"Georgia airport trying to navigate patch of turbulence"

Sunday, December 30, 2007

Airport trying to navigate patch of turbulence
By Travis Fain
The Macon (GA) Telegraph


Last year, the Middle Georgia Regional Airport seemed to have turned a
corner.

In spring 2006 the city-owned airport had narrowly avoided a federal
shutdown of commercial flights over a string of violations. The director had
been ousted, and the city was paying a private company nearly $100,000 on an
emergency contract to right the ship.

And that all came less than two years after the city had cut the ribbon on
some $6 million spent in upgrading the airport from mostly federal tax
dollars.

But in August 2006, then-Mayor Jack Ellis announced the airport was "back."
Federal regulators had given the facility a stamp of approval. More federal
grants were on the way. And city officials were optimistic about adding
another route and a new air carrier, despite a waning number of passengers
on the only existing flights: a couple of round trip hops each day to
Atlanta.

Optimism ran high.

Fast forward to present day. The airport's true value to commercial carriers
is becoming clear. Delta and Atlantic Southeast Airlines, which operate the
hop flights in a partnership, want to shut them down. The only thing keeping
them from doing that are federal laws keeping them in place and a taxpayer
subsidy.

Three times the U.S. Department of Transportation has tried to find a
replacement for Delta and ASA, which operate in a partnership at the
airport, and three times no one has wanted the job, according to department
records and a spokesman.

Now plans to add a new route to Washington, D.C., are in a shambles. The
roughly $500,000 in federal grant money that the city planned to entice a
new airline can't be used for that anymore. With ASA getting about $2
million a year in federal subsidies, the DOT has blocked the city from
spending the smaller grant as planned, saying a new flight would pull
passengers away from Delta and ASA.

In other words, the two subsidy programs conflict, and the larger one won
out.

For Aviation Advantage Inc., the company that planned to offer the D.C.
route, it was like having the rug yanked out from beneath them, Executive
Vice President Cary Evans said.

"The one thing that I'm certain of is that we will not be flying out of
Macon unless someone changes this decision," said Evans, who figured his
company spent about $80,000 getting ready to start flights.

City officials remain optimistic about the airport's future, particularly
with TBI Airport Management now handling day-to-day management in a
public-private partnership with the city. The company also played a large
role in keeping the airport open last year and boasts a successful track
record at other facilities - particularly Orlando Sanford International
Airport in Florida, where TBI says it has increased passenger counts from
48,000 a year to 1.8 million.

But Delta and ASA's shunning of the commercial traffic side of the airport,
even as ASA continues to base its maintenance hub there providing hundreds
of jobs to the area, is clearly a major blow, city officials said.

"We can't use (the $500,000 grant) to start a competing airline," said Mike
Anthony, the city's interim chief administrative officer and former interim
airport director. "We can market the airport. We can market ASA if they want
it, which they don't."

Thus, by declaring their intention to abandon the Macon routes, the
companies reaped the benefit of a federal subsidy and simultaneously shut
down an effort to bring in competition at the airport.

"Delta welcomes competition in every market that we serve," Delta spokesman
Kent Landers said in response to the suggestion that this was a calculated
move. "But in this case, this was a situation where Delta was very clear
that we were desiring to discontinue the market completely due to low
demand."

'YOU JUST NEVER KNOW'

Part of the problem is that ASA's planes, which carry between 50 and 70
passengers, are too large for Macon, according to the U.S. Department of
Transportation. The department would prefer an airline to offer three or
four round trips to Atlanta on 19-seat aircraft, but ASA doesn't operate
that size plane, and so far no one has stepped up to offer that service -
even with the subsidy.

So ASA gets monthly payments from the federal government that will annualize
out to nearly $1.97 million. That amount includes, by law, 5 percent profit
for ASA, according to DOT figures. In return, ASA can't leave the market,
even though it wants to.

The primary reason for low demand at Middle Georgia Regional has always been
clear: The airport, which is south of the city, is less than a two hour
drive from the one of the world's busiest airports, Hartsfield-Jackson
Atlanta International Airport.

But in 2003 and 2004, far more passengers used the airport than do today,
many because they could clear security much faster in Macon than in Atlanta.
The number of departing passengers at the Macon airport rose as high as 95 a
day in the busiest summer months of 2003. In August 2004, the passenger
total topped 100 a day.

But in November 2004, a decline began, and by February 2005, ASA had
bottomed out at about 40 departing passengers a day. For much of 2007, the
airline has been below 40 passengers a day.

Delta's Landers said that coincides with problems at the airport - then
operated solely by the city of Macon - that led the Federal Aviation
Administration to change the airport's category designation. That meant
airplanes with more than 60 seats couldn't operate out of Middle Georgia
Regional. And that cut out two midday flights, Landers said.

