BEFORE THE UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION FEDERAL AVIATION ADMINISTRATION

MANSFIELD HELIFLIGHT, INC.

Complainant,
v. Docket No. 16-14-06 CITY OF BURLINGTON, VERMONT Respondent.

REBUTTAL OF THE CITY OF BURLINGTON, VERMONT
Pursuant to 14 C.F.R. 

## § 16.23(f), and FAA’s December 8, 2014 order granting an extension of time, Respondent, the City of Burlington, Vermont (“City” or “Respondent”), submits this Rebuttal in response to the Consolidated Reply andAnswer to RespondentsAnswer and Motion for Summary Judgment (“Reply”) filed by Mansfield Heliflight, Inc. (“Complainant”). The City incorporates all of the arguments made in, and exhibits submitted with, its Consolidated Answer, Motion for Summary Judgment, and Motion to Dismiss (“Answer”), and reiterates those arguments as if restated herein. To the extent Complainant raises new allegations in its Reply that are not expressly addressed in this Rebuttal, such allegations are hereby denied. I. INTRODUCTION Complainant hasthe burden ofprooffor showing noncompliance, 14 C.F.R. 

## § 16.23(k)(1), and it must carry that burden by a preponderance ofsubstantial and credibleevidence. See BMI Salvage Corp. v. Miami-Dade Cnty., Fla., FAA Docket No. 16-05-16, Final

Decision and Order on Remand at 51 (Apr. 15, 2011); Aerodynamics ofReading, Inc. v. Reading Reg‘1 AirportAuth., FAA Docket No. 16-00-03, Final Decision and Order at 15-16 (July23, 2001). “First-person accounts ofconversations and an abundance ofargumentative opinion and criticism do not equate to substantial and credible evidence.” Meyerv. City ofCincinnati, FAA Docket No. 16-12-14, Director’s Determination at 25 (Sept. 12, 2014). Here, aside from offering conjectures-based on unfounded innuendo, Complainant has introduced no evidence of noncompliance. In its Answer, the City showed, based on the evidentiary record (much ofwhich was introduced by Complainant), why each ofComplainant’s claims ofnoncompliance are wrong. In its Reply, Complainant merely rehashes its own conspiracytheories about howthe Citytried to exclude Complainant from the Airport. But nothing that Complainant adds to the record—either in its arguments orwith newevidence—supports the proposition thatthe City is in violation of Grant Assurances. On the contrary, the evidence clearly shows thatthe City is, and has been, addressing the day-to-day needs and long-term planning goals ofthe Airport while appropriately engaging with Complainant. The City is aware that it is required to provide reasonable Airport
access to aeronautical users without unjust or undue discrimination. As the administrative record shows, the City has done so here by responding to Complainant’s inquiries and working to accommodate its many requests. It is the characterization of, and the motivation for, the City’s dealings with Complainant that are in dispute, notthe relevant facts themselves. Complainant attempts to paintthe City’s

2responses and dealings as incomplete and evasive,1 butthe City has maintained professional and

appropriate open channels ofcommunication with Complainant. The City should not be obligated to give Complainant special treatment. Indeed, it might be improperto do so. The City’s actions have been reasonable and in compliance with its Federal obligations. II. THE CITY’S DEALINGS WITH COMPLAINANT HAVE BEEN FAIR AND IN COMPLIANCE WITH ITS FEDERAL OBLIGATIONS Because Complainant continues to rely almost exclusively on rhetorical arguments, it is importantto revisitthe relevant, material facts that are actually supported bythe record evidence. It is on these facts thatthe City rests2 and relies in support ofits Motion for SummaryJudgment.3 Complainant has made different and often vague requests for space atthe Airport, including: hangar space to store aircraft, hangar space from which to offer aeronautical services (sometimes to run an FBO, othertimes suggesting that itwishedto provide maintenance services
orcharter services), office space (again, at differenttimes suggesting different proposed uses), and/or raw land in which to build FBO facilities. Complainant argues that its requests have been clear—it wishes to start a new FBO. See, e.g., Reply at 3. While it istrue that Complainanthas stated from time to time that itwishes to open a new FBO (in fact, at one pointthe City believed

l For example, Complainant alleges that afterthe meeting in January 2013, Director ofAviation Gene Richards refused to “engage [Complainant] directly on the subject ofits interest in opening an FBO.” Reply at 14 n. 8. Not only is this statement unsupported, but it is actually contradicted by record evidence introduced by Complainant. See, e.g., Complaint Ex. 20 (October2013 email exchange between Mr. Richards and Complainant); Complaint Ex. 21 (same); Complaint Ex. 33 (May 2014 email exchange between Mr. Richards and Complainant). 2 The City sees no need to introduce additional evidence, and rejects Complainant’s suggestion thatthe City must put forth additional evidence ofits own. Reply at2. First, although the City has done so here, it is notthe airport sponsor’s burden to showthat it remains in compliance with its Federal obligations. Second, a respondent in a Part 16 proceeding should be able to base its arguments on complainant’s own evidence when, as here, that evidence fails to show noncompliance. Third, the City introduced sufficient evidence with its Answerthat, togetherwith the evidence introduced by Complainant, fully supports the City’s narrative and legal arguments. The City stands ready, however, to make available any additional information that FAA may require forthe determination ofthis case. Togetherwith its Answer and Motion for Summary Judgment, the City also filed a Motion to Dismiss certain claims. Answer at 52-60. The City notes that Complainant did not respond to, or in any way address, the arguments made in the Motion to Dismiss. Thus, the Motion to Dismiss is now unopposed.
3that it had reached conceptual agreement on the development ofa newareafor such use),

