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72 This chapter provides a summary on how state DOT Offices/Bureaus of Aviation/ Aeronautics view airline upgauging and the resulting impacts on the airport systems under their authority. The information presented in this chapter is based on the literature review conducted by the study team as well as the interviews with the following state agencies and bureaus: â¢ Florida Department of Transportation (FDOT) â¢ Mississippi Department of Transportation â¢ North Dakota Aeronautics Commission (NDAC) â¢ Alaska Department of Transportation and Public Facilities (Alaska DOT&PF) The goal was to obtain their input on the issues and challenges associated with airline upgaug- ing, and discuss their recommendations on successful (and unsuccessful) practices when facing significant changes of aircraft and passenger activities. This series of interviews allowed for identifying some differences in the roles and approaches that state agencies can have to support the development of airports. The main common obser- vation is that state agencies primarily look at the economic benefits that potential development projects would bring to local communities and to the state as a whole. Initiatives can have dif- ferent forms, including but not limited to the following: â¢ Preparation and publication of economic impact studies to justify the importance of aviation in their state and promote the development of airport facilities as a potential way to attract business, support economic growth, and develop jobs â¢ When solicited, being involved in the review of long-term and master planning efforts for air- ports, in close coordination with local communities and the FAA, to share a global perspective on the aviation system needs at the state level â¢ Secondary (and/or primary) funding sources, which are usually complementary to federal grants, to support airport projects that may not entirely meet the FAA requirements or criteria Another form of support from state agencies can be the creation of minimum revenue guarantee (MRG) programs. As an example, in an effort to attract more flights, the Cabinet for Economic Development in Kentucky announced in July 2017 an MRG program designed to entice airlines to provide more service from the city of Louisville. âMRGs alleviate budget uncertainty for air providers. If traffic does meet the agreed upon revenue minimum, local entities such as Louisville Regional Airlift Development (LRAD) commit the difference to an escrow-type account. The commitment decreases when traffic generates more than the minimumâ (Paeth 2017). C H A P T E R 5 State Agenciesâ Perspective on Airline Upgauging
State Agenciesâ Perspective on Airline Upgauging 73 Florida Department of Transportation Interviewees â¢ Andy Keith, aviation development administrator â¢ Todd Cox, aviation program development manager â¢ Abdul Hatim, aviation engineering manager Description/Overview of the State Airport System â¢ 129 airports in current FDOT scope: 105 public owned, 24 privately owned (open to public). â¢ 100 airports included in the FAA NPIAS: 80 GA, seven non-hub, six small, three medium, and four large hubs (only state with four large hubs). â¢ No airport is state owned in Florida. Florida statutes prohibit FDOT from regulating com- mercial air carriers operating within the state pursuant to federal authority and regulations; and from participating in or exercising control in the management and operation of a spon- sorâs airport, except when officially requested by the sponsor. â¢ The latest updated State Aviation System Plan was completed in November 2017 and will be available January 2018. â¢ Florida is unique. The Continuing Florida Aviation System Planning Process (CFASPP) was established to help maintain a viable statewide aviation environment. A primary function of the CFASPP is to help keep the Florida Aviation System Plan (FASP) in step with the constant changes in the aviation industry through periodic updates. The CFASPP is a method used within Florida to continually monitor the aviation environment, to determine the develop- ment requirements to best meet projected aviation demands, and to maintain and enhance Floridaâs aviation system. To support the CFASPP, the state has identified nine regional cen- ters of aviation activity. The nine regional CFASPP steering committees and the one executive statewide committee are integral to this entire process and the 10 committees each meet three times per year. During the three annual meetings and through an increasingly automated information management system, they provide both regional and statewide input critical to the ultimate success of the FASP and a number of similar aviation system planning efforts. â¢ Seven FDOT district coordinators deal with funding and work closely with the central office. â¢ Cargo activity is mostly centralized at Miami International Airport: 84% of Florida cargo. â¢ GA airports that are proposing to become commercial airports (scheduled passengers), need to reach the 10,000 enplanements threshold to be recognized by FDOT as a commercial ser- vice airport (same as FAA definition for commercial airports). FDOT State Planning and Funding Process â¢ The state funding process is achieved through the Joint Automated Capital Improvement Program, which centralizes all project communication and coordination between the air- ports, FDOT, and the FAA. (Refer to Florida Aviation Project Handbook for additional state funding information for Florida airports.) â¢ Through the centralized system, and on the basis of airport needs, FDOT can assess if an air- port is getting close to reaching its maximum capacity. An example given during the inter- view is MCO (Orlando): the airport has already passed the threshold and has undertaken a major ongoing terminal development project. As the economy roars nationwide, Orlando is extremely busy because of the numerous sightseeing and tourist destinations and theme parks. â¢ As part of the capital improvement plan, airports submit a 5-year plan and update it every year. Shifting a project from one year to another after approval doesnât mean the funding will still be available for that particular year. It would need to be reevaluated.
