintained public-use airports which airport sponsors operate in a manner consistent with their federal obligations and the public's interest in civil aviation. The Airport Compliance Program does not control or direct the operation of airports. Rather, it monitors the administration ofvaluable rights, which airport sponsors pledge to the people ofthe United States in exchange for monetary grants and donations of federal property, to ensure that airport sponsors serve the public interest. FAA Order 5190.6B, FAA Airport Compliance Manual, September 30, 2009, (hereinafter Order) sets forth policies and procedures for the FAAAirport Compliance Program. The Order is notregulatory and is not controlling with regard to airport sponsor conduct; rather, it establishes thepolicies and procedures for FAA personnel to follow in carrying out the FAA's responsibilities for ensuring airport compliance. The Order, interalia, analyzes the various obligations set forth inthe standard airport sponsor assurances, addresses the application ofthe assurances in the operation ofpublic-use airports, and facilitates interpretation ofthe assurances byFAApersonnel.

12In addressing allegations ofnoncompliance, the FAA will make a determination as to whether an airport sponsor is currently in compliance with the applicable federal obligations. Consequently, the FAA will considerthe successful action by the airport to cure any alleged orpotential past violation ofapplicable federal obligation to be grounds for dismissal ofsuch allegations. See e.g. Wilson Air Center v. Memphis and Shelby County Airport Authority. FAA DocketNo. 16-99-10, August 30, 2001, Final Decision and Order, p. 5.Affirmed, WilsonAir Center. LLC v FAA, 372 F.3d 807, 6th Cir. 2004. C. Statutes, Sponsor Assurances, and Relevant Policies As a condition precedentto providing airport development assistance under AIP, the Secretary ofTransportation, and by extension, the FAAreceives certain assurances from the airport sponsor, including the statutory sponsorship requirements under 49 U.S.C. 47107(a). The FAA has a statutory mandate to ensure that airport owners comply with these sponsor assurances.5 Three grant assurances apply to the specific circumstances ofthis complaint: Grant Assurance 22, EconomicNondiscrimination; Grant Assurance 23, Exclusive Rights; and Grant Assurance 24, Fee andRentalStructure. 1. Grant Assurance22,EconomicNondiscriminarion. Grant Assurance 22, EconomicNondiscrimination, requires the owner ofany airport developed with Federal grant assistance to operate the airport for the use and benefit ofthe public andto make it available to all types, kinds, and classes ofaeronautical activity onfair and reasonable terms, and without unjust discrimination. GrantAssurance 22 deals with both the reasonableness ofairport access and the prohibition ofadopting unjustly discriminatory conditions as a potential for limiting access. Grant Assurance 22 implements the provisions of49 U.S.C. 47107(a)(l)-(6), and requires, inpertinentpart, that the sponsor ofa federally obligated airport: (a) will make its airportavailable as an airport forpublic use onreasonable terms, andwithout unjust discrimination, to all types, kinds, andclasses of aeronautical activities, including commercialaeronautical activities offeringservices to the public at the airport. (h) may establish such fair, equal, andnotunjustly discriminatory conditions to be met by all users of the airportas may be necessary for the safe andefficient operation of the airport.

5 See, e.g., Federal Aviation Act of1958, as amended and recodified, 49 U.S.C. 40101, 40113, 40114, 46101, 46104, 46105, 46106, 46110; Airport and Airway Improvement Act of 1982, as amended and recodified, 49 

## u.s.c. 47105(d), 47106(d), 47107(k), 47107(1), 471ll(d), 47122.

13(i) may ... limit anygiven type, kind, or class of aeronautical use of the airport 

### if such action is necessary for the safe operation of the airport or necessary to serve the civilaviation needs of thepublic. Subsection (h) qualifies subsection (a), and subsection (i) represents an exceptionto subsection (a) to permitthe sponsor to exercise control ofthe airport sufficient to preclude unsafe and inefficient conditions that would be detrimental to the civil aviation needs ofthe public. FAA Order 5190.6B describes the responsibilities under Grant Assurance 22 assumed by the owners or sponsor ofpublic use airports developed withFederal assistance. Among these is the obligationto treat in a uniform mannerthose users making the same or similar use ofthe airport and to make all airport facilities and services available onreasonable terms without unjust discrimination. See FAA Order 5190.6B, Chapter 9. 

### 2. GrantAssurance 23, 

### ExclusiveRights. Grant Assurance 23, Exclusive Rights, implements the provisions of49 U.S.C. 40103(e) and 47107(a)( 4), and requires, inpertinentpart, that the owner or sponsor ofa federally obligated airport: willpermitno exclusive right for the use of the airport byanypersons providing, or intending toprovide, aeronautical services to thepublic. will not, either directly or indirectly, grant orpermitanyperson,firm, or corporation, the exclusive right atthe airport to conductanyaeronautical activities

... In Chapter 8 ofFAA Order 5190.6B, the FAA discusses its exclusive rights policy and broadly identifies aeronautical activities as subject to the statutoryprohibition against exclusive rights. While public-use airports may impose qualifications and minimum standards uponthose who engage in aeronautical activities, FAAhas taken the position that the application ofany unreasonable requirement or any standard that is applied in an unjustly discriminatory manner may constitute the constructive grant ofan exclusive right. Courts have found the grant ofan exclusive right where a significantburden has been placed on one competitorthat is not placed on another. See, e.g., Pompano Beachv FAA, 774 F2d 1529 (11th Cir., 1985). 

