The Conundrum of GA Airports

While the largest commercial service airports produce substantial operating surpluses and can finance their investment needs for capital expenses, this does not apply to all airports, especially general aviation airports. In fact, many smaller airports have an operating deficit and therefore generate no funds for capital projects. The FAA’s Airport Improvement Program (AIP) pays for at least 90% of capital investments (runways, taxiways, ramps, etc.) at GA airports, but they must rely on the local community’s tax revenues to cover operating deficits. The federal government supports GA airports because they connect smaller communities to the nation’s air transportation system. But the federal government does not fund operating expenses. School, public safety, roads, transportation, and social programs compete for these dollars at the local level. In times of economic uncertainty, local support for a GA airport wanes. Education, safety, etc. trumps attracting and maintaining an economic and employment base in the community.

Revenue at GA airports is generated by land and building leases, fuel flowage fees, and for a very few, landing fees. What can airports (and their local communities) do to improve the financial position of these smaller airports? Basically, the answer is the same as it is for any underperforming business:

• Increase revenues

• Decrease operating expenses

• Make investments revenue-generating and self-financing

Now, let’s briefly look at each of these three options and how they might be accomplished.

Increasing Revenues
Small airports generally rely on lease income from land leased to aircraft service businesses (FBOs, maintenance providers, charter companies, etc.), and fuel flowage fees collected from anyone delivering fuel on the airport as their principal sources of revenues. Strategies to attract companies that operate business jets and turboprop aircraft should be pursued. These aircraft consume a large amount of fuel compared to small piston powered aircraft. Business jets require hangar space whereas the majority of small aircraft can simply be tied down on the ramp. Maintenance, part sales, and other services for these turbine powered aircraft are substantially higher than for the piston fleet. Attracting these types of aircraft depends on the facilities at the airfield both in terms of safety and amenities. On the safety side, precision instrument approach capability as well as runway length and runway safety areas are required.

Commercial service airports charge a landing fee, but very few GA airports charge a landing fee. This should change. A small fee of $5 to $10 per landing could put most GA airports in the black.

Controlling Costs
Many GA airports have public employees staffing the airport. A full-time airport manager and other public employees at the airport perform administrative, maintenance (grass cutting, snow removal, etc.) and other functions. A lower cost alternative might be for the fixed based operator to assume these responsibilities on a contract basis. For example, fuelers and other FBO personnel could be trained in airport maintenance duties. The cost reduction to the community could be substantial. The municipality that owns the airport could maintain governance of the airport including control of master leasing of land and buildings.

Investments
Local communities might consider converting land that is surplus to the operation of the airport, or land that might be restricted because of building height or other FAA horizontal surface limits, to commercial uses. A good example is a golf driving range in the runway protection zone (RPZ) that would not interfere with aircraft operations.

Solutions for this GA airport dilemma are not easy, but creative out-of-the box thinking is paramount.