UNITED STATES DEPARTMENT OF TRANSPORTATION 

FEDERAL AVIATION ADMINISTRATION 

WASHINGTON, D.C. 

 

Docket No. 16-08-02 

 FINAL October 1, 2009 

Asheville Jet, Inc. d/b/a Million Air Asheville 

COMPLAINANT 

v. 

Asheville Regional Airport Authority; City of 

Asheville, North Carolina; and Buncombe 

County 

RESPONDENTS 

DIRECTOR’S DETERMINATION

I. INTRODUCTION 

This matter is before the Federal Aviation Administration (FAA), Director of the Office 

of Airport Compliance and Field Operations1 to investigate pursuant to the Rules of 

Practices for Federally Assisted Airport Enforcement Proceedings found in Title 14 Code 

of Federal Regulations (CFR), Part 16. 

Asheville Jet, Inc.2 d/b/a Million Air Asheville (Complainant) filed a formal Complaint 

pursuant to 14 CFR Part 16 against the Asheville Regional Airport Authority and 

sponsors the City of Asheville and the County of Buncombe (Respondents) alleging 

discriminatory actions in violation of grant assurance 5, Preserving Rights and Powers; 

grant assurance 22, Economic Nondiscrimination; grant assurance 23, Exclusive Rights; 

and grant assurance 27, Use by Government Aircraft,

3

 including: 

A. Subleasing Airport property on which federal funds were expended and that had 

previously been available to users of all types, kinds, and classes, to a competitor 

for the competitor’s exclusive use. [See FAA Exhibit 1, Item 3, page 2.] 

 

1

 This office was formerly part of the Office of Safety and Standards; the Office of Airport Compliance and 

Field Operations is now a separate directorate responsible for adjudicating Part 16 formal complaints, 

among other matters. 

2

 Throughout the record documents, Complainant’s business name is spelled both “Asheville Jet” and 

“Ashville Jet.” In this determination, we have used “Asheville Jet,” which is the initial spelling provided 

by Complainant’s counsel in the Complaint document. 

3

 See FAA Exhibit 1, Item 3, page 2. 
B. Permitting a competitor to operate without complying with the Airport minimum 

standards. [See FAA Exhibit 1, Item 3, page 2.] 

C. Providing substantially more favorable sublease terms to a competitor than to the 

Complainant. [See FAA Exhibit 1, Item 3, page 2.] 

With respect to the allegations presented in this Complaint, under the specific 

circumstances at the Airport as discussed below and based on the evidence of record in 

this proceeding, the FAA finds that the Respondents are not currently in violation of their 

federal obligations. 

The basis for the Director’s conclusion is set forth herein. 

II. PARTIES 

A. Airport

The Asheville Regional Airport (Airport or AVL) is a public-use airport owned by the 

City of Asheville (City) and operated by the Asheville Regional Airport Authority, a joint 

governmental agency created by the City and Buncombe County pursuant to Article 20 of 

Chapter 160A of the General Statutes of North Carolina. The Airport Authority controls 

and operates the Airport pursuant to a lease between the City and Airport Authority dated 

July 1, 1980. Through an amendment to the Airport Authority’s lease with the City, the 

Airport Authority’s lease terminates on April 30, 2018. As such, the City requires that 

the City Council approve any subleases that extend beyond April 30, 2018. [FAA 

Exhibit 1, Item 3, page 3.] 

The Airport has 8 helicopters and 122 based aircraft with 35,374 operations annually, 

including more than 1,000 military operations. [FAA Exhibit 1, Item 1.] Since 1983, the 

Airport has received entitlement and discretionary Airport Improvement Program (AIP) 

grants totaling more than $39 million. [FAA Exhibit 1, Item 2.] 

B. Complainant

Complainant, Asheville Jet Center, is a fixed-base operator (FBO)4

 located at Asheville 

Regional Airport (AVL). Complainant holds a long-term sublease on the Airport for its 

facilities. Complainant executed a 24-year sublease effective January 1, 1993 [see FAA 

Exhibit 1, Item 5, attachment 3]; and subsequently executed two management agreements 

effective September 13, 2004, for the construction and development of a Bulk Hangar 

Facility and a T-Hangar Facility [see FAA Exhibit 1, Item 5, attachments 5 and 6]. 

Asheville Jet states it has been in business at the Airport with its current owners or prior 

owners for over 25 years. [FAA Exhibit 1, Item 12, page 12.] Until the Airport entered 

 

4

 A fixed-base operator (FBO) is a commercial entity providing aeronautical service such as fueling, 

maintenance, storage, ground and flight instruction, etc., to the public. [FAA Order 5190.6A, Airport 

Compliance Requirements, October 2, 19889, Appendix 5.] 

Page 2 
into an agreement with Encore Acquisitions LLC – a competing fixed-base operator – in 

November 2007, Asheville Jet was the only fixed-base operator at the Airport. 

III. BACKGROUND and PROCEDURAL HISTORY 

The City of Asheville owns the land on which Asheville Regional Airport (AVL) is 

located. The City leases the land to the Airport Authority, which operates the Airport. 

The Airport Authority is a governmental entity. Its lease with the City is in effect 

through April 30, 2018. [FAA Exhibit 1, Item 6, page 1,] 

Effective January 1, 1993, Complainant Asheville Jet executed a 24-year sublease with 

the Airport Authority. [FAA Exhibit 1, Item 5, attachment 3.] In 2003, Asheville Jet 

(which had originally been an independent company) became part of the Million Air 

chain. [FAA Exhibit 1, Item 6, page 1.] 

Beginning in 2004, the Respondents made an effort to attract a second fixed-base 

operator, believing the Airport could sustain two fixed-base operators and that the 

competition would benefit the aeronautical users of the Airport. [FAA Exhibit 1, Item 6, 

page 2.] 

Effective September 13, 2004, Complainant executed two management agreements for 

the management of a bulk hangar facility and a t-hangar facility. Both management 

agreements were for a five-year term with two five-year options. The Authority 

constructed both the bulk hangar facility and the t-hangar facility, which Asheville Jet 

now manages. [See FAA Exhibit 1, Item 5, exhibit 5, pages C-1 and D-1; and Item 5, 

exhibit 6, pages C-1 and D-1.] 

On July 9, 2007, competitor Encore Acquisitions, LLC (Encore) provided the Airport 

Authority with a commitment letter indicating its interest in constructing a new fixedbase operator facility at the Airport. [FAA Exhibit 1, Item 3, page 4. See also Item 5, 

exhibit 8, July 9, 2007 letter.] 

Effective November 9, 2007, the Respondents and Encore entered into a 30-year sublease 

agreement with a ten-year option. [See FAA Exhibit 1, Item 6, page 2; and Item 5, 

attachment 10.] The agreement requires Encore to invest $3.5 million in facilities at the 

Airport by March 31, 2009.5

 [FAA Exhibit 1, Item 6, page 9.] The agreement also 

grants a temporary waiver from certain minimum standard requirements while Encore 

completes the construction of its fixed-base operator facilities. [FAA Exhibit 1, Item 6, 

page 10.] 

Until November 2007, Asheville Jet was the only fixed-base operator on the Airport. 

[FAA Exhibit 1, Item 6, page 1.] As of June 11, 2008, Encore was still in the design 

phase of its operations at the Airport and had not yet begun conducting any fixed-base 

operator activities. [See FAA Exhibit 1, Item 13, exhibit b, page 3.] Although Encore 

 

5

 In order to get an additional 10 years and an option, Encore would have to invest another $4.5 million on 

top of the $3.5 million. [FAA Exhibit 1, Item 5, attachment 9, page 16.] 

Page 3 
had the right under its sublease to use temporary facilities for fuel sales during the design 

and construction phases, Encore advised the Airport Director on May 30, 2008, that it did 

not intend to exercise that right. [FAA Exhibit 1, Item 13, exhibit F.] 

In December 2007, the Respondents entered into a third management agreement with 

Asheville Jet to manage another bulk hangar constructed by the Authority for Asheville 

Jet’s benefit. [FAA Exhibit 1, Item 6, attachment A, pages 1-2.] 

On January 28, 2008, Complainant filed its Part 16 Complaint with the FAA. [FAA 

Exhibit 1, Item 3.] At the same time, Complainant filed a Certification of Good Faith 

[FAA Exhibit 1, Item 4] and the Declaration of Ken Allison, President of Asheville Jet 

[FAA Exhibit 1, Item 5.] 

On February 14, 2008, Complainant filed its First Supplemental Declaration of Ken 

Allison, President of Asheville Jet. [FAA Exhibit 1, Item 8.] 

On February 15, 2008, FAA docketed the Complaint at Docket No. 16-08-02. [FAA 

Exhibit 1, Item 7.] 

On March 12, 2008, Respondents filed their Answer to the Complaint. [FAA Exhibit 1, 

Item 6.] 

On May 15, 2008, Complainant filed its Reply to the Answer. [FAA Exhibit 1, Item 12.] 

On June 12, 2008, Respondents filed their Rebuttal. [FAA Exhibit 1, Item 13.] 

On August 22, 2008, the FAA sent a notice requesting additional information from the 

parties. [FAA Exhibit 1, Item 14.] 

On September 15, 2008, Respondents submitted their response to the request for 

additional information. [FAA Exhibit 1, Item 15.] 

On October 7, 2008, Complainant submitted its reply to the Respondent’s response to the 

request for additional information. [FAA Exhibit 1, Item 16.] 

IV. ISSUES

Upon review of the allegations and the relevant Airport-specific circumstances, the FAA 

has determined that the following issues require analysis in order to provide a complete 

review of the Respondents’ compliance with applicable federal law and policy: 

3⁄4 Issue 1: Whether Respondents are in violation of grant assurance 5, Preserving 

Rights and Powers, grant assurance 22, Economic Nondiscrimination, grant 

assurance 23, Exclusive Rights, and grant assurance 27, Use by Government 

Aircraft, by granting a preferential use apron, upon which federal funds were 

expended, to a competing fixed-base operator. [FAA Exhibit 1, Item 3, pages 5-7.] 

Page 4 
3⁄4 Issue 2: Whether the Respondents are currently in violation of grant assurance 22, 

Economic Nondiscrimination, and grant assurance 23, Exclusive Rights, by (a) 

requiring the Complainant to comply with the Airport minimum standards while not 

requiring the competing fixed-base operator to comply with the same standards and 

(b) granting substantially favorable sublease terms to the competing fixed-base 

operator. [FAA Exhibit 1, Item 3, page 8.] 

Our determination in this matter is based on the applicable federal law and FAA policy, 

review of the arguments and supporting documentation submitted by the parties, and the 

administrative record reflected in the attached FAA Exhibit 1.6 

V. APPLICABLE FEDERAL LAW AND FAA POLICY 

The following is a discussion pertaining to (a) the FAA’s enforcement responsibilities; 

(b) the FAA compliance program; (c) statutes, sponsor assurances, and relevant policies; 

and (d) the complaint process. 