74 How Airports Plan for Changing Aircraft Capacity: The Effects of Upgauging â¢ FDOT is not involved with any procedure relating to ASD and/or communication or relationships with airlines because of statutory restrictions. No incentive would be provided by FDOT. Its sole role is to support airports based on their proposed plan to the state. â¢ Airports need to proactively pursue Part 139 certification if they want to start scheduled passenger service. Airports propose their plan to both FDOT and FAA, including their needs, and get the support from government agencies to move forward. â¢ At the state level, FDOT prepares an Air Service study every 2 or 3 years that includes domestic, international, and inter-state operations forecasts from a capacity perspective. The most recent one (2016) states that âenplanements for all commercial service airports in the Florida system grew 2.6% between 2013 and 2015.â The highest (Punta Gorda) witnessed a 70% growth (see Figure 28). â¢ Overall, the state had 168 million passengers in 2016; significant growth compared with 2 years ago. â¢ Allegiant has been increasing its flights and is contributing to airport service expansion. Once the airports have indicators that show an exceeding capacity, FDOT will start working with them. For instance, the state identified that Fort Lauderdale will reach 100% of its capacity by 2025. Strategic Intermodal System Projects â¢ The Strategic Intermodal System Projects (SIS) is the stateâs highest priority for transportation capacity investments and a primary focus for implementing the Florida Transportation Plan, the stateâs long-range transportation vision and policy plan. â¢ The current designated SIS is a network of high-priority transportation facilities that: a. Includes the stateâs largest and most significant commercial service airports, spaceport, deepwater seaports, freight rail terminals, passenger rail and intercity bus terminals, rail corridors, waterways, and highways; and b. Carries more than 99% of all commercial air passengers and cargo, virtually all waterborne freight and cruise passengers, almost all rail freight, 89% of all interregional rail and bus passengers, and 55% of total traffic and more than 70% of all truck traffic on the State Highway System. â¢ Only 20 airports are currently SIS eligible: 18 of 20 commercial service airports and two GA airports. Figure 28. Airport enplanement trends in Florida (Source: Florida Department of Transportation 2016).
