The Crested Butte News Serving the Gunnison Valley since 1999
Reduced airport fees for new or expanded service
By Richard Kadzis
Strategic Goal Challenges Airport
By 2020, increase the airport’s economic impact to the community by 40 percent over 2013 CODOT study to $140 million as a consequence of reversing identified passenger leakage (77 percent of GUC’s market “leaked”’ to competing airports). Increase enplanements to 45,000, and increase corporate and general aviation activity.
—Gunnison County 2015 Performance Report
The nagging question of how to expand airline service and air passenger volume at the Gunnison–Crested Butte Regional Airport (GUC) is back in front of the Gunnison County commissioners.
The board will take up a proposal at the September 6 commissioners’ meeting to potentially offer operating cost incentives for new airline service into GUC. The board discussed some options at an August 23 work session.
According to airport manager Rick Lamport, after researching multiple large and small airports nationally, Lamport made a case for providing airport incentives to try and attract new carriers or increase the service of current airlines using GUC.
By offering incentives like free or reduced runway landing fees or free counter space in the terminal, overall airport fees could be lowered dramatically, and more airlines would, at least theoretically, be encouraged to enter the market.
New air service would be defined as at least one flight weekly to a destination not currently served from the airport, sustained for a period of at least 24 months or two seasons.
In addition, the cost structure to support and absorb the revenue offset by incentives is already in place, Lamport assured the commissioners. The GUC plan would “predefine what we pay,” he said. “The incentives would only be for new air service, not for existing service already in place.”
“It’s got to be a net positive for the airport and the community,” insisted commissioner Phil Chamberlain.
Lamport agreed, saying this would not be “a shell game taking planes from one location of origin and feeding them to us from another one.”
The three commercial carriers currently serving GUC are United, American and Alaskan Airlines, Lamport confirmed. With the exception this year of suspending mud season service from its Denver hub, United is the only carrier to operate year-round. The airport will also be closed for a period next spring for runway improvements.
Those airlines could be eligible for the incentives if they increase their flight service.
Increased air service would be defined as an increase in frequency of an existing scheduled route by one or more flights per week as compared to the previous years’ applicable months or season, sustained at least 24 months or two seasons.
Another plus for airlines potentially looking at GUC is that the regional summer economy has become bigger than the winter’s, a factor that could help attract new airline service to a remote market with ongoing challenges like a small local population base, lower-than-average business travel volume, and the “leakage” of local passengers from GUC to competing airports in Montrose, Denver and Grand Junction.
“There are so many variables in this game,” Lamport said. Thus, factors like load factors and costs per flight warrant consideration of a new model.
How much could airlines new to GUC save in operating costs? Lamport said the airport’s current landing fee is $5.35 per thousand pounds. So for example, the maximum landing weight of the American jet—an Airbus 319—is about 134,000 pounds, so American would owe approximately $700 per landing. The multiples in airline savings over what could be a two-year term for the incentives are substantial.
Lamport said the airlines now expect operating incentives from small airports. And with the incentive program it’s not like the airport is cutting into current revenues since there isn’t revenue in place now. Lamport said, “Without service, there is no money, but with at least some service, there is some money.”
Even new airlines with a minimum one-year agreement to serve GUC might have a strong rationale to remain longer, said commission chair Paula Swenson. “If there was a two-year incentive in place, like a landing fee abatement, that could be a good situation.”
Helping to justify the new incentives plan is the recent growth in airline passenger volume. According to Lamport, in 2015, GUC saw a 7 percent volume increase over 2014, so bringing in more air service through incentives could keep that ball rolling.