Complainant’s subsequent requests for space have not always appeared to be in pursuit ofthat goal. Attimes, Complainant requested specific facilities thatwere (and still are) leased to others. Complainant also asked to look at any and all available space, most ofwhich would be inappropriate for operating an FBO. More recently, Complainant asked to lease undeveloped land before suddenly reversing course and again asking for already developed hangar and office space. Atvarious times, the City has understood Complainantto be asking forspace to, among otherthings: open a new FBO, run a charter business, store aircraft, and/or perform (or perhaps offerto the public) aircraft maintenance services. Despite the lack ofclarity or consistency in the various requests, Airport staffhas responded to Complainanttimely and in good faith—every time. A. The City workedwith Complainantfrom its initial requestto open an

FBO attheAirport. From the momentthat Complainant first approached Airport staffaboutthe possibility of doing business atthe Airport, Airport staffhas consistently communicated one basic point: although the Airporthas no available, already-developed facilities suitable for an FBO, there are undeveloped aeronautical areas that could accommodate such an operation.4 See Answer Ex. 1, 

## ¶ 4; Complaint Ex. 24. Whether Complainant “accepted Respondent’s contention thatthere was no room for a second FBO in existing facilities,” Reply at 6 n. 1, is beside the point. Complainant has introduced no evidence suggesting thatthe underlying premise is untrue5 orthat

~ The suggestion that ifthe City were “legitimately interested” in Complainant developing new space itwould produce internal emails, Reply at 7, is absurd. The City should not be required to hunt for internal documents when the documentary evidence introduced by Complainant sufficiently supports the City’s position.

~ Relatedly, Complainantoriginally alleged that “Heritage has yetto putthe ASH Hanger [sic] orAtlantic Hanger [sic] to productive use,” Complaint, ¶ 39, introducing photographs allegedly depicting vacant areas in both 4the parcels proposed bythe City for development are not suitable for FBO activities. Eventually,

just afewweeks before filing its Part 16 complaint,6 Complainant announced that itwanted to
move forward with aplan to lease some ofthe undeveloped land that had been identified by Airport staff~ “on which [itwished] to build a suitable structure for FBO operations.” Complaint Ex. 34 at 2. While early on Complainant expressed a preference to lease existing facilities, the City believes that its Federal obligations did not require itto acquiesce to Complainant’s requests for particular facilities, especially since those facilities were being used by, and under lease to, others. Moreover, while Complainant’s initial requestwas for space in which to run an FBO, thereafterthe purpose forwhich Complainant sought space changed.7 In each instance, Airport

buildings. Complaint Ex. 12 at 1-6. The City denied that claim. Answer at 17, ¶ 39; see also Answer Ex. 1, ¶ 5. Complainant now hedges its bets, insisting that it “has provided photographic evidence demonstrating that properties in Heritage’s current leasehold atthe Airport (i.e., the ASH Hanger [sic] terminal, and the GA terminal associated with the Atlantic Hanger [sic]) are virtually empty and unused.” Reply at 34 (emphasis added). First, Complainant provides no foundation forthe photographs it placed in the record. It is undeniable that whatever space they show appeared to be empty atthe time the photographs were taken. But it does notfollow thatthe facilities are not being putto practical use orthatthey are “virtually” empty and unused. In fact, both the ASH Hangar and the Atlantic Hangar (better known as the South Hangar) are being used. The ASH Hangar aircraft storage space is fully occupied. Complainant stores some ofits aircraft and has office space there. While the hangar currently has some office space available, upon information and belief, Heritage is in active negotiations with atenantto occupy much ofit. While the lobby area may be currentlyvacant, it is only a small portion ofthe building. And while the South Hangar may have had at some time unused office space, the aircraft storage space in that building is fully occupied by at least four aircraft owners. The City stands by its denial ofthe allegation. It is unfounded and untrue, and Complainant’s proffered evidence—photographs without afoundation that are not representative ofthe overall space—does not change these facts. 6 Negotiations ceased after Complainantfiled its Part 16 complaint.

