Google execs' jet fuel deal draws scrutiny

New questions are being raised about an unusual arrangement that permitted Google founders Larry Page and Sergey Brin to use a NASA airfield in Mountain View as a base for their private aircraft, after the Wall Street Journal reported this week that the Googlers have been allowed to buy jet fuel at a bargain price from the Pentagon.

NASA recently ended an arrangement that allowed the Googlers’ private aviation company to buy the government fuel at Moffett Field, after the Department of Defense raised questions,  the Journal reported.  But a U.S. Senator is pressing for an audit and a consumer advocacy group is also calling for an investigation.

A spokesman for the aviation firm said there was no other source for fuel at Moffett, adding that the company paid the government-set price and “all applicable taxes.”

The Googlers’ use of Moffett runways and hangar space has raised eyebrows before. Critics have questioned the agreement between NASA and H211, the company that manages private planes for Page, Brin and Google chairman Eric Schmidt, since it lets the billionaires park their fleet of private jets and take off or land on a government air strip that is just a few minutes’ drive from their company’s home office.

NASA and H211 have defended the arrangement by saying the Googlers pay $1.3 million a year in rent for facilities that lack many of the amenities found at other corporate jetports, and they also let NASA use their planes for research flights and scientific studies.

By the Journal’s reckoning, only about a quarter of H211’s flights over the last six years were related to NASA missions, while others carried the Google executives to destinations such as Los Angeles, New York, Hawaii, Nantucket and Tahiti.

Meanwhile, the Journal says NASA has sold H211 about 2.3 million gallons of jet fuel since early 2009, at prices that the Defense Department says covered the government’s costs – but which the Journal estimates were about a dollar less per gallon than the average paid by corporate jet owners at other airports.

Sen. Charles Grassley, R-Iowa, is pushing for an audit of those sales, since the fuel is only supposed to be used for government-approved purposes, according to the Journal. And the frequent Google critics at Consumer Watchdog are calling it a sweetheart deal.

A spokesman for H211 said the company is now looking into alternative fueling arrangements, but added in a statement:

“Until last month, H211 aircraft have purchased the only fuel available at Moffett, which is managed by the Defense Logistics Agency. Our invoices include all applicable taxes, and we have not sought a tax exemption, even for the dedicated NASA missions we conduct.”

H211’s lease with NASA is due to expire next year, however, and the Google guys have been looking for a new home for their planes.  They’re working with another aviation company on plans to develop a new corporate jet facility at Mineta San Jose International Airport.

(Photo of Larry Page and Sergey Brin courtesy of Google)

Brandon Bailey Brandon Bailey (328 Posts)

Brandon Bailey covers Google, Facebook and Yahoo for the San Jose Mercury News, reporting on the business and culture of the Internet.