### 3. GrantAssurance 24, 

### Fee andRentalStructure Grant Assurance 24, Fee andRentalStructure, implements 49 U.S.C. 47107(a)(13) and reqmres: [The airport owner or sponsor} will maintain a foe andrental structurefor thefacilities andservices atthe airport thatwill make the airportas selfsustainingaspossible under the circumstances existingattheparticular

14airport, taking into accountsuchfactors as the volume of traffic and economy of collection. The owner or sponsor's obligationto make an airport available for public use does not precludethe owner or sponsor from recovering the cost ofproviding the facility. The owner or sponsor is expectedto recover its costs through the establishment offair, reasonable, and notunjustly discriminatory fees, rentals, orotheruser charges that will make the airport as self-sustaining as possible under the circumstances existing atthe particular airport. See FAA Order 5190.6B, FAA Airport Compliance Manual, Chapter 17, Self-sustainability. In addition, Section 9.6.e ofFAA Order 5190.6B states: To aidin establishing uniform rates andcharges appliedto aeronauticalactivities on the airport, the sponsor shouldestablish minimum standards to be met as a conditionfor the right to conduct an aeronautical activity on the airport. 

### D. Minimum Standards Advisory CircularAC 150/5190-7, Minimum Standards for CommercialAeronautical Activities, provides basic informationpertainingto the FAA's recommendations on commercial minimum standards and related policies. Although minimum standards are optional, the FAA highly recommends their adoption as a means ofminimizingthe potential for violations ofFederal obligations at Federally obligated airports. The FAA's policy recommending minimum standards stems from the airport sponsor's grant assurances to make the airport available for public use onreasonable conditions and withoutunjust discrimination. The FAA objective inrecommending the development of minimum standards serves to promote safety in all airport activities, protect airport users from unlicensed and unauthorized products and services, maintain and enhance the availability ofadequate services for all airport users, promote the orderly development of airport land, and ensure efficiency ofoperations. Oncethe airport sponsorhas established minimum standards, it should apply them objectively and uniformly to all similarly situated on-airport aeronautical service providers. The failure to do so may result in a violation of the prohibition against exclusive rights and/or a fmding ofunjust economic discrimination for imposing unreasonable terms and conditions for airport use.

Minimum standards can be amended periodically overtime; however, a constantjuggling of minimum standards is not encouraged. The FAA expects airport sponsors to apply their minimum standards consistently through their interactions with aeronautical users and serviceproviders. Withthat said, the standard ofcompliance does notrequire that airport sponsors enforce minimum standards so rigidly as to require identical tone andposture toward all airport users that have different records and history with the sponsor. Aircraft Management Services. Inc. v. SantaRosa County. Florida, FAADocketNo. 16-12-02, March 27,2015, Director's Determination, p. 15; citingRick Aviation. Inc. v. Peninsula Airport Commission, FAADocketNo. 16-05-18, May 8, 2007, Director's Determination, p.

1516; Rick Aviation Inc. v. Peninsula Airport Commission, FAA Docket No. 16-05-18, November 6, 2007, Final Decision and Order, p. 9; and Springfield Flight Academy v. City ofSpringfield, FAA DocketNo. 16-10-03, August 25, 2011, Director's Determination, p. 15.Also see FAA Advisory Circular 150/5190-7, Minimum Standards for Commercial Aeronautical Activities, p. 4. 

### E. The Complaint and Appeal Process 1. 

### Filing a Formal Complaint Pursuant to 14 CFR § 16.23, a person directly and substantially affected by any alleged noncompliance may file a complaintwith the FAA. The complainant shall provide a concise but complete statement ofthe facts relied upon to substantiate each allegation. The complaint shall also describe howthe complainant was directly and substantially affected by the things done or omitted bythe respondents. 14 CFR § 16.23(b)(3)-(4). If, based onthepleadings, there appears to be a reasonable basis for further investigation, the FAA will investigate the subject matter ofthe complaint. Inrendering its initial determination, the FAA may rely entirely onthe complaint andthe responsive pleadings provided. Eachparty shall file documents that it considers sufficient to present all relevant facts and arguments necessary for the FAAto determine whetherthe sponsor is in compliance. 14 CFR, § 16.29(b)(l). Part 16 further provides that the burden ofproofis on the complainantto show noncompliance with a statute, regulation, order, agreement, or document ofconveyance. 14 CFR § 16.23(k)(l). The proponent ofa motion (including a motionto dismiss, or for summaryjudgment), request, or orderhas the burden ofproof. 14 CFR 

### § 16.23(k)(2). Additionally, a party who has asserted an affirmative defense has the burden ofproving the affirmative defense. 14 CFR § 16.23(k)(3). 

### 2. Appealing the Director's Determination A party adversely affected bythe Director's Determinationmay file an appeal with the Associate Administrator within 30 days after the date ofservice ofthe initial determination. 14 CFR § 16.33(c). The Associate Administrator does notconsider newallegations or issues on appeal unless finding good cause to do so. 14 CFR § 16.33(£). Reviewbythe Associate Administratoris limited to an examination ofthe Director's Determination andthe administrative record upon which such determination was based. Failure to raise issues and allegations inthe original complaint documents may be cause for such issues and allegations to be deemed waived and not reviewable upon appeaL

163. FAA's Responsibilitywith Regard to an Appeal Pursuantto 14 CFR § 16.33(b)(I), the Associate Administrator will issue a fmal decision on appeal from the Director's Determination, without a hearing, wherethe complaint is dismissed after investigation. In such cases, the Associate Administrator will use the following analysis: (I) Are the findings offact each supported by a preponderance ofreliable, probative, and substantial evidence contained inthe record? (2) Are conclusions made in accordance with law, precedent, andpolicy? (3) Are questions on appeal substantial? (4) Have any prejudicial errors occurred? 14 CFR 

