"Rochester, Minn., Airport Sees Second-Largest Earnings Ever in 2002"

Thursday, June 12, 2003

Rochester, Minn., Airport Sees Second-Largest Earnings Ever in 2002
The Rochester (MN) Post-Bulletin


The Rochester International Airport weathered the multiple storms of
terrorism threats, a struggling national economy and fewer destinations with
financial success in 2002, its year-end report shows.

Revenues from flights, building rentals, fuel sales, and other airport
activities climbed to about $2.7 million, up 6 percent from 2001, airport
manager Steve Leqve said.

Operating expenses also rose somewhat from 2001. But, when the bills were
paid, The Airport Co., which is the Mayo Clinic subsidiary that manages the
field, returned $748,083 in profit to the City of Rochester, which actually
owns the airfield on the extreme southern tip of town.

The earnings were the second largest in airport history, ranking next to the
record $801,055 returned in 2001, Leqve said. Although the city gets the
money for its use, in practice the city places the proceeds into an account
that help pays for remodeling or new construction projects at the airport
itself, the manager said.

Despite last year's turbulent atmosphere, the local air transport industry
experienced only a tiny decline in traffic. 

Scheduled air carriers Northwest Airlines, Mesaba Airlines (which flies as
part of Northwest's system) and American Airlines logged 293,833 arriving
and departing passengers during 2002. That was 1,786, or less than 1
percent, fewer than in 2001. 

But all three airlines actually filled more seats during the year. "The real
loss # was due to the loss of a third air carrier," Leqve said. The prior
year had included 18,261 passengers who traveled on a short-lived route to
St. Louis via Trans World Express, Leqve notes. The TWA affiliate had flown
for nine months before closing Rochester operations in fall 2001. There is
no direct air service between Rochester and St. Louis now.

Meanwhile, air freight continued to be a growing business in 2002. Federal
Express, which is the dominant overnight carrier in this market, hauled just
less than 23 million pounds of cargo, up 7 percent from 2001. Airborne
Express, the second biggest, carried close to 3.9 million pounds, or 9
percent more than in the prior year.

At the same time, the airfield wasn't as busy with flights as in the prior
year. Numbers of flight operations drifted down 8 percent to 71,393, Leqve
said. The loss of Trans World Express was one influence. Military traffic
also declined somewhat, as some Twin Cities-based crews were flying
war-related missions instead of practicing takeoffs and landings at
Rochester.

"The other part of that is we had a decline, a little bit, in civilian
operations," Leqve says.

2002 was not a big year for brick and mortar improvements at the airport.

Security was an obvious concern, and the airport remodeled to give patrons
outside security gates a window to the restaurant and a snack area at a cost
of about $61,900. Because of new security rules, patrons previously could
not eat at the restaurant unless they were ticketed passengers. 

The airport also built a roadway for employee and maintenance traffic
between the west side of the main terminal and the general aviation area at
a cost of $412,600. The road also aids in security, Leqve said. 

In addition, the airport enlarged the water system serving its general
aviation area with a trunk main at a cost of $151,000. 

State or federal grants paid for the majority of all three projects, with
city participation ranging from 40 percent for the water main and terminal
area improvements to 10 percent for the roadway.

This year's slate of projects will include: replacement of three 43-year-old
boilers used for heating various parts of the airport campus, an estimated
$500,000 project; repairs to an older portion of the parking apron for
planes in front of the terminal building for a projected $433,000 and
installation of some runway lights at about $150,000. 

The next big project on the airport's horizon likely will be an extension of
the length of the main runway to 9,000 feet from the current 7,533 feet.
That project, likely to exceed $8 million in cost, likely will take place in
2004 and 2005, Leqve said. Federal dollars again should pay for most of the
cost, he said.


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