 

A. FAA Enforcement Responsibilities

The Federal Aviation Act of 1958, as amended, 49 U.S.C. § 40101, et seq., assigns the 

FAA Administrator broad responsibilities for the regulation of air commerce in the 

interests of safety, security, and development of civil aeronautics. The federal role in 

encouraging and developing civil aviation has been augmented by various legislative 

actions, which authorize programs for providing funds and other assistance to local

communities for the development of airport facilities. In each such program, the airport 

sponsor assumes certain obligations, either by contract or by restrictive covenants in 

property deeds and conveyance instruments, to maintain and operate its airport facilities 

safely, efficiently, and in accordance with specified conditions. Commitments assumed 

by airport sponsors in property conveyance or grant agreements are important factors in 

maintaining a high degree of safety and efficiency in airport design, construction, 

operation, and maintenance, as well as ensuring the public reasonable access to the 

airport. Pursuant to 49 U.S.C. § 47122, the FAA has a statutory mandate to ensure that 

airport owners comply with their federal grant assurances. 

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. Sponsor obligations 

are the basis for the FAA’s airport compliance effort. The airport owner accepts these 

obligations when receiving federal grant funds or when accepting the transfer of federal 

property for airport purposes. The FAA incorporates these obligations in grant 

agreements and instruments of conveyance to protect the public’s interest in civil aviation 

and to ensure compliance with federal laws. 

 

6

 The attached FAA Exhibit 1 provides the Index of the Administrative Record in this proceeding. 

Page 5 
The FAA designed the Airport Compliance Program to ensure the availability of a 

national system of safe 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 of valuable rights, which 

airport sponsors pledge to the people of the United States in exchange for monetary 

grants and donations of federal property, to ensure that airport sponsors serve the public 

interest. 

FAA Order 5190.6A, Airport Compliance Requirements, October 2, 1989, (hereinafter 

Order) sets forth policies and procedures for the FAA Airport Compliance Program. The 

Order is not regulatory and is not controlling with regard to airport sponsor conduct; 

rather, it establishes the policies and procedures for FAA personnel to follow in carrying 

out the FAA’s responsibilities for ensuring airport compliance. It provides basic 

guidance for FAA personnel in interpreting and administering the various continuing 

commitments airport owners make to the United States as a condition for the grant of 

federal funds or the conveyance of federal property for airport purposes. The Order, inter 

alia, analyzes the various obligations set forth in the standard airport sponsor assurances, 

addresses the application of the assurances in the operation of public-use airports, and 

facilitates interpretation of the assurances by FAA personnel. 

The FAA compliance program is designed to achieve voluntary compliance with federal 

obligations accepted by owners and/or operators of public-use airports developed with 

FAA administered assistance. Therefore, in addressing allegations of noncompliance, 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 consider 

the successful action by the airport to cure any alleged or potential past violation of 

applicable federal obligation to be grounds for dismissal of such allegations. [See e.g. 

Wilson Air Center v. Memphis and Shelby County Airport Authority, FAA Docket No. 

16-99-10, (August 30, 2001) (Final Decision and Order).] 

C. Statutes, Sponsor Assurances, and Relevant Policies

As a condition precedent to providing airport development assistance under the 

Airport and Airway Improvement Act of 1982 (AAIA), codified at Title 49 U.S.C. 

§ 47101, et seq., the Secretary of Transportation receives certain assurances from the 

airport sponsor. 

The AAIA, 49 U.S.C. § 47101, et seq., sets forth assurances to which an airport sponsor 

receiving federal financial assistance must agree as a condition precedent to receipt of 

such assistance. These sponsorship requirements are included in every airport 

improvement program (AIP) grant agreement. Upon acceptance of an AIP grant by an 

airport sponsor, the assurances become a binding obligation between the airport sponsor 

and the federal government. 

Page 6 
Complainant alleges violations of four (4) grant assurances, which are listed below in 

numerical order: grant assurance 5, Preserving Rights and Powers, grant assurance 22, 

Economic Nondiscrimination, grant assurance 23, Exclusive Rights, and grant 

assurance 27, Use by Government Aircraft. 

(1) Grant Assurance 5, Preserving Rights and Powers

Grant assurance 5, Preserving Rights and Powers, requires the airport owner or sponsor 

to retain all rights and powers necessary to ensure the continued operation of the airport 

consistent with its federal obligations. This assurance implements the provisions of the 

Airport and Airway Improvement Act of 1982 (AAIA), 49 U.S.C. § 47107(a), et seq., 

and requires, in pertinent part, that the owner or sponsor of a federally obligated airport 

“...will not take or permit any action which would operate to deprive it of any of the 

rights and powers necessary to perform any or all of the terms, conditions, and assurances 

in the grant agreement without the written approval of the Secretary, and will act 

promptly to acquire, extinguish, or modify any outstanding rights or claims of right of 

others which would interfere with such performance by the sponsor.” 

Grant assurance 5 states in pertinent part: 

a. [The airport owner or sponsor] will not take or permit any action which would 

operate to deprive it of any of the rights and powers necessary to perform any 

or all of the terms, conditions, and assurances in the grant agreement without 

the written approval of the Secretary, and will act promptly to acquire, 

extinguish or modify any outstanding rights or claims of right of others which 

would interfere with such performance by the sponsor. This shall be done in a 

manner acceptable to the Secretary. 

b. [The airport owner or sponsor] will not sell, lease, encumber, or otherwise 

transfer or dispose of any part of its title or other interests in the property 

shown on Exhibit A to this application or, for a noise compatibility program 

project, that portion of the property upon which federal funds have been 

expended, for the duration of the terms, conditions, and assurances in the 

grant agreement without approval by the Secretary. If the transferee is found 

by the Secretary to be eligible under Title 49, United States Code, to assume 

the obligations of the grant agreement and to have the power, authority, and 

financial resources to carry out all such obligations, the sponsor shall insert in 

the contract or document transferring or disposing of the sponsor’s interest, 

and make binding upon the transferee all of the terms, conditions, and 

assurances contained in this grant agreement. 

(2) Grant Assurance 22, Economic Nondiscrimination

The owner of any airport developed with federal grant assistance is required to operate 

the airport for the use and benefit of the public. Grant assurance 22, Economic 

Nondiscrimination, deals with both the reasonableness of airport access and the 

Page 7 
prohibition of adopting unjustly discriminatory conditions as a potential for limiting 

access. Grant assurance 22 of the prescribed sponsor assurances implements the 

provisions of 49 U.S.C. § 47107(a)(1) through (6), and requires, in pertinent part: 

[The airport owner or sponsor] will make the airport available as an airport for 

public use on reasonable terms and without unjust discrimination to all types, 

kinds and classes of aeronautical activities, including commercial aeronautical 

activities offering services to the public at the airport. [Assurance 22(a).] 

Each fixed-base operator at the airport shall be subject to the same rates, fees, 

rentals, and other charges as are uniformly applicable to all other fixed-base 

operators making the same or similar uses of such airport and utilizing the same 

or similar facilities. [Assurance 22(c).] 

[The airport owner or sponsor] will not exercise or grant any right or privilege 

which operates to prevent any person, firm, or corporation operating aircraft on 

the airport from performing any services on its own aircraft with its own 

employees (including but not limited to maintenance, repair, and fueling) that it 

may choose to perform. [Assurance 22(f).] 

In the event the sponsor itself exercises any of the rights and privileges referred to 

in the assurance, the services involved will be provided on the same conditions as 

would apply to the furnishing of such services by commercial aeronautical service 

providers authorized by the sponsor under these provisions. [Assurance 22(g).] 

The sponsor may establish such reasonable, and not unjustly discriminatory, 

conditions to be met by all users of the airport as may be necessary for the safe 

and efficient operation of the airport. [Assurance 22 (h).] 

The sponsor may prohibit or limit any given 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 civil aviation needs of the public. [Assurance 22(i).] 

Subsection (h) qualifies subsection (a), and subsection (i) represents an exception to 

subsection (a) to permit the sponsor to exercise control of the airport sufficient to 

preclude unsafe and inefficient conditions that would be detrimental to the civil aviation 

needs of the public. 

In all cases involving restrictions on airport use imposed by airport owners for safety and 

efficiency reasons, the FAA will make the final determination on the reasonableness of 

such restrictions when those restrictions deny or limit access to, or use of, the airport. 

[See FAA Order 5190.6A, Airport Compliance Requirements, October 2, 1989, 

paragraph 4-8(a)(1).] 

Page 8 
(3) Grant Assurance 23, Exclusive Rights

Title 49 U.S.C. § 40103(e), provides, in relevant part, that “there shall be no exclusive 

right for the use of any landing area or air navigation facility upon which federal funds 

have been expended.” 

Title 49 U.S.C. § 47107(a)(4) similarly provides, in pertinent part, that “there will be no 

exclusive right for the use of the airport by any person providing, or intending to provide, 

aeronautical services to the public.” 

Grant assurance 23, Exclusive Rights, of the prescribed sponsor assurances implements 

both statutory provisions, and states in its entirety: 

[The airport owner or sponsor] will permit no exclusive right for the use of the 

airport by any person providing, or intending to provide, aeronautical services to 

the public. For purposes of this paragraph, the providing of the services at an 

airport by a single fixed-base operator shall not be construed as an exclusive right 

if both of the following apply: 

a. It would be unreasonably costly, burdensome, or impractical for more than 

one fixed-base operator to provide such services, and 

b. If allowing more than one fixed-base operator to provide such services 

would require the reduction of space leased pursuant to an existing 

agreement between such single fixed-base operator and such airport. 

[The airport owner or sponsor] further agrees that it will not, either directly or 

indirectly, grant or permit any person, firm, or corporation, the exclusive right at 

the airport to conduct any aeronautical activities, including but not limited to, 

charter flights, pilot training, aircraft rental and sightseeing, aerial photography, 

crop dusting, aerial advertising and surveying, air carrier operations, aircraft sales 

and services, sale of aviation petroleum products whether or not conducted in 

conjunction with other aeronautical activity, repair and maintenance of aircraft, 

sale of aircraft parts, and any other activities which because of their direct 

relationship to the operation of aircraft can be regarded as an aeronautical activity, 

and that it will terminate any exclusive right to conduct an aeronautical activity 

now existing at such an airport before the grant of any assistance under Title 49, 

United States Code. 

(4) Grant Assurance 27, Use by Government Aircraft

Grant assurance 27, Use by Government Aircraft, states in its entirety: 

[The airport sponsor] will make available all of the facilities of the airport 

developed with federal financial assistance and all those usable for landing and 

takeoff of aircraft to the United States for use by government aircraft in common 

Page 9 
with other aircraft at all times without charge, except, if the use by government 

aircraft is substantial, charge may be made for a reasonable share, proportional to 

such use, for the cost of operating and maintaining the facilities used. Unless 

otherwise determined by the Secretary, or otherwise agreed to by the sponsor and 

the using agency, substantial use of an airport by government aircraft will be 

considered to exist when operations of such aircraft are in excess of those which, 

in the opinion of the Secretary, would unduly interfere with use of the landing 

areas by other authorized aircraft, or during any calendar month that – 

a. Five (5) or more government aircraft are regularly based at the airport or 

on land adjacent thereto; or 

b. The total number of movements (counting each landing as a movement) of 

government aircraft is 300 or more, or the gross accumulative weight of 

government aircraft using the airport (the total movement of government 

aircraft multiplied by gross weights of such aircraft) is in excess of five 

million pounds. 