### § 16.33(e); see also, e.g., Ricks v Millington Municipal Aimort, FAADocketNo. 16-98-19, December 30, 1999, Final Decision and Order, p. 21. VI. ISSUES ON APPEAL Upon consideration ofthe Complaintfrom the Complainant, filed withthe FAA onMarch 27, 2013, the FAA Office ofAirport Compliance andManagementAnalysis previously determined Respondent is not currently inviolation ofits federal obligations regarding the issues argued in the Complaint. The specifics ofthese findings are detailed inthe above Section II, Summary ofthe Director's Determination. On appeal, Complainant alleged the Director made errors in interpretingthe evidence and making conclusions from the evidence. Specifically, Complainant argues on appeal the Director: A. Failed to recognize that the Board, by amending the leaseto Somerset Regional Aviation, LLC., (Somerset) Somerset's Limited Fixed Base Operator (LFBO) Agreement, and by amending the AirportMinimum Standardsthe Board unjustly discriminated in favor ofSomersetto the detriment ofSPA. FAA Exhibit I, Item 24, page I. B. ConcludedthatMinimum Standards ofOperationcomply withgrant assurances as long as the Minimum Standards are uniformly, but indiscriminately applied to operators engaged in dissimilar businesses. FAA Exhibit I, Item 24, page 2. Developing these two issues, Complainant argues six points in its appeal: 1. Viewing the massive disparity between the rental structure chargedto Somerset with that offered to SPA based upon the Board's requirement that every operator perform the required ten (10) paid third party annual inspections per annum reveals a violation ofGrant Assurance 22,

### EconomicNondiscrimination. FAAExhibit 1, Item 24, p. 9.

17 

## 'SPA states thatwhile the Director's Determination correctly concludedthat SPA and Somerset were not similarly situated priorto the amendment oftheAirport's Minimum Standards, the Director's Determination ignores the obvious fact that the new Minimum Standards were applicable to all operators onthe airport and would have rendered all operators "similarly situated" by requiring them to go into the "annual inspection" business. Notwithstanding that SPA admits it is not similarly situation with Somerset, it goes on to compare the "massive disparity betweenthe rental rates charged to Somerset and those charged to SPA." SPA concluded thatthe two tenants' rental structure was $29,199 per annum less favorable to SPA. FAA Exhibit 1, Item 24, p. I0. SPA went onto argue thatby cutting SPA'shanger space to 2,400 square feet, SPA was immediately in violation ofthe Minimum Standards. FAA Exhibit 1, Item 24, p. 10. 2. The Director's Determination was based upon the improper assumption that SPA was required to prove that it offered services similar to Somerset. FAA Exhibit 1, Item 24, p. 12. SPA argues that Respondent was required to make the airport available to SPA on reasonable terms. SPA argues that, contraryto the Director's Determination, it was not required to prove that it was similarly situated to any other operatorto require the Boardto offerto renewthe lease on reasonable terms and negotiate in good faith. FAA Exhibit I, Item 24, p. 12. SPA states thatthe Board's amended Minimum Standards require operators who repaired or maintained aircraft or aircraft accessories to prove that they performedten (I0) third party annual inspections in orderto do business on the airport orbe ousted from the airport property. SPA argues thatRespondent applied this standardto all operators at KSME and notjust aircraft maintenance LFBOs. SPA concludes that the appropriate inquiry is not whether the Board properly enactedthe same minimum standards for similar operations, but whether the Board unreasonably applied the same minimum standards to dissimilar operations. FAAExhibit 1, Item 24, p. 12. 3. The Board unlawfully manipulated the amendment to the airport's Minimum Standards to favor Somerset over SPA. FAA Exhibit 1, Item 24, p. 15. SPA argues thatRespondent entered into a lease and LFBO Agreement with Somerset, without any requirement that Somersetperform any annual inspections. In responding to the Informal Complaint Respondent modified the airport's minimum standards to include the performance often (I0) paidthirdparty annual inspections, knowing that SPA was not in the business ofperforming annual inspections ofnon-owned aircraft. SPA argues that consequently, the Board made itimpossible for SPAto continue doing its refurbishment and resale business onthe field. SPA argues that amending the minimum standards for one tenant is illegal. It states that it cannot change its business model to include offering annual inspections to the public because it is not a certified FAA repair station. SPA concludes that by amending its Minimum Standards to include performance ofa maintenance requirement

