Can a city force skydiving off a municipal airport?

Our local City Council is making noise about booting the skydiving operation off of our airport. Apparently the folks who run this operation have riled some of the old money at the airport in ways and for reasons that I have not been able to discern.

The upset folks are airport tenants, however, in positions of influence around town -- and they clearly have a burr under their saddles about sky-diving. I've never had a problem with the jumpers, the aircraft, or the traffic -- but others apparently have.

I was under the impression that if an airport is a public use facility, they could not ban legal commercial operations. True?

Anyone with experience in something like this?
 
There was an attempt to shut down skydivers at the airport I fly out of. Bottom line is that if the airport has ever taken any Federal grant money for improvements, then the airport may not discriminate against any FAA approved aviation activities. The city would have to show the activity is a safety hazard. Is the drop zone near the field?

Here's one story on it:
http://special.registerguard.com/turin/2009/aug/15/creswell-may-miss-faa-deadline/

Story I heard from locals is that one of the two skydiving operators had some some conflict with another flight in the pattern that had a CFI and student on board. Unpleasant words were exchanged (skydiving pilot filed a complaint against the CFI with the FAA or something like that. Complaint never yielded anything except more animosity.) Things escalated from there, till city decided to ban skydiving. In the end the drop zone got moved, but slydiving wasn't banned per se.
 
Jay Honeck said:
The drop zone is on the beach, roughly 1/2 mile from the airport.
That might be close enough to irritate some people. If the airport has accepted FAA grant money, then the best they might be able to do is wear the skydiving operation down by various actions or getting the drop zone moved, but they couldn't ban them.

Sounds like from this story that a few years ago they had just gotten funding only from Texas DOT and were only then just looking to get grant money from the feds: http://visitorsguide.portasouthjetty.com/node/2768
 
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