D. The Complaint Process

Pursuant to 14 CFR, Part 16, § 16.23, a person directly and substantially affected by any 

alleged noncompliance may file a complaint with the FAA. The complainant shall 

provide a concise but complete statement of the facts relied upon to substantiate each 

allegation. The complaint shall also describe how the complainant was directly and 

substantially affected by the things done or omitted by the respondents. [14 CFR, 

Part 16, § 16.23(b)(3,4).] 

If, based on the pleadings, there appears to be a reasonable basis for further investigation, 

the FAA will investigate the subject matter of the complaint. In rendering its initial 

determination, the FAA may rely entirely on the complaint and the responsive pleadings 

provided. Each party shall file documents it considers sufficient to present all relevant 

facts and arguments necessary for the FAA to determine whether the sponsor is in 

compliance. [14 CFR, Part 16, § 16.29.] 

The proponent of a motion, request, or order has the burden of proof. A party who has 

asserted an affirmative defense has the burden of proving the affirmative defense. This 

standard burden of proof is consistent with the Administrative Procedure Act (APA) and 

federal case law. The APA provision states, “[e]xcept as otherwise provided by statute, 

the proponent of a rule or order has the burden of proof.” [5 U.S.C. § 556(d).] [See also, 

Director, Office of Worker’s Compensation Programs, Department of Labor v. 

Greenwich Collieries, 512 US 267, 272 (1994); Air Canada et al. v. Department of 

Transportation, 148 F3d 1142, 1155 (DC Cir, 1998).] Title 14 CFR § 16.229(b) is 

consistent with 14 CFR § 16.23, which requires that the complainant must submit all 

documents then available to support his or her complaint. Similarly, 14 CFR § 16.29 

states that “[e]ach party shall file documents that it considers sufficient to present all 

Page 10 
relevant facts and argument necessary for the FAA to determine whether the sponsor is in 

compliance.” 

VI. ANALYSIS and DISCUSSION 

Upon review of the allegations and the relevant airport-specific circumstances, the FAA 

has determined that the following issues require analysis in order to provide a complete 

review of the Respondents’ compliance with applicable federal law and policy: 

3⁄4 Issue 1: Whether Respondents are in violation of grant assurance 5, Preserving 

Rights and Powers, grant assurance 22, Economic Nondiscrimination, grant 

assurance 23, Exclusive Rights, and grant assurance 27, Use by Government 

Aircraft, by granting a preferential use apron, upon which federal funds were 

expended, to a competing fixed-base operator. [FAA Exhibit 1, Item 3, pages 5-7.] 

3⁄4 Issue 2: Whether the Respondents are currently in violation of grant 

assurance 22, Economic Nondiscrimination, and grant assurance 23, Exclusive 

Rights, by (a) requiring the Complainant to comply with the Airport minimum 

standards while not requiring the competing fixed-base operator to comply with 

the same standards and (b) granting substantially favorable sublease terms to the 

competing fixed-base operator. [FAA Exhibit 1, Item 3, page 8.] 

A. Issue 1: Preferential Use Apron

Under Issue 1, Complainant alleges Respondents are in violation of grant assurance 5, 

Preserving Rights and Powers, grant assurance 22, Economic Nondiscrimination, grant 

assurance 23, Exclusive Rights, and grant assurance 27, Use by Government Aircraft, by 

granting a preferential use apron, upon which federal funds were expended, to a 

competing fixed-base operator. [FAA Exhibit 1, Item 3, pages 5-7.] 

There is a difference between “preferential use” and “exclusive use.” A tenant having a 

“preferential use” right has priority to use that asset. At times when the tenant having the 

preferential use right is not using the asset, other tenants may use the asset so long as 

their use does not interfere with the operations from the preferential user. In contrast, a 

tenant having an “exclusive use” right retains the sole authority to use a particular asset.7

 

 

7

 Respondents defined preferential use as it applies to aprons and ramps at the Airport as “meaning that a 

lessee shall have the first right to use of the Aircraft Parking Apron assigned to it. The Authority shall 

have the right to access and assign the use of that Aircraft Parking Apron on a second-priority-use basis 

to other aeronautical users when such apron is not reasonably required for the lessee’s own operations. 

When areas are subleased on a preferential-use basis, the Authority considers the areas to be available to 

all aeronautical users of the Airport (not merely subtenants).” [FAA Exhibit 1, Item 15, page 1.] 

Complainant agrees with this definition. [FAA Exhibit 1, Item 16, page 1.] 

 The Respondents defined exclusive use as it applies to aprons and ramps at the Airport as “meaning space 

leased by a lessee that is used exclusively by that lessee. The Authority does not have the right, without 

the permission of that lessee, to allow any third party to use that lessee’s exclusive use aprons or ramps.” 

[FAA Exhibit 1, Item 15, page 2.] Complainant agrees with this definition. [FAA Exhibit 1, Item 16, 

page 2.] 

Page 11 
The Airport has two major apron areas,8

 the general aviation fixed-base operator ramp 

and the air carrier commercial ramp. The general aviation fixed-base operator ramp 

comprises the south ramp, middle ramp, and north ramp. Asheville Jet subleases and 

controls the south ramp (shown on the left in blue in Figure 1 below), the middle ramp 

(shown in blue and red in the middle section of Figure 1 below), and part of the north 

ramp (shown on the right in orange in Figure 1 below). Encore subleases the other part 

of the north ramp (shown on the right in green in Figure 1 below). 

Figure 1: Fixed-Base Operator (FBO) Preferential and Exclusive Use Ramps9 

When Encore becomes operational, it will control that part of the north ramp (shown in 

green) contained in its sublease. (Neither Asheville Jet nor Encore has a sublease for, or 

control over, the air carrier commercial ramp, which is not depicted here.) The north and 

middle ramps have a load-bearing capacity of 60,000 pounds for dual-wheel aircraft. The 

 

8

 The terms “apron” and “ramp” are used interchangeably in this document to describe a defined areas on 

the Airport intended to accommodate aircraft for purposes of loading or unloading passengers, mail, or 

cargo; refueling; parking; or maintenance. [See Aeronautical Information Manual / Federal Aviation 

Regulations (AIM/FAR) 2006, page 359.] 

9

 Figure 1 is from FAA Exhibit 1, Item 15, attachment A. Complainant disputes that the orange area is 

“preferential use” and argues instead that it is “exclusive use” via a lease agreement with the 

Complainant. [See FAA Exhibit 1, Item 16, attachment 1.] Whether that space is preferential use or 

exclusive use for the Complainant does not alter the fact that the Complainant controls that ramp area. 

Page 12 
south ramp has a load-bearing capacity of 100,000 pounds for dual-wheel aircraft. All 

three of these ramps are public-use aprons available to aeronautical users of the Airport.10

[FAA Exhibit 1, Item 6, attachment L.] 

The record shows Respondents entered into a sublease agreement with Encore that 

included leasing part of the north ramp on a preferential use11 basis for $.30 per square 

foot annually. This area is shown in Figure 1 above in green. [See FAA Exhibit 1, 

Item 15, attachment A, and also Item 5, attachment 8.] 

 

Complainant argues the portion of the north ramp subleased to Encore on a 

preferential use basis is the only apron at the Airport on which many military aircraft, 

including C-130’s, can be serviced. As a result of granting the priority use privilege 

to Encore, Complainant argues Asheville Jet will be prevented from servicing certain 

military aircraft. [FAA Exhibit 1, Item 3, page 7.] 

Subleases involving Federal Funds

Complainant makes a point of stating that the apron area subleased to Encore on a 

preferential use basis was financed or improved, in part, with federal funds. [FAA 

Exhibit 1, Item 3, page 5.] Respondents do not dispute this, but counter that the apron 

area subleased to Asheville Jet was also financed or improved, in part, with federal 

funds.12 [See FAA Exhibit 1, Item 13, page 3.] 

Airport projects funded with federal grants are expected to be for the benefit and use of 

the aviation public. When an airport area is available and accessible for public-use 

aeronautical services – even if that area is managed by a single entity – the FAA may find 

it appropriate and desirable to use federal funds for construction or improvements of that 

area. The FAA permits airport sponsors to lease the federally funded apron area in the 

immediate vicinity of a fixed-base operator to that operator so it can manage the public’s 

aeronautical use of that ramp. [See FAA Order 5190.6A, Airport Compliance 

Requirements, October 2, 1989, section 5, “Use of Airport Property,” paragraph 4-

17,k(2).] That is the situation in this case. The apron areas under sublease to both 

 

10 The administrative record referred to the various ramps by different names and descriptions. For 

example, Complainant refers to the north ramp and south ramp; Respondents refer to the general aviation 

ramp and air carrier ramp. We contacted the Airport Director, David Edwards, Jr. on June 17, 2008, and 

November 5, 2008, for clarification of the terminology only. 

11 Respondents state this preferential use apron remains open, available, and accessible to the traveling 

public and the aeronautical users of the Airport; it is not available to competitors of Encore, such as the 

Complainant, at any time. [FAA Exhibit 1, Item 13, page 3.] 

12 Complainant argues that its own apron was constructed and financed by Asheville Jet’s prior owners 

without any federal funds. [FAA Exhibit 1, Item 12, page 4.] Respondents state, however, that a large 

portion of Asheville Jet’s ramp was constructed and rehabilitated using federal funds when the area was 

subleased to Piedmont/Hawthorne, Asheville Jet’s predecessor at that location. [FAA Exhibit 1, Item 13, 

exhibit B, #9.] The administrative record includes a 1985 grant agreement showing the approved project 

included overlaying the general aviation apron and expanding the general aviation apron. [FAA 

Exhibit 1, Item 13, exhibit E.] 

Page 13 
Asheville Jet and Encore are available and accessible to the aeronautical users of the 

Airport. [See FAA Exhibit 1, Item 13, page 3.] 

Assurance 5, Preserving Rights and Powers

Complainant argues the Respondents are in violation of grant assurance 5, Preserving 

Rights and Powers, by entering into a sublease agreement with Encore for a preferential 

use apron. Complainant states, “Encore’s Preferential Use Apron is explicitly 

incorporated into the leasehold through a $.30 per square foot apron rent fee and is, 

accordingly, more than a ‘special privilege.’” [FAA Exhibit 1, Item 3, page 6.] 

