CITY OF RED BLUFF 

555 Washington Street Red Bluff, California 96080 (530) 527-2605 Fax (530) 529-6878 www.cityofredbluff.org 

December 4, 2015 

Randall S. Fiertz 

Director, Airport Compliance and 

Management Analysis 

Federal Aviation Administration 

800 Independence Ave., SW 

Washington, DC 20591 

Re; Local Tax Revenues for Airport Purposes 

Mr. Fiertz, 

The City of Red Bluff owns and operates the Red Bluff Municipal Airport (RBL). 

Consistent with our understanding of the FAA's recently amended Policy and 

Procedures Concerning the Use of Airport Revenues, the City of Red Bluff is 

proposing an action plan to comply with this policy change. As we currently 

understand this policy change, the federal regulation by the Federal Aviation 

Administration has clarified the rule, requiring that the local taxes on aviation fuel 

may not be expended for any purpose other than the capital or operating costs of the 

airport. 

The City of Red Bluff currently receives the following California Sales and Use Tax 

components to which the FAA rule applies: 

State: Local Revenue Fund 

(County realignment) 

State: Local Public Safety Fund 

(Proposition 172) 

Local Transactions and Use Taxes 

(1/4 cent sales tax increase) 

0.50% 

0.50% 

0.25% 

The City of Red Bluff established the % cent sales tax increase with the approval of 

a ballot measure in November 2015. Beginning April2015, the% cent increase was 

implemented, affecting the sales tax collected within the City of Red Bluff. There 

are no restrictions mandating the use of the % cent sales tax increase. 

Currently the City of Red Bluff does not segregate the general sales tax revenue, 

derived from the aviation and jet fuel sold at the Red Bluff Municipal Airport, from 
other taxable sales. It is difficult to estimate in advance the portion of general sales 

tax revenues derived from aviation fuel because of the fluctuating price of aviation 

fuel and the intermittency of jet fuel customers. However the City is now requiring 

that the fixed base operator submit monthly reports differentiating between Jet Fuel 

and Gas sales and report on the sales tax allocation associated with those sales. 

In 2014, the Red Bluff airport sold approximately 22,200 gallons Jet fuel at an 

average price of $4.74 per gallon; yielding at the applicable FAA tax rate (1 .25%) an 

annual expenditure obligation of less than $1,500. 

The City of Red Bluff spends far more on the aviation services, maintenance and 

operating costs at the airport than the estimate of the relevant sales tax revenues 

derived from aviation fuel. The City's operation costs include, but are not limited to: 

• Fire protection services 

• Public safety services 

• Emergency response services 

• Access to and from the airports, roads, and highways 

• Infrastructure, including water, electricity and sewer 

• Government supplied employee services 

Over the next two years, the City of Red Bluff will work to provide confirmation that 

the allocated tax revenues and Airport related expenditures the complies with the 

FAA policy relative to the expenditures of applicable sales tax revenues on capital 

and operating costs for the Red Bluff Municipal Airport. The City will commit to 

continuing to refine its estimates of both relevant sales tax revenue and 

expenditures on capital and operating costs for the airport to certify that the City 

complies with the FAA policy. 

If, the City determines that its expenditures on airport capital and operating costs do 

not exceed sales tax revenues derived from aviation fuel, it will consider legislative 

solutions. 

Respectfully, 

~~ City of Red Bluff 

Airport Manager 

Public Works Director 

(530) 527-2605 X 3055 
CITY OF RED BbUFF 

555 Washington Street, Red Bluff~ Ca 96080 

FAX 

NAME Randall S. Fiertz FROM Anita Rice 

DEPARTMENT FAA Compliance and Management DEPARTMENT Red BluffMunicipal Airport 

PHONE PHONE 527-2605 X 3067 

FAX (202) 267-4629 ttb3o FAX 529-6878 

Mr. Fiertz, 

Re: local Tax Revenues for Airport Purposes 

Please accept this fax from the City of Red Bluff Municipal Airport regarding the City's plan in regards to 

local tax revenues for airport purposes. I will overnight the original today. 

Thank you, 

Anita Rice 
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