~ In March 2013, Complainant stated that itwas interested in being an FBO atthe Airport, butwould not submit additional information unless it got some indication thatthe City was likelyto seek another FBO. Complaint Ex. 13, § 2.0. Over six months later, Complainant stated it wanted to “introduce services that have never been available at the Burlington airport as well as return [dropped] services” such as a “full service charter operation.” Complaint Ex. 19. Yet overthe following few weeks, Complainant changed tack, saying that “securing space atthe Airport” had become a priority, Complaint Ex. 22, and that itwanted to look at “everything available now, as well as whatever space could/would be available in the future,” Complaint Ex. 23. That request was not specific to any particular aeronautical service, but instead was accompanied by a list ofaircraftthat Complainant owns or operates, without indicating which aircraft, ifany, might be involved in the inquiry. Id. The following month, Complainant sent a letter enumerating its business capabilities and objectives and howthey “dovetail[ed] with its desire to secure a lease that provides airport access.” Complaint Ex. 25. Five months later, Complainant reiterated its goal to provide FBO 5staffcontinued working with Complainant, doing its bestto respond to each inquiry, despite

Complainant’s moving target. See, e.g., Complaint Ex. 20 (stating thatAirport staffwould keep Complainant updated on any agreementon the Valley and North Hangars); Complaint Ex. 24 (detailing facilities available for lease atthe Airport, offering the possibility that Complainant might construct facilities, and asking to schedule meeting with Complainant); Complaint Ex. 26 at 3 (describing lease agreementwith Atlantic); Complaint Ex. 28 at 1-2 (providing information about leasing various facilities atthe Airport); Complaint Ex. 40 at 1, 3 (telling Complainantthat Airport staffwas working on a draft lease for office space and supplying estimated timeline for approval). Complainant faults the City for not explicitly asking for a business plan and for mentioning the need for a business plan at a meeting that Complainant did not attend.8 Reply at22. Whetherthe City should have asked directly, orwhat Complainant should have provided, is not relevantto the compliance questions raised by Complainant in this proceeding. What is

services, butthis time (finally) also wanting to discuss the building ofa new structure and suggesting that it might wantto include charter operations, maintenance services, and fueling. Complaint Ex. 28 at 3-4. Then, a few weeks later, Complainantchanged course and asked about moving its aircraft based atthe Airport from the ASH Hangarto the North Hangar, suggesting (but not requesting) that it expected to lease storage space on comparable terms to its lease with Heritage. Complaint Ex. 31 at 1. Eventually, five days later, Complainant actually requested office space in the North Hangar. Complaint Ex. 32 at I. Butfourweeks later, Complainant appeared to go back, resuming its interest in building new facilities for an FBO, Complaint Ex. 34, before ittacked again and asked for confirmation that its office lease in the North Hangarwould allow itto provide FBO services from that space, Complaint Ex. 43 at 1. From the Reply, the City now learns thatthe office space would have been used only to “provide maintenance services, and possibly charterservices.” Reply at 19 n. 12 (without explaining how Complainant would offer aircraft maintenance services—presumablyto the public—using only office space).

~ The suggestion that Director ofAviation Richards “conveniently” raised the need for a business plan at an Airport Commission meeting that Complainant did not attend, Reply at 22, is an example ofthe baseless innuendo that permeates the Complaint and Reply. Mr. Richards’ statement was no secret. Complainant could easily have found out about Richards’ statement by attending the meeting or reading the minutes. See Complaint Ex. 18, § 3.1. But, once again, the point is not whetherthe City specifically asked for a business plan. What is relevant in response to Complainant’s arguments is that Airport staffcontinued working to accommodate Complainant despite Complainant’s moving target

— i.e., the City believes that it has gone above and beyond what is required by its Grant Assurances in its dealings with Complainant.
6relevant is thatAirport staffproperly responded to each ofComplainant’s requests for space

ratherthan dismissing them out-of-hand for lack ofspecificity. B. The City accommodated Complainant’s requestto explore leasing “any availablespace.” After its initial requestto lease space for an FBO, Complainant “request[ed] a lease of any available space atthe airport” on October 18, 2013. Complaint Ex. 21 at 2. Promptly, Airport staffasked for clarification and offered to compile a list ofvacantfacilities and a map showing the various locations. Complaint Ex. 23. Complainant reiterated its expansive wish to “lookat everything available now, as well as whatever space could/would be available in the future,” and included a list ofthe aircraft it owns and operates: “Beech 1900D, Citation II, TBM 700, King Air 350, Cheyenne 4, Corvette 26, Cessna’s [sic] ofvarious models, Sikorsky S76, Bell 407, 206 and 412, Robinson R44, R22, ect [sic].” Id. On October 30, 2013, Airport staffresponded to Complainantwith a list ofall available facilities, including the relevant square footage for each space. Complaint Ex. 24 at2. Specifically, the City offered: five different spaces in the Terminal Building, a block ofspace in the FAA Building, and another block ofspace at 700 Airport Parkway. Id. Airport staffalso referred to the Airport’s ongoing negotiations with Heritage and indicated thatthe Airportwould likely reacquire some ofthe areas leased and used by Heritage, but until an agreementwas in place and details were finalized, none ofit could be offered to Complainant. Id. Further, Airport staffsuggested that Complainant might considera land lease in which to construct newfacilities, echoing its January 2013 suggestion that Complainant considerdeveloping a new site. See Answer Ex. 1,

## ¶ 4. Airport staffoffered to arrange a meeting to visitthe (then) currently available sites, discuss other possibilities, and reviewthe Airport Master Plan. Complaint Ex. 24

7at 1-3; see also Answer Ex. 5. There can be no doubtthatAirport staffwas willing to workwith