Assurance 5 prohibits the airport sponsor from giving away rights and powers it needs to 

control and operate the Airport as an airport. It obligates the sponsor to retain financial 

and legal control of airport property to ensure the airport’s continued operation as an 

airport. [See Section V (B)(1), Applicable Federal Law and FAA Policy, in this 

determination.] 

Entering into an agreement for a preferential use apron is not inconsistent with grant 

assurance 5. The agreement with Encore does not give away rights and powers needed to 

control and operate the Airport. The agreement does not transfer financial or legal 

control of Airport property to Encore. It merely permits Encore to offer aeronautical 

services to the public at a specified location on the Airport in exchange for lease 

payments to the Airport. This is not substantially different from what Asheville Jet has in 

its own sublease agreement in which it manages apron areas on the Airport for the benefit 

of the aviation public. 

 

Apart from the general aviation apron areas subleased to Encore and to Asheville Jet, 

Respondents state the Airport “controls a significant amount of common use [air carrier] 

commercial ramp containing hard stands that are capable of supporting and handling 

military aircraft that are too heavy to be handled on either Encore’s apron area or 

Asheville Jet’s apron area.” [FAA Exhibit 1, Item 6, page 6.] The area controlled by the 

Airport consists of approximately 280,000 square feet and has a load-bearing capacity of 

170,000 pounds for dual-wheel aircraft. [FAA Exhibit 1, Item 6, attachment A, page 4, 

#15.] By contrast, the general aviation ramp areas subleased to Encore and to Asheville 

Jet have a load-bearing capacity of 60,000 pound and 100,000 pounds, respectively, for 

dual-wheel aircraft. [FAA Exhibit 1, Item 6, attachment A, page 4, #14.] The Airport 

retains control of common areas that will handle the heaviest aircraft. 

Director’s conclusion on assurance 5

The Respondents have not given away rights and powers needed to control and operate 

the Airport as an airport. There is no record evidence to suggest the airport sponsor 

failed to maintain financial and legal control of the Airport or is unable operate the 

Airport as an airport. These are the essential elements of assurance 5. Therefore, the 

Director finds the Respondents are not currently in violation of grant assurance 5, Rights 

and Powers, by including a preferential use apron in Encore’s sublease. 

Page 14 
Assurance 22, Economic Nondiscrimination

Complainant argues the Respondents violated grant assurance 22, Economic 

Nondiscrimination, by giving Encore preferential use of an apron upon which federal 

funds were expended and that had previously been used by the Complainant and other 

aviation users. [FAA Exhibit 1, Item 3, page 7.] 

The record shows that, in the past, Asheville Jet had used the apron now subleased to 

Encore to service military aircraft pursuant to federal contracts. [FAA Exhibit 1, Item 6, 

page 6.] By converting this apron to preferential use for Encore, Complainant states 

Asheville Jet “will be limited in its ability to service military jets.” [FAA Exhibit 1, 

Item 3, page 7.] Specifically, Complainant states the preferential use apron is “the only 

ramp large enough and suitable for fueling certain military aircraft, including Lockheed 

C-130 Hercules transport aircraft.” [FAA Exhibit 1, Item 5, page 4, #20.] 

Respondents dispute this claim, noting that Asheville Jet conducts most of its fueling 

operation for military aircraft on the south ramp area,13 which is subleased to the 

Complainant. Respondents state the south ramp apron subleased to Asheville Jet is 

superior to the apron subleased to Encore because it is approximately two times larger 

and is capable of handling heavier aircraft.14 [FAA Exhibit 1, Item 6, page 6.] 

In addition, Respondents identify other common use air carrier commercial ramp areas 

suitable for fueling military aircraft that have a higher load-bearing capacity than either 

the ramp subleased to Encore or the ramps subleased to Asheville Jet.15 Respondents 

argue that subleasing the apron area to Encore has “not limited Asheville Jet’s ability to 

fuel military aircraft in the slightest degree.” [FAA Exhibit 1, Item 6, page 6.] 

Respondents provide photographs showing large military aircraft, including C-130s, 

being serviced on a ramp they swear under oath is subleased to Asheville Jet. [FAA 

Exhibit 1, Item 13, page 2, and Item 13, exhibit A; and Item 13, exhibit B, #3.] 

Even though Complainant may have the ability to service military aircraft from ramp 

space other than the ramp subleased to Encore, Complainant argues that the shift to 

different ramp space will greatly inconvenience its customers. [FAA Exhibit 1, Item 12, 

page 3.] Because of the location and distance from the ramp space available to Asheville 

Jet for fueling large military aircraft and Asheville Jet’s terminal, people cannot walk 

between the two areas; they have to be shuttled from the ramp to the terminal. [FAA 

Exhibit 1, Item 12, page 5.] Complainant states the ramp area subleased to Encore was 

purposefully constructed adjacent to Asheville Jet’s terminal with the intent of servicing 

military aircraft at that location. [FAA Exhibit 1, Item 12, page 4.] Complainant states 

 

13 See Figure 1 on page 12 of this document. South ramp area is the blue section on the left. 

14 The ramp area subleased to Encore has a load-bearing capacity of 60,000 pounds for dual-wheel aircraft; 

the ramp areas subleased to Asheville Jet include ramp space with a load-bearing capacity of 100,000 

pounds for dual-wheel aircraft. [FAA Exhibit 1, Item 6, page 6.] 

15 The Airport controls common use air carrier commercial ramp space consisting of approximately 280,000 

square feet with a load-bearing capacity of 170,000 pounds for dual-wheel aircraft. Respondents state this 

area is suitable for fueling military aircraft. [FAA Exhibit 1, Item 6, attachment A, page 4, #15.] 

Page 15 
the ramp area identified by the Respondents as being more efficient for fueling military 

aircraft is at the opposite end of Complainant’s leasehold from the Encore ramp; 

Complainant argues the Encore ramp location is more desirable.16 (See Figure 2, 

Complainant’s Fixed-Base Operator Site, below.) 

Figure 2: Complainant’s Fixed-Base Operator Site 

Asheville Jet’s leasehold is outlined in blue; the ramp Complainant refers to as being 

less desirable – and at the opposite end of its leasehold – is outlined in white. 

Encore’s ramp, which Complainant states is a more desirable location for 

Complainant’s fueling operations, is outlined in red. (Note: The aerial photograph in 

Figure 2 is shown from the opposite angle to the aerial photograph in Figure 1. In 

Figure 1, the Encore ramp is shown in green on the right side of the photograph. That 

same space is shown in Figure 2 outlined in red on the bottom left side of the 

photograph.) 

Complainant argues military aircraft have easier access for turning around on the Encore 

ramp. In addition, Complainant argues the Asheville Jet ramp is so close to the main 

 

16 See FAA Exhibit 1, Item 12, page 4; and Item 12, exhibit 2, photo: compare red space for Encore ramp 

and white space for Asheville Jet’s ramp with blue outlining the perimeter of Complainant’s entire 

leasehold. 

Page 16 
Airport terminal that unavoidable blasts from jet engines will damage the Airport 

terminal if that ramp is used. [FAA Exhibit 1, Item 12, page 5.] 

Previous Case Cites 

Both the Complainant and Respondents cite previous FAA Part 16 decisions to support 

their respective positions. However, the cases cited do not support either one. 

Complainant cites Platinum Aviation and Platinum Jet Center BMI v. BloomingtonNormal Airport Authority, FAA Docket No. 16-06-09 (June 4, 2007) (Director’s 

Determination) to support its position that Encore may not be permitted to have a 

preferential use apron. [FAA Exhibit 1, Item 3, page 5.] In Platinum Aviation, the tenant 

asserted its right to exercise what it determined was a priority use in an area that 

interfered with active public-use taxiways and movement areas. The tenant parked 

aircraft and vehicles in this “priority use” area, blocking access to other airport users and 

creating a safety issue at the airport. The FAA found the airport could not permit such 

activity and any priority use affecting active public-use taxiways and movement areas 

had to be eliminated. [See Platinum Aviation and Platinum Jet Center BMI v. 

Bloomington-Normal Airport Authority, FAA Docket No. 16-06-09 (June 4, 2007) 

(Director’s Determination).] 

In the current case, Encore’s preferential use ramp area does not interfere with active 

public-use taxiways and movement areas. In addition, Encore’s sublease states 

specifically that “for the purposes of egress and ingress both aircraft and vehicles may 

traverse the Premises if necessary.” [FAA Exhibit 1, Item 6, attachment E, page F-3.] 

Respondents cite two cases to support their position that an airport sponsor may provide 

preferential use ramp or apron space: (1) Roadhouse Aviations, LLC v. City of Tulsa & 

the Tulsa Airports Improvement Trust, FAA Docket No. 16-05-08 (June 26, 2007) (Final 

Decision and Order), and (2) The Aviation Center, Inc. v. City of Ann Arbor, Michigan, 

FAA Docket No. 16-05-01 (December 16, 2005) (Director’s Determination). [FAA 

Exhibit 1, Item 6, page 7.] 

Roadhouse Aviation discusses access using taxilanes that run through another tenant’s 

subleased tie-down blocks. The taxilanes were to be accessible at all times. In that case, 

the FAA found the access was reasonable and not a violation of the grant assurances. 

The focus in Roadhouse Aviation is on the non-exclusive use of taxilanes. Even though 

the case mentions an exclusive use ramp that does not include the provision of taxilane 

access, the case neither discusses nor supports any position regarding preferential use 

ramps or aprons. [See Roadhouse Aviations, LLC v. City of Tulsa & the Tulsa Airports 

Improvement Trust, FAA Docket No. 16-05-08 (June 26, 2007) (Final Decision and 

Order).] 

Neither does Aviation Center discuss or support Respondents’ position that an airport 

sponsor may provide preferential use ramp or apron space. In Aviation Center, the ramp 

issue involves one tenant providing service using the airport terminal apron. This was 

not an exclusive-use arrangement. In fact, the complainant in that case also provided 

Page 17 
services from the terminal apron, just on a smaller scale. The terminal facilities were 

available to the public and customers of all fixed-base operators, and the complainant was 

free to provide aeronautical services to the public at the terminal and the terminal apron. 

[See The Aviation Center, Inc. v. City of Ann Arbor, Michigan, FAA Docket No. 16-05-

01 (December 16, 2005) (Director’s Determination), page 26-27.] 

Director’s conclusion on assurance 22

Asheville Jet is not prevented from fueling large military aircraft as a result of the 

Respondents subleasing a preferential use ramp to Encore. Asheville Jet is 

inconvenienced by this change, particularly since the Encore ramp is located adjacent to 

the Complainant’s terminal. Nonetheless, Asheville Jet is not being denied the 

opportunity to provide the same fixed-base operator services it has provided in the past or 

the same fixed-base operator services Encore will be able to provide. 

