By NEIL HARTNELL
Tribune Business Editor
Norman's Cay homeowners and the Bahamian aviation industry yesterday blasted the "outrageous" fees imposed by the island's private airport operator in a bid to recover some of its $10m investment in the facility.
Tribune Business was told that Exuma Resort Developers Ltd, which is aiming to create a high-end marina and tourism destination on the island, had suddenly imposed some of the highest landing and parking/ramp fees seen at any airport in The Bahamas.
Multiple sources voiced particular concern that the move from zero to around $200-$230 per landing would make it prohibitively expensive for aircraft to use the Norman's Cay airstrip and drive potential traffic away.
They added that this was especially problematic given that Norman's Cay acts as the gateway to all other islands in the northern Exumas chain, with the airstrip supposed to be available to all aircraft and flights despite its private ownership and management.
One aviation source, speaking to Tribune Business on condition of anonymity, replied: "I almost choked on my grapefruit" when informed of the landing fee now being charged at Norman's Cay. By comparison, landing fees for smaller aircraft at Lynden Pindling International Airport (LPIA), such as Piper Aztecs, were in the $19 to $35 range.
And, at Ocean Reef airport, a private facility in Florida, landing fees range from $28 to $59 for the same aircraft. The source questioned whether the scale of the Norman's Cay fees was intended to "dissuade" persons from landing at the airport, although they conceded "there's no denying" the developer had invested heavily in upgrading the runway and associated facilities.
Exuma Resort Developers also appears to have been less than fully transparent about the new landing fee schedule, having informed Norman's Cay's homeowners in a recent letter that these will not be provided by e-mail. Instead, they have to call a cell phone number to obtain the necessary information.
The letter, written by Matt Tabrizi, who appears to be leading Exuma Resort Developers' efforts on behalf of Miami-based Fort Partners, its major shareholder, told the island's homeowners that the fees were necessary to both recover the developer's investment and fund ongoing maintenance and operational costs at the airport.
"As you may know, Exuma Resort Developers has invested in excess of $10m building and maintaining our airport," Mr Tabrizi wrote. "To recuperate some of its expenditure and continue maintaining and operating our airport, Exuma Resort Developers has implemented fees which went into effect on May 1, 2020."
While domestic and international aviation in The Bahamas is currently shutdown (with exceptions) due to the COVID-19 pandemic, Exuma Resort Developers is now levying parking fees of $45 for aircraft that are parked for between one to three hours, and $90 for planes left for a duration of four hours to one night.
It has also introduced a three-tiered landing fee structure for small planes and helicopters; light jets weighing less than 50,000 pounds; and bigger jets over 50,000. Norman's Cay homeowners, and a few select other persons, have been given a $100 discount - around 50 percent - on their fees.
"Norman's Cay landing fees are not published and, as such, they cannot be listed here," Mr Tabrizi wrote. "However, the landing fees are the same for everyone other than the discount provided within this document, and only vary by the categories mentioned.
"To verbally obtain the landing fees, please contact MacDuff's at..... Please not that MacDuff's cannot provide rates by e-mail." MacDuff's may be the Norman's Cay-based restaurant and cottages that share the same name. Exuma Resort Developers also has an NC MacDuffs Ltd affiliate, which was incorporated in 2012 as an International Business Company (IBC).
While no discounts are being provided for the parking fees, Mr Tabrizi wrote that the $100 reduction to homeowner landing levies will be reviewed every December by the developer. Other persons classified as
"homeowners", and thus eligible for the discount, include Mark Holowesko and Lester Smith, due to their development activities on nearby Highbourne Cay and Wax Cay, respectively.
The letter laid out how discounts can be applied to charter flights carrying members of the homeowner's family, staff, guests, tradesmen and cargo. E-mails seen by Tribune Business show the developers' letter was distributed to Norman's Cay homeowners by Gregory Cleare, the former senior partner at KPMG Bahamas who is now chief financial officer at Holowesko Partners.