Complainant as Complainant continued to adjust its business plans and goals. Complainant replied with a list ofservices that itwished to offer atthe Airport—some (presumably) right away, some after obtaining FAA certification, and yet others in some undefined future—including: charter operations, scheduled flight operations, general aviation maintenance services, fueling services, and helicopteroperations. Complaint Ex. 25. A few days later, Complainant met again with Airport staff. Complaint,

## ¶ 58; Answer at 19,

## ¶ 58. At that meeting, Airport staffagain explained the unavailability ofready-built facilities and again offered the option ofconstructing new facilities. Answerat 19-20,

## ¶~J 58-66. Airport staffalso committedto keeping Complainant updated on the Airport’s progress in settlement negotiations with Heritage, to the extent possible and permitted under its legal obligations, Id. at20,

## ¶ 67, and expressed interest in having a second FBO atthe Airport, Complaint Ex. 28 at 4~9 C. The Citytriedto accommodate Complainant’s interest in leasingspace foraircraftstorage. In an April 7 letter, while noting the length oftime that itwas taking the City to settle with Heritage, Complainant asked for a meeting to discuss potential sites for new construction, and the process for obtaining the requisite approvals. Complaint Ex. 28 at 3-4. Although Complainant asked to be kept informed ofthe availability ofspace at certain existing buildings “that might be suitable for an FBO operation,” it also stated that it “look[ed] forward to

~ The City submitted the “Vision 2030 Master Plan Update” with its Answerto show that planned future development forthe Airport includes general aviation facilities, fuel storage, and aircraft maintenance areas. The Master Plan update does not specifically state thatthe area is reserved for an FBO because the ultimate use ofthe space will depend, at least in part, on the actual development ofthe land and the aeronautical service providers that will use it. Answer Ex. 5 at 9.
8beginning discussions about constructing new space atthe airport.” Complaint Ex. 28 at4.

Airport staffresponded timelyto set up a meeting. Complaint Ex. 29. The meeting happened on April 29. Complaint,

## ¶ 73; Answer at 21,

## ¶ 73. Atthe meeting, Airport stafftold Complainantthat, although negotiations with Heritage were ongoing, ifand when the North Hangar and Valley Hangar reverted to the City, the City would request proposals forthe management and repair ofthe facilities.’0 Complaint,

## ¶ 75; Answerat 21,

## ¶ 75. Atthe meeting, the parties also discussed development ofa new area. Airport stafftold Complainantthat next steps would include the parties entering into a negotiated lease (similarto the Heritage FBO agreement) and Complainant gaining a better understanding ofthe building permit requirements.’~ The City and Complainant also discussed insurance and ground lease rental rates.’2 Afterthe meeting, Complainant emailedto confirm its requests for a copy ofthe standard FBO agreement, a permit number, and insurance requirements. Answer Ex. 15 at 3. Airport staffresponded with the requested information.’3 Id. at 1.

10Complainanttold Airport staffthat it wanted to receive the requestfor proposals when it was released. Reply Ex. 3. The City has notyet requested proposals, although the issuehasbeen discussed with the Board ofAirport Commissioners. Answer Ex. 12, § 9.0. In the interim, all aircraft storage space in the hangar is leased and the City continues to receive revenue from its tenants.

~ To the latter, Airport stafftold Complainantthat research ofan earlier building permit forthat space may, among otherthings, disclose additional requirements, and in a follow-up email, the City sentthe permit numberto Complainantto aid in Complainant’s research. Answer Ex. 15 at 1. 12 Contraryto Complainant’s allegation, Reply at 7, Airport staffnever represented thatthis was “the entire universe ofinformation required in order for [Complainant] to proceed with its development ofnew facilities.” Atthe very least, in orderto proceed, Complainant would need to: (1) negotiate its own FBO lease, (2) research whetherthe existing building permit is still valid or ifitwould need to obtain new permits thatwould be predicated on as yetundisclosed details ofthe actual uses forthe new facilities, and (3) develop and obtain approval forthe plans and specifications forthe new facilities. The first two issues were discussed atthe April meeting, Answer at21, ¶ 75, and the last should come as no surprise.
‘~ Complainant complains that “it was not until six weeks after meeting with Airport staff... that [Complainant] was finally provided with” the requested material. Reply at 6-7. But Complainant’s narrative fails to note thatthe April 29 request for information and May 16 follow-up email to Airport staffwere sent to the wrong email addresses. Answer Ex. 15 at 1. Once Airport staffreceived the email—forwarded bythe City’s counsel—the information was promptly provided to Complainant. Id.
9On May 2, Complainant asked to transfertwo aircraftto the North Hangar. These

aircraftwere atthe time, and are currently, hangared in the ASH Hangar pursuantto Complainant’s agreementwith Heritage. Complaint Ex. 31 at 1. Airport staffrequested the square footage necessaryto accommodatethe two aircraft, and Complainant responded with aircraft dimensions. Complaint Ex. 32 at 1. Director ofAviation Richards replied thatAirport staffwas working with a group ofpeople interested in space in the North Hangar and hoped to get backto everyone shortly. Complaint Ex. 33 at 1. Airport staffkept Complainant updated on the progress, again noting thatthere were multiple requests for hangar space andthatthe City was trying to accommodate everyone. Complaint Exs. 35 & 36. Although Airport staffinitially believed there would be enough hangar space to accommodate all requests, thatturned out notto be the case. Complaint,

## ¶ 91; Answer at 23,

## ¶ 91. With only limited space available, the City leasedthe space—on a month-to-month basis—to aircraft operators who had pending storage space requests.’4 Complainant now argues that its requestfor business space should havetaken precedence
over requests for aircraft storage. Reply at 39-40. First, it is news to the City that Complainant’s request for aircraft space in the North Hangarwas so that it could conduct business from it.15 Complainant simply asked to move its aircraftfrom the ASH Hangarto the North Hangar.

