The Port of Kennewick's attempts to find someone to manage Vista Field appear to have fallen apart.
On Tuesday, the port commission reportedly will consider rejecting Mike Shannon's proposal to be the airport's fixed-based operator.
Shannon said Friday that he was told by the port that negotiations will be terminated.
He met in a private negotiation session with port staff and port Commission President Skip Novakovich on Thursday for the first time since Shannon responded in writing to a draft contract.
Novakovich said the commission is likely to receive a recommendation by port staff and the port's attorney about Shannon's proposal. Commissioners could decide to continue negotiations or reject it, he said.
Despite Shannon's belief that the decision already is made, Novakovich told the Herald that isn't something one commissioner can decide.
Shannon and the port started negotiating nine months ago on a contract to make Shannon the fixed-based operator at the small airport near the Three Rivers Convention Center.
Shannon, of Shannon Dental, would provide services such as aircraft repair and maintenance and flight lessons and oversee fueling and hangar and tie-down rentals.
In addition, the port would turn over management of the airport to Shannon, giving him the responsibility for recruiting businesses to Vista Field.
But negotiations soured when each side claimed the other was being difficult to work with. Then the allegations got personal with accusations of lying and bad faith negotiating.
Shannon accused port officials of being dishonest and said he's disgusted with the way negotiations have gone.
Novakovich said he believes it's more of a difference of opinion.
"Right now, it just seems that there is no middle ground," he said. "Everybody is just so far apart."
Port staff told commissioners May 8 that the cost of operating Vista Field during 30 years could be $20 million to $33 million based on a staff analysis of Shannon's proposed changes to a draft contract.
Port staff said the commission would have to increase taxes to raise that amount.
Shannon fired back at the May 22 port meeting, claiming the numbers were a gross exaggeration and criticizing the commission for discussing negotiations during a public meeting.
Shannon claims port Executive Director Tim Arntzen was negotiating in bad faith. As long as Arntzen is involved, the community won't see success at Vista Field, he said.
"Unfortunately, Vista Field is a thorn in his side," Shannon said.
Why else would Arntzen introduce "inflammatory information" about costs and mention raising taxes? Shannon asked.
Novakovich said he doesn't know why negotiations deteriorated to this point.
It sounded like a great partnership, he said. The airport would remain open, but the management would be out of the port's hands.
In exchange, the port would pay Shannon $40,000 a year plus all income from the airport, which could total more than $100,000 annually, he said.
The port has been losing money subsidizing Vista Field, Novakovich said. That's why the port looked for an operator.
Arntzen couldn't be reached Friday, but he previously told the Herald that he is disappointed in Shannon's claims about him. He believed contracting with an airport operator could solve some of the airport's financial problems.
Novakovich said Arntzen has done only what commissioners have asked and is supportive of Vista Field, including coming up with the idea to try to get a private business to run the airport to make it viable.
Arntzen has accomplished a lot for the port, Novakovich said.
The dispute has centered primarily on a draft contract the port sent to Shannon in December and Shannon's response in April in the form of a detailed, three-page list of comments and questions.
Novakovich said Shannon's list is far from the brief proposal he submitted in response to the port's request for proposals.
And Arntzen said the list was vastly different from what commissioners authorized him to negotiate on, so he needed to ask the commission for direction.
"I think there was a wow factor associated with the new document turned in by Shannon," Arntzen said.
Shannon said the price tag the port attached to his list of discussion points was a "total fabrication."
"It's playing with numbers, what they are doing, making Vista Field look bad by using funny numbers," Shannon said.
A Herald analysis of Shannon's list found that it likely would cost the port about $5.5 million if the contract ended after the first year, based on Shannon's requested buyout of $180,000 a year.
A 30-year contract could cost at least $14 million, not including maintenance, material and equipment, key cards and gate, insurance and the cost of the port buying all of the material and equipment the operator owns when the lease ends.
Arntzen said he expects to have an independent analysis of the costs ready for commissioners at Tuesday's meeting.
Shannon said he hasn't seen how the port got to "their crazy numbers" and believes the port's draft lease is different from what he discussed with Arntzen. "The whole thing is a disaster," he said.
Carl Cadwell, owner of Cadwell Laboratories and a pilot, said the conditions in the draft contract were beyond anything a normal business person even would consider. He pointed to the requirements for 20 hangars to be built in 18 months and for a new operator building to be built in 24 months.
"This is the most onerous thing I have ever read," Cadwell said.
But Novakovich countered that the port isn't saying Shannon must build those buildings or the hangars. He said Shannon's role would be to recruit other businesses for that.
The Vista Field master plan assumes private enterprise will pay for about $16.5 million of airport improvements during 10 years, including paying for the new operator building and hangars.
Vista Field is too close to the Richland and Pasco airports to qualify for Federal Aviation Administration money, which most airports use to pay for capital improvements.
Instead, Novakovich said the port plans to put up the land and put in the infrastructure. It is asking investors to make improvements, much like it did with the Spaulding Business Park in Richland.
Shannon asked for a 30-year contract with automatic renewal if all terms were met.
In his list, he asked the port to pay him $60,000 a year with a 5 percent annual increase, as well as earmarking $200,000 a year for capital projects.
Shannon said what he's asking for would be the minimum needed to staff the airport. Hopefully, increased airport activity would offset some of the management fee, he said.
Shannon said he was asking that $200,000 be available each year for capital improvements, not necessarily that it would be used.
"There is a reason that there is a port set up," Shannon said. "They provide services that individual entrepreneurs would not take on. But there is a substantial return to the community on these things."