The Tribune Democrat, Johnstown, PA

Local News

January 15, 2013

Airport authority vexed over development money

JOHNSTOWN — Officials at the cash-strapped Johns­town airport have a dilemma with Cambria County commissioners’ additional $170,000 allocation for development of a foreign trade zone around the airfield.

The Johnstown-Cambria County Airport Authority has been authorized to disperse the funding, but it is county Commissioner Douglas Lengenfelder who is spearheading the initiative.

The authority received $20,000 last year, with two allocations of $75,000 promised by summer.

Lengenfelder, who also is an authority member, outlined his latest plans during Tuesday’s authority meeting at the airport.

“We are starting to develop that plan,” Lengenfelder said. “It looks like we can do it quicker that I thought.”

Lengenfelder said he is lining up consulting help from attorney Jose Latour, whom he described as an expert in foreign investment programs.

In addition to creating a foreign trade zone offering tax advantages for foreign investment, Lengenfelder envisions a state Keystone Opportunity Zone with property tax breaks and the U.S. Citizenship and Immigration Service’s Immigrant Investor Program, also known as “EB-5.”

“They are all part of this package of how you become an economic engine for development,” Lengenfelder said.

Lengenfelder first brought the foreign trade zone proposal to the authority’s October meeting, saying the program could allow Argentine vineyards to save money by sending barrels of wine here for bottling and distribution by local businesses.

The idea would be to establish an area around the airport as the primary foreign trade zone under federal laws that provide special customs procedures to U.S. plants engaged in international trade-related activities. International companies pay tariffs only on the work done abroad, Lengenfelder explained at the time.

He said he would travel to Argentina in November to meet with vineyard owners.

That trip was postponed, but is now planned for Feb. 14, he said Tuesday.

Lengenfelder and business leaders will first take a trip to Washington, D.C., later this month to meet with business liaisons at foreign embassies.

His group will also visit a foreign trade zone conference in on Feb. 12.

Authority Chairman James Loncella interrupted Lengenfelder’s description of his itinerary to ask how the travel would be funded.

“It is coming out of my pocket right now,” Lengenfelder said. “I have not requested that yet.”

Revenue in the authority’s budget under the line item “economic development” was provided by the county and set aside for expenses related to the foreign trade zone development, authority member William Polacek said.

“It is county money,” Polacek said. “If you just request it – if it’s not unreasonable – we’ll probably approve it.”

The authority has asked for a business plan to help determine what expenses are acceptable, Loncella said.

“The authority hasn’t approved this whole thing,” Loncella reminded Lengenfelder.

“One of the concerns we have: It is money that is not generated by our revenue streams, but we have stewardship responsibility. We have to go through our normal application process. It is public money.”

Latour has been out of the country on other business, but will return this week, Lengenfelder said. He expects to begin developing the business plan to provide more details and time lines in the near future.

But even developing the plan will cost some money, Lengenfelder warned.

“Jose is the man who will move this along,” Lengenfelder said. “We can’t get a plan out in front of the board without spending money to get a professional to get the plan out.”

The total cost will reach about $200,000, Lengenfelder estimated, describing it as “a shoestring.”

“You are looking at millions of dollars coming into this area,” he said. “Other foreign trade zones cost for $2 million to $5 million.”

Latour has tentatively agreed to do Cambria County’s consulting at his cost because of the region’s potential, Lengenfelder said, admitting the consulting contract has not been finalized.

“That conversation starts tomorrow,” Lengenfelder said Tuesday.

The board agreed to call a special meeting to consider a contract with Latour.

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