Lower Airport Traffic Puts Pressure on Costs
It has just been reported that Pittsburgh International Airport (PIT) traffic in 2008 fell to its lowest annual total since before the new terminal was opened-and presumably quite a number of years prior to the opening of the new facility.
And there is no doubt why. USAIRWAYS at one time had 500 or so flights per day, now the number is 47. While other carriers have come and started flying out of the airport, the loss of the USAIRWAYS hub simply cannot be offset by growth in local travelers.
The bad news is that even though fares are down for many flights owing to the greater competition, the fixed costs of the huge airport debt is an anchor around the airport’s finances. With many fewer landings, gate operations, deplanements and enplanements, the fees charged to the airlines have had to increase to raise the money needed to pay the principal and interest on the airport bonds. That puts PIT in the unenviable position of being one of the higher cost facilities in the country. At a time of recession and weaker travel demand, PIT needs to be lowering costs. If the Chief Executive had not grabbed the $30 million or so of gaming money intended to help pay off the bonds, the airport could have made sizable cuts in the two previous years. It would have been great for the carriers.
Now, even with the $20 million the airport is borrowing for that purpose (pledging future gaming revenues), the $40 million the County plans to intercept means that the gaming money going to the airport will now total only $110 million rather than the $150 million the legislature intended.