To offset a bump in aviation fuel taxes passed by the Legislature, the Missoula County Airport Authority on Tuesday expanded its incentives offered to long-haul carriers that serve the city, hoping to keep the routes viable as the costs to fly them increase.
The Missoula airport, along with other large airports across the state, lobbied against the fuel tax increase, saying it could put hard-earned routes in jeopardy. That included longer routes, which cost more to operate.
“We did a proposal for the more high risk, longer hauling lines to provide incentives and to make sure they were solid and healthy for us,” said Brian Ellestad, the airport’s deputy director. “At the time, we passed the incentives, but we didn’t fund them.”
The board approved the original incentive package in April to offset lost yields incurred by carriers resulting from the state’s 150 percent increase