State Agenciesâ Perspective on Airline Upgauging 75 Strategic Airport Investment Projects â¢ In addition to the regular funding mechanisms, Florida has a special programâStrategic Airport Investment Projects (SAIP)âfor capacity-related issues. SAIP has more flexibility in that if it can provide justification for a project, it can qualify for up to 100% funding. â¢ To qualify for SAIP funding, airport projects need to be identified as a strategic infrastructure investment opportunity for the state through the following criteria: â Provide important access and on-airport capacity improvements. â Provide capital improvements to strategically position the state to maximize opportunities in international trade, logistics, and the aviation industry. â Achieve state goals of an integrated intermodal transportation system. â Demonstrate the feasibility and availability of matching funds through federal, local, or private partners. â¢ These criteria are used to determine the eligibility of the project to receive up to 100% fund- ing from the state. â¢ When no federal funding is available, FDOT provides up to 50% of total funding for com- mercial airports and up to 80% for GA airports. For airport capital improvement projects to be considered eligible under SAIP, the project, per statute, must meet the following criteria: 1. Is the project a top priority for the airport? 2. Does the airport have (or will it have) matching funds? 3. Is the project consistent with most recent department/FAA-approved airport master plan? 4. Has financial and economic analysis been completed? 5. Does it support an increase in Florida jobs? If so, how many? 6. Does it provide statewide or national impacts for throughput of passengers and/or cargo? 7. Does it provide improved access or multimodal connectivity for passengers and/or cargo? 8. Does it allow the state to accommodate changes in trade patterns or to capture a new market for the state? â¢ Once these factors are considered, projects will be prioritized by putting them into the following categories: â Safety: Funding will prevent infrastructure failure or resolve a critical safety issue. â Capacity: Funding will improve capacity to prevent businesses from leaving or allow business expansion. â Improvement: Funding will provide for improvements that are likely to immediately attract new businesses. Stateâs Perspective on Impacts and Challenges from Airline Upgauging â¢ In terms of overall infrastructure conditions, most airports in the state are in good conditions on the airside but some of them show deficiencies on the terminal side, such as security check- points. The FDOT is not usually involved in these types of capacity issues but does provide infrastructure-related grant funding. â¢ FDOT enjoys the partnership between federal agencies and airports. The agency is a firm believer that no secret should be keptâairports should be fully transparent and let FDOT know of their exact conditions/situations. â¢ Florida is one of the few states (besides New York and Alaska) that has its own Airports Dis- trict Office (ADO), and FDOT works closely with the Orlando ADO. FDOT has been putting great investments and efforts into airport improvement funding, about $250â$260 million a year as state funding, higher than federal funding. The close relationship between FDOT and ADO is a key factor in the success of the development of the stateâs airport system.
76 How Airports Plan for Changing Aircraft Capacity: The Effects of Upgauging â¢ As the world shifts to more eco-friendly sustainability, it will lead to the reduction of fuel revenue, which could affect airport development. New tech such as hybrid-regional jets in development might be a game changer too. â¢ ACRP Synthesis 79: Funding Industrial Aviation includes more information. Mississippi Department of Transportation Interviewee â¢ Thomas M. Booth, aeronautics director Description/Overview of the State Airports System â¢ 73 airports included in the FAA NPIAS (72 publicly owned, and one privately owned): 67 GA, three commercial service, two non-hub, one small. â¢ No airport is state owned in Mississippi, and a few airports are operated by state colleges and universities. â¢ The latest State Aviation System Plan is from 1999 and has not been updated since. At the time, Mississippi had started getting service from Southwest Airlines and the plan included a forecast for commercial service growth at the main airports. Unfortunately, the events of 9/11 greatly affected the aviation industry in the state. The drop in traffic that followed those events, as well as the series of airlines mergers, were not predicted in the system plan. â¢ In 2014, an Economic Impact Study (CDM Smith 2014) was prepared by the state. The key findings are presented in the following summary: Airports in Mississippi are significant components of the stateâs economy. . . . It was found that the 73 airports considered in this analysis generated an estimated $2.53 billion in economic output in 2012. . . . the airports help to support a total of 20,025 jobs that have an annual payroll of nearly $722 million. Stateâs Perspective on Impacts from Airline Upgauging/Downgauging â¢ Since the last recession in 2008/2009, no major traffic growth was observed at Mississippi airports. â¢ Since the Delta/Northwest merger, airports actually lost some of their commercial service and experienced a downgauging of airlines fleet from regional jets to 10â20 seat aircraft (turboprops). â¢ The last major terminal renovation project in the state was at Gulfport-Biloxi International. However, the terminal is not used at its full capacity because some of the gates are currently not operated. AirTran operated at the airport until January 2009. Attempts to get AirTran back failed once it was acquired by Southwest. â¢ Most of the recent development projects involving MDOT/FAA were related to airside infrastructure, such as runway, land acquisition, and noise abatement programs. â¢ The state does not get involved directly with the airlines; airports are responsible for all discussions related to commercial service. â¢ However, for the past 5 years, the state has had a funding program that helps airports pay for ASD consulting costs. â¢ In terms of commercial service, the Essential Air Service (EAS) program plays a key role at Mississippi airports to provide commercial service to small communities. The program is directly handled by the U.S. DOT; the state is not involved. â¢ Currently four airports are under EAS; all of them were initially downgraded in the NPIAS from primary to non-primary airport, seeing a reduction of FAA passenger entitlement from
