Airport, Ski Corp. officials target new summer flights

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— Yampa Valley Regional Airport has never enjoyed direct jet connections to cities beyond Colorado outside of ski season. But the outcome of a federal grant application could change that.

Routt County government and resort leaders are anxiously awaiting news Sept. 29 on a federal grant application that has the potential to usher in a new era of non-ski season air service at YVRA.

Some of the funds would be used to leverage revenue guarantees for daily flights on small jets from Salt Lake City and Houston in spring, summer and fall.

The Houston service would open convenient connections to the Southeast and East Coast. And the Salt Lake service on Delta would provide new options for travelers between Northwest Colorado and cities in California, for example.

The addition of two new airlines in the market and the resulting competition should have the effect of less expensive air travel, according to one of the business leaders who worked on the grant application.

"Anytime you add one layer of service and a second layer, out of competition, you will automatically have moderation of price," Andy Wirth said. He is vice president of marketing for the Steamboat Ski and Resort Corp. and oversees the ski season airline program into YVRA. YVRA is currently served only by United Express in spring, summer and fall.

In addition to seeking funds to underwrite new summer air service, local officials are asking for money to help with a multi-year project to upgrade the terminal at YVRA.

The money is available through a federal grant program overseen by the U.S. Department of Transportation. It is commonly referred to as "Air 21," short for the Small Community Air Service Development Pilot Program.

This year, Routt County is seeking $625,000 from the program, County Manager Tom Sullivan said. That amount would be matched with $225,000 in local funds.

The first portion of the grant application seeks $250,000 to help underwrite the increased service at the airport. It calls for a match of $125,000, which would come from the business community. The second portion of the grant seeks $375,000 to accelerate terminal improvements.

Sullivan said members of a subcommittee of the airport advisory board debated right up to the deadline whether the terminal construction or the additional air service should receive emphasis on the application.

"Additional airline service is our first priority because the Department of Transportation looks on it more favorably," Sullivan said. "Facility improvements get a lower priority."

The decision was taken, he said, with the knowledge that competition for the grants is keen.

A pot of $20 million is available nationally and there are almost 2,000 applications, most of them seeking considerably more than Routt County's request Sullivan said. Only 40 grants can be approved nationally, a constraint intended to ensure the impact of the funds won't be diluted. No more than four grants may be approved in any single state.

Sullivan said the application sent to the DOT uses historical airline figures to justify the need for more commercial airline service.

"We've had a loss of air service since 1993," Sullivan said. "We really do have demand for an increase."

The application shows that in 1993, the Yampa Valley was served by Continental Express operating turboprops between the old Stapleton International Airport and Steamboat Springs Airport. From April through November, that service generated 42,600 roundtrip seats with far more frequent flights than the three daily roundtrips into YVRA this summer. Roundtrip passengers totaled 26,548, for a load factor of 62 percent. Last summer, with one of three daily flights operated on a 50-passenger regional jet, YVRA saw 23,136 roundtrip seats with 15,450 passengers for a load factor of 67 percent.

United Express flights leaving Yampa Valley Regional Airport in July were 70 percent full on average.

That means the 37-passenger Dash-8 turboprops flown by Mesa Air Group under the United Express flag carried an average of 26 passengers last month.

Sullivan said the empty seats aren't necessarily the best indicator of current demand for air travel. Some people learned other travel habits because air service into YVRA as recently as the summer of 2001 was notably unreliable. For others, three flight options a day don't offer enough convenience. Wirth said the current flight schedule doesn't match well with certain key flights out of DIA.

One of the most persuasive pieces of information in the Air 21 application is a letter from Robin Croop of TIC, a top 50 national contracting firm with 200 employees based in its Steamboat headquarters and a total of 7,000 employees. Croop reported that on a six-month basis, TIC employees book about 425 flight segments between YVRA and Denver with a cash ticket value of $131,000. She said that number would be much higher if all of the TIC employees who drive to DIA to begin business trips were accounted for. The number would go even higher if the figures were expanded to include TIC employees traveling from distant cities to visit the home office in Steamboat.

"In my research with our training department, I found that we fly in approximately 500 trainees per year," Croop wrote. The approximate airline cost for the trainees per year is between $575,000 and $625,000. The total infusion of dollars in Steamboat from our training department alone is approximately $1.25 million per year."

Croop said her company has had internal discussions about the possibility of reducing training services in Steamboat to take advantage of better air connections at other locations. Clients are not able to get into Steamboat, so meetings are not conducted here. Similarly, bid critiques and other meetings that would bring 20 to 30 people here for two to five days, are held at other locations.

"We are fortunate that for (more than five) months during the winter, thanks to the Ski Corp. and Chamber, there is dependable air service in and out of Hayden," Croop wrote. "But the other six to seven months a year, a large company like TIC suffers."

Sullivan said increased year-round service at YVRA would make it more cost effective for the county to operate YVRA. The county would generate more revenues from "passenger facility charges" added to each airline ticket and from airline fees.

Wirth's conclusions about the feasibility of the Continental and Delta regional jet flights were based on studies of load factors and yields experienced by the Western Slope cities of Montrose and Gunnison for similar flights.

"It's not just speculation," Wirth said. He's cautiously optimistic that the Houston market, with Florida beyond, would support the Steamboat flights.

Ski season jet flights from Houston have provided Steamboat with a successful track record and customer base with Continental. The winter flights have been successful enough to render them "revenue neutral," meaning yields have offset the guarantees put up by the Fly Steamboat coalition, Wirth said. Steamboat's wintertime relationship with Delta is brand new, but again, Wirth sees promise in off-season flights.

Already, elements of the business community have pledged enough support to raise the grant match of $125,000, he said. The flights should be backed with between $25,000 and $75,000 in micro targeted marketing funds, he added.

The Steamboat Chamber and the county applied for Air 21 funds to support a Houston flight last summer and did not land a grant, Wirth said.

This effort is better connected politically. The application has received support from both Colorado senators as well as State Sen. Jack Taylor. Jason Reese of U.S. Rep. Scott McInnis' office has been exceptionally helpful, Wirth said. And Gov. Bill Owens' office has helped the local committee connect with Rep. Bob Beauprez' office.

"We learned a lot from last year's process," Wirth said. "We thought we had a very good application, but we've talked to very senior level people at the airlines and we understand now that we were probably not as politically active as we should have been. That inspired us to put together a significant political action plan."

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