Assurance 22 obligates airport sponsors to treat similarly situated airport tenants in a 

comparable fashion. The record shows both Asheville Jet and Encore have either 

exclusive use or preferential use apron areas within their respective leaseholds. [See

FAA Exhibit 1, Item6, page 6, and Item 6, attachments J and L for Asheville Jet; and 

Item 6, attachment E, page A-1 for Encore.] While Complainant makes a point of stating 

federal funds were used on the apron that is now in Encore’s leasehold,17 Respondents 

point out that the ramp area subleased to Asheville Jet was also improved with federal 

funds.18 Both fixed-base operators manage their respective ramps. 

Assurance 22 does not require the airport sponsor to offer convenience and efficiency to 

its tenants and airport users. It does not obligate the airport sponsor to provide a certain 

level of cost effectiveness to its tenants and airport users. It does not prevent an airport 

sponsor from changing the use of airport structures and facilities from their initial 

purpose. 

The Airport Compliance Program does not control or direct the operation of airports. 

Rather, it monitors the administration of the valuable rights that airport sponsors pledge 

to the people of the United States in exchange for monetary grants and donations of 

federal property to ensure that airport sponsors serve the public interest. How the airport 

sponsor chooses to manage its airport is within its own discretion absent violating federal 

law or policy. 

Whether or not to provide a preferential use agreement to Encore for the ramp space 

more conveniently located to Asheville Jet’s terminal – but not within Asheville Jet’s 

leasehold – is an Airport business decision. The FAA does not normally intervene in the 

business decisions of the airport sponsors where grant assurance violations are not at 

issue. [See Jet 1 Center, Inc. v. Naples Airport Authority, FAA Docket No. 16-04-03, 

(January 4, 2005) (Director’s Determination); and also M. Daniel Carey and Cliff 

 

17 See FAA Exhibit 1, Item 3, page 5. 

18 See FAA Exhibit 1, Item 6, page 6. See also footnote #12 in this determination. 

Page 18 
Davenport v. Afton-Lincoln County Municipal Airport Joint Powers Board, FAA Docket 

No. 16-06-06, (January 19, 2007) (Director’s Determination).] 

Complainant has not demonstrated that Asheville Jet has been directly and substantially 

affected by the Respondents’ action to sublease a ramp area to Encore19 that was 

previously available to the Complainant. Both Asheville Jet and Encore have ramp areas 

within their respective leaseholds. Federal funds were used to improve the ramps in both 

leaseholds. Asheville Jet continues to have the ability to fuel military aircraft on either its 

own ramp space or in one of the common use air carrier commercial ramp areas. The 

Administrative Record does not support Complainant’s allegation that it has been 

unjustly discriminated against with regard to the preferential use ramp subleased to 

Encore. The Director finds the Respondents are not currently in violation of grant 

assurance 22, Economic Nondiscrimination, as a result of giving Encore preferential use 

of an apron that had previously been used by the Complainant. 

 

Assurance 23, Exclusive Rights

Complainant alleges Respondents are in violation of grant assurance 23, Exclusive 

Rights, by granting preferential use of an apron upon which federal funds were expended 

to a competing fixed-base operator. [FAA Exhibit 1, Item 3, page 9.] 

Assurance 23, Exclusive Rights, prohibits the airport sponsor from granting to one entity 

the right to provide a particular aeronautical service to the public while preventing other 

entities from offering the same aeronautical service.20 An exclusive right is defined to 

mean: (a) any exclusive right to use the airport for conducting any particular aeronautical 

activity requiring operation of aircraft, and (b) any exclusive right to engage in the sale or 

supplying of aircraft, aircraft accessories, equipment, or supplies (excluding the sale of 

gasoline and oil) or aircraft services necessary for the operation of aircraft (including the 

maintenance and repair of aircraft, aircraft engines, propellers, and appliances.) [See FAA 

Order 5190.6A, Airport Compliance Requirements, October 2, 1989, paragraph 3-2(d).] 

Complainant argues that the Airport has granted an exclusive right to Encore by giving 

Encore preferential use of ramp space that was previously used by Asheville Jet. [FAA 

Exhibit 1, Item 3, page 2.] 

Even though Asheville Jet finds itself inconvenienced by the fact that Encore now has 

preferential use of a ramp area located adjacent to the Complainant’s terminal, this is not 

a violation of assurance 23. On the contrary, since the facilities and/or space was 

available, the Respondents were obligated by grant assurance 23 to negotiate a sublease 

with Encore once Respondents accepted Encore’s proposal to establish a fixed-base 

 

19 To prevail in a Part 16 Complaint, the Complainant must demonstrate that it has been directly and 

substantially affected by any alleged noncompliance. [See 14 CFR, Part 16, § 16.23(a).] Complainant is 

inconvenienced by the sublease to Encore, but it is not prevented from providing service to military 

aircraft. The FAA does not equate mere inconvenience – even where additional operating costs are 

incurred – with being substantially affected. 

20 See section V.C.(3) of this determination for a full reading of the grant assurance on exclusive rights. 

Page 19 
operation at the Airport. [See FAA Exhibit 1, Item 6, attachment H.] The airport sponsor 

cannot, as a matter of convenience, choose to have only one fixed-base operator provide 

services at the airport if the circumstances at the airport do not warrant limiting this 

service because it is unreasonably costly, burdensome, or impractical to have more than 

one fixed-base operator. [See Advisory Circular 150/5190-6, Exclusive Rights at 

Federally Obligated Airports, January 4, 2007, page 5.] 

In this case, the Respondents sought to attract a second fixed-base operator based on the 

belief that the Airport could support two fixed-base operators and the resulting competition 

would benefit the aeronautical users at the Airport. [FAA Exhibit 1, Item 6, page 2.] 

While the Complainant objects that the Respondents “did not even commission a market 

study [to determine the need or viability of] a second [fixed-base operator],” [FAA 

Exhibit 1, Item 12, page 6] they were under no obligation to conduct such a study. The 

FAA also permits an airport sponsor to exclude an incumbent fixed-base operator from 

participating in a competitive solicitation to bring a second fixed-base operator onto the 

airport to create a more competitive environment. [See Advisory Circular 150/5190-6, 

Exclusive Rights at Federally Obligated Airports, January 4, 2007, page 6.] 

Complainant states that in order to establish that the Airport granted an exclusive right to 

Encore by subleasing a federally funded preferential use apron, it need only show (a) the 

Respondents impeded Complainant’s ability to compete on an equal footing; (b) the 

imposition has placed a significant burden on Complainant that is not placed on Encore; 

and (c) Complainant’s allegation is supported by documentation. [See FAA Exhibit 1, 

Item 3, page 9.] 

(a) Equal Footing

Complainant argues that the preferential use apron subleased to Encore is the only ramp 

space suitable for fueling military aircraft. [FAA Exhibit 1, Item 5, page 4, #20.] 

Respondents have effectively dispelled this claim by pointing out that the ramp space 

subleased to Asheville Jet is superior to the ramp space subleased to Encore; Asheville 

Jet’s ramp space is larger and is capable of handling heavier aircraft. In addition, there 

are other common use air carrier commercial ramp areas suitable for fueling military 

aircraft that have a higher load-bearing capacity than either the ramp subleased to Encore 

or the ramps subleased to Asheville Jet. Respondents argue Asheville Jet conducts most 

of its fueling operation for military aircraft on the south ramp area, which is subleased to 

the Complainant. [FAA Exhibit 1, Item 6, page 6.] (This claim is discussed more fully 

under “Assurance 22” above.) 

Both Encore and Asheville Jet have preferential use or exclusive use ramp space within 

their respective leaseholds.21 Asheville Jet is not precluded from fueling military aircraft 

 

21 Both Complainant and Respondents agree Encore has preferential use of the ramp shown in green on 

Figure 1 in this document. (See page 12.) Complainant acknowledges it has exclusive use ramps as 

shown in Figure 1, but argues the area shown in orange is actually exclusive use rather than preferential 

use for the Complainant. [See FAA Exhibit 1, Item 16, attachment 1.] That distinction, while important 

for the fixed-base operator’s activity, does not demonstrate in any way that Encore enjoys a right or 

Page 20 
simply because Encore now has that same ability. Complainant has not demonstrated 

that it is unable to compete on an equal footing with Encore as a result of including 

preferential use ramp space within Encore’s sublease. Complainant has its own ramp 

space included in its own sublease. 

The Complainant and its competitor are on an equal footing regarding the ability to fuel 

military aircraft. 

(b) Significant Burden

Complainant does not specify the burden that significantly affects Complainant over its 

competitor with regard to the preferential use apron. As noted above, both entities enjoy 

preferential use ramp space and both entities have the capability to fuel military aircraft. 

It appears from the Complaint that the “significant burden” referred to by the 

Complainant is related to the enforcement of the Airport’s minimum standards. The 

Complainant argues that its competitor is permitted to operate until March 31, 2009, 

without meeting the minimum standard requirements while Complainant must meet those 

requirements today. [See FAA Exhibit 1, Item 3, page 9.] However, the minimum 

standards the Complainant cites refer to fueling operations, construction requirements, 

and service obligations – not ramp space or apron use. The Complainant’s allegations 

regarding the Airport minimum standards are addressed below under Issue 2, Minimum 

Standards and Favorable Sublease Terms. 

Complainant has not identified a significant burden placed on it regarding the use of ramp 

space. 

 

(c) Documentation

The Administrative Record includes the November 9, 2007, sublease with Encore. This 

document shows preferential use ramp space on an existing apron subleased to Encore for 

the term of the sublease. It also shows preferential use ramp space on a new apron to be 

constructed adjacent to the existing apron. [FAA Exhibit 1, Item 6, attachment E, 

page A-1.] This agreement gives Encore the right to control this specific ramp space. 

The sublease does not include the right to control all ramp space on the Airport. In fact, 

the Complainant controls the greater portion of ramp space, as shown in Figure 1. 

The sublease with Encore does not grant an exclusive right to Encore to provide any 

particular aeronautical activity on the Airport to the exclusion of the Complainant. [See

FAA Exhibit 1, Item 6, attachment E, page F-3, #9.] 

Complainant asserts Encore will enjoy a constructive exclusive right to service military 

aircraft by virtue of Encore’s preferential use of a ramp more convenient for this activity 

than Complainant’s ramps. As noted earlier, convenience is not the standard for 

evaluating whether an aeronautical tenant enjoys an exclusive right or not. Complainant 

 privilege that is not available to the Complainant. In fact, based on the definitions agreed to by both the 

Respondents and Complainant (see footnote # 7) an exclusive use right gives the lessee (in this case, the 

Complainant) greater control over its ramp(s) than a preferential use right. 

Page 21 
retains the right and ability to provide this same service at a different location on the 

Airport. Respondents have shown Complainant has fueled military aircraft on ramps 

other than the ramp designated for Encore in the past. 

In the current case, the ramp space in question is not the only ramp space on the Airport, 

nor is it the only ramp space suitable for fueling military aircraft. The Administrative 

Record does not support Complainant’s allegation that subleasing ramp space to Encore 

with a preferential use provision rises to the level of an exclusive right. 

