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Rock Airport offers plan for solvency

Monday, May 26, 2014, 12:01 a.m.
 

A bankruptcy reorganization plan for Rock Airport and Business Park filed with the court on Friday relies on projected proceeds from a gas lease with Huntley & Huntley to repay creditors.

The gas lease would provide $800,000 up front with royalty payments totalling an estimated $12 million over 15 years, the document states.

Income from the ongoing business operations at the West Deer airport and park, possible real estate sales and possible contracts with utility companies for fly ash disposal can pay third-party claims, the document states.

The plan — which would keep the airport open — was filed before a Tuesday hearing during which bankruptcy court Judge Carlota Böhm is expected to address a number of pending issues in hopes of moving the 5-year-old case closer to resolution.

“I think it's going to be interesting … If everything goes according to plan, that should change the dynamics of the whole process,” airport president Rock Ferrone said of the reorganization plan.

“We are obviously anxious to emerge the project from bankruptcy and save the airport ... letting it become the economic engine that we all knew that it would become over a decade ago,” he said via email.

In order for the plan to be approved, the creditors in the case must sign off on it. Ferrone said they have tentative agreements with those involved.

The reorganization plan would compete with a pending sale agreement and any bids that are submitted to buy the property.

In March, Alaskan Property Management, a subsidiary of Management Science Associates offered to buy the 268-acre parcel for $6 million. MSA is a tenant of the business park.

Alaskan has not said whether it will keep the airport open.

Other parties will have the opportunity to submit a purchase bid. It must exceed Alaskan's offer. Bids can't be submitted until the bid procedures are finalized.

Secured claims total $6 million. The primary creditors in the case are Huntington National Bank, which is owed $3.1 million and the Allegheny County Redevelopment Authority, which is owed $1.74 million and First Commonwealth Bank, owed $526,000.

The trustee in the case, Natalie Lutz Cardiello, stands to be paid at least $180,000 in commission on the current sale agreement. According to federal statute, which dictates bankruptcy trustees' commissions, a trustee earns 3 percent on all monies disbursed or turned over in the case. This amount does not include fees or other expenses for which the trustee requests payment. The trustee's payment must be approved by the judge in the case.

Cardiello did not return calls seeking comment.

Attorneys on both sides said they anticipated having a number of matters resolved or close to a resolution this week. Rock Airport and Business Park has been in bankruptcy since 2009.

Among the items to be addressed on Tuesday are:

• Determining whether a new owner must repay $9.3 million in grant money to PennDOT if it closes the airport and if that detail should be included in the bid requirements.

• Settling bid procedures, which are used by parties interested in submitting bids to buy the property.

• Finalizing information for potential bidders that ownership will come with a required easement for access to the business park power grid, which isn't part of the sale.

• Update on progress on an environmental assessment that Alaskan must complete as part of its purchase agreement.

The judge will also take testimony on Alaskan's request for the appointment of an examiner in the case.

According to the U.S. Bankruptcy Code, an examiner investigates the conduct, assets, liabilities, business operations and financial condition of the debtor. The examiner may assess the desirability of continuing the business.

Alaskan/MSA and Ferrone, which have had a contentious and litigious relationship, have filed motions against each other asking the bankruptcy court judge to impose sanctions for what the other perceives as purposely not cooperating in various aspects of the case.

Jodi Weigand is a staff writer for Trib Total Media. She can be reached at 724-226-4702.

 

 
 


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