Communities Bet Subsidies Will Land More Air Service

 - February 1, 2012, 1:25 AM

As the Department of Transportation’s Small Community Air Service Development Program (SCASD) enters its 10th year, two communities hope their share of $14.9 million in grants awarded in 2011 will help them land new flights.

SCASD came into being in April 2000 as part of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR-21) as a way to offer grants to help smaller communities improve air service.

Arizona’s Flagstaff Pulliam Airport led a group awarded $800,000 to lure a second airline to offer service in competition with current carrier US Airways Express, which flies to its Phoenix hub. A group led by Bozeman Gallatin Field Airport, Mont., hopes to use its $950,000 grant to attract summer and winter seasonal service to New York City.

Flagstaff paid Seattle-based Horizon Air $600,000 in subsidies starting in June 2008, but the carrier pulled its service two years later, said airport director Barney Helmick. Flagstaff wants to attract a carrier that will either give local travelers an option to travel east via hubs such as Denver or Dallas/Fort Worth or west to Los Angeles to attract passengers from the Pacific Rim, he added.

“In the former group, most of our travelers drive to Phoenix for service, and we’re losing about 50 percent of our potential customers,” says Helmick. “We’ve also lost tourist groups because we don’t have direct service from Los Angeles.”

Helmick said he doesn’t worry about losing US Airways Express service if another carrier comes to town. “One, our grant doesn’t preclude US Airways from bidding on the grant funds when we do our request for proposal if it’s on a secondary route. US Airways Express has been here a long time and has an established market,” he noted. “Two, competition is good for established airlines. Even when Horizon Air was here, US Airways Express was still growing.”

The grant will cover two communities in Montana: Bozeman and Big Sky/Yellowstone, according to airport director Brian Sprenger. “Our consortium going after the service includes local businesses, tourism, hotels, improvement districts, high-tech companies and local chambers of commerce,” he explained.

The airport targeted New York City because it is the largest market without nonstop service from our region, said Sprenger. “We’ve also had some success in attracting service to new markets working with our community and offering guarantees,” he noted. “We started our Seattle service almost 20 years ago by offering guarantees to Horizon Air. And we have numbers that show New York City can be viable in this market and can garner higher air fares.”

The region maintains quite a few ties to the Northeast part of the country, especially New York. “We’re hopeful that the service will eventually become year-round, but our best opportunity is to start on a seasonal basis to benefit the tourism community, although we have a fairly strong business community that will use the service too,” said Sprenger. The summer service would run from June through Labor Day, while winter would extend from December 15 to early April, he added.