Steamboat Springs After being quickly immersed in airport economics this week, the new Yampa Valley Airport Commission asked Routt County staff to finalize a budget that will not raise the overall fees airlines pay for the privilege of taking tickets and landing jets in Hayden.
In just its second meeting, the commission reviewed the 2004 budget for Yampa Valley Regional Airport and passed it along to the Routt County Board of Commissioners with its recommendations.
The commission is the embodiment of a new regional approach to managing Routt County's two airports. The commission next meets Oct. 23 at Steamboat Springs Airport, where it will get a tour of new general aviation facilities under construction. Marty Kolonel, a veteran of previous airport advisory boards, was elected chairman of the new commission Thursday and John Ponikvar, representing the city of Craig and Moffat County, was elected vice chairman. Among the members of the commission are Steamboat Springs City Council President Kathy Connell and County Commissioner Dan Ellison.
Connell said she hopes the new commission can find creative ways to make the airport more self-sustaining while improving travelers' experience.
"The guest experience reflects on the airlines," Connell said. "Until we can get our new facilities completed, we have to ask, 'How can we make the guest experience better?'"
The members of the new commission already are intent on finding new revenue streams. They want to help offset a portion of the necessary annual infusion of cash the county must provide the airport in order to balance the books and provide a modicum of capital reserves. However, after hearing that the landing fees at YVRA are already among the highest in the United States, they will not attempt to get more money from the airlines.
The operating budget for the airport in 2004, which has yet to be adopted by the county commissioners, is tentatively set at $2.15 million. Add in capital expenditures of $1.53 million and the total is almost $3.7 million. However, all but $178,400 of the capital expenditures is covered by grants.
Margot Gasch, the county's accountant who tracks airport revenues and expenses, told the advisory commission that the airport typically operates at a loss in the range of $300,000 to $450,000. The county commissioners have transferred money from the county's general fund to make up the shortfall. Beginning in 2001, the county added a portion of its 1 percent sales tax to create a positive fund balance that can be used to build a capital fund.
"In 2001, the commissioners voted to subsidize the airport each year with county overhead, and 12 percent of the 1 percent county sales tax as a cash transfer. The combined total has been in the $700,000 range each year, which is also approximately 20 percent of the sales tax," Gasch said. "The 12 percent sales tax cash transfer has resulted in positive net operating income, which means that working capital could grow to support capital expenditures."
The new budget calls for airlines such as American and Continental to pay $2.65 per 1,000 pounds of landed weight, up from $2.49 last year. By comparison, Eagle County Airport near Vail charges $3.50.
Steamboat Ski and Resort Corp. marketing executive Andy Wirth told the commission increases in landing fees are passed along to local businesses that supply minimum revenue guarantees to the airlines.
"There's a one-year delay, but they pass it straight through to us," Wirth said.
Landed-weight fees are just one of several factors contributing to airline costs at the airport. Terminal rent, a security fee and a passenger service fee all contribute to the $8.73 average charge to the airlines for every passenger who boards an airplane at YVRA. That amount remains unchanged from last year because the airport budget calls for a reduction of 11 percent in the rent airlines are charged at the terminal, passing along a reduction in terminal operating costs.
Airport manager Jim Parker said the costs at YVRA could be largely attributed to the seasonal swings in business at the airport. YVRA must provide facilities in ski season that can meet the demands of passengers disembarking from multiple full-size passenger jets daily. American, United, Continental, Northwest and Delta will all fly into the airport mid-December through mid-April.
However, during spring, summer and fall this year, the airport saw only three daily commercial flights on small turboprops.
Unlike many other airports, YVRA cannot amortize the cost of facilities, improvements and to a degree, staff, over landings and passenger enplanements that remain at high levels year round.
County Manager Tom Sullivan said the staff has made a list of 28 ways to drive more revenue for the airport. Attracting more airport retailers and food service operators is among them.
The airport is in the first phase of a multi-year terminal expansion project. The commission told Parker it will ask to take a close look at how efficiencies in airport staffing can be improved through cross-training employees to perform more than one job description.
Kolonel pointed to the annual budget of $484,000 for airport rescue and firefighting. It represents 20 percent of all airport operating expenses.
"Is this all mandated?" he asked. Parker responded that the airport must meet strict federal guidelines for those services any time that commercial flights are landing. He said the county commissioners' philosophy has not been to send rescue and fire personnel home during slow periods when commercial flights are not landing, but to keep them at the airport to meet the needs of private aircraft landing at the airport.
Personnel in the firefighting facility also fulfill the role of "Unicom" employees at the airport, updating inbound and outbound pilots on weather and runway conditions in lieu of a control tower. Following the Oct. 23 meeting at Steamboat Springs Airport, the commission will meet Nov. 13 at YVRA.
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