Skydive Myrtle Beach, Horry County and Federal Law

By Paul Gable

The general aviation procedures at the Horry County Department of Airports seem to raise more questions than answers provided.

The county is currently involved in litigation with Skydive Myrtle Beach over the apparently discriminatory way in which the airport department attempted to treat the skydiving company.

While researching information regarding the ongoing litigation between Skydive Myrtle Beach and Horry County, I came across an interesting piece of information that brings into question leases between the airport department and several individual businesses operating at county airports.

Horry County proposed Skydive Myrtle Beach occupy a hangar at Grand Strand Airport under a space use agreement in which the county would charge Skydive Myrtle Beach $1,200 per month or 24% of the gross receipts of the business, whichever is greater.

The Department of Airport leases with Executive Helicopter at Myrtle Beach International Airport include an annual lease amount or 5% of the gross receipts, whichever is greater.

Skydive Myrtle Beach offered tandem skydiving operations to interested customers. Executive Helicopters provides helicopter sightseeing rides as well as maintenance services.

However, under the terms of what is commonly called the United States Anti Head Tax Act, it appears those charges on gross receipts may be illegal.

The US Department of Transportation, under which the FAA is included, is charged with administering the AHTA.

The AHTA prohibits a state or political subdivision (such as a county) from levying or collecting a: “tax, fee, head charge, or other charge [directly or indirectly] on — an individual traveling in air commerce; … or the gross receipts derived from that air commerce or transportation. 49 U.S.C. § 40116(b)(1), (4).”

All states and their political subdivisions are prohibited from applying tax or other gross receipts charges against revenue derived from any activity occurring within Federal Air Space. Skydiving services, helicopter rides, hot air balloon rides and commercial aviation flights are some of the activities covered by the AHTA, according to a USDOT guidance letter.

All of the gross revenues of Skydive Myrtle Beach were derived from skydiving services taking place in Federal Air Space.

Some, I would venture a guess currently most, of the gross revenues of Executive Helicopters are derived from helicopter rides in Federal Air Space.

How can Horry County Department of Airports base lease charges on gross receipts derived from these activities?

Do these airport leases violate federal law?

Does the vast difference in percentage charged between the two businesses violate due process and equal application of the law?

These questions should be answered before Horry County Department of Airports is allowed to enter into any new lease negotiations.

 

 

 

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