~ Complainantmisconstrues the nature ofMessrs. Mendal and Sporn’s requests. See Reply at 15-16 & n.9. When they asked to lease hangar space for aircraft storage in November2013, their request was not specificto the North Hangar. Atthe time, Mr. Richards told them both that, although there was no aircraft storage space available, he would keep them updated. Answer Ex. 1, ¶~j 9-10. Complainant now implies a conspiracy to keep it away from the North Hangar based on the timing ofthe requests. See Reply at 8 n.2. Such allegation is nothing more than baseless innuendo and is hereby denied. 15 Complainantfails to distinguish between its statements that it is interested in running a business, such as a charter operation, see Complaint Ex. 19, and its requestto “getthe aircraft moved ASAP,” Complaint Ex. 31 at 1. Complainant nowtreats its requestto move the aircraft as a request for space to run a charter operation, see Reply at 18-19, suggesting thatAirport staffshould have earlier divined its real intentions.
10Complaint Ex. 31 at 1. Although it is true thatthe City knew about Complainant’s interest in

developing a new FBO, at no time did Complainant suggestthatthe requested aircraft hangar space would be used to run an aeronautical business.’6 Even now, it is unclearwhattype of aeronautical business Complainant would have conducted, since one ofthe aircraft itwanted to
move to the North Hangarwas inoperable.’7 Second, while the City admits that North Ramp Aviation and Contact Aero are month-to-month North Hangartenants whose leases were assumed bythe City when the North Hangar reverted to the City, Reply at 38, these preexisting tenants are not similarly situated to Complainantwho was not operating out ofthe North Hangar when operational control was transferred to the City. Lastly, even ifthe City had granted Complainanta lease for aircraft hangar space, itwould have been on a month-to-month basis (similarto all other North Hangar leases)—hardlythe type ofleasehold rights necessaryto begin operating a new aeronautical business. D. The City worked diligently on Complainant’s requestforoffice space, but itturnedoutto be anothermoving target. Atthe sametime that Complainant provided aircraft dimensions for possible aircraft space in the North Hangar, it also inquired about leasing office space that it had previously occupied. Complaint Ex. 32 at 1. Aftersome exchanges to clarifythe space in question, Airport staffbegan working on a lease. Complaint Ex. 40 at 1-2. On July 9, Airport staffinformed Complainantthat a draft lease would be available by July 18 orearlythe following week, and detailed the steps necessary forformal approval ofthe agreement. Id. at 1. Then, on July 18,

16Atthe time Complainant and the City were discussing a brand new development elsewhere atthe Airportto accommodate Complainant’s business. 17 Complainant does not refute the City’s understanding that one ofComplainant’s aircraft currently hangared in the ASH Hangar has been inoperable since at least 2012. See Answer at 8 n. 9.
11just as the Citywas aboutto make available a draft lease, Complainant announced that itwas

“ultimately going to wantto provide FBO services from the office so the lease should take that into account.” Complaint Ex. 43 at 1.18 This new requirementwas surprising because it conflicted with Complainant’s contemporaneous assertion that itwas “readyto close a deal” on the land lease for new construction. Complaint Ex. 34 at 2. Further highlighting the lack of clarity in Complainant’s request, Complainant nowclaims on Replythat it “had no intention of operating a full-service FBO out ofan office.

. . , butthat it did believethat it could begin to provide maintenance services, and possibly charter services.” Reply at 19 n.12. E. The Citytried (butfailed) to clarifycommunications with Complainant. On July22, 2014, the Assistant CityAttorney emailed Complainant’s counsel. Complaint Ex. 44. The email was meantto clarifythe status ofComplainant’s then-pending requests and inquiries, including: Complainant’s multiple points ofcontact,19 the City’s decision to seek a property managerforthe North Hangar, and Complainant’s last-minute requestthatthe office lease allowfor FBO services. Complaint Ex. 44. Complainant’s counsel respondedthat