State Agenciesâ Perspective on Airline Upgauging 77 $1 million to $150,000. This determination is made based on the 10,000 enplanements threshold. Since then, one has become a primary airport again, Meridian Regional Airport (MEI), and two others could become primary again in the next year or two. â¢ Some of the issues that airports experience with the EAS program are related to the reliability of the service. For instance, flights being canceled due to mechanical issues. These types of issues generally affect the image of the airport from a passengerâs standpoint, especially when passengers are not informed ahead of time. The number of passengers go down, people stop flying from that particular airport, and eventually the airline ends service and cancels its agreement. â¢ Service reliability is a key factor to attract more passengers. Another factor is the type of equipment: travelers usually like to fly jet aircraft. Even though an airline under EAS provides reliable service, it was observed that if the service is provided by turboprops only, passengers may instead choose another airport or another means of transportation, such as driving to their destination. â¢ Currently, Greenville airport is facing the opposite challenge. A charter airline was recently selected to take over the EAS service at the airport and has been successful even though it is flying turboprop aircraft. The aircraft have a high reliability of service and their fares are com- petitive. The demand has increased, but the airline does not operate larger aircraft. Because of this limitation, some demand is actually turned away, and the airport has its hands tied on how much it can do to provide more service and capture the unmet demand. North Dakota Aeronautics Commission Interviewee â¢ Jared Wingo, airport planner Description/Overview of the State Airports System â¢ Aviation System has a total of 89 public use airports. 53 airports included in the NPIAS (51 publicly owned, one privately owned, one Native American owned): 45 GA, eight provid- ing commercial service: two non-primary and six primary (five non-hub and one small hub). â¢ Two airports are state owned: International Peace Garden (S28) and Garrison Dam Recre- ational Airpark (37N). â¢ The officeâs involvement in the development of airports is mostly related to funding, planning, and programming. The office has no direct involvement with the airlines. â¢ The latest State Aviation System Plan was completed in 2014. The plan was prepared while the state was experiencing a major period of traffic growth, driven by a growing economy in agriculture, tourism, small business, and an increase in oil and natural gas exploration (see Figure 29): Since the last system plan was completed in 2007, the number of enplanements in North Dakota has nearly doubled from 652,380 to over 1.1 million in 2013. Average daily airline departures in North Dakota have increased from 52 to 75, and the number of non-stop destinations has grown from 5 to 12 (North Dakota Aeronautics Commission 2014). â¢ In terms of airline fleet changes, the study is making an interesting statement regarding the trends observed in the state in comparison to the national level: Unlike the national trends of fewer flights but with larger airplanes, North Dakota experienced a continued increase in the number of flights from 2010â2014 as airlines began responding to the increase in demand as a result of economic and population growth. Whereas the US has been experiencing a steady increase in the number of seats per flight flown, North Dakota experienced a slight declineâfrom 64 to 57 seats per
78 How Airports Plan for Changing Aircraft Capacity: The Effects of Upgauging departureâbetween January 2010 and April 2011. This reflects the use of smaller, regional aircraft for many of these flights. In 2014, the number of flights has leveled off and even declined slightly. At the same time, the number of seats per operation is climbing back upâindicating a shift by commercial carriers to larger gauge aircraft that are now making their way into the stateâs commercial aviation system (North Dakota Aeronautics Commission 2014). â¢ This trend of upgauging was discussed as well during the interview and confirmed. One of the potential reasons given was the shortage of pilots observed at both the state and national levels. Recent Changes of Airlines Activity at North Dakota Airports (Upgauging) â¢ One of the impacts of this important traffic growth in the state is the construction of a new airport to serve the city of Williston. The current airport, Sloulin Field International Airport (ISN), was built in 1947 and faces expansion constraints, design issues, and the need for runway refurbishment. â¢ The other recent development projects that were triggered by a need for more capacity include the construction of a new terminal at Minot International Airport and the upgrade of a runway for Part 135 airlines at Dickinson-Theodore Roosevelt Regional. â¢ In terms of the NDACâs involvement, the commission works in continuous coordination with the local FAA Airports District Office (ADO) for every airport development project. The commission is consulted as part of any master plan and airport layout plan update to provide input and information relating to the overall state plan (e.g., forecasting effort). â¢ In terms of funding, the NDAC also works hands-on with the ADO and with the local communities. Stateâs Perspective on Impacts from Airline Upgauging â¢ The main objective is always to facilitate communication at all the levels involved in the project: federal, state officials, and local communities. â¢ In particular, it is important to educate the public early in the project stages. Through local engineers and program managers, the NDAC provides support to the communities, but the Figure 29. Airport enplanement trends in North Dakota (Source: North Dakota Aeronautics Commission 2014).