Director’s conclusion on assurance 23

Complainant has not shown the Respondents granted to Encore the exclusive right to 

conduct any particular aeronautical activity or to provide any particular aeronautical 

service on the Airport. Both Asheville Jet and Encore are fixed-base operators with the 

same opportunity to offer the same aeronautical services to the aviation public. The 

Respondents are not currently in violation of grant assurance 23, Exclusive Rights, by 

granting preferential use of an apron to a competing fixed-base operator. 

Assurance 27, Use by Government Aircraft

The focus of grant assurance 27, Use by Government Aircraft, is to make the airport 

available to government aircraft without charge except where government use is 

substantial. [See V.C.(4) in the Applicable Law and Policy section of this determination.] 

This is not relevant to the current Complaint. Complainant argues military aircraft can be 

accommodated on the preferential use ramp only, which – if it were true – could preclude 

service by the Complainant. [See FAA Exhibit 1, Item 5, page 4, #20.] That allegation is 

more appropriately argued under grant assurances 22, Economic Nondiscrimination, and 

23, Exclusive Rights, which are addressed above. There is no evidence that government 

aircraft are prohibited from using the Airport without charge for use that is not 

substantial. The Director finds the Respondents are not currently in violation of grant 

assurance 27, Use by Government Aircraft. 

Director’s Conclusion on Issue 1.

The Director finds the Respondents are not currently in violation of grant assurance 5, 

Preserving Rights and Powers, grant assurance 22, Economic Nondiscrimination, grant 

assurance 23, Exclusive Rights, or grant assurance 27, Use by Government Aircraft, by 

granting preferential use of an apron upon which federal funds were expended to a 

competing fixed-base operator. 

• The Respondents have not given away rights and powers needed to control and 

operate the Airport. (Assurance 5.) 

• The Complainant has not been unjustly discriminated against as a result of granting 

preferential use of a ramp to Encore; both Asheville Jet and Encore have 

preferential use or exclusive use aprons in their respective leaseholds. 

(Assurance 22.) 

Page 22 
• Complainant has not shown the Respondents granted to Encore the exclusive right 

to conduct any particular aeronautical activity or to provide any particular 

aeronautical service on the Airport. Complainant’s concern that it will be less 

convenient to service military aircraft without having access to Encore’s 

preferential use ramp does not equate to being denied the right or opportunity to 

provide such service. (Assurance 23.) 

• There is no evidence to suggest government aircraft are prohibited from using the 

Airport without charge for use that is not substantial. (Assurance 27.) 

B. Issue 2: Minimum Standards and Favorable Sublease Terms

Under Issue 2, Complainant alleges Respondents are in violation of grant assurance 22, 

Economic Nondiscrimination, and grant assurance 23, Exclusive Rights, by (1) by 

requiring the Complainant to comply with the Airport minimum standards while not 

requiring the competing fixed-base operator to comply with the same standards, and (2) 

by granting substantially favorable sublease terms to the competing fixed-base operator. 

[FAA Exhibit 1, Item 3, page 8.] 

(1) Airport Minimum Standards

The Asheville Regional Airport adopted Airport minimum standards April 19, 2004, 

which were amended July 19, 2004. [FAA Exhibit 1, Item 5, attachment 4.] These 

standards establish the minimum requirements for a full service fixed-base operator at the 

Airport. 

Only full service fixed-base operators are permitted to dispense aviation fuel to the 

public. Full service fixed-base operators are required to provide a minimum set of 

aeronautical services and activities to the public, including (a) passenger transportation 

services between the subleased premises and other Airport locations, (b) emergency 

assistance, to include towing or transporting disabled aircraft up to a certain weight, (c) 

collection services for landing fees, (d) aircraft airframe, engine, and accessory 

maintenance and repair services, and (e) at least two additional services, which may 

include any of the following: aircraft sales; aircraft rental; flight training; avionics, 

instrument, and propeller repair; aircraft charter and air taxi; aircraft storage; specialized 

commercial flying services; and pilot supply store and flight planning facilities. [FAA 

Exhibit 1, Item 5, attachment 4, pages 21-22.] 

Complainant alleges its competitor, Encore, is allowed by its sublease to begin fueling 

operations immediately without providing the other aeronautical service required by the 

Airport minimum standards for full service fixed-base operators. [See FAA Exhibit 1, 

Item 6, attachment 5, page 3.] Complainant states, “Encore is permitted to begin [fixedbase operator] operations effective November 9, 2007, but is not required to meet the 

same Minimum Standard requirements as Asheville Jet until March 31, 2009.” [FAA 

Exhibit 1, Item 3, page 9.] 

Page 23 
The Respondents do not dispute Complainant’s claim that Encore is permitted to sell fuel 

while not yet meeting the Airport’s minimum standards established for fuel sales. 

Rather, Respondents argue “an airport operator is not required to enforce minimum 

standards to require identical tone and posture towards all competitors.” [FAA Exhibit 1, 

Item 6, page 9.] Respondents point out that the Airport’s minimum standards include a 

section on waivers. It states, “The Authority may further temporarily waive any of the 

Minimum Standards for non-governmental Operators where the Authority, in its sole 

discretion, deems such waiver to be in the best interest or welfare of the Airport’s 

operation.”22 [FAA Exhibit 1, Item 6, attachment K, pages 9-10.] Respondents argue 

they have temporarily waived the standards for Encore to permit fuel sales. 

Encore’s sublease permits it to sell fuel during construction; Respondents have granted 

Encore a temporary waiver under the Airport minimum standards until March 31, 2009, 

to permit such fuel sales. [FAA Exhibit 1, Item 6, pages 9 and 10.] Encore wrote in a 

May 30, 2008, letter to the Airport Director, “Although we have the right under the lease 

to use temporary facilities for fuel sales in the interim, it is our intent not to exercise that 

right. Rather, we intend to begin such sales and operations when the Phase 1 

construction is completed.”23 [FAA Exhibit 1, Item 13, exhibit F.] As of June 12, 2008, 

Encore had not conducted any fixed-base operator activities, including selling fuel, at the 

Airport. [See FAA Exhibit 1, Item 13, page 5.] The Airport Director confirmed 

November 5, 2008, that Encore has still not begun fuel sales. 

Assurance 22, Economic Nondiscrimination

Assurance 22, Economic Nondiscrimination, requires airport sponsors to treat similarly 

situated fixed-base operators in the same manner. [See Assurance 22 under Section 

V.C.(2), “Applicable Law and Policy,” Statutes, Sponsor Assurances, and Relevant 

Policies, on pages 7-8 in this Director’s Determination.] 

Complainant argues it is similarly situated with Encore since both entities are fixed-base 

operators, yet Encore is permitted to operate without complying with the minimum 

standards while Asheville Jet must meet the standards. [FAA Exhibit 1, Item 3, page 8.] 

Respondents argue the two entities are not similarly situated. Complainant is an 

established fixed-base operator; it manages facilities that were constructed by the Airport 

Authority. [See FAA Exhibit 1, Item 6, page 1.] Encore is a new fixed-base operator 

required by its sublease to invest a substantial sum of money in new facilities on the 

Airport by March 31, 2009. [FAA Exhibit 1, Item 6, pages 9-10.] 

Respondents state they granted Encore a temporary waiver – which is allowed by the 

minimum standards at the Airport’s sole discretion – while Encore completes the 

construction of its fixed-base operator facilities. [FAA Exhibit 1, Item 6, page 10.] The 

 

22 This section does not define how long a “temporary” waiver may last. 

23 Phase 1 construction is to be completed on or before March 31, 2009. [See FAA Exhibit 1, Item 6, 

attachment E, page 3.] 

Page 24 
FAA Atlanta Airports District Office confirmed in an August 30, 2007, letter that it is 

permissible to allow Encore to operate from temporary facilities while constructing 

permanent facilities. Given that Encore was under contract to construct the permanent 

facilities, the FAA concluded there was no intent to circumvent the Airport minimum 

standards. [FAA Exhibit 1, Item 6, attachment H.] 

Respondents argue that both Encore and Asheville Jet are subject to the same minimum 

standards, including the provision permitting waivers. [FAA Exhibit 1, Item 6, page 10.] 

Respondents point out that the minimum standards in question were not promulgated 

until after Asheville Jet was already established on the Airport, so granting such a waiver 

at the time Asheville Jet was getting started was not even an issue. Respondents argue 

there is no evidence to suggest that Asheville Jet, or even a third fixed-base operator, 

would not be granted the same sort of waiver on request if it established new or expanded 

operations on the same level. [FAA Exhibit 1, Item 6, page 10.] 

 

Respondents cite two previous FAA determinations to support their contention that 

Asheville Jet and Encore need not be treated in the same fashion regarding airport 

minimum standards: (1) Rick Aviation, Inc. v. Peninsula Airport Commission, FAA 

Docket No. 16-05-18, (May 8, 2007) (Director’s Determination) and (November 6, 2007) 

(Final Decision and Order); and (2) The Aviation Center, Inc. v. City of Ann Arbor, 

Michigan, FAA Docket No. 16-05-01 (December 16, 2005) (Director’s Determination). 

3⁄4 Rick Aviation

In Rick Aviation, the complainant alleged unfair economic discrimination because the 

complainant was required to comply with the airport’s minimum standards while its 

competitor was not. Both tenants were fixed-base operators. 

In that case, the airport sponsor did not waive the minimum standards. On the contrary, 

the airport sponsor began enforcing the minimum standards within the competitor’s first 

months of operation. The fact that the competitor may have fallen short of the minimum 

standards was not evidence that the airport sponsor permitted this shortfall. In fact, the 

airport sponsor was working with both fixed-base operators to bring them into 

compliance with the airport’s minimum standards. The FAA concluded, “noncompliance 

by [the competitor] does not automatically result in noncompliance by [the airport 

sponsor].” 

Respondents cite Rick Aviation in stating “...the FAA has recognized that differences in 

enforcement of an airport’s minimum standards are permissible and, in certain cases, 

appropriate.” [FAA Exhibit 1, Item 6, page 9.] This is not correct. While the FAA 

recognizes there may be exigent circumstances to consider from time to time, the FAA 

does expect airport sponsors to enforce minimum standards consistently. In Rick 

Aviation, the airport sponsor was attempting to enforce the minimum standards in place. 

The standards were not waived. In the current case, the standards permit a waiver, which 

would be applicable to any tenant under the same or similar circumstances. 

Page 25 
Respondents cite Rick Aviation in stating, “The FAA deems an airport operator in 

compliance with its grant assurances when the operator has a program in place to address 

its grant obligations and it implements that program.” [FAA Exhibit 1, Item 6, page 9.] 

In the context of the Director’s Determination, this statement referred to the airport 

sponsor’s efforts to enforce compliance. If, in fact, the airport sponsor is taking no steps 

to implement its minimum standards consistently, the airport operator would likely be 

found in noncompliance. In the current case, Respondents are consistently applying the 

Airport’s minimum standards in that the standards themselves permit temporary waivers. 

