SD city chooses Ohio-based carrier for flights to Denver

Staff and wire report

PIERRE, S.D.

City leaders have chosen an Ohio-based carrier to provide federally subsidized daily service, but that airline has a record of financial problems.

The carrier, Aerodynamics Inc., also plans to begin daily service between Youngstown-Warren Regional Airport and Chicago this year, pending Department of Transportation approval.

Beachwood-based Aerodynamics CEO Scott Beale has a federal court judgment against him in Virginia alleging $500,000 in fraud and a bankruptcy proceeding in Ohio in which he claimed $5.9 million in liabilities and $22,000 in assets, according to the Capital Journal.

Beale denies wrongdoing in the fraud case, and says Aerodynamics is financially sound.

“Pierre is such a great city. I’ve been out there and talked to a lot of the airport board and the community,” Beale said. “I think our business plan we provided Pierre shows our willingness and our desire.”

The Pierre City Commission voted to recommend Aerodynamics to provide flights through the Essential Air Service federal subsidy program.

The Youngstown-Warren Regional Airport and 25 other airports lost their EAS program eligibility more than 10 years ago because they are within 70 miles of a major hub airport.

The federal Department of Transportation will make the final decision. Aerodynamics would offer 12 flights per week to and from Denver, with a stop in Scottsbluff, Neb.

City leaders acknowledge there are questions about Aerodynamics — including whether the carrier is ready to move from charter service to commercial service — but they say current provider Great Lakes Aviation has become too unreliable.

“For every question we asked, they had certainly done their homework,” City Council member Jeanne Goodman said of Aerodynamics. The company’s history of charter work “showed that safety is important to them and on-time performance is important,” she said.

As for the bankruptcy, “That’s a situation where they have to show their financial fitness to the DOT,” Goodman said. “Their contract [would be] with the DOT. ... That’s outside of our realm.”

Beale said he took Aerodynamics into bankruptcy when he got involved with the company in 2011 to get it back on solid financial ground.

Federal officials have asked Beale for more information about the bankruptcy and about a recent federal court judgment against him in Virginia ordering him to pay a former business partner and potential investor in Aerodynamics $500,000 in compensation and $100,000 in punitive damages.

Beale said he did not defraud anyone.

“Of course I disagree with the [court’s] decision,” he said.