WAGGA City Council is in damage control and has sought to quell fears the city’s relationship with Regional Express (Rex) has soured beyond repair.
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The fallout from the airline’s shock decision to pull the pin on an agreement with council continued on Monday, as mayor Rod Kendall reassured ratepayers Wagga still had a “very, very good relationship” with Rex.
It comes as the Advertiser reveals Douglas Aerospace had been operating rent free in the council-owned hangar for three months – even after council cancelled its $2 million loan to Douglas.
Under prevailing commercial terms, the rent potentially amounts to $15,000 a month.
Cr Kendall said council agreed to let Douglas remain in the hangar rent free for three months as part of negotiations with Rex.
“It was never our intention for it to be ongoing,” he said of the arrangement.
Cr Kendall earlier told reporters at a press conference – which was not attended by acting general manager Alan Eldridge – council would move to evict Douglas from its hangar.
Council is still looking for a new partner going forward, with “two or three” apparently flagging their interest since Friday.
Rex refused to comment further on its decision to leave council hanging, and there are ongoing questions about council’s so-called “material breaches” of the agreement.
But Cr Kendall said he believed council had not breached anything “because there is no formal arrangement yet in place for Rex”.
Rex relationship ‘strong’
In July, council was singing Rex’s praises for helping it overcome a “very tricky and difficult situation” at the airport.
Cr Kendall said he was disappointed Rex decided to terminate negotiations via a media release.
However, he said it did not change the city’s long-term relationship with Rex, which included pilot training and engineering facilities at the airport.
“It just means this particular relationship is no longer on the table,” Cr Kendall said.