By the time Middle Georgia Regional had gotten back into FAA compliance for
the larger planes, "it was determined that 2-3 flights daily (as operated
today) was a more appropriate schedule for the economics of the Macon
market," Landers wrote in an e-mail to The Telegraph. The passenger numbers
never recovered.

ASA operates the route, but Delta sets the schedule because ASA is a
connector service for the larger airline. Because of that relationship, ASA
provided information for this article, but referred The Telegraph to Landers
on most issues.

Price doesn't appear to be a problem for passengers. Online searches showed
that flying from Macon to Washington, D.C., with a stop in Atlanta, costs
about $44 more than a Delta flight from Atlanta to D.C. And there's free
parking at the Macon airport, as opposed to Atlanta which has parking fees.

A shuttle bus to Hartsfield-Jackson from north Macon costs $58 round trip.
>From Warner Robins, it's $61.

Flight times vary, but there is typically a Macon flight to Atlanta leaving
each day at 7 a.m., another flight two or three hours later and two evening
flights back to Macon. Sometimes there is a third flight going either way as
well. Sometimes those flights are convenient, sometimes they aren't, former
frequent fliers said. But of greater concern, they said, is inconsistency.

And though ASA reports monthly completion rates ranging from 91 percent to
100 percent for the past three years - meaning that almost all of its
scheduled flights actually took place - travelers complain of inconsistency.

The airline's own statistics on flight delays show an on-time rate for the
past three years of about 59 percent for departures to Atlanta. With a
15-minute grace period, that increases to 71 percent.

"I would like to fly out of Macon," Bibb County Superior Court Judge Tripp
Self said. "But with only two flights a day, it's just so hit and miss.

"I had one trip where I flew into Atlanta at like 6 p.m. to catch a 7:45
flight (back to Macon)," Self said. "And at 2 a.m. they put us in a hotel.
... You just never know what's going to happen."

Al Stewart, the head of community relations and government affairs for
Boeing in Macon, said he used to fly out of Macon "all the time." But
inconsistency, particularly in the return trip, soured him on it.

"They either cancel the flight or they hold the flight," Stewart said. "You
never know."

It's not just the Macon to Atlanta route, though. The DOT reported in
November that ASA had the worst on-time rate in the airline business for the
preceding year. Kate Modolo, a spokeswoman for ASA, said she expects to see
"significant improvement" when new DOT figures are released in January.

THE FUTURE

Despite the Macon airport's proximity to Atlanta, TBI Airport Management
officials have said repeatedly they think the Macon airport has a bright
future. They signed a contract, with much of the profit potential for the
company tied to growth factors.

"Believe me, they just don't know about Macon yet," TBI Vice President John
Green said. "And that's going to be our challenge. ... I'm convinced that
there's a market."

What that market is remains to be seen.Green said it's possible that the
city will end up spending its $500,000 grant to help market ASA's service to
Atlanta. The money has to be spent by the spring of 2008 or it heads back to
Washington, he said.

Green said he hopes to "put some people in the seats ... prove to (ASA) that
there is a market."

Adding another route was never a silver bullet anyway. Several City Council
members didn't even want to accept the money in 2005, and that debate
stretched over months as Ellis fought the council.

The grant program has a spotty track record at other airports across the
nation, and often new flights buoyed by the money often are discontinued
when the public dollars run out.

In fact, of the 40 communities that received the grant in 2002 - the
program's first year -16 airports were able to add a new route, according to
data from the Federal Aviation Administration. Of those 16, eight still
offered the route in 2006.

Though Anthony, the city's interim CAO, said ASA has "not been real up front
with a lot of information" and that the city learned ASA hoped to
discontinue the flights the same day the plans were announced to the media,
he also said he believes ASA when the company says it will keep its
maintenance hub here.

The airline promised as much earlier this month, when it announced that
about 60 administrative jobs would move from its Macon facility to Atlanta,
but the bulk of the 400-person maintenance operation would remain in place.

That maintenance hub is a key economic driver for the airport and the
region, and many officials and business leaders have said the airport's
future lies not in passenger service but as a maintenance depot or freight
airport. Anthony said there are a couple of companies interested in locating
a maintenance facility here, but talks are preliminary and he wouldn't
divulge names.

As for passenger flights, it remains difficult to recruit new airlines,
though TBI also is in "very preliminary" discussions with "several
airlines," Anthony said. But with the rising cost of fuel and Middle Georgia
Regional's close proximity to Atlanta "it's got to be pretty attractive for
other airlines to come here," Anthony said.

Reliability is going to be key, said Green of TBI. And though he didn't have
hard figures to go by, Green said he's heard enough complaints to know ASA
needs to increase the dependability of its flights.

"It only takes a couple of times before you drive and you park your car," he
said.


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