18Respondent gave exclusive rights to Somerset and discriminated against SPA. FAA Exhibit 1, Item 24, pp. 15-16. 4. The "ten annuals" requirement is unreasonable. FAA Exhibit 1, Item 24, p. 16. SPA argues that itwas notreasonable for the Boardto cut SPA'shangar space andto expect SPAto change its business model to engage in a facet ofaeronautical activities which ithad never done inits history inthat shrunken space while Somersethad4,800 sq. ft. ofhangar space in which to complete its ten (I0) paidthird party annual inspections. SPA argues that it does not hold a certificate qualifying it to perform annual inspections. SPA concludes that it was unreasonable for Boardto require Somersetto perform annual inspections in orderto obtainthe incentives and remain a tenant onthe airport property while imposing the same requirement on SPA. SPA concluded that proofofthe "unreasonableness" ofthe I0-annual requirement is that Somersetwent out ofbusiness. FAA Exhibit I, Item 24, pp. 16-17. 5. The Minimum Standard, as applied, unjustly discriminated against SPA. FAA Exhibit I, Item 24, p. 17. SPA states that the Amended Lease and the Amended LFBO Agreements require Somerset to report the ten (I0) paidthird party annuals ifit is to receive the rent subsidy and the insurance subsidy. SPA argues that failing to produce any ofthe mandatoryreports which Somersetwas required to file confirmed that Somerset failed to satisfythe conditions for the rent and insurance subsidies. The lists of"Annual Inspections" that the Board didproduce are highly suspect. SPA concludes that without evidence that the Board actually enforced the "ten annuals" Minimum Standard in Somerset's case, it is clearthat the Boardunjustly discriminated against SPA by demanding that it adhere to a minimum standard which it disregarded as to Somerset. FAA Exhibit I, Item 24, pp. 17-18. 6. The Director's Determination repudiates the Agency's own interpretation ofits rules. FAA Exhibit I, Item 24, p. 18. SPA states that FAA guidance6 contains a listing ofabout three dozen acceptable subjects of inquiry for the drafting ofminimum standards applicable to specific types ofoperators. SPA finds that "volume ofthe service provided" is not one ofthe appropriate enumerated considerations. Itthen draws the conclusion that the Agency did not consider a minimum volume ofservice to be providedby any operatorto be an appropriate topic for minimum standards. FAA Exhibit 1, Item 24, pp. 18-19. The Appellant concludes its Appeal by saying that Walter Iversenhadbecome personally unpopular with the Boardbecause ofa personality conflictwith some ofthe frequenters of the airport, and his actions personally irritated the powers who operate the airport. SPA concludes that the Board retaliated against SPA by amending the airport's minimum standards in orderto rationalize the intended ouster ofSPA. SPA closes with, "Whether or notthe Board actually enforced the minimum standards in Somerset's case remains

6 § 2.1 (e) ofAppendixC to FAA Order 5190.6B.

19problematical. The plain fact is that nobody appears to be beating downthe door for the opportunity to do business under suchpatently unreasonable conditions." FAAExhibit 1, Item 24, pp. 19-20. For an appeal to be successful, the appellant must demonstrate with evidence thatthe Director (a) made- or failed to make- fmdings offact supported by a preponderance of reliable, probative, and substantial evidence; or (b) made conclusions oflawthat were not in accordance with applicable law, precedent, and public policy. 14 CFR §16.33(e)(l)-(2). The appeal is notan opportunityto reargue the same issues from the initial complaint or to bring new issues forward that were notpresented inthe initial complaint. The arguments contained in SPA's Appeal are the same to those in its Complaint and Reply (Complainant's Memorandum Opposing Dismissal. FAAExhibit 1, Item 9). The arguments are cast in different verbiage stating that the Minimum Standards were indiscriminately applied in a non-uniform mannerto dissimilarly situatedtenants (FAA Exhibit 1, Items 9, p. 10, and 24, p. 2), the requirement compelling operators to perform 10 annual inspections was a violation ofGrantAssurance 22 (FAA Exhibit 1, Items 9, p. 7, and 24, pp. 16-17), it was a violation ofthe grant assurances to make SPA prove that it offered services similar to that ofSomerset (FAA Exhibit 1, Items 9, p. 7, and 24, p. 17), the Minimum Standards favored Somerset over SPA (FAA Exhibit 1, Items 9, p. 11, and 24, p. 19), andthat the requirementto perform 1

### 0 annual inspections was discriminatory against SPA (FAA Exhibit 1 Items 9, p. 8, and 24, p. 18). Issue A: Determine whether the Director erred in failing to recognize thatthe Board, by amending the lease to Somerset, by amending Somerset's Limited Fixed Base Operator (LFBO) Agreement, andby amending the Airport Minimum Standards, unjustly discriminated in favor of Somersetto the detriment ofSPA. FAA Exhibit 1, Item 24, p. 1. SPA argues that Respondent's amending Somerset's lease, Somerset's LFBO Agreement, andthe Airport Minimum Standards resulted in unjust discrimination to SPA. FAA Exhibit 1, Item 24, page 1. Specifically SPA states: When confrontedwith its violations, the Boardsuddenly found it "necessary" to modifYthe airport's minimum standards to include theperformance often (10) paid thirdparty annual inspections, knowing full well that SPA was not in the business of performingannual inspections of non-ownedaircraft. By this transparent artifice, the Boardmade it impossiblefor SPA to continue doing its refUrbishment andresale business on thefield. FAA Exhibit 1, Item 24, p. 15. SPA argues thatby changing the Minimum Standards to now require operators to conduct at least 10 annual aircraft inspections, Respondent was effectivelyrequiring SPAto change its business model to nowbecome a maintenance service provider. FAA Exhibit 1, Item 24, p. 15.

