PTI Sees Passenger Facility Charge As Best of Bad Alternatives

Passengers should expect to pay a little more to fly out of Greensboro’s Piedmont Triad International Airport.

The airport’s seven-member authority recently voted to ask the Federal Aviation Administration to allow the airport to place a $4.50 passenger facility charge on every airline ticket purchased.

Authority member and Forsyth County Commissioner Gloria Whisenhunt cast the lone “no” vote.

“I’m the only board member that’s elected, and you look and things differently when you’re elected,” Whisenhunt said in a phone interview. “I had constituents calling me voicing their concerns and I think they had very legitimate concerns.”

Even so, PTI officials say they need a source of additional revenues, and a PFC is the best available available. Without a PFC, PTI would have to increase landing fees, said PTI Director Kevin Baker in a phone interview. Landing fees are based on the weight of planes using the runways. Increasing them would compromise the airport’s competitiveness, he warned.

“We’re concerned that our landing fees will be so high it will affect our competitive position,” Baker said. “We would be in a position where it would be difficult to lure low-cost carriers, and we might even be threatening our position with our existing carriers.”

For her part, Whisenhunt said she spoke with one constituent who owned a company that has employees fly four to five times per week. The PFC could “add $50,000-$60,000 a year to their bottom line,” Whisenhunt said. “That’s very difficult in this economy.”

Whisenhunt suggested that the airport either delay the PFC or reduce it by half. But for now it appears as though the FAA will approve the airport’s request as approved by the authority, perhaps later this year.

“I can’t imagine the FAA saying no, with so many other airports having them,” n Baker said. “It’s a standard tool for airports. We’re just coming late to the game.”

According to the FAA’s website, the PFC program allows airports to collect the fees “to fund FAA-approved projects that enhance safety, security, or capacity; reduce noise; or increase air carrier competition.”

The federal government caps PFCs at $4.50, but USA Today recently reported that that the Obama administration proposed raising the cap as part of its budget proposal, which would at the same time slash airport construction funds.

PTI has tried to land a major low-cost carrier for more than 20 years, Baker noted. The airport believed it had finally made the big score in 2007 when low-cost carrier Skybus announced it would make the airport a hub.

News photos at the time showed then-Gov. Mike Easley and Skybus CEO Bill Diffendorffer smiling ear-to-ear and proudly displaying “Welcome Triad” signs at a press conference.

The airport immediately jumped on board, signing an incentives package worth $50 million that included new construction. The state and local governments also pitched in.

But it was not meant to be. By April 2008, Skybus was bankrupt, citing rising fuel prices. PTI still has not recovered, and now passenger boardings are “at 1980s levels,” Baker said.

“If the world were cranking right now and we had 1.5 million passengers right now instead of 850,000, and flight carriers were going full steam, then we would have less of a need for (the PFC) because we’d be recouping it in landing fees,” Baker added.

The airport also needs the PFC to help with maintenance and construction costs on its new $150 million runway. The federal government picked up most of the tab, but the airport’s share of the cost was $30 million, financed over several years.

The runway was built as part of the deal to lure a FedEx hub to PTI. Local officials predicted the hub would be a driver of economic development. Forecasts suggested that not only would the hub itself provide as many as 1,500 jobs, but companies also would spring up around the airport, hoping to take advantage of the hub’s proximity to ship time-sensitive products.

Neither scenario has come true, at least so far. FedEx has been hit hard by the downturn in the economy and has provided fewer than half of the projected job totals at the new hub, while available land surrounding the airport sits mostly undeveloped.

In fact, an existing building across Bryan Boulevard just became available, as American Express recently announced it was shutting down its Greensboro call center, costing the Triad 1,500 jobs.

Economic developers still expect PTI to become an “aerotropolis” once the economy turns around. And all has not been doom and gloom at PTI. Honda Aircraft Co. announced in 2007 it would locate its world headquarters and production facility at PTI, employing as many as 300.

Moreover, passenger numbers for the month of January were up 14 percent over the same period in 2010, while cargo numbers increased slightly less than 3 percent.

But Baker said PTI must stay ahead of its competitors when possible. “In order to remain competitive, we have got to keep our cost of doing business here competitive with the other communities around us,” he said. “Taking no action is a greater risk than taking this action.”

Sam A. Hieb is a contributor to Carolina Journal.