Vision2 proposal includes building repairs that are the responsibility of tenants
BY WAYNE GREENE World Senior Writer
Monday, October 01, 2012
10/04/12 at 3:40 PM
This story originally contained an error concerning the size of the Air Force Plant No. 3 building leased by IC Bus and Spirit AeroSystems. The story has been corrected.
Read more about the proposal and the status of Vision 2025 projects.
City leases with industrial tenants in Air Force Plant No. 3 say building upkeep is the responsibility of the tenants, but Vision2 backers say local taxpayers should pick up $40 million in work on the structure.
Vision2 would upgrade the more than 66-acre building's decades-old roof, electrical system and air handling equipment.
The building houses manufacturing facilities of two companies: IC Bus, the largest manufacturer of school buses in North America, and Spirit AeroSystems, the world's largest supplier of commercial airplane assemblies and components.
The city's IC Bus lease says that the company "shall perform all repairs, maintenance, and preventative maintenance, including capital maintenance and repair to the leased premises, which shall include all repairs to the structure, roof, heating, electrical, plumbing and air conditioning systems."
As long as IC Bus employs 1,200 people, the lease sets the company's rent at $1 a year.
The lease applying to the Spirit AeroSystems space is less specific concerning roofing, electrical and air conditioning systems, but still broadly puts the responsibility on the company, which shall "paint, repair, replace or rebuild all of any part of the leased premises, interior or exterior, structural or nonstructural, which may be damaged or destroyed."
The lease also states the tenant "shall ... take good care of the leased premises; shall maintain the same at all times in good condition; shall make all repairs and replacements inside and outside, ordinary and extraordinary, structural or otherwise ... and shall pay promptly the costs and expenses of such repairs, replacements and maintenance."
The company, which employs about 2,700 people, pays $14,211 annually to the city for its portion of Air Force Plant No. 3 and other buildings.
Spirit also pays a $623,646 market rate for another series of buildings south of the American Airlines maintenance base to the Tulsa Airport Improvement Trust.
Both companies have spent heavily on the buildings.
A document distributed by Vision2 supporters shows that the two Air Force Plant No. 3 tenants have invested $80.8 million in improvements and site infrastructure.
Spirit paid the city $1.6 million annually until 2009 to pay back improvements that were made.
IC Bus funded a $2 million roofing job this summer for the most pressing roofing problems over its part of the building, a total of 250,000 square feet.
Tulsa Airports Director Jeff Mulder said the Vision2 money should be a strategic investment, not a sign that taxpayers are relieving the tenants from future maintenance responsibilities.
If Vision 2 passes, he said he would recommend the city continue to require the tenants to perform future maintenance.
Tulsa City Councilor Blake Ewing said he is bothered by the idea of the city using millions in economic development funding to pay for something that is the responsibility of the tenants. He said he can think of hundreds of better uses of $40 million.
"If we're going to use taxpayer money to get economic development in Tulsa, I think we owe it to ourselves to consider all of the possibilities and be creative with our ideas," Ewing said.
If the city makes a low-rent deal with a tenant in exchange for jobs, part of the equation needs to be requiring them to make needed repairs to the property, Ewing said.
On the other hand, if the city is going to pick up major maintenance costs, it needs rent income to pay for it, he said.
But the Vision2 proposal is silent on who is responsible for maintaining the facilities in the future, he said.
"I don't want it to be that my children are faced with this same situation, where equipment purchased in 2012 is now in disrepair because we didn't maintain it," Ewing said.
Tulsa Mayor Dewey Bartlett, co-chairman of the Vision2 campaign, said he doesn't see the projects planned with the public money as being ordinary repair work.
"To me when something like an entire roof needs to be replaced, that's not just a repair. That is something that is really structural to the entire property," Bartlett said.
"I think, ultimately, it is the city's responsibility. It's the city's property."
The city owes the repairs not just to the tenant companies, but also to people who work there and the community at large, which depends on the economic activity generated in the building for its prosperity, the mayor said.
With an investment in the buildings now, the city can continue to get thousands of jobs from the building for decades to come, he said.
"We have to take the responsibility of ownership but also of looking at the future," Bartlett said.
But if taxpayers don't invest in improving the building, they face the possibility of losing the tenants, which would mean the city is left with an empty building that still needs repair but isn't producing jobs, he said.
Election date: Nov. 6
Amount: $748.8 million
Tax impact: Extension of 0.6 percent Vision 2025 sales tax from 2017 through 2029
Proposition 1: Economic development
Airport industrial complex buildings and infrastructure - $122 million
Airport industrial complex equipment - $132 million
Closing fund - $52.942 million
Bond costs and interest - $79.938 million
Proposition 2: Quality-of-life improvements
Tulsa County - $92 million
Tulsa - $157.92 million
Bixby - $11.3 million
Broken Arrow - $44.1 million
Collinsville - $3 million
Glenpool - $5.9 million
Jenks - $9.2 million
Owasso - $14.38 million
Sand Springs - $10.1 million
Skiatook - $1.16 million
Sperry - $643,894
Bond costs and interest - $12 million
Development group issues opposition to Vision2 proposal
A group that helped in the formative process of the Vision 2025 campaign has come out in opposition to the Vision2 proposal.
The governing board of TulsaNow, a nonprofit group focused on intelligent and sustainable development, preservation and the revitalization of Tulsa, voted last week to oppose both parts of the proposal.
The group found that Vision2's economic development proposal - Proposition 1 - gives insufficient emphasis to promoting diverse and sustainable industries and has inadequate oversight and limits on a proposed closing fund.
The governing board's vote on Proposition 1 was unanimous.
On a split vote, the group also opposes quality-of-life funding in Vision2's Proposition 2.
The process for determining funded quality-of-life projects was too rushed, the proposal's structure leaves too much control over funding in the hands of county government, and the funding has little or no focus on key redevelopment and transportation issues, a statement from the group says.
Original Print Headline: Vision2 covers tenant repairs
Wayne Greene 918-581-8308
Natalie Catlett works to paint a bus at the IC Bus Plant that might benefit from Vision2. Above the bus behind her is a tarp that is used because of a leaky roof. MIKE SIMONS / Tulsa World
Brandon Thomas works to sand a bus at the IC Bus Plant that might benefit from Vision2. MIKE SIMONS / Tulsa World