20Respondent argues that it wasjustified in amending the Airport Minimum Standards. It explainedthat attracting, developing, and sustaining meaningful thirdparty maintenance services would facilitate growth at the Airport by attracting more users and allowing the Airportto generate additional revenue streams. FAA Exhibit 1, Item 29, p. 6. Respondent states further that the minimum standards regarding the subsidies also applies only when "there exists insufficient availability ofaircraft maintenance services at the Airport and, to incentivize the provision ofsuch services, grant subsidy incentives" as set forth in correspondence with the FAA. Standards. [The Minimum Standards] state the incentives "will be offeredto all similarly situated providers ofmaintenance services at the airport." FAA Exhibit 1, Item 29, p. 9. While SPA acknowledges itis not a maintenance service provider, it claims entitlementto the incentives available under the Incentive Program. FAA Exhibit I, Item 24, p. 13. Effectively, SPA wants Respondent to offerthe incentives to SPA without SPA's compliance with the Incentive Programrequirements. The Incentive Program requires, among other actions, that maintenance service providers conduct at least 10 annual inspections a year; it was developed in cooperation with the FAA, the purpose ofwhich is to enhance the availability ofmaintenance services to the public at the Airport. Respondent argues, again, that the ten annual inspectionrequirement and the incentives apply to maintenance service providers and not to SPA. Respondent further argues that these terms ofthe Minimum Standards are notmeantto apply to all operators at the Airport and that a different section ofthe minimum standards applies to those businesses selling aircraft from the Airport. FAA Exhibit 1, Item 5, Exhibit M. Conclusion onIssue A The Directoris correct when he concludes: Contrary to SPA's assessment, this sample question section serves merely as a reference guide to assist an airportsponsor informulating effective minimum standards that address some of the types of commercial aeronautical services or activitiesfrequently offeredto thepublic. TheA

### C explains that the sample questions areprovidedto address some of the various types of specific services or activities frequently offered to the public, andis nota limitation on what can be covered in the minimum standards. Accordingly, consistent with the ADO'sAugust21, 2012 letter, an airport sponsor may establish a minimum standardprovision basedon the volume of aparticularservice 

### if justified. FAA Exhibit 1, Item 20, p. 25. Adopting minimum standards is a valid action on the part ofthe airport sponsor. A review ofthe minimum standards indicates that they cover many aeronautical activities and services including FBO services, aircraft maintenance, aircraft sales, aircraft rental, charter operations, and flight training. A review ofthe minimum standards concerning aircraft maintenance shows that, as written, they are not contrary to Respondent's federal

21obligations. The standards outlined by Respondent are generally consistent with FAA's guidance on the matter. The provisions that implement a sound and economic-based approach in managing incentives and competition are in line with FAArecommendations and guidance. Moreover, in light ofthe economic issues documented inthe record, Respondent's actions relating to establishing, updating, and enforcing minimum standards are not onlyjustified, but necessary. As provided in Grant Assurance 22, Respondent mustretain the ability to impose such additional reasonable restrictions or conditions onoperations from time to time it may deem to be necessary in orderto ensure the efficient operation ofthe Airport. See Skydive Mvrtle Beach, Inc., v. Horry County Department ofAimorts, South Carolina, FAA DocketNo. 16-14-05, October 7, 2015, Director's Determination, p. 41. The FAArecognizes thatbothminimum standards and lease terms may change overtime. Leases are legal documents that exist intime and are rarely identical betweenusers because ofdiffering circumstances such as sites , users, negotiations, business plans, economic circumstances, minimum investment requirements, demand, location, venture risk, ownership offacilities, time remaining on contract terms, condition offacilities, and market conditions. Aircraft Management Services, Inc. v. SantaRosa County, Florida, FAA Docket No. 16-12-02, March 27,2015, Director's Determination, p. 22. Also see FAA Order 5190.6, section 9.5(d). Here Somerset and SPA are users with differing circumstances; Somerset was a maintenance service provider, and SPA is an aircraft sales dealer. FAAExhibit I, Item 24, p.13. It is, therefore, permissible for Respondent to have different leases with the two entities, andto have developed minimum standards that address the different concerns of the two entities. The Associate Administrator concludes that Director did not err in his finding; that he correctly found it permissible for the Boardto amendthe lease to Somerset for the reasons statedherein; and in amending the Airport Minimum Standards, the Board did not discriminate in favor ofSomersetto the detriment ofSPA.

Issue B: Determine whether the Director erredin concluding that Minimum Standards ofOperation comply with grant assurances as long as the Minimum Standards are uniformly, but indiscriminately appliedto operators engaged in dissimilar businesses. FAAExhibit 1, Item 24, page 2. Inthe appeal, Complainant argues that applying Minimum Standards in a non-uniform mannerto dissimilarbusinesses is a violation ofthe grant assurances. FAA Exhibit l, Item 24, page 2. The Director was clear in his Director's Determinationthat the businesses must be similar when looking to apply the nondiscriminatory requirement ofGrant Assurance 22.