‘~ While the draftoffice lease was pending, Complainant also requested copies ofthe Airport’s minimum standards. Complaint, ¶ 102; Answer at24, ¶ 102; Complaint Ex. 41 at 1. It is undisputed thatthe Airport did not have minimum standards atthattime. However, Complainant infuses a level ofconspiracy into the City’s development ofminimum standards that has no basis in fact. See Reply at 20-21. On the contrary, based on the advice ofFAA Region, the City is working to develop thoughtful, appropriate standards forthe Airport in orderto attract new aeronautical business. Answerat 12-13. This undertaking is independent ofany dealings with Complainant. Id. 19 The Airport experienced considerable turnover in administrative personnel in 2014. Ryan Betcher left, Answer Ex. 3, ¶ 9, and since then, Heather Kendrew has resigned to take anotherjob, and Robert McEwing has retired. Contraryto Complainant’s claims ofmalicious intent, Reply at 16 n.l0, as responsibilities shifted, Airport staff notified Complainant ofthe appropriate new contact, doing its bestto be responsive to Complainant’s various inquiries. See, e.g. Complaint Ex. 17, ¶ 4 (Complainant states that on June 20, 2014, Heather Kendrew informed it that Nicolas Longo was handling leases forthe Airport butwas out ofthe office until June 24); butsee Reply at 18 n. 11 (Complainant appears to change its storywhen it alleges that Heather Kendrew advised Tina Lindberg to try again afterJune 24 not because ofNicolas Longo’s actual availability, but rather because ofmalicious intent). Airport staffhas consistently made itselfavailable to workwith Complainant.
12same day, noting atthe end ofhis email thatthe parties “appearto have come to the end ofthe

road here.” Reply Ex. 4. One week later, Complainant filed its Part 16 Complaint. The timing ofthe Complaint is representative ofthe City’s dealings with Complainant. Complainanttakes the time it needs and wants to replyto Airport staffand convey its interest in different options—and it is free to do so. The City does not purportto question Complainant’s businessjudgments. However, Complainant seems to expectthatAirport staffshould respond immediatelyto each ofits various requests, even in cases where Complainant asks Airport staff to do an about-face, adding new or different requests, and despite the City’s explanations about the time required to go through internal review processes. Complainant now criticizes the City’s measured responses as untimely and attributes malice and deceitto Airport staff. That is
nonsense. The City has not deceived, neglected, or refused to workwith Complainant. The City did not unjustly discriminate against Complainant and did not refuse it access to the Airport. On the contrary, the City has continued to offer space to build new FBO facilities, and has devoted significant resources to fulfilling Complainant’s other requests to the extentpossible and in light ofthe City’s Federal obligations. III. COMPLAINANT’S ASSERTIONS ABOUT THE CITY’S RELATIONSHIPS WITH THIRD PARTIES ARE WRONG AND IRRELEVANT TO THIS PROCEEDING Complainant’s claim ofnoncompliance is based on not only its mischaracterization ofthe City’s continued efforts to respond to its inquiries and requests, but also its mistaken view—both ofthe nature and the relevance—ofthe City’s relationships with Heritage and BTV Avcenter Inc., d/b/aAtlanticAviation (“Atlantic”). While it is possible that an airport sponsor’s interactions with some parties could impactthe sponsor’s compliance obligations towards other aeronautical users, that is notthe case here. Specifically, Complainant rehashes the claim that 13the City created an exclusive right because, allegedly: (1) Heritage is notfully utilizing the

space it controls; (2) the City failed to “take action” when Heritage acquired a controlling interest in Atlantic in 2011, eighteen months before Complainant first approached the City about opening a new FBO; and (3) the City “actively conspired” in 2013 to encourage Atlanticto purchase Heritage ratherthan encouraging Heritage to sell to Complainant. All three allegations
are unproven and untrue. And even iftheywere true, they are irrelevantto the compliance claims raised by Complainant. A. There is nothing inherently improper aboutHeritage’sspace. Complainant alleges thatthe City is somehow excluding itfrom the Airport because it allowed Heritage to “acquire and hold propertythat greatly exceeds its immediate needs,” and this action is tantamountto “land grabbing.” Reply at 11, 27, 34. Complainant is both factually and legally wrong. The City’s decision to use the tax litigation settlement negotiations to more “appropriatelytailorthe size ofHeritage’s leasehold to Heritage’s current service offerings” was not an “admission.

. . that, at least priorto the settlement, Heritage was not making use ofall of its leased properties atthe Airport.” Reply at 11 & n.4. Priorto the settlement, Heritage’s business activities included the managementofthe North Hangar and the Valley Hangar, in which Heritage subleased space to otherAirport (sub)tenants for office and aircraft storage purposes. The City’s repossession ofthese buildings reflects the City’s opinion ofthe space required to continue current FBO activities, predicated on the give and take ofsettlement negotiations and the City’s leverage gained through litigation. The City believes that its Federal obligations did not require itto take back any facilities orfacilities that in Complainant’s opinion
were more desirable. See Ricks v. Millington Mun. AirportAuth., FAA Docket No. 16-98-19, Director’s Determination at 25 (July 1, 1999) (in finding that respondentwas in compliance with 14GrantAssurance 23 because there was space available atthe airport, the Director explained that

“FAA’s policy makes clearthat [even] when all or most ofthe available land and improvements have been leased to a single enterprise, an arbitrary division or restriction to create an opportunity for a competitive enterprise is not required merelyto complywith the exclusive rights policy”). Sincethe North Hangar and the Valley Hangar reverted to the City on May 8, 2014, there has been no indication, and Complainantprovides no reliable evidence,20that Heritage is not utilizing the remaining property in a productive manner. And the two facilities that reverted to the City are full. The Valley Hangarwas and remains fully occupied. Complaint

## ¶ 75. As evidenced bythe factthatthe City could only fittwo additional aircraft after it regained operational control, the North Hangar’s aircraft parking space was productively used when the facilitywas under Heritage’s operational control, and remains full today. Even assuming, arguendo, that portions ofHeritage’s space is currently underutilized, Complainant has “failed to show how.