Respondents cite Rick Aviation in stating, “That standard of compliance ‘does not 

require that airport operators enforce minimum standards so rigidly as to require identical 

tone and posture toward all competitors that have different records and history with the 

sponsor.’” [FAA Exhibit 1, Item 6, page 9.] In that case, the FAA recognized that one 

fixed-base operator met the minimum standards through the use of approved 

subcontractors performing fixed-base operator services on behalf of the parent company. 

The floor space occupied by the subcontractor counted toward the floor space 

requirement for the fixed-base operator. The complaining fixed-base operator did not use 

subcontractors for fixed-base operator services and was not permitted to count floor space 

from an unrelated subtenant that did not perform fixed-base operator services. The FAA 

recognized that meeting the minimum standards could be accomplished directly by the 

fixed-base operator or through the use of approved subcontractors, reflecting that 

minimum standards need not be so rigidly enforced as to require identical tone and 

posture toward all competitors that have different records and history with the sponsor. 

[See Rick Aviation, Inc. v. Peninsula Airport Commission, FAA Docket No. 16-05-18, 

(May 8, 2007) (Director’s Determination), page 16.] In the current case, the Complainant 

is the incumbent fixed-base operator. It meets the minimum standards without regard to 

any waivers. The competitor is a new fixed-base operator initiating service at the 

Airport. It is complying with the minimum standards through the allowable waiver. 

Encore’s fixed-base operator sublease agreement with the Respondents permits it to 

operate for a specified period of time from temporary facilities while it constructs the 

facilities required for fixed-base operators. [FAA Exhibit 1, Item 5, attachment 10, 

page 3.] 

Respondents cite Rick Aviation in arguing that a new entrant fixed-base operator may be 

excused from meeting airport minimum standards while its facilities are under 

construction. Respondents cite Rick Aviation stating, “The FAA noted that ‘considering 

that the Complainant admits that Mercury is proceeding with the construction of the 

terminal building, it appears that [the airport operator] has succeeded in compelling 

Mercury’s compliance with the 2004 Mercury Lease.’” [FAA Exhibit 1, Item 6, 

page 10.] This citation is not relevant to the current case. In Rick Aviation, the 

requirement to construct a terminal building was contained the tenant’s lease, not in the 

minimum standards. The Director’s Determination points out that FAA does not enforce 

lease agreements through the grant assurance compliance program. The issue regarding 

construction of the terminal building was not an issue for FAA to resolve. [See Rick 

Aviation, Inc. v. Peninsula Airport Commission, FAA Docket No. 16-05-18, (May 8, 

2007) (Director’s Determination), page 20.] Respondents are correct in noting, however, 

Page 26 
that the airport sponsor may permit new entrant tenants an appropriate amount of time – 

based on the extent of investment and complexity of the enterprise – to come into 

compliance with minimum standards. 

3⁄4 The Aviation Center

Respondents cite The Aviation Center in stating, “The FAA has also recognized that a 

waiver of an airport’s minimum standards, where such a waiver is not unjustly 

discriminatory, is permissible.” [FAA Exhibit 1, Item 6, page 10.] 

In The Aviation Center, the complainant argued it was discriminated against when a 

competing fixed-base operator was permitted to operate without complying with the 

airport’s operational standards. In that case, the operational standards were adopted in 

1981, but had never been made a mandatory requirement for commercial aeronautical 

activity at the airport. In fact, neither the airport sponsor nor the complainant was even 

aware that the operational standards existed until a freedom of information request was 

conducted as part of the complaint process. As with the current case, the operational 

standards included a section permitting the airport sponsor to waive any provision it 

deemed in the public interest to waive. By not enforcing the standards, the sponsor 

deemed the standards to have been waived. [See The Aviation Center, Inc. v. City of 

Ann Arbor, Michigan, FAA Docket No. 16-05-01 (December 16, 2005) (Director’s 

Determination), pages 5-6, 23.] The FAA found the airport sponsor enforced – or waived 

– the standards consistently among the fixed-base operators at the airport. As such, there 

was no basis for finding the sponsor in noncompliance with grant assurance 22, 

Economic Nondiscrimination. 

In the current case, the Respondents did not waive the entire Airport minimum standards 

for every fixed-base operator on the Airport. In fact, they did not waive the minimum 

standards at all. They applied the minimum standards as those standards permit – 

including allowing a temporary waiver. In this case, the temporary waiver permits 

Encore to operate while constructing the facilities needed to comply with the Airport’s 

minimum standards for a fixed-base operator. 

Director’s conclusion on grant assurance 22 related to Airport minimum standards

Respondents have a set of Airport minimum standards. These standards allow the 

Respondents to waive the standards on a temporary basis as appropriate in the sole 

discretion of the Respondents. Respondents have deemed it appropriate to waive certain 

requirements during the initial period while the new entrant fixed-base operator 

constructs its facilities. 

The established fixed-base operator and the new entrant fixed-base operator are not 

similarly situated for purposes of the Airport minimum standards until such time as both 

are fully established. In this case, Respondents set a specific date (March 31, 2009) by 

which the new entrant is expected to be fully established.24 

 

24 Encore is a new fixed-base operator whose sublease grants it a temporary waiver from certain 

requirements of the minimum standards while it completes the construction of its fixed-base operator 

Page 27 
The important factor to consider in determining compliance with the sponsor’s federal 

obligations on this issue is whether the same latitude is, or has been, provided to all 

tenants under the same circumstances. This is the first time this situation has arisen since 

the minimum standards were adopted in 2004. There are no previous cases at this Airport 

for comparison. Respondents indicate they would provide a similar waiver in the future 

to the Complainant or another fixed-base operator should the need arise. They state, 

“there is no suggestion that Asheville Jet – or a hypothetical third FBO – would not 

likewise be given the same sort of waiver if it requested one occasioned by new or 

expanded operations at [the Airport].” [FAA Exhibit 1, Item 6, page 10.] Until such time 

as a comparable situation arises, neither the FAA nor the Complainant can predict how 

the Respondents will respond. 

The FAA’s role in a Part 16 Complaint is to determine whether the Respondents are in 

current compliance with their federal obligations. [See Section V.B, “Applicable Law and 

Policy,” FAA Airport Compliance Program, on pages 5-6 in this Director’s Determination.] 

There is no evidence the Respondents are unjustly discriminating against the Complainant 

by temporarily waiving certain minimum standards during the new entrant’s construction 

phase. The minimum standards permit granting such temporary waivers. As such, there is 

no violation of the minimum standards. In addition, it is not unreasonable to allow a new 

entrant fixed-base operator to begin certain operations from temporary facilities while it 

constructs its permanent facilities. Even so, Encore has elected not to engage in fixed-base 

operator activities – including fuel sales – during phase 1 construction. Therefore, while 

the temporary waiver is permissible and not a violation of the Respondents’ federal 

obligations, granting the waiver has not yet directly impacted the Complainant. As of 

November 5, 2008, the Complainant remains the only fixed-base operator operating on the 

Airport. 

The Director finds the Respondents are not currently in violation of grant assurance 22, 

Economic Nondiscrimination, by granting a temporary waiver of certain Airport 

minimum standards for a specified period of time while the new entrant fixed-base 

operator constructs the required facilities. 

Assurance 23, Exclusive Rights

Assurance 23, Exclusive Rights, prohibits the airport sponsor from giving any tenant the 

exclusive right to provide a particular aeronautical service. [See Assurance 23 under 

Section V.C.(3), “Applicable Law and Policy,” Statutes, Sponsor Assurances, and 

Relevant Policies, on page 9 in this Director’s Determination.] 

 facilities. Encore is required to invest $3.5 million to complete the construction of those facilities by 

March 31, 2009, after which it will be required to comply with the minimum standards. [FAA Exhibit 1, 

Item 6, page 10.] Even when the two fixed-base operators are deemed to be similarly situated with 

regard to the Airport minimum standards, they may still be regarded as not similarly situated in terms of 

grant assurance 22, Economic Nondiscrimination, since Encore is constructing its facilities at its own 

expense and making a substantial investment in the Airport while Asheville Jet is managing facilities 

constructed at the airport sponsor’s expense and is not making the same type of substantial investment in 

the Airport. 

Page 28 
 

Complainant alleges the Respondents gave Encore an exclusive right by permitting it to 

operate without complying with the minimum standards. [FAA Exhibit 1, Item 3, 

page 9.] 

Complainant points to no service or product Encore is exclusively permitted to offer or 

provide. Without this element, there can be no exclusive rights violation. In fact, by 

entering into an agreement with Encore to provide fixed-base operator services in 

competition with the Complainant, the Airport sponsors have actually avoided what could 

have been a potential violation of assurance 23. Had the Respondents refused to consider 

offers to establish a competing fixed-base operator when it was not unreasonably costly, 

burdensome, or impractical to have more than one fixed-base operator, and it did not 

require reducing the space subleased to the existing fixed-base operator, they could have 

been found in violation of their federal obligations regarding exclusive rights.25 

Director’s conclusion on grant assurance 23 related to Airport minimum standards

The Director finds the Respondents are not currently in violation of grant assurance 23, 

Exclusive Rights, by granting a temporary waiver of certain Airport minimum standards 

for a specified period of time while the new entrant fixed-base operator constructs the 

required facilities. 

(2) Favorable Sublease Terms

Complainant alleges Respondents granted Encore substantially favorable sublease terms 

that will result in unjust economic discrimination to the Complainant in violation of grant 

assurance 22, Economic Nondiscrimination. [FAA Exhibit 1, Item 3, page 11.] 

Assurance 22, Economic Nondiscrimination, obligates airport sponsors to offer each 

fixed-base operator the same rates, fees, rentals, and other charges as are uniformly 

applicable to all other fixed-base operators making the same or similar uses of the airport 

and using the same or similar facilities. [See Assurance 22 under Section V.C.(2), 

“Applicable Law and Policy,” Statutes, Sponsor Assurances, and Relevant Policies, on 

pages 7-8 in this Director’s Determination.] 

 

Complainant argues its competitor fixed-base operator, Encore, enjoys substantially 

favorable sublease terms that impede Asheville Jet’s ability to compete on an equal 

footing. [FAA Exhibit 1, Item 3, page 12.] For example, 

• Encore pays a $.05 per gallon fuel flowage fee while Ashville Jet must pay 5% of 

gross receipts on fuel sales. Complainant states this will result in a $.13 per 

gallon difference. Complainant argues such a difference will be devastating to 

 

25 Complainant argues it lost the use of a previously available apron when the Respondents gave 

preferential use of this apron to Encore. This does not equate, however, to reducing the fixed-base 

operator’s subleased space to a degree that precludes it from competing with the second fixed-base 

operator or from requesting additional land upon which to construct replacement apron space. [See

Issue 1 above.] 

Page 29 
Asheville Jet. [FAA Exhibit 1, Item 3, page 12; and Item 6, attachment E, 

page 19.] 

