Quick question for you: how financially sound is your airport?
For many of you, the answer is fine. Flights are expanding, more people are traveling, cargo is expanding and demand for concessions are growing.
But for many smaller commercial airports and general aviation airports, things might be a little tougher. It can be hard to attract more traffic in your region and even more challenging to get flyers or corporate aircraft to base themselves on your field.
Coupled with continued needs on airport infrastructure with only so much AIP funding to go around, it’s creating plenty of stress on your finances.
But is it time you consider privatization of more services to address these needs?
I recently attend the P3 Airport Summit in San Diego, where some experts say it’s not just a good idea, but it might be more appealing to smaller airports than you think.
Privatization isn’t a new idea in the U.S. Individual terminals at airports like JFK have shown it can be a cost effective way to make enhancements to the facilities without stressing public dollars.
However, it’s still a highly contentious topic. St. Louis leaders are looking at the move, but politics has gotten ahold of the issue, especially on the revelations of political groups helping fund the efforts for the city.
But smaller airports might avoid these pitfalls. Jorge Roberts, CEO of AvPorts told the summit smaller or general aviation airports have performed well for privatized airports, with there essentially being no limit on how small of a facility can be managed by private companies.
Propeller Airports CEO Brett Smith said the new facility his company runs at Paine Field outside of Seattle is getting rave reviews from the community since it opened as an alternative to Sea-Tac. Despite just opening, it’s even expected to be financially sound in the near term.
I’m not someone who finds public entities to be an anachronism, but there are instances where it could make sense. If your airport authority is using revenues from its commercial airport to subsidize smaller general aviation facilities, it might make sense to privatize the small airport.
Privatization isn’t a cure all for airports, nor is it something all of you should look at doing. But if there are some issues in the system you can’t address or some challenges that are impossible to tackle due to current restrictions, it might be worth at least kicking the tires on privatization to see if there’s any potential solution.