. . alleged underutilization amounts to a grant assurance violation.” BistiAviation, Inc. v. City ofFarmington, NM, FAA Docket No. 16-07-01, Director’s Determination at 18 (Dec. 4, 2007) (dismissing allegation ofnoncompliance with Grant Assurance 23). Similarto the complainant in Bisti, Complainanthas neither alleged nor introduced any evidence “that aeronautical users are not being accommodated atthe Airport through [Heritage’s] alleged business practices” and, to the City’s knowledge, there have been
no “other complaints from users.

. . alleging they are being denied services atthe Airport.” Id. Complainant’s statement, Reply at 35, thatthe City has not produced additional “evidence ofits

20 See note 5, above.
15own” to refute the claim ofunderutilization is meritless. “[G]rant assurances do not require [the

City) to verifythe daily business practices/behavior ofan aeronautical tenant northe daily occupancy rates ofatenants aircraft storage hangars.” Bisti at 18. While the City has not micromanaged Heritage, the City is satisfied that Heritage is using its space in accordance with its contractual obligations, and Complainant does not claim that Heritage’s contractual obligationsviolate GrantAssurances. Underthe circumstances atthe Airport, Heritage is not “land grabbing.” While the City readily acknowledges thatthe “intent ofGrantAssurance 23.

. . is that an airport sponsor not lease all available land to one FBO thereby granting an exclusive right,” id. at 18, all available land has not been leased. As the Airport staffhas explained repeatedlyto Complainant, there is undeveloped land available for lease. That space has been offered to, and seemingly accepted by, Complainant, and Complainant does not claim thatthe space is not usable for FBO purposes. The City has acted consistent with its GrantAssurance 23 obligations. B. The City appropriately respondedto Heritage’s acquisition ofcontrolling interest in Atlantic. In 2011, eighteen months before Complainantfirst approached the City for space atthe Airport, Heritage acquired a controlling interest ofAtlantic. This transaction took place between Heritage and Atlantic’s previous owner and without prior notice to, or approval by, the City. Answerat 3-4. Complainant claims that “Heritage’s acquisition ofAtlantic, and Respondent’s acquiescence to such, constitutes aviolation ofGrantAssurance 23.” Reply at 8. Complainant further claims (forthe firsttime) thatthe City is likely in violation ofGrant Assurance 5 due to the terms ofthe Atlantic FBO agreement. Reply at 10.21

21 To the extent Complainant seeks to add a new claim ofnoncompliance, it is procedurally improperbecause
16Complainant is wrong. The Atlantic-Heritage deal did not create an exclusive right, and

neitherthe Atlantic northe Heritage contracts restrictthe City’s abilityto preserve its rights and powers. 1. Heritage’s acquisition ofAtlantic’s ownership interestwell before

Complainant made its request for space atthe Airport does not supportafinding thatthe City has granted an exclusive right. Complainant appears to suggestthatthe City’s tacit acquiescence to the Heritage-Atlantic transaction created a constructive exclusive right in the surviving entitythat is nowpreventing Complainantfrom accessing the Airportto conduct aeronautical activities or offer aeronautical services to the public. This allegation ignores the factthat: (1) the City has not denied Complainant access to operate an FBO—an essential component ofafinding ofaviolation of GrantAssurance 23, Answer at 36-39; (2) the City did not consentto the Heritage-Atlantic transaction and has made it clearto the parties that consent has notbeen granted and thatthey each remain obligated to the City, Answerat4, 40; see also note 24 below; and (3) the relevant contracts are subordinated to the City’s obligations underthe GrantAssurances, including the obligation to not permit exclusive aeronautical rights atthe Airport, see Section III.B.2 below. But even setting aside these deficiencies, Complainant still fails to plead facts or provide any reliable, probative evidence to support its allegation. Additionally, Federal requirements should not obligate a sponsorto unravel events that occurred well before a potential new entrant FBO requests space at an airport. In this case, the factthatthe transaction led to having a single FBO atthe Airport eighteen months priorto Complainant’s request is not, by itself, evidence thatthe City acquiesced to the creation ofan
Complainant filed neither a motion nor supporting documentation to amend its original complaint as required under 14 C.F.R. § 16.23(j). The City, nevertheless, responds to this new claim in orderto develop a more complete record.

17exclusive right. See Answerat 40-41. The City could not have chosen the incumbent over

Complainant because the Atlantic-Heritagetransaction was completed priorto Complainant expressing any interest in starting an FBO atthe Airport. All the evidence shows is that: (1) there usedto be two FBOs and now, forthe time being, there is only one;22 and (2) the particularAirport facilities that Complainant prefersto use to start its new business are not available because they are leased, used, and controlled bythat one remaining FBO (or, in the
case ofthe two hangars that more recently reverted to the City, by otherthird parties). Neither of those two conclusions is particularly remarkable or evidence, standing alone, that a constructive exclusive right is preventing Complainant from gaining access to the Airport.

