POCATELLO — Inaction on an $800,000 subsidy agreement has left some members of the City Council questioning how much SkyWest Airlines wants to remain a partner with the city of Pocatello.

During a Pocatello City Council work session on May 5, Lydia Noble of the local government watchdog group Pocatello For Accountable Government Entities, or PAGE, indicated she has been attempting to try and gain insight into the progress of the subsidy agreement, which prompted a response from Pocatello Mayor Brian Blad.

“We have approved that contract, which is in SkyWest’s hands at this point,” Blad told Noble during the May 5 meeting. “We are waiting right now. They haven’t given us any invoices and we haven’t given them any money.”

According to the terms of the transportation services agreement between SkyWest and Pocatello, which the City Council approved on March 17, SkyWest will continue to operate one daily round-trip flight between Pocatello and Salt Lake City for all of 2022. Pocatello will agree to reimburse SkyWest up to $800,000 for its revenue losses on a quarterly basis retroactively from Jan. 1 and up through Dec. 31, or until all of the subsidy funds have been exhausted, whichever comes first.

Though the City Council approved the contract about two months ago, SkyWest has not yet signed and accepted the deal. The company expects that a resolution will be reached this week.

”SkyWest appreciates the partnership and support the Pocatello airport has shown,” SkyWest said in an email to the Idaho State Journal on Monday. “We look forward to having a finalized agreement as early as this week, which will ensure continued reliable air service at (the Pocatello Regional Airport).”

Once executed, the $800,000 will come from the airport’s general operating fund for 2022 and any budget shortfalls as a result of the subsidy will come from airport reserves. According to the city’s 2022 fiscal year budget, the airport started the year with an operational budget of just over $1.9 million. The $800,000 subsidy is about 42 percent of the airport’s operational budget.

Among some of the concerns expressed by council members Claudia Ortega and Christine Stevens is a statement Pocatello City Attorney Jared Johnson made during the May 5 meeting about contracts the city executes with outside parties requiring terms detailing when such agreements must be signed and accepted by all parties.

“There is no provision in the contract for when (SkyWest) has to sign (the contract), but I know that our airport and mayor are in contact with SkyWest and we are working through that,” Johnson said.

Stevens inquired why such terms weren’t included in the contract, to which Johnson said, “I’ve actually never seen a provision like that in a contract before.”

The retroactive clause in the contract has left Stevens and Ortega questioning whether or not the entire $800,000 could already be owed to SkyWest immediately upon its signing of the contract.

“My concern is that we don’t know what we may be owing them from their perspective each month,” Stevens said. “If they sign it in six months then are we still liable for up to $800,000 even though during part of that period they hadn’t signed the contract? I like things that are more straightforward. Why didn’t we put together a contract that has some sort of execution date? Every time I’ve ever bought or sold a house it had some type of due date.”

Knowing that the city has to begin its process of developing the next fiscal year’s budget in the next two weeks, Ortega added, “The problem with this is that there is no time limit with (SkyWest) to sign the contract, so if they sign the contract five years from now will we still have to give them the money? Right now, we’ve earmarked $800,000 of taxpayer money to SkyWest and we don’t know if we are going to have access to that money when we are budgeting. You can’t just hold onto a contract and sign it whenever you want.”

The lack of action on the contract has left both Ortega and Stevens wondering whether or not SkyWest is actually committed to remaining a partner with the city.

“This does make me wonder whether (SkyWest) was actually negotiating in good faith,” Stevens said. “Are they just hedging their bets and waiting for some undetermined point to decide if this is what they really want to do? Are they going to come out and say, ‘Hey, we decided that we don’t want to do this anymore,’ and just back out entirely. It just feels odd to me. It doesn’t feel like they are being 100 percent straightforward.”

Ortega added, “Why would you let one side of the equation make all of the decisions in a negotiation? Why is there no pushback? There needs to be some pushback. We are going to sit back and let SkyWest decide the future. Maybe they didn’t think they would get the subsidy and wanted a reason to cancel that flight. There is a reason why they are not signing the contract and two months is more than enough time to be sitting on a contract. The whole thing is not OK. The city has to have some self respect. SkyWest has been operating here for a long time. How about some mutual respect?”

Kristy Heinz, the management assistant at the Pocatello Regional Airport, said Pocatello and SkyWest are working to hammer out some details regarding the contract and she expects a resolution could be reached by the next regular City Council meeting at City Hall on Thursday. An agenda item that included a slightly modified version of the contract approved on March 17 was added to the City Council’s agenda for Thursday.

Heinz did not disclose what details SkyWest and airport staff are attempting to work out, and other members of the council have said they are unaware of the specific details as well.

“We are kind of in an information vacuum right now,” said council member Roger Bray. “It’s really hard to monitor a contract when you’re not getting any feedback. That being said, the contract said we could pull out whenever we wanted to, so if passenger flights at the airport are a hole that we cannot fill then we should probably pull out.”

When contacted for comment, Blad deferred to the statements from Heinz, though he did add that SkyWest has been and continues to be a great partner with the city of Pocatello.

Council member Linda Leeuwrik was not immediately available for comment Friday and council member Rick Cheatum declined to comment on the matter.

The newest member of the council, Josh Mansfield said he has spoken to city staff about the subsidy contract and has been assured that both parties are engaging in meaningful conversations.

“I have full faith in our relationship with (SkyWest),” Mansfield said. “Moreover, I don’t see any negative consequences in delaying the contract signing. We still have our flight. We haven’t paid any money to them. At the end of the day, I don’t think we should make speculation about motive or intention without full information that could risk the relationship that we currently have with SkyWest and the opportunity to improve that relationship for the future.”