• Encore pays 5% of gross receipts on nonaeronautical services and products, 

including rental cars, ground transportation, retail merchandise, and food and 

beverage sales. It excludes in-flight catering, vending machine sales, and all onairport aviation services and products, such as maintenance services, air charter 

services, flight training, hangar rentals, facility and service fees, and into-plane 

fees. [FAA Exhibit 1, Item 5, attachment 10, page 19; and Item 6, attachment E, 

page 19.] 

• Ashville Jet must pay 5% of all gross receipts (not just on nonaeronautical 

receipts). Complainant states “... requiring Asheville Jet to pay Airport Authority 

5% of all gross receipts while allowing Encore to pay only 5% on minor ancillary 

revenue sources will give Encore substantial cost savings that will allow it to 

obtain further competitive and pricing advantages with higher profits.” [FAA 

Exhibit 1, Item 3, page 13.] 

Table 1 below gives a general comparison of the differing terms between the Asheville 

Jet sublease and the Encore sublease. 

Table 1: Comparison of Sublease Terms

Sublease Term Asheville Jet 

(Complainant) 

Encore 

(competitor) 

Reference 

Sublease executed 1993 2007 FAA Exhibit 1, Item 6, page 11. 

Subleased area 33.67 acres 9 acres FAA Exhibit 1, Item 6, page 12. 

Fuel flowage fees 5% of gross receipts 

on fuel sales 

$.05 per gallon FAA Exhibit 1, Item 3, page 12 

Gross receipts 5% of all gross 

receipts 

5% of gross receipts 

for nonaviation 

products and 

services 

FAA Exhibit 1, Item 3, page 14; Item 

6, page 12. 

Unimproved land rent N/A $.25 per square foot FAA Exhibit 1, Item 5, attachment 10, 

page 5. 

Preferential use apron N/A $.30 per square foot FAA Exhibit 1, Item 5, attachment 10, 

page 5. 

Option provision for 

additional unimproved 

land 

None $.025 per square 

foot; right of first 

refusal on 8 acres. 

FAA Exhibit 1, Item 5, attachment 10, 

page 5; Item 6, page 12. 

Base sublease term and 

investment requirement 

24 years; Authority 

constructed facilities

30 years with $3.5 

million investment 

FAA Exhibit 1, Item6, pages 11, 15. 

Sublease extension option 

and investment 

requirement 

1 year for each 

$135,000; rental rate 

reverts to fair 

market value. 

10 years with $4.5 

million investment 

FAA Exhibit 1, Item 6, page 11. 

Page 30 
These two subleases were negotiated 14 years apart. It is reasonable to expect there 

would be some differences in the terms. The Director has consistently concluded that 

grant assurance 22, Economic Nondiscrimination, does not require a sponsor to offer 

lease rates and terms that are identical to other leases negotiated at different points in 

time. The FAA does not require a sponsor to maintain equal lease rates over time 

between competing fixed-base operators. [See Aerodynamics of Reading, Inc. v Reading 

Regional Airport Authority, FAA Docket No. 16-00-03 (July 23, 2001) (Final Agency 

Decision).] 

Further, two fixed-base operators may be considered not essentially similar as to rates 

and charges – even though they offer the same services to the public – when there is a 

difference in space, location, or facilities. [See FAA Order 5190.6A, Airport Compliance 

Requirements, October 2, 1989, chapter 4, section 4-14d(2)(a,b).] Even when 

aeronautical tenants propose the same or similar use of the airport, if the level of financial 

investment is dissimilar, the FAA may find the aeronautical users are not similarly 

situated. 

In this case, Asheville Jet entered into a sublease agreement to manage facilities 

constructed and paid for by the Respondents. In contrast, Encore entered into an 

agreement to construct and pay for its own facilities. Encore committed to making a 

substantial financial investment in the Airport that was not made by Asheville Jet. As 

such, the two fixed-base operators are not similarly situated. 

Complainant has more than three times the land area as Encore yet pays no rental rate 

directly on the property. Instead, Complainant pays five percent (5%) of gross receipts as 

its rental payment. Encore, on the other hand, pays a land rental rate that will be adjusted 

annually by the Consumer Price Index and every five years by appraisal. [FAA 

Exhibit 1, Item 6, page 12.] Encore also pays five cents ($.05) per gallon for a fuel 

flowage fee. The fuel flowage fee for Asheville Jet is included in the five percent of 

gross receipts. These terms are admittedly different. 

The Director finds the differing terms between the Asheville Jet sublease and the Encore 

sublease are justified, however, by the differing circumstances and the investment 

requirements of each fixed-base operator. The differing terms are not so disparate as to 

result in a violation of the Respondents’ federal obligations under grant assurance 22, 

Economic Nondiscrimination. In August 2007, the FAA Atlanta Airports District Office 

reviewed the Encore sublease at the airport sponsor’s request and also concluded that 

while the Encore sublease and Asheville Jet sublease were not exactly the same, they 

were equitable, fair, and reasonable. [FAA Exhibit 1, Item 6, attachment H.] 

Even so, Respondents state, “The Authority has repeatedly offered to renegotiate the 

terms of Asheville Jet’s [fixed-base operator] sublease to address the issues that are the 

subject of [this] Part 16 Complaint.” [FAA Exhibit 1, Item 6, page 5. See also Item 5, 

attachment 9, page 17.] The Asheville Jet sublease includes a provision for renegotiating 

the terms of the sublease at the Complainant’s request subject to providing substantial 

Page 31 
additional capital investment.26 [FAA Exhibit 1, Item 5, attachment 3, page 6.] In 

addition, Respondents argue, “the Authority would be willing to offer those comparable 

sublease terms to Asheville Jet.” [FAA Exhibit 1, Item 6, page 14.] The Complainant 

stated at a regular meeting of the Asheville Regional Airport Authority on October 12, 

2007, that it would like to renegotiate its lease terms “to become comparable to other 

tenant leases.” The Complainant did not elaborate on what changes might be requested. 

[FAA Exhibit 1, Item 5, attachment 11.] 

Complainant’s sublease contains the following general provision: “Lessor shall not 

require a greater level of service or performance from Lessee than that which is required 

from any other occupant of the Airport providing some or all of the Commercial Aviation 

Activities (‘competitor’), nor shall Lessor grant terms more favorable than those 

contained in this Lease to any other competitor. It is the intention of the parties that no 

competitor, whether presently occupying the Airport or occupying the Airport hereafter, 

have an unfair advantage by paying a lesser rental than Lessee or being provided with 

terms or treatment which are directly more favorable to Competitor than those provided 

to or required of Lessee.” [FAA Exhibit 1, Item 5, attachment 3, page 11.] 

If it is the Complainant’s intent to argue that this term in its sublease has been breached 

by the Respondents’ sublease with Encore, Complainant must pursue that issue in state 

court. The FAA does not arbitrate or mediate negotiations through a formal Part 16 

complaint process. Nor does the FAA enforce lease terms between parties to an 

agreement. Rather, the FAA enforces contracts between an airport sponsor and the 

federal government. [See AmAv v. Maryland Aviation Administration, FAA Docket No. 

16-05-12, (March 20, 2006) (Director’s Determination).] Whether or not an airport 

tenant has breached the terms of its lease agreement with the airport sponsor is a matter to 

be resolved in state court. The FAA is not a party to litigation proceedings between 

complainants and respondents involving contract disputes; nor does the FAA have 

jurisdiction over matters of contract law between airport tenants and sponsors. [See Rick 

Aviation, Inc. v. Peninsula Airport Commission, FAA Docket No. 16-05-18, 

(November 6, 2007) (Final Decision and Order).] 

Director’s conclusion on favorable sublease terms

The Director finds the Respondents are not currently in violation of grant assurance 22, 

Economic Nondiscrimination, as a result of offering different terms for a sublease 

requiring a substantial investment in the Airport as compared to a sublease that did not 

require a similar substantial investment. 

Director’s Conclusion on Issue 2

The Director finds the Respondents are not currently in violation of grant assurance 22, 

Economic Nondiscrimination, or grant assurance 23, Exclusive Rights, by (1) by requiring 

 

26 The sublease states, “If Lessee requests and shall be willing to provide substantial additional capital 

investment, the Parties agree that they will negotiate in good faith the terms of this Lease which term 

would bear a relation to the amount of additional capital investment proposed, taking into consideration 

the amount of time remaining under this Lease.” [FAA Exhibit 1, Item 5, attachment 3, page 6.] 

Page 32 
the Complainant to comply with the Airport minimum standards while not requiring the 

competing fixed-base operator to comply with the same standards, or (2) by granting 

substantially favorable sublease terms to the competing fixed-base operator. 

• It is both reasonable and permitted by the Airport minimum standards to allow a 

temporary waiver for a new entrant fixed-base operator during a period of 

construction. 

• In addition, the Respondents’ federal obligations do not require it to offer 

identical lease terms to fixed-base operators that enter into agreements at different 

times and on different bases. In this case, the new entrant agreed to make a 

substantial investment in the Airport that was not made by the incumbent fixedbase operator. As such, the two are not similarly situated for purposes of rates 

and fees under grant assurance 22.27 

VII. FINDINGS and CONCLUSIONS 

Upon consideration of the submissions and responses by the parties, the entire record 

herein, applicable law and policy, and for the reasons stated above, the Director of the 

FAA Office of Airport Compliance and Field Operations finds and concludes as follows: 

• The Director finds the Respondents are not currently in violation of grant 

assurance 5, Preserving Rights and Powers, grant assurance 22, Economic 

Nondiscrimination, grant assurance 23, Exclusive Rights, or grant assurance 27, 

Use by Government Aircraft, by granting preferential use of an apron upon which 

federal funds were expended to a competing fixed-base operator. 

• The Director finds the Respondents are not currently in violation of grant 

assurance 22, Economic Nondiscrimination, or grant assurance 23, Exclusive 

Rights, by (1) by requiring the Complainant to comply with the Airport minimum 

standards while granting a temporary waiver from those standards to a new 

entrant competing fixed-base operator during a period of construction, or (2) by 

granting different sublease terms to a competing fixed-base operator making a 

substantial investment in the Airport that is not made by the Complainant. 

ORDER

Accordingly, it is ordered that: 

1. The Complaint is dismissed. 

2. All Motions not expressly granted in this determination are denied. 

 

27 Once both fixed-base operators are fully functioning with permanent facilities, they will be deemed to be 

similarly situated for the purpose of complying with the Airport minimum standards for fixed-base 

operators only. For purposes of comparing sublease terms, they will continue to be not similarly situated. 

Page 33 
RIGHT OF APPEAL

This Director's Determination is an initial agency determination and does not constitute a 

final agency action and order subject to judicial review. [14 CFR 16.247(b)(2)] A party 

to this Complaint adversely affected by the Director's Determination may appeal the 

initial determination to the FAA Associate Administrator for Airports pursuant to 14 CFR 

16.33(b) within thirty (30) days after service of the Director's Determination. 

 

 

 October 1, 2009

Randall S. Fiertz Date 

Director, Office of Airport Compliance 

 and Field Operations 

Page 34