2. The City has retained all necessary rights and powers to operate the Airport and comply with GrantAssurances. In passing, Complainant tries to arguethatthe terms ofthe Atlantic FBO agreement violate GrantAssurance 5 because they “granted a property interest.

. . that restrict[s] the airport sponsor’s abilityto preserve its rights and powers to operate the airport in compliance with the applicable federal obligations.” Reply at 10 (internal quotations omitted). But Complainantfails to explain which provision ofthe Atlantic FBO agreementviolates GrantAssurance 5, or how any alleged violation occurs. See 14 C.F.R. 

### § 16.23(b)(3) and (4). All Complainant argues is that “Heritage was free to acquire a monopoly over FBO services atthe Airportwithout requiring the City’s consent.” Id. As noted in its Answer, the City denies that Heritage has a monopoly over FBO services at the Airport, and Complainant does not even attemptto prove monopoly power.23 More

22 In fact, itcan be inferredfrom Complainant’svarious statementsthat its interest in opening a new FBO atthe Airport stems from the factthatthe Airport had only one FBO atthe time. 23 Complainant does not define the product or geographic marketthat it claims to have been monopolized by
18importantly, however, consistent with its obligations and in accordancewith FAA best practices,

FAA Order 51 90.6B at 6-2 (2009), all relevantAirport agreements include a subordination clause stating that ifthere is a conflict betweenthe terms ofthe agreement and the Grant Assurances, the GrantAssurances will govern. See Complaint Ex. 3, 

## § 5; Complaint Ex. 4, 

## § 6. Should the City needto modify any ofthese agreements to maintain compliance with its Federal obligations, it has the contractual rightto do so. There can be no GrantAssurance 5 violation as a result ofan agreementwhen the agreement itselfis subordinated to the requirements ofGrant Assurance 5. The City has not consented to the Heritage-Atlantictransaction and has not relinquished its abilityto complywith GrantAssurances in the first place.24 Butto the extentthat Complainant is alleging thatthe Heritage agreement should be modified, no modification is needed, because those agreements do not deny Complainant access to the Airport. C. The 2013 negotiations betweenAtlantic andHeritage do notprove a violation ofGrantAssurances. Complainant also alleges thatthe City “overt[ly] violat[ed] GrantAssurances 22 and 23” by actively encouraging Atlantic to purchase Heritage and “willfully” seeking to prevent Mansfield from purchasing Heritage assets. Reply at 6; see also id. at 7, 27. As the City has not engaged in such conduct, it is unclearto what events Complainant is referring, butthe City
assumes that Complainant is referring to reported discussions between Heritage and Atlantic in 2013 in which Atlantic’s previous owner is said to have considered reacquiring operational control over some or all ofHeritage’s business concerns atthe Airport.
Heritage. 24 The City has not acquiesced to the transaction. Answer at4. In fact, to this date, the City has not relieved Atlantic’s previous owner ofits obligations under a financial guarantee made to the City.
19The City is aware that discussions took place between Heritage and Atlantic and that

nothing came ofit. Complaint Ex. 10, 

## § 4.01. More importantly, and contraryto Complainant’s claim, the City did not “actively” or “willfully” encourage or discourage any party from purchasing Heritage’s leasehold. Although Complainantwas apparently interested in acquiring
some or all ofHeritage’s assets, Heritage declined to engage with Complainant. Complaint Ex. 11 at 1. This has nothing to do with the City. Heritage is not an agent ofthe City; its actions and statements are its own.25 Complainant has provided no evidence thatthe City is not in compliance with its Federal obligations as a result ofthe 2013 Heritage-Atlantic discussions. And private discussions between two parties that did not include the City should have no bearing
on the City’s current compliance status.

25 Complainantagain refers to an alleged statement ofHeritage’s general manager, Reply at 27, suggesting it is evidence thatthe City conspired to have only one FBO atthe Airport. As the City explained in its Answer, this individual does not speakforthe City, and the City has no knowledge ofthe alleged statement. Answer at 1 n.2. See also Keyes v. McMinn Cnty., Tenn., FAA Docket No. 16-08-12, Final Agency Decision and Order at 13 n.12 (July 26, 2010) (“The Directorwill not investigate allegations based on third party conversations that amountto hearsay

. . . 20IV. CONCLUSION

Forthe foregoing reasons, the City respectfully requests thatthe Complaint be summarily dismissed as requested in the City’s motions or, in the alternative, that it be dismissed afterfull investigation. Respectfully submitted,

~ Pablo 0. Nüesch Anjali G. Patel Jessica R. Bell Spiegel & McDiarmid LLP 1875 Eye Street, N.W. Suite 700 Washington, DC 20006 Email: pablo.nuesch~spiege1mcd.com Phone: 202-879-4000 Fax: 202-393-2866 Attorneys forthe City ofBurlington, Vermont

January 9, 2015

21Certificate ofService

I hereby certifythat I have today, the 9th day ofJanuary, 2015, caused the foregoing Rebuttal to be served electronically, on the following: Benjamin H. Klein The Klein Law Firm, LLC 61 Broadway, Suite 2125 New York, NY 10006 bklein@thekleinfirm.com Attorney for Complainant

Pablo 0. Nüesch