Air service program open house is Tuesday in Steamboat's Library Hall

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— The public is invited to ask questions and learn more about Yampa Valley Regional Airport's ski season flight program during an open house from 5 to 7 p.m. Tuesday in Library Hall at Bud Werner Memorial Library.

The meeting is hosted by the board of the Local Marketing District, which oversees the flight program that is funded in part by a 0.25 percent general sales tax in Steamboat.

“Any member of the community can ask any question in any detail,” LMD treasurer Bill Stuart said during an LMD board meeting in August. “It’s what we’re doing in terms of letting the community know what the LMD does, which is sometimes confusing in detail. It’s a very open, transparent meeting. So if anyone has a question or misunderstanding, this format is a valuable (opportunity) to come and ask their questions."

In addition to LMD board members, Steamboat Ski and Resort Corp. executives, representatives of the city of Steamboat Springs and the Steamboat Springs Chamber Resort Association will be in attendance to field questions.

Comments

Steve Lewis 1 year, 6 months ago

I've been critical of the air program. I studied their data and took my unhappy findings directly to this board, to Ski Corp, to the Pilot, and to the City. Lately I reconsidered my direct criticism of this board. Obviously, it is an increasing challenge to deliver flights to Steamboat. I began to wonder if each board member really understands the numbers behind that challenge, or do they simply take Ski Corp representations at face value.

These are simple questions about what we were promised:

1) In 2011, the YestoAIr campaign published a 5 year projection, to 2016/17, of how many seats the air program would deliver if given extra funding via a .25% sales tax. Why is it, having won that taxpayer funding, the LMD and Ski Corp now insist they cannot project these airline seats beyond one year, not even to 2013/14?

2) In that same 5 year projection, they assumed a 3% per year inflation in the $$ guarantee of each seat to promise 160,000 seats into Hayden in 2016/17. That 3% number is wrong. Wrong according to my estimates by a factor of 5. Wrong according to their own 2013 budget testimony (6.2%) by a factor of 2. Where did they get that 3% ? What do they deliver when it is corrected?

3) The YestoAir campaign promised they would use the .25% sales tax to rebuild program reserves. Yet each budget submittal after winning the sales tax specifically states it will be their policy to commit the full reserves of the program to guaranteeing airline contracts each year. Where is their plan to rebuild program reserves as promised?

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Steve Lewis 1 year, 6 months ago

I attended the open house.

The audience was also concerned about the promised rebuilding of reserves. The LMD responded that reserves will be a function of each year's performance - we will have reserves if things go well that year. In their 2012 and 2013 budget submittals: "It is the practice of the LMD to budget the full risk and fund exposure (CAPS). It is possible that the costs could actualize lower and realize a savings."

Every program representative who spoke, including Chris Diamond, walked away from the promise of reserve building they made the previous year.

Asked why their 2B campaign used 3% inflation in Guarantees/Seat instead of their recently claimed average of 6.2%, they answered, "We also had an Actual Cost/Seat inflation average of about 4.3% so we thought 3% or 4% was a good number to use for the Guarantee inflation." Not a credible response.

Worth noting, if they had used their own 6.2%, their 2B campaign projection would have shown 115,000 2016/17 winter seats into Hayden rather than the 160,000 of their website and ads.

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Steve Lewis 1 year, 6 months ago

Much of the audience commentary expressed interest in changing the paradigm of subsidizing far reaching flights, and shifting instead to the nearby hubs of Denver and Salt Lake. Eliminating subsidy of the long directs would encourage the regional services and be far cheaper.

The increased regional service would also better serve contingents of tourists and business travelers not currently well served.

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Scott Wedel 1 year, 6 months ago

Well, the great beauty of the tax having a sunset provision is that soon enough LMD and ski area will start thinking about what it will take to get the tax reauthorized.

It is reasonable to spend all of their money on the upcoming year's flights.

It is not reasonable and pretty inept to have no projections of how much of that will be returned due to meeting revenue targets. The ability to meet revenue targets should be an essential part of picking which flights to subsidize and be how their management of the program is measured.

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Steve Lewis 1 year, 6 months ago

Scott, You are right. Though the reauthorization is coming sooner than you think. They will not make it 4 more years.

I have no problem with the new contract. Their historical data showed they would guarantee a contract at about that $/seat rate. The embarrassment is that they blame it in any part on snow. The industry is predicting next season's snowfall? That makes no sense. Penalizing us for last year's? That makes no sense either. The future guarantees will have 19% or more inflation, the average inflation since 2008. It is actually a very steady trend. They know it is easier to excuse their performance if we perceive the airline challenge is as capricious as the weather. That is not the reality.

The two main promises of the 2B ballot question were the sales tax would deliver 1) 160,000 airline seats by 2016/17, and 2) a rebuilding of reserves. The LMD's own numbers show 160,00 was never remotely possible. This week in their open house, they walked away from the promise of rebuilding reserves. Integrity there?

Reauthorization of this tax should fail. The City has shown it will not use it's oversight authority in the use of the tax. The LMD has shown it has no plan to deliver on it's promises.

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