For the Caddo Mills Airport, an FBO, or Fixed Base Operator, is granted permission by an airport to provide aeronautical services to aircraft, passengers, and crew. These services often include fueling, aircraft maintenance, hangar space, and ground handling, catering to private and corporate aviation. Think of them as the "truck stops" for private and business aviation.

An airport Fixed Base Operator (FBO) is a market DIFERENTIATOR and plays a crucial role in the sustainability and growth of a small town and its surrounding region, functioning as a vital transportation and economic hub. Here's a breakdown of why FBOs are important for small towns: 

1. Economic activity and job creation

• FBOs provide jobs directly at the airport, including roles in fueling, maintenance, ground handling, and administrative services.

• They attract businesses to the area, particularly those reliant on efficient air transport, contributing to the town's overall economic health.

• Visitors arriving via the FBO often patronize local businesses, generating additional economic activity in sectors like hospitality, dining, and retail.

• FBOs facilitate the movement of goods and services, supporting local industries like agriculture (e.g., crop dusting) and manufacturing. 

2. Maintaining connection and access

• In areas with limited or no commercial airline service, FBOs provide a critical connection to the national transportation system, ensuring that residents and businesses can access vital travel and shipping options.

• They support general aviation, including private and charter flights, enabling efficient travel for business leaders, investors, and tourists to and from the community.

• This enhanced connectivity can be a key factor in attracting and retaining businesses in the region. 

3. Supporting essential services

• FBOs at small town airports are often vital for medical flights, air ambulances, and emergency services like Life Flight, providing rapid access to care.

• They serve as hubs for disaster relief efforts, enabling the swift deployment of personnel, supplies, and equipment in times of crisis.

4. Enhancing quality of life

• FBOs make it possible for residents to fly privately for leisure or business, offering a convenient alternative to potentially long and crowded commercial flights from larger airports.

• They offer amenities for pilots and passengers, contributing to a more comfortable and enjoyable travel experience.

• Furthermore, they create opportunities for pilot training and aircraft maintenance, fostering local talent and bolstering the aviation ecosystem within the community. 

In essence, FBOs are more than just service providers; they are integral partners in the economic, social, and logistical fabric of small towns, facilitating connectivity, boosting local economies, and enhancing the overall quality of life for residents.

In essence, airports, and by extension the cities that own them, generate income from two primary sources: aeronautical and non-aeronautical activities. 

1. Aeronautical revenue

This stream encompasses income generated from activities directly related to aircraft and airline operations. Key components include: 

• Aircraft parking and hangar rentals: Fees for parking aircraft and leasing hangar space.

• Fuel flowage fees: Airports can also collect fees on the sale of aviation fuel. 

2. Non-aeronautical revenue

This category encompasses a wider range of commercial activities and services that are not directly tied to aircraft operation but enhance the passenger experience and contribute significantly to airport profitability. Examples include: 

• Retail and concession sales: Rent paid by airport shops, restaurants, duty-free stores, and other concessionaires, often with revenue-sharing agreements based on sales performance.

• Advertising: Selling advertising space within the terminals, parking garages, and other airport areas.

• Real estate leasing: Leasing land and facilities for various purposes, including hotels, offices, warehouses, and logistics hubs, creating additional commercial development opportunities.

• Other services: This can include revenue from airport lounges, business centers, fuel sales to general aviation, and even repurposing unused land for things like solar farms. 

3. Other sources of revenue

• Grants: Airports may receive grants from government agencies for infrastructure development and other projects.

• Investment Income: Airports can generate revenue by investing their surplus funds. 

By diversifying their revenue streams, airports aim to ensure financial stability, fund necessary infrastructure improvements, and potentially contribute to the economic development of the surrounding region. 

In Texas, cities do not directly impose a property tax on airplanes. However, they may benefit from local property tax revenue generated at the county level. This is because Texas law allows for the assessment of an annual local personal property tax on aircraft used for business purposes. 

Here's a breakdown:

• Local Personal Property Tax: This tax is levied by the county where the aircraft is hangared. The tax rate can vary by county and can be substantial, exceeding 3% of the assessed value annually in some cases. Cities benefit indirectly from this through the county's allocation of funds to various local entities.

• Business Use Requirement: Aircraft strictly used for personal, recreational purposes are exempt from this property tax.

• Allocation for Out-of-State Use: Texas allows for a reduction in the assessed value based on the previous year's flight activities. If an aircraft spends time outside of Texas, the percentage of non-Texas landings is applied as a reduction to the assessed value.

• Sales and Use Tax: It's important to note that the purchase, lease, or rental of an aircraft in Texas is subject to state and local sales and use tax. The state rate is 6.25%, and local rates can add up to 2%, for a maximum combined rate of 8.25%. 

In essence, while cities themselves don't directly tax airplanes, they are part of the broader local tax structure where counties assess personal property taxes on business aircraft, contributing to the overall local revenue stream.

https://comptroller.texas.gov/taxes/publications/94-168.php

https://aviationtaxconsultants.com/texas-business-personal-property-tax-filing-deadline/

https://comptroller.texas.gov/forms/50-159.pdf

https://www.aopa.org/advocacy/state-advocacy/texas