Kingsport Times News Wednesday, October 1, 2014

Business & Technology

Director says TCRA should seek new sources of revenue to stay in the black

April 26th, 2007 10:27 pm by Hank Hayes



BLOUNTVILLE - Tri-Cities Regional Airport's finances are in the black, but TCRA Executive Director Patrick Wilson showed airport commissioners a line graph that raised a red flag on Thursday.


The line graph showed airport operating revenues barely outpacing expenses in recent years.


Wilson, while reviewing projected fiscal year-end figures and next year's preliminary budget numbers with commissioners, used the visual aid to hammer home a point that TCRA's financial growth is too dependent on passenger-related revenues.


"You can see the orange line for revenues has really flattened out. ... The flattening of that revenue curve is our number one concern and focus," he told commissioners.


Wilson said 83 percent of the projected $5.9 million worth of revenues in next year's budget will come from passengers - through airline rents and fees, terminal concessions, parking and rental cars.


"That is really significant given the volatile state of the airline industry over the last four or five years," Wilson pointed out. "Our number one source of revenue is very volatile, so it's hard for us to build long-term plans on how to maintain the airport at an acceptable level. ... As the old analogy goes, you can only go so long without changing the oil in your car and it starts to come apart. We feel like we're starting to get to that point."


Besides revenue growth, Wilson laid out other challenges faced by TCRA. Those include maintaining an aging terminal building that is more than 40 years old.


"We have to fix things when they break," he said.


Wilson also said that on April 1, TCRA lost the services of longtime Finance Director Cathy Smith, who has won awards for financial presentations but is now facing serious health issues. The airport also has to negotiate new airline rent and fee agreements and try to build up an airline incentive fund to recruit additional airlines to TCRA, he noted.


TCRA's opportunities coinciding with those challenges include developing and getting income from airport-owned land on the airfield's south side - which Airport Commissioner John Gillenwater of Bristol said may require adding a business development position to the airport payroll.


TCRA is also about to start up new air service offered by Allegiant Air - the airport's first-ever low-fare airline - on May 17. The airport has hired personnel to staff a ticket counter and handle baggage for Allegiant.


Wilson suggested TCRA might set up a new business unit for ground handling services at the airport.


"(Airports at) Knoxville and Chattanooga are doing it," he said of ground handling services. "I think our timing on starting that program (for Allegiant) is very appropriate. All airports are looking for new areas of business to move into to offset loss in airline revenues."


Airport commissioners, after seeing Wilson's presentation, indicated TCRA needs to better promote itself to win the traveling public's business.


"We need passengers to support this airport. ... Some think we have an endless pot of money to support this airport," said Airport Commissioner Frank Anderson of Johnson City.


For more about TCRA, go to www.triflight.com.


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