The sad news is that Westmoreland County’s Arnold Palmer Regional Airport (LBE), left commercial carrier-less with the demise of Spirit Airlines, had to lay off 25 workers this month. Two others had their hours reduced.
And the TSA, the Transportation Security Administration, has given the airport a 90-day notice that it will be pulling out. That is, unless LBE can land another commercial airline.
It tried, and failed, for years to attract a second carrier. And that in a climate of sharply falling passenger numbers – nearly two-thirds lost – between 2015 and 2025. And as the Westmoreland County Airport Authority spent $22 million to expand the now soon-to-open facility to, in its original design, accommodate a second commercial carrier.
To that end, Moe Haas, the Airport Authority’s director, tells the Tribune-Review that LBE has received a letter of support from an unnamed airline to submit along with an application for a grant through the federal Small Community Air Service Development (SCASD) program, which he said can help draw in a commercial carrier.
Encouraging news, right? Perhaps for Palmer Regional. Perhaps not for taxpayers.
SCASD is a federal grant program designed to help “small communities address air service and airfare issues.” According to program materials, it involves revenue guarantees, start-up costs and studies and financial assistance for marketing programs (capped at $1.2 million). It aims to improve air carrier service to airports in the United States that do not receive sufficient service.
By proxy, it’s a federal subsidy to commercial carriers. And that’s on top of the subsidy that any new carrier at Palmer could receive, just as Spirit did for Spirit-specific staffing operations (to the tune of about $2.6 million annually from the county). In a Unity Township passenger air travel market that has been declining for the past 14 years.
And with Pittsburgh International Airport (which has its own subsidized flight issues) a mere 62 miles or about an hour- and-20-minute drive away.
Clearly, and despite a lot of happy talk, Arnold Palmer Regional Airport has been on a downward trajectory for years as a one-airline pony. Even with existing taxpayer subsidies and those that it might garner in the future, should another commercial carrier come to LBE.
And, just as clearly, it’s time to try something “new” – outright privatization or a public-private partnerships (a P3).
We place “new” in quotation marks because while the concept might be considered new domestically, it has become something of the norm overseas.
As the Reason Foundation’s Robert Poole – in conjunction with the Brookings Institution – noted just last August:
“Advanced nations in other parts of the world have increasingly privatized commercial airports via sale or public-private partnerships (P3s). According to the Airports Council International, 75 percent of passengers in Europe use privatized airports, 66 percent in Latin America and 47 percent in Asia-Pacific.
“However, in the United States, only one airport, in San Juan, Puerto Rico, has been successfully privatized,” Poole wrote in his August white paper of 2025.
Two bottom lines here from Poole:
“Privatized airports were found to have more airlines, lower airfares, greater productivity and overall greater passenger satisfaction. Many of these are also owned or operated by airport groups that benefit greatly from economies of scale, standardized practices and training pipelines that enable talented managers from smaller regional airports to transition to larger international airports.”
The U.S. Congress authorized such privatization through 2018’s Airport Investment Partnership Program. But Poole says two tax changes are needed to make the program more attractive – “removing the requirement that tax-exempt airport bonds be paid off before a change in control and allowing P3-leased airports to issue tax-exempt private activity bonds.”
If there’s truly a commercial-carrier-sustaining market at Palmer Regional — and without subsidies piled on subsidies — perhaps outright privatization or a public-private partnership is worth the effort.
But if there’s not, and with Pittsburgh International so relatively close, the very future of LBE has to be in serious doubt. And it would be one very expensive failure.
Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).
