After years of battling the city of Santa Monica for a reasonable business environment at the Santa Monica Airport, several businesses have thrown in the towel and vacated the airport property. The biggest hit came on Tuesday as Justice Aviation, one of the biggest flight schools in southern California, settled with the city and will shut its doors in the next few weeks.
The business environment for the tenants at SMO has been difficult at best in the past few years, particularly since the city no longer is willing to extend reasonable lease terms in an apparent effort to make the businesses leave on their own account. This strategy is proving to have some success. Last summer the city denied three-year leases to Gunnell Properties, Atlantic Aviation, American Flyers and Krueger Aviation, which have all been long-term revenue-generating tenants at SMO. Instead, these companies along with several others were offered month-to-month leases, providing no long-term stability.
Since then Gunnell, Audi and several law firms that were good revenue generators for the airport have moved, said Santa Monica Airport Association’s president Christian Fry.
Business had been particularly challenging for Justice Aviation since the city implemented landing fees at the airport. While the landing fees originally only affected visiting airplanes, airport tenants have been forced to pay fees for each landing since August 2013. Because tenants already pay the city property taxes and other fees, many tenants found this additional fee to be unreasonable. Flight schools are hard hit by the fees as their students are forced to fly to other airports to practice landings or rack up major fees.
In protest Justice Aviation refused to pay the fees. The city retaliated last year by serving Justice Aviation with a three-day notice to pay the fees or close the business. In addition, the city imposed a 30-day notice to vacate the property. Justice Aviation was also involved with several lawsuits and court actions against the unreasonable treatment the city had given it and other businesses at the airport.
To remain legally compliant Justice Aviation’s owner Joe Justice paid the fees within the three-day timeframe, yet the city persisted with the eviction notice. The suits and countersuits that followed between the city and Justice settled on Tuesday. Justice will receive $450,000 of Santa Monica taxpayer funds to cease all business operations by May 11 and vacate the property by June 10.