22The Director quoted from Chapter 9 ofFAA Order 5190.6B that describes the responsibilities under Grant Assurance 22 assumed bythe owners or sponsor ofpublic use airports developed with Federal assistance. The Order states that among these is the obligationto treat in a uniform manner those users makingthe same or similar use ofthe airport and to make all airport facilities and services available onreasonable terms Without unjust discrimination. FAA Exhibit 1, Item 20, p. 11. FAApolicy specifies that sponsors choosingto establish minimum standards should apply them objectively and uniformly to all similarly situated on-airport aeronautical serviceproviders. FAA Exhibit 1, Item 20, p. 25. The Director found thatthe incentives contained in the Minimum Standards and the Airport Leases were offeredto all similarly situated operators at KSME; that is, they were offered to all maintenance service providers at KSME. FAA Exhibit 1, Item 20, p. 22. The Director stated that Complainant did notprovide evidence demonstrating that the Sponsorhad not universally applied uniform Minimum Standards to similarly situated commercial aeronautical tenants onthe airport. Furthermore, Complainant did not articulate how modificationto the Minimum Standards created an exclusive right for Somersetor how the new Minimum Standards would preclude SPA from continuing to engage inits business ofpurchasing, refurbishing, and re-selling aircraft from facilities leasedto it atthe Lake Cumberland Regional Airport. FAA Exhibit 1, Item 20, p. 25. Contraryto Complainant's assertions, Respondent is not "forcing" SPA to become a maintenance service provider so that SPA canreceive the incentive. The incentive was offered to all maintenance service providers under certain conditions (among others, to perform 10 aircraft armual inspections a year) in orderto encourage business at KSME. Respondent did not offerthe incentive to aircraft sales businesses to, for example, achieve a certain number ofaircraft sales, orto aircraft charter businesses to conduct a certain number ofcharter flights. Respondent concluded that servicing aircraftbyperforming armual inspection wouldbring more businessto the airport. It was within the business prerogative ofRespondent to make this decision and such a decision, ifapplied in a uniform marmer to maintenance service providers, is not discriminatory as analyzed inthis issue. Conclusion on Issue B: The Associate Administrator concludes thatthe Director did not err in concluding that Minimum Standards ofOperation comply with grant assurances andthat the Minimum Standards were uniformly applied to all operators similarly situated. The Minimum Standards were not indiscriminately applied to operators similarly situated at KSME. The Respondent is notrequired by the Grant Assurances and current applicable rules, regulations and statutes to apply the Minimum Standards to businesses that are dissimilarly situated. The Complainanthas misappliedthe standard required to determine ifa violation ofGrant Assurance 22 has occurred inthis matter, which causes the Complainant's argument to fail.

23It is not discriminatory for Respondent to non-uniformly apply the Minimum Standards incentives to dissimilar tenants. New Evidence. Complainant offers new evidence in its Appeal stating that subsequent to the issuance ofthe Directors Determination Somerset Aviation has gone out ofbusiness. Complainant argues that this supports its argument that Respondent's application ofits Minimum Standards is discriminatory. However. SPA does not argue thatthis new evidence moots any extant issues. SPA surmises that SomersetAviation went out ofbusiness because it was not profitable trying to satisfy the Minimum Standards. FAA Exhibit 1, Item 24, p. 16. Respondent offers evidence showing that Somerset closed business dne to personal reasons, that is, retirement ofthe business principals. FAA Exhibit 1, Item 27, Exhibit A-3. While the Associate Administrator allows the introduction ofthe newevidence demonstrating that Somerset closed its business, he fmds that it does not alter any fmdings in the Director's Determination. The Director finds thatthe Respondent's counter argument is more reliable. SPA also offered new evidence, to wit, Respondent's records obtained under the Kentucky Open Records Act, purporting to showthatthe AirportBoard failed to apply the Incentive Program requirements to Somerset. FAA Exhibit 1, Item 24, pp. 17-18. SPA argues thatthe list ofannual inspections performed by Somerset and kept by Respondent contained identical lists ofaircraft type which are highly suspect. SPA argues that common sense teaches that it is virtually impossible for any FBO to have performed annual inspections on the same 12 planes in any two successive calendar years. Respondent replies that the list of annual inspections are the very same un-redacted lists that Somersetprovided to Respondent each year to comply with the Minimum Standards. FAA Exhibit 1, Item 27, p. 8. The Associate Administrator is unpersuadedby Complainant's speculative arguments since the evidence presented demonstrates Respondent reasonably applied its criteriafor incentives. The Associate Administrator allows introduction ofthis evidence, buthe does not find it alters any findings in the Director's Determination. When SPA asserted inits Appeal that the absence ofinsurance records proved that Somerset failed to comply with the Minimum Standards, Respondent producedrecords to prove Somersethadthe required insurance. FAA Exhibit 1, Item 27, Exhibits A-1 and A-2. While the Associate Administrator will allow the introduction ofthe new evidence regarding the possession oftherequisite insurance, the evidence does not alter any findings in the Director's Determination. The Respondent's evidence and counter-argument are more reliable. The Associate Administrator concludes thatthe new evidence producedby SPAto show that Somersethad not complied with the Minimum Standards by failing to perform 1 0 annual inspections per year and failing to carrythe requisite insurance is not persuasive in reversing the conclusions inthe Director's Determination.

24SPA's Motion to Respond. SPA filed a motionto respond to Respondent's Response to SPA's Appeal. FAAExhibit 1, Item 28. The Associate Administrator denied the motion in an Order dated January 8, 2016. FAA Exhibit 1, Item 29. The reasoning for the denial is contained in said Order and will not be reiterated here. VII. FINDINGS AND CONCLUSION Upon an appeal ofa Part 16 Director's Determination, the Associate Administrator will use the following analysis: (1) Are the fmdings offact each supported by a preponderance ofreliable, probative, and substantial evidence contained inthe record? (2) Are conclusions made in accordance withlaw, precedent, and policy? (3) Are questions onappeal substantial? (4) Have any prejudicial errors occurred? 14 CPR § 16.33( e); see also, e.g., Ricks v MillingtonMunicipal Airport, FAA DocketNo. 16-98-19, December 30, 1999, Final Decision and Order, p. 21.
In arriving at a final decision onthis appeal, the FAAhas reexaminedthe record, including the Director's Determination, the administrative record supporting the Director's Determination, the appeal submittedbythe Complainant, the Response submitted by Respondent, and applicable law and policy. Based onthis reexamination, this decision concludes thatthe Director's Determination is supportedby apreponderance ofreliable, probative, and substantial evidence, and his conclusions are consistentwith applicable law, precedent, and public policy. The Appeal does not contain persuasive arguments sufficient to reverse any portion ofthe Director's Determination. The Director's Determination is affirmed. This decision constitutes the final decision ofthe Associate Administrator for Airports pursuantto 14 CPR § 16.33(b ). ORDER ACCORDINGLY, itis hereby ORDERED that (I) the Director's Determination is affirmed, and (2) the appeal is dismissed, pursuantto 14 CPR§ 16.33.

