One On One
Incoming AAAE chair Jim Koslosky talks about capacity, slots, and more
By By John F. Infanger, Editorial Director
Koslosky is an aviation management graduate of the University of North Dakota and a former Air Force air traffic controller. He previously was in management at Dane County Regional Airport in Madison, WI.
AIRPORT BUSINESS: In this era of rebuilding infrastructure and adding capacity, you have done both at Grand Rapids.
Koslosky: We have essentially rebuilt our airport over the past ten years. We invested a little over $250 million in the facility, have three all-new runways, a new air cargo and trade center, and have completely remodeled and expanded the terminal building and expanded our parking and road system. We acquired about 1,000 acres of property for airport protection. It’s postured our community well for the future.
Traffic is up about ten percent. We have 12 airlines, 180 flights a day, direct to 17 hubs and in some cases are bypassing hubs. We’ve now got direct service to Dallas, Washington National, New York LaGuardia, Columbus (OH).
AB: Capacity, particularly at the major hubs, is the hot topic today. How is the capacity issue affecting Grand Rapids or other primary airports?
Koslosky: It affects everybody. If an airport is capacity constrained, obviously you can’t get the activity from your community to that particular airport.
I’ve seen it happen at our market when slots were lifted at LaGuardia. We had air service to LaGuardia from U.S. Airways. We had three flights a day one year ago, but then when they had that explosion of growth at LaGuardia, U.S. Airways jumped into that market. Of course, that led to the horrendous delay problem last summer at LaGuardia and the Port Authority and FAA had to do something — the slottery.
At that point, a number of slots that U.S. Air had were lost, cutting deeply into their system. So they had to make some business decisions and Grand Rapids was affected. We lost our air service to LaGuardia, our number one O&D market at that time. Fortunately, two other carriers — Continental and Midwest Express-Skyway — picked up slots in the process and both are now giving us LaGuardia service. So, now I have two airlines competing on upwards of six flights a day.
That said, if the capacity issue isn’t dealt with, more and more communities, small and medium sized, will lose access to those airports.
AB: One of the interesting aspects of the LaGuardia slottery is, the intent was to try to create more access to small communities, and yet that is somewhat counterproductive to the whole capacity issue at LaGuardia.
Koslosky: That shows you the fallacy of the slot system to begin with. It suppressed the demand. Over time, this demand built up and all of a sudden you take the dam away and the airport got flooded. Anybody who didn’t suspect that that would happen was fooling themselves.
It held down capacity; it also took the pressure off of providing the capacity long-term into the future. We not only artificially manipulated the marketplace by having these caps on, we held down airports ... from doing anything about future capacity.
AB: That leads into the discussion of peak period pricing. Do you have thoughts on whether or not it’s a good thing, if it will work?
Koslosky: There’s an association position on these issues and then there’s my personal opinion.
My personal opinion, as a result of experiences that I’ve had in the industry, including our court case with the airlines (Kent County vs. Northwest Airlines), is that the federal government ought not to be in the business of economic regulation of airports. That’s best left to the marketplace and the individual communities. I don’t personally believe that there ought to be caps or government control of PFCs. I don’t know of any other government-provided service at the local level that is regulated the way we are in terms of rates and charges — by the federal government.
The federal government doesn’t regulate how you price your sewer and water systems locally. Why should they regulate how an airport puts on a PFC (passenger facility charge) or doesn’t put on a PFC? We certainly need safety and security to keep a viable air transportation system, but I question the validity of economic regulation.
From an industry standpoint, I think there needs to be more discussion of these issues. Peak hour pricing depends on whose ox is being goured in that process. That will affect general aviation and its ability to access airports, and at this point we still have a free market economy and equal access privilege.
Unless there’s going to be a national, conscious decision to constrain capacity, which I think is going the wrong direction, you may have to do something in the interim. But the real issue is laying down more concrete. Bottom line, and our industry position, is that we need more runways to deal with capacity and to take a longer range focus.... In infrastructure development you’ve got to take ten- and 20-year views of the world and work toward those objectives.
We redeveloped our airport based on a 20-year view, and on an annual cycle keep advancing that visionary process. And we’ve got a board and a community that understand that, and that’s why we have a state-of-the-art airport with plenty of potential on 3,000 acres of property.
AB: You’re familiar with the Naples (FL) Airport situation related to Part 161 and noise. Central to the issue at Naples is one that seems to be surfacing more and more — the move for more local control of airports. How much do you think it’s becoming an issue?
Koslosky: I’m a firm believer when it comes to the noise issue that, in order to maintain a viable national air transportation system there has to be national standards. There’s a danger with communities going off on their own and developing their own standards, and as a result in most of those cases placing restrictions on the use of their airport. It will have a long-term detrimental effect on the efficiency and effectiveness of our air transportation system. Congress I think agrees with that; it’s why we have the Aviation Noise and Capacity Act of 1990 that set up the Part 161 process.
AB: What about banning a certain classification of aircraft?
Koslosky: The problem that we’re running into there in terms of general aviation activity is, the public doesn’t understand the distinction between the airlines and general aviation. They think there ought to be one standard for the air fleet of this country. You try to sit down and explain to them that there’s two sets of rules here and general aviation’s making a good faith effort over time to get to Stage 3 and eventually a Stage 4 standard, via the manufacturers.
I think that gives communities some wiggle room in terms of them placing restrictions on those kinds of aircraft as a result. But there’s a danger in that — denying access to a class of users who are part of a national system, like the federal highway system.
AB: A hot button today is the issue of streamlining the process for building a runway and other infrastructure.
Koslosky: There’s nothing in our EASE (Expedited Airport System Enhancement) program that says we are suggesting that you eliminate current environmental standards or programs we’re required to comply with. What we’re saying is the process can be brought together.
A lot of state agencies won’t act until the federal decision has been made. So there are state actions and local actions that could and should be going down at the same time, parallel to one another.