Mr Cleare, a director of Norman's Cay Development Company, wrote: "In my discussions with them, I can inform you that Exuma Resort Developers management has been concerned to establish a fair and reasonable fee structure that is simple to administer. I believe you will find this to be the case when you consider the investment made by Exuma Resort Developers and the ongoing costs to maintain and manage the airport."
Mr Cleare, together with Mr Holowesko, is also part of a Bahamian investor group including R. James Cole, the Higgs & Kelly attorney and partner, and Martin Solomon, which had sought to partner with Exuma Resort Developers when the project was under previous ownership. They are now thought to be involved in their own separate project.
The Exuma Resort Developers' letter, and Mr Cleare's e-mail, have sparked a backlash from both Norman's Cay homeowners and aviation industry executives. One homeowner, speaking on condition of anonymity, asked: "Is the runway a public government runway for all to use or is it private. I don't see how it could be both and, no matter what, do the homeowners have a right to use it as we have for 50 years without fees?
"Again, I'm not opposed to paying a minimal landing fee for maintaining the runway. We have given money more than once for maintaining the old runway. I can't imagine the government allowing the runway to become private, as it serves the northern Exumas."
One aviation source, also wishing to remain anonymous, said: "The residents' concerns are about the sudden imposition of outrageous landing and ramp fees on both residents and visitors alike. Such fees are unheard of in this country, and the conversion of a once public runway, being the lifeline to neighbouring Highbourne Cay, to a now unaffordable (by most) private entity has created a disturbing scenario for charter services that need to land there and those of us who wish to visit."
They added that the greatest impact would be felt by persons seeking to use Norman's Cay as the gateway to access the rest of Exuma, arguing that the new fees represented a significant additional cost facing the aviation industry and its passengers.
"It's just terrible to slap them with that kind of fee. It's just not attainable or sustainable," the source said. "Highbourne Cay relies on that runway, and staff that want to get in and out, their children that want to get in and out. These people are crippled by this.
"We don't mind paying a landing fee but make it reasonable. These fees don't exist in this country because Bahamians cannot afford them. That's why there's such an uproar. There's nowhere that charges such an amount of money. No one can afford that. That's just outrageous."
Warning that the landing fees, in particular, could "cut off the gateway" to the northern Exumas, they added: "That's the conversation right there. There's also a lot of people that like to fly to Norman's Cay for lunch and give MacDuff's business. They're shooting themselves in the foot."
Captain Randy Butler, Sky Bahamas president and chief executive, told Tribune Business that the Norman's Cay fee schedule was "crazy compared to other airports" in The Bahamas. "I hope the director-general of civil aviation [Captain Charles Beneby] and the minister take action right away," he added. "This is the kind of thing that discourages people from coming to the islands."
Dionisio D'Aguilar, minister of tourism and aviation, told this newspaper he was aware of the controversy and had requested a copy of the project's Heads of Agreement from the Bahamas Investment Authority (BIA) to determine if the developer was permitted to introduce such a fee schedule.
Confirming that the Norman's Cay airstrip is privately owned and managed, Mr D'Aguilar said it was nevertheless supposed to be open for public access given that it "supports the islands in the northern Exumas" by acting as the main gateway to those cays.
While acknowledging that Exuma Resort Developers and its shareholders were entitled to seek a return on their investment, and recoup the millions spent on upgrading and revamping both the runway and associated facilities, he acknowledged that this needed to be balanced with ensuring access to the rest of the northern Exumas chain.
"They've invested millions into that airport and runway" Mr D'Aguilar told Tribune Business. "They've extended the runway, repaved it and made it larger and wider, opening it up to bigger jets from further away. It's understandable that having made that expenditure they want to recoup their costs but I'm not sure what their agreement allows them to do. It has to be open to the public to support the islands in the northern Exumas chain around Norman's Cay."
Mr Tabrizi did not return Tribune Business's message to his personal work e-mail seeking comment on the growing controversy last night.