RIGHT TO APPEAL A party to this decision disclosing a substantial interest inthe final decision andorder ofthe Federal AviationAdministration may file a petition for reviewpursuantto 49 U.S.C. 46110, inthe United States Court ofAppeals for the District ofColumbia Circuit or inthe court of appeals ofthe United States for the Circuit in whichthe person resides orhas its principal

25inthe United States Court ofAppeals for the District ofColumbia Circuit or in the court of appeals ofthe United States for the Circuit in which the person resides orhas its principal place ofbusiness. The petition must be filed not later than 60 days after a Final Agency Decisionhas been served onthe party. 14 CFR, § 16.247(a).

**~----~-1))**



# Efd::~~4J Associate Administrator for Airports

26SPA Rental, LLC, d/b/a MSI Aviation 

### v. Somerset-Pulaski County Airport FAA Docket No. 16-13-02 INDEX OF ADMINISTRATIVE RECORD Item 1- Part 16 Complaint dated March 27,2013, alleging Respondent violated Grant Assurance 24 and including Exhibits A-F. Exhibit A- Limited Fixed Based Operator Agreement dated June 30, 2009, between the Somerset-Pulaski County Airport Board and SPA Rental, LLC d/b/aMSI Aviation. Exhibit B- Somerset-Pulaski ComityAirport Board Hangar Lease dated January I, 2013, between the Somerset-Pulaski County Airport Board and SPA Rental, LLC d/b/a MSI Aviation, unsigned. Exhibit C -Limited Fixed Base Operator Agreement, including Exhibit AMinimum Standards, undated and unsigned. Exhibit D- Correspondence dated May 9, 2012, from Phillip J. Braden, FAA Manager, Memphis ADO to DonBandy, Chairman Somerset-Pulaski County Airport Board. Exhibit E- Informal Complaint Correspondence, dated Aprill9, 2012, from Winter R. Huff, Attorney for SPARental, LLC, to James H. Williams, FAA Program Manager, Memphis ADO, including Exhibits A-K. Exhibit F- Sworn Affidavit ofWinter R. Huffdated March 21,2013, detailing events prior to the filing ofa formal complaint. Item 2- Notice ofDocketing, dated April 8, 2013. Item 3- AgreedMotion for Additional Time to Respond to Complaint, dated April29, 2013. Item 4- FAA letter granting the request for an extension oftime to file Respondent's Answer, dated May 30, 2013. Item 5- Motionto Dismiss and Answer, dated May 30, 2013. Item 6- Supporting Memorandum ofPoints and Authorities for the Airport Board's Motion to Dismiss, dated May 30, 2013, and including Exhibits A-N. Exhibit A- Correspondence dated August 21,2012, from Phillip J. Braden, FAA Manager, Memphis ADO to Richard VanHook, Chairman Somerset-Pulaski County Airport Board Maintenance Committee. Exhibit B- Correspondence dated July 23, 2012, from Richard Van Hook to James H. Williams.

27Exhibit C- Somerset-Pulaski County Airport Board Hangar Lease signed and dated June 30,2009, between the Somerset-Pulaski County AirportBoard and SPA Rental, LLC d/b/a MSI Aviation for HangarNumber B-3 for a one year term commencing January 1, 2009 and terminating onDecember 31, 2009. Exhibit D

- Somerset-Pulaski County Airport Board Hangar Lease unsigned and incomplete, betweenthe Somerset-Pulaski County Airport Board and SPA Rental, LLC d/b/aMSI Aviation for Hangar Number B-4 for a one year term commencing January 1, 2009 and terminating onDecember 31,2009. Exhibit E

- Correspondence from TomHalbleib, Stites & Harbison, PLLC, via email dated November 29, 2012, to Winter R. Huff. ExhibitF

- Limited Fixed Base Operator Agreement and separate lease for Hangar 10, both signed and dated March 24,2012, for a one year term, renewable for two successive one year terms, betweenthe Somerset-Pulaski County Airport Board and Somerset Regional Aviation, LLC, including associated amendment(s) and Minimum Standards for Fixed Base Operation. Exhibit G- Correspondence dated April4, 2012, from James H. Williams, Memphis ADO, to Kellie Baker, AirportManager, Somerset-Pulaski County Airport, andreply dated April23, 2012, from John T. Mandt, Attorneyrepresenting Somerset-Pulaski County Airport Board to James H. Williams. Exhibit H- Correspondence dated May 18,2012, from Tom Halbleib, Stites & Harbison, PLLC, to Phillip Braden (FAA). Exhibit I- Correspondence dated August 7, 2012, from Tom Halbleib, Stites & Harbison, PLLC, to James Williams (FAA). Exhibit

