Flight academy in Atwater remains in operation

Neither a federal investigation nor a power struggle between its owners has disrupted operations at an Atwater aviation academy, where classes were underway Tuesday and student pilots continued to venture into the sky, according to a spokesman for the school.

A day after Treasury Department investigators descended on the Sierra Academy of Aeronautics, the school at the former Castle Air Force Base was in full operation, according to Bob Deklinski, a spokesman for the company.

Deklinski said “100 percent” of the school’s operations continued without any delay. “All our flight operations, our ground-school operations and our simulator operations are still going,” he said. “We’re still moving as we did two days ago, and so Sierra is looking forward to a bright future.”

But the arrival of Internal Revenue Service investigators on Monday was only the latest in a series of problems clouding over the academy.

Also known as KS Aviation, the company is at the center of a civil dispute between its two owners, John Yoon and Daniel Yoon, who are not related. John Yoon claims that his business partner attempted to seize control of the company by taking advantage of an absence John Yoon was forced to take after a 2013 motorcycle accident.

Daniel Yoon, 66, faces felony criminal charges filed this month by the Merced County District Attorney’s Office, which says he falsely used John Yoon’s name to apply for a loan. He is charged with two counts of falsification of corporate records and two counts of forgery, according to court records.

The case is unrelated to the IRS probe, according to Deputy District Attorney Walter Wall.

The IRS investigation was ongoing Tuesday and officials had no new information to release to the public, said Arlette Lee, a special agent with the Treasury Department.

The academy, which specializes in training commercial pilots from Asia, particularly from China, Korea, Taiwan and Vietnam, has about 250 students and employs some 100 people, according to Deklinski.

Since 2004, the school has been based at Castle Commerce Center, the former air base that, although within the city of Atwater, is the property of Merced County.

As the school has grown, it has signed multiple leases with the county for Castle sites, including a 2013 deal securing 18 acres of land to build a fixed-base operation with corporate hangars and a fuel facility. It added an 11-ton Boeing 737 simulator in 2014.

Mark Hendrickson, director of the county’s Department of Commerce, Aviation and Economic Development, said the academy is a successful tenant with a significant economic impact in the area. “They’re a prominent tenant for Castle – not our largest, not the smallest,” he said.

He said it was too early to speculate on the IRS investigation or how any outcomes would affect the airport.

Company officials “conservatively” estimate the academy puts at least $500,000 into the surrounding communities per month, Deklinski said. The company buys materials from local vendors and the flight school students, who live in dorms at Castle, spend money locally.

Students of the school can often be seen dining in Atwater restaurants, said Atwater Police Chief and City Manager Frank Pietro.

County officials also estimate the school is responsible for 90 percent or more of the nearly 95,000 flights originating at Castle in 2015, a tally important for maintaining the federal funding for the control tower.

The civil lawsuit between John Yoon and Daniel Yoon is ongoing, with a Merced County hearing scheduled for March. Officials maintain the school will not suffer any hiccups while the court battle continues.

Vincent Kim, John Yoon’s attorney, said the two men were equal partners in the academy but Dan Yoon attempted to wrest full control away after John Yoon’s accident, according to court documents.

Cyril Lawrence, Daniel Yoon’s attorney, said the civil lawsuit is over a disagreement that didn’t need to go to court but he’s confident the parties will work it out. “It’s two guys pulling on the same oar and going different ways,” he said.

Lawrence added that it’s in the best interest of the shareholders for the owners to resolve their differences quickly. He declined to comment on any criminal allegations.

This story was originally published January 26, 2016 at 5:51 PM with the headline "Flight academy in Atwater remains in operation."