FAA news from Cle Elum puts the city’s airport leasing freeze on a tighter clock. The FAA said the moratorium on new ground leases at Cle Elum Municipal Airport violates federal grant assurances and ordered the city to submit a corrective action plan.
The agency’s finding centers on access. Under FAA grant assurances, airports that receive federal funding must provide reasonable access to aeronautical users, and the FAA said an indefinite ban on new leases is an unreasonable restriction.
Cle Elum Municipal Airport
The dispute began after airport users filed an informal Part 13 complaint when the city suspended new leases. Cle Elum later tied the freeze to ongoing bankruptcy proceedings, saying the moratorium would stay in place until those proceedings ended and officials decided whether to continue operating the airport.
That city position sits beside a federal obligation the FAA says still applies. The airport has five privately owned hangars on leased municipal property, and the city’s website says no additional hangars are available for rent.
Matthew Lundh on Chapter 9
Cle Elum filed for Chapter 9 bankruptcy protection in June 2025 after a $25.9 million arbitration award tied to a dispute involving a local development agreement. In the city’s June 2025 announcement, Mayor Matthew Lundh said, “Our priority continues to be protecting Cle Elum’s residents, essential services, and our financial future,” and added, “Chapter 9 allows us to do just that.”
The FAA said those financial circumstances do not relieve the city of its airport-access obligations. That leaves Cle Elum to draft a corrective action plan that addresses the lease moratorium while the bankruptcy case continues, even as the city has not set a timetable for reopening new ground leases.
FAA corrective action plan
The corrective action plan is the city’s required response to the FAA finding. It is the mechanism the city must use to show how it will bring airport leasing policy back in line with federal grant assurances, including the requirement that access not be restricted without a reasonable basis.
For airport users and prospective lessees, the practical issue is simple: the lease freeze remains the barrier until Cle Elum acts. The city’s response will determine when new ground leases can resume, and the FAA has already said the current moratorium cannot stand as written.
