PENDLETON — In recent years, city of Pendleton officials have shared anecdotes about busier restaurants, full hotel rooms, and even purchased houses to demonstrate the value of Pendleton Unmanned Aerial Systems Range and the significant public investment that’s funding it.
Now the city is seeking numbers to back it up.
At a Tuesday meeting, the Pendleton City Council will consider awarding a bid to NEXA Advisors to perform an economic impact study for the Pendleton UAS Range.
In a staff report, Steve Chrisman, airport manager and economic development director, wrote that the Virginia-based company would provide “(a)ccurate information about direct, indirect and induced revenue, jobs, taxes and investment is critical for attracting more public and private investment.”
NEXA managing partner Michael Dyment wrote in his pitch to Chrisman that the company has experience doing a similar study for New York and its UAS range project.
Comparing the development of UAS to the development of the printing press, the automobile, and the internet, Dyment wrote that its prior studies have been used to “strengthen negotiations supporting investment, strategic partnerships and trade.”
NEXA will make its calculations using data from the U.S. Bureau of Economic Analysis, interviews with Pendleton UAS Range staff and drone industry employees, and economic projections done by the city.
The study comes hot on the heels of the council agreeing to spend $7.4 million from the water and sewer funds to provide infrastructure for a UAS industrial park.
On top of an expected $3 million grant from the U.S. Economic Development Administration, the city hopes the UAS range will continue to grow if it provides drone companies with shovel-ready ground for hangars and other facilities.
According to a Wednesday interview, Chrisman thinks the study will help justify the city’s investment.
Chrisman recently compiled an economic projection for the UAS industrial park that anticipates the city’s $7.4 million investment will more than pay off in a decade.
The city predicts $12.1 million in land lease revenue over the next 10 years, in addition to $2.2 million in hangar rental revenue.
Subtracting what the city’s spending, Chrisman thinks the city will still end up with a net return of $6.9 million. He added that his estimations might be a little conservative, and he could envision the investment paying for itself sooner than 10 years.
Despite the rosy view of the UAS range’s future from city staff and council members, Chrisman acknowledged that some members of the public were still skeptical of offering free public infrastructure and other incentives to national and multinational companies.
Chrisman framed the incentive process as the cost of doing business in economic development.
While some West Coast companies may have a regional preference for Pendleton, in other instances, Pendleton is competing with other drone ranges in places like Nevada, North Dakota, and New York, with each offering its own incentives.
As the UAS range has grown, the city has shifted focus away from the economic development project literally just down the road from the airport.
The city raised $6.9 million from the state, federal government, and a city-wide gas tax to extend Airport Road from Interstate 84 Exit 202 to the rest of the airport in 2009. Two years later, the city bought 40 acres of land from A & B Pinkerton Inc. with the expectation that it would be developed into an industrial park.
But there’s been little activity on the property since then, and now Pinkerton is looking to buy back a 60-acre expansion option that was included in the original deal.
On Tuesday, the council will consider selling the option to Pinkerton for $8,937.
In 2018, Chrisman told the council that there was “nothing tremendously special” about the Airport Road industrial park concept, but the UAS range offered a once-in-a-lifetime competitive advantage.
The shift in economic development strategy is also causing consternation among general aviation businesses at the airport, who are currently pushing against new “reversionary clause” language.
While city officials say that contract language that allows the city to take back rented property once a lease ends is standard in lease contracts at federally funded airports, some airport business owners say the reversionary clause would stifle existing businesses as the city prioritizes UAS.
The Pendleton Airport Commission came up with lease options that were amenable to the airport business community, but the city council sent it back to the commission after City Manager Robb Corbett suggested some revisions.
But the airport commission didn’t implement any of Corbett’s revisions and are sending back the lease proposal back to the council for a vote.
The council meeting will be held Tuesday at 7 p.m. at the council chambers in city hall, 500 S.W. Dorion Ave.