Commissioners discuss funding for terminal

ALPENA — The Alpena County Board of Commissioners held a special meeting and public hearing Friday to discuss applying for a loan from United States Department of Agriculture to be used to cover the county’s portion of the cost to have a new terminal built at Alpena County Regional Airport.

The final cost of the terminal has yet to be determined, but is expected to be in the neighborhood of about $13 million. The county is responsible for 2.5 percent of that as a match and also must cover the entire amount of costs of areas where passengers aren’t permitted. Because the entire cost of the project is yet to be determined, the county likely will have to borrow between $2 million and $2.8 million.

Airport Manager Steve Smigelski said he asked consultant and architectural firm RS&H for the worst-case scenario cost-wise and was told it shouldn’t cost more than about $1.8 million. Once bids for the project come in this summer, the county will have a better idea what to borrow from the USDA, Smigelski said.

Smigelski gave a presentation about the terminal and explained what it will include on the interior and exterior. He shared how operations will continue at the airport while construction is being done and how the transition will take place when it is complete.

He said the design is 90 percent done and submitted to the Federal Aviation Administration and all that is left to design are minor electrical, plumbing and other infrastructure elements of the terminal. He detailed the layouts of the new parking lots and went over improvements for the taxiway and drainage system improvements which will also be made.

Smigelski said there have been years of work done to get a new terminal, which started under former Manager Billi McRoberts. He said if the county doesn’t take advantage of the funds the FAA is willing to give Alpena, it may never have another opportunity to get the government to pay for it.

“The FAA isn’t in the business of building terminals and this is a gift that isn’t going to be offered again,” he said. “There has been a lot of work put into this and if we don’t do this now we may never be able to do this.”

The county intends to lease space in the new terminal that will help take care of the loan payments. Chairman Cam Habermehl said the rental revenue likely will cover about half of the payment and the rest would be taken from interest earned on the revolving tax fund.

The loan is expected to be a 20-year loan with an interest rate of 3.8 percent. Once the county gets approval from FAA for the discretionary funding for the terminal, likely in August, it also will get a notice to proceed. Smigelski said by that point contractors should be hired and demolition of the north hangar could begin and footings for the new terminal installed before winter arrives. Full construction would begin in spring 2019 and work would continue until the terminal is complete sometime in 2020.

During the meeting the board voted to remove an item on the agenda that called for discussion and a vote on millage language that, if passed, would have paid for the project. Habermehl said the commissioners were not in favor of a millage because if it failed it could jeopardize the project. He said there also are a lot of millages facing renewal.

“We don’t want the people getting millaged to death,” he said.

Steve Schulwitz can be reached via email at or by phone at 358-5689. Follow Steve on Twitter ss_alpenanews.