Sisters Eagle Airport's Benny Benson stands on a tarmac at the airport in 2013. (Bulletin file photo)

Sisters Eagle Airport must repay close to $400,000 in grant money that the Oregon Department of Transportation says the airport misused.

Benny Benson, owner of Sisters Eagle Airport, misused some of the money he received in transportation grant funds for runway and airport improvements, according to a review by ODOT. The state agency found more than half of the misused portion of the grant money was paid to Benson, airport managers and two companies headed by Benson.

ODOT explained how the ConnectOregon grant money was misspent in a letter to Benson dated March 21.

ConnectOregon uses lottery money to fund nonhighway projects meant to improve the connections between different modes of transportation across the state. ODOT entered a grant agreement with the airport on May 20, 2015, agreeing to provide Sisters Eagle Airport $733,259 in ConnectOregon funds to be used “solely for construction of a taxiway on the property, pavement of aircraft parking and ramp areas, installation of runway lighting and improvements associated with these projects,” according to the letter.

A citizen expressed concern to ODOT in August 2016 about the airport’s use of the grant money, the letter said.

This isn’t the first complaint raised involving the privately owned, public use airport: Deschutes County, the Oregon Department of State Lands and the U.S. Army Corp of Engineers are all looking into issues that the airport’s neighbors reported as early as summer 2016 according to Bulletin reports.

ODOT conducted a review of how the ConnectOregon money was used by looking at records and meeting with Benny Benson, his wife and airport co-owner Julie Benson, and airport manager David Campbell on Sept. 22, according to Benny Benson.

Benson said Thursday he was “surprised, if not shocked, to hear about the demand letter,” adding he first learned about it via the media.

“The Oregon Department of Transportation’s lack of adherence to administrative review process is surprising,” he said. “The last we heard from ODOT was when we met last year.”

Benson explained he expected ODOT staff would have made a phone call or in-person meeting, beyond sending a letter, to make the airport aware of the review’s conclusion.

Benson said he plans to hire a lawyer to respond to ODOT and “follow the Oregon administrative review process.”

He said he is “not in agreement with some of the interpretations presented in the letter” of how the airport’s use of funds differed from what was outlined in the agreement. He also highlighted his frustration with the origin of the complaint, noting “the neighbors that are making complaints all use the airport.”

In total, $390,185 must be repaid to ODOT by April 6.

There is no formal appeals process for the demand for repayment, according to Dave Thompson, an ODOT spokesman.

“At this point right now it’s a request for repayment and it may go further,” he said.

The letter from ODOT breaks down how the grant money was misused on ineligible projects and expenses:

• $215,436 to Benny Benson, airport managers David Campbell and Hobbs Margaret, project administrator ENERGYneering Solutions, Inc. (of which Julie Benson is chief financial officer and Benny Benson is chief executive officer and president) and B2 Aviation, an aircraft management and charter company (of which Benny Benson is a corporate officer). The grant agreement prohibits officers, employees or agents of Sisters Eagle Airport from “soliciting or accepting gratuities, favors or any item of monetary value from contractors” working on the project.

• $4,716 for a hangar project

• $57,976 for runway protection and drainage runout area, work that wasn’t included in the grant agreement and is not on property owned by Sisters Eagle Airport

• $20,000 for setting up the construction site — ODOT argued since ENERGYneering Solutions Inc. is already on site, it wouldn’t have setup costs. ODOT also argued setup costs would generally be paid to contractors staging construction, not to project managers.

• $3,821 in invoices not substantiated by receipts

• $3,191 in double billing

• $63,462 in invoices for a required automated weather observation system — in its original agreement, the airport agreed to pay for the system

• $8,550 in airport fuel and storage discounts

The airport also owes $13,033 to meet the minimum match requirement the grant agreement set up, which it never paid.

— Reporter: 541-383-0325, 
kfisicaro@bendbulletin.com