State Agenciesâ Perspective on Airline Upgauging 79 local officials are ultimately the ones responsible for this effort. Airports sometimes experi- ence critics from their community when development projects, such as terminal expansion projects or construction of a new facility, are presented to the public. Sometimes those facility developments are not related to any traffic growth but are necessary to meet new requirements and/or regulations from the state or from the federal government (e.g., TSA checkpoints). â¢ The second objective is to maintain flexibility in terms of plans. To achieve this objective, stakeholder involvement is key, as well as a thorough collection of data and information on the existing conditions. This information should be developed and used as a basis for any projects. This process will avoid finding issues and restrictions at a later stage that would constitute a major obstacle for the success of the project. â¢ Communication/relationship with airlines should be directly done by airports and local communities. Then airports need to develop and propose plans to the FAA and the DOT that already include input from the airlines. Alaska Department of Transportation & Public Facilities Interviewee â¢ Roger Maggard, statewide airport development manager Description/Overview of the State Airports System â¢ Seventy-four airports included in the NPIAS (all public owned): 69 GA, three non-hub, two small The Aviation and Airports office of the Alaska DOT&PF is mainly split into two groups. One group coordinates directly with the five primary airports in the state. For these airports, most of the planning and the programming are done directly by the airport. The other group is respon- sible for all the GA airports in the state. Stateâs Perspective on Impacts from Airline Upgauging Roger Maggard, the statewide airport development manager, provided his input and feedback on the challenges of airline upgauging through the online survey questionnaire prepared as part of the study: â¢ Main drivers of change of activity: â Airports approached by new airlines to start service â Airline(s) already operating at the airport that changed operations (e.g., opening of new routes/destinations/markets) â Comments: âAlaska Airlines is migrating their fleet to B737-800 & 900. Peninsula Airways is changing portions of their fleet from Saab 340 B to Saab 2000 aircraft. Delta Airlines is now providing jet service at Ketchikan Airport.â â¢ Direct effects of this change of airlines activity on airport operations: â Use of larger aircraft: âThe upgauging to B737-800 & 900 from Alaska Airlines increases the ARFF category. The change from Saab 340 B to Saab 2000 aircraft from Peninsula Airways is expected to require certification of two airports (Sand Point and St. Paul) which are not currently certificated, but were certificated in the past.â â Increase of flight frequency: âThe start of jet service from Delta Airlines at Ketchikan Airport required increasing the ARFF category at this airport.â
80 How Airports Plan for Changing Aircraft Capacity: The Effects of Upgauging â¢ Main issues and challenges faced by airports due to airline upgauging: 1. Financial/capital investments 2. Operations and management 3. Coordination with regulatory agencies â¢ Part 139 requirements: â Yes, the following ones: i. Major changes in Airport Certification Manual (ACM) ii. Aircraft Rescue and Fire Fighting (ARFF) operations iii. Major changes in Airport Emergency Plan (AEP) iv. Impacts on snow and winter events requirements (e.g., deicing operations) â Good communication and coordination process with the FAA local ADO and with the airlines â¢ Agreement with airline partners to share the financial risks associated with the costs and investments involved in the upgauging process: â Yes: âAt Sand Point, Peninsula Airways is funding the salary and per diem for a qualified DOT&PF employee to train city personnel to perform ARFF duties. The City of Sand Point will provide the ARFF crews.â â¢ Benefits from investments made to support the activity growth: â âCommunity residents will be served by more modern aircraft.â