Lake Charles Regional Airport. (Special to the American Press)
Last Modified: Sunday, January 20, 2013 6:44 PM
Despite industry challenges for the Lake Charles Regional Airport, 2012 was a “successful year” but “marked a significant shift in the airport’s finances,” said an airport official.
“We have been very focused on the expense side of our budget — operating extremely lean while taking advantage of every opportunity to save a few dollars,” Executive Director Heath Allen told the airport authority board at its regular monthly meeting last week.
In terms of personnel, the airport is at the minimum with which it can operate the facility effectively and efficiently, he said.
“We continue to have people wearing several hats in order to accomplish our mission,” Allen said in his report. “While I don’t see that ending, given the efficiencies gained, we will continue to explore the use of contract and part-time labor to help supplement our full-time employees when appropriate.”
The airport has also realized new revenue.
In addition to new contracts, the airport is now seeing benefits from the state maintenance reimbursement program. Through Louisiana Airport Managers and Associates, the state airports have worked with the state aviation department to establish a program that reimburses $100,000 to commercial airports annually for maintenance and other expenses. The airport also received assistance from the Calcasieu Parish Police Jury that will help it acquire much-needed capital equipment — a lawn mower, 15-foot rotary mower, a small off-road utility vehicle and an operations vehicle — and provide marketing funds for air service promotion.
Allen said 2012 was not without challenges in commercial air service. Substandard service from Colgan Airlines, which flew on behalf of United Airlines, hampered the airport beginning in 2011 and continued through the first quarter of 2012.
“By substandard, I mean month after month where delays exceeded 50 percent,” Allen said in his report to the board. “This caused harm that we are still recovering from today. Above all else, our travelers require flights that get them to their destination on time. Many of those travelers abandoned the Colgan Service, opting for other alternatives.”
He said Colgan is no longer in the market and the airport has seen a “vast improvement in on-time performance.”
The airport ended the year with traffic down more than 8 percent. By comparison, capacity was down by 15 percent.
“This, combined with the Colgan issues early in the year, account for this drop,” Allen told the board. “I’m always looking for the silver lining and I can say that the numbers could have been worse. Interestingly enough, rental car revenue was up 3 percent.”
Allen hopes to see a rebound in 2013.
“We’ve seen mergers, bankruptcies and complete airline closures. Fewer airlines flying fewer airplanes equate to the bar being raised for small and mid-size markets,” he said. “With 50-seat and smaller jets being retired at an ever-increasing pace and no new aircraft to take their place, the future is certainly dicey for many markets.”
The airport has seen capacity constrained in the market, however, yields remain strong and the carriers are making money, he said.
“This is, of course, the bottom line,” he said in his report. “Add to this the fact that Southwest Louisiana appears to be on the verge of a significant economic boom and that gives us reason to be optimistic. An airport’s activity is indicative of a region’s economic activity and vice versa. That fact bodes well for LCH and Southwest Louisiana.”
The airport will devise an Air Service Master Plan with the help of the Boyd Group International utilizing police jury and airport funds. From that plan, the airport will implement an air service recruitment/retainment and strategic marketing strategy aimed at achieving its air service objectives.
“There is no silver bullet solution when it comes to air service,” he said. “Incentives and guarantees to airlines can work for a short period of time but ultimately it is the market that dictates air service levels.”
Last year continued what has been an unprecedented period of airport construction. Through the efforts of LAMA and the state aviation department, the airport was successful in increasing the State Aviation Trust Fund from about $9 million three years ago to $30 million in 2012.
The airport now has eight to 10 projects going at any given time. Most of those are 100 percent state funded.
“We are very fortunate in that regard considering the ever-increasing uncertainty of federal funds,” Allen said to the board.
Even though no general funds are used to fund the FAA and its associated programs, the industry can expect to be targeted for cuts.
Allen said hopefully the airport organization’s lobbying efforts will be successful nationwide.
In spite of the federal issues in 2012 alone, the airport completed a slurry seal of their secondary runway, expanded the airport fire station, took delivery of a new fire truck, constructed the terminal drive through the canopy, installed gate check conveyor systems on both loading bridges, replaced the parking and boulevard lighting systems, added three electronic gates and completed runway safety area improvements.
The airport also awarded contracts to rehabilitate phase one of the airfield drainage, complete an airport master plan, acquire a mass casualty incident vehicle/trailer, replace airfield signs, acquire an interactive airport training system and complete a wildlife management plan.
Allen said 2013 will begin with a flurry of activity with these projects and a major runway rehabilitation.
“Taking the primary runway down for maintenance is always a challenge for airports. Fortunately we have the ability to continue operations uninterrupted on the secondary runway, though we do lose some capability,” Allen said.
In the coming year, Allen expects to accomplish the fuel farm relocation, Runway Protection Zone land acquisition, airfield pavement rehabilitation, phase one of the perimeter fencing project, phase II of the airfield drainage rehabilitation and the passenger lounge expansion.
Collectively, these projects represent more than $12 million dollars in improvements to the airport’s facility.
When economic impact multipliers are factored in, these projects represent many more millions than that, Allen said.
Allen said he was “pleased” with the current position that the airport is in but “not satisfied.”
“We all know that challenges certainly remain and I’m not remotely suggesting that our work is done,” he told the board. “Looking ahead to 2013 we will continue all of our efforts relating to planning, construction, cost savings and revenue development.”