### J- Pulaski County Fiscal Court Ordinance No: 220.30, amendment to Section 1.08 Collection ofTax-Records, adopted June 8, 2010, and published June 13,2010. Exhibit K- Somerset-Pulaski County AirportBoard Minutes from Special Called Meeting, September 10, 2012, and correspondence dated July 23, 2012 from Richard VanHook, Chairman, Somerset-Pulaski CountyAirport Board to James H. Williams, explainingthe subsidy incentive and amendmentto minimum standards for fixed based operation. Exhibit L- Correspondence from Walter Iversento Kellie Baker, dated February 7, 2013, regarding a request for public record, and a response from Tom Halbleib to Walter Iversen dated February 13, 2013. Exhibit M- Correspondence dated October 2, 2012, from Tom Halbleib, Stites & Harbison, PLLC, to Winter Huff, including proposed modifications to the Hangar Lease and LFBO Agreement, and Minimum Standards. Exhibit N- A series ofemail correspondence, dated January 27, 2013, between TomHalbleib and Winter Huff. Item 7- Joint Application to Establish a Responsive Pleading Schedule, dated June 5, 2013. Item 8- FAA letter granting the request ofa Responsive Pleading Schedule, dated June 7, 2013.

28Item 9- Complainant's Memorandum Opposing Dismissal, dated July, I, 2013, and includes Exhibits 1 and 2. Exhibit 1- Correspondence, dated April25, 2013, unsigned from WalterP. Iversen to Somerset-Pulaski County Board proposingto enterinto an LFBO agreement in which SPA Rental, LLC, d/b/a MSI Aviation, would continue to rent Hangars B3 and B4 and qualify for incentives. Exhibit 2- Reply from Tom Halbleib to Komad Kuczak, dated June 18,2013, in which the Somerset-Pulaski CountyAirport Board declines MSI Aviation's proposal. Item 10 -Rebuttal and Reply in Support ofthe Airport Board's Motion to Dismiss, dated July 18,2013. Item 11- Notice ofExtension ofTime, dated January 16,2013 (sic- 2014). Item 

### 12- Notice ofExtension ofTime, dated April 17,2014. Item 13- Notice ofExtension ofTime, dated September 5, 2014. Item 14- Notice ofExtension ofTime, dated December 8, 2014. Item 15- Notice ofExtension ofTime, dated March 10,2015. Item 16- Notice ofExtension ofTime, dated April 17,2015. Item 17 -Notice ofExtension ofTime dated May 12,2015,to June 30,2015. Item 

### 18 -Notice ofExtension ofTime dated June 25,2015,to August 28,2015. Item 19- Grant History Report for Somerset, KY dated 08/26/2015. Item 

### 20- Director's Determination, dated September 1, 2015. Item 

### 21- SPA's Motion for Extensionto File Notice ofAppeal and Brief, dated September 15,2015. Item 22- FAA Order granting extension oftime to November 2, 2015, dated September 28, 2015. Item 23- SPA's Notice ofAppeal, dated October 27,2015. Item 24- BriefofSPA in support ofits appeal, dated October 27,2015. ExhibitA- Affidavit ofWalter P. Iversen, dated September 26, 2015.

29Exhibit B- Affidavit ofKonrad Kuczak, dated October 27,2015. Exhibit 

### B-1- Correspondence, dated September 15, 2015, from Konrad Kuczak to Somerset-Polaski County Airport Board. Exhibit 

### B-2- Correspondence, dated September 24, 2015, from SomersetPulaski County Airport Board to Konrad Kuczak. Exhibit 

### B-3- Somerset Regional Aviation Inc. 2013 Annual Inspections. Exhibit B-4

- Somerset Regional Aviation Inc. 2014 Annual Inspections. ExhibitB-5

- Somerset Regional Aviation Inc. 2015 Annual Inspections. Item 25- Respondent's Motionfor Additional Time to Respond to Appeal dated November 6, 2015. Item 26- FAA Order granting extension oftime to December 18,2015, dated November 23, 2015. Item 27- Respondent's Response to SPA'sAppeal ofthe Director's Determination dated December 18,2015. Exhibit A- Affidavit ofKellie Baker dated December 18,2015. Exhibit

### A-1- Certificate ofLiability Insurance, Somerset Regional Aviation Inc. ExhibitA-2 -Certificate ofLiability Insurance, Somerset Regional Aviation Inc. Exhibit A-3- Correspondence, dated May 15, 2015, from Somerset Regional Aviation Inc. to Lake Cumberland Airport Board. Exhibit 

### A-4- Newspaper Public Notice, Request for Proposal, Airport Limited FixedBased Operator Exhibit

### A-5- Newspaper Classified Advertisement, Somerset-Pulaski County Airport Board Requestfor Proposals, First October Issue 2015.

Item 28- SPA'sMotion for Leave to File Reply to Respondent's Brief, dated December 23, 2015. Item 29- FAA's Order denying SPA'sMotion, dated January 8, 2016. Item 30- FAA'sNotice ofExtension ofTime to issue the Final Agency Decisionto May 31, 2016, dated March 4, 2016. Item 31- FAA'sNotice ofExtension ofTime to Issuethe Final Agency Decisionto July 31, 2016, dated June 8, 2016. Item 32- FAA Form 5010 -KSME.

30CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on August 8, 2016 I causedto be placedin the United States mail (first class mail, postage paid) a true copy ofthe Final Agency Decision for FAA Docket No. 16-!3-02 addressed to: Counsel for Complainant: Konrad Kuczak !30 West Second Street, Suite 1010 Dayton, OH 45402

Counsel for Respondent: Rachel Owsley Bethany A. Breetz Stites & Harbison, PLLC 400 West Market Street, Suite 1800 Louisville, KY 40202

Hand delivered to: FAA Part 16 Airport Proceedings Docket FAA Airport Compliance and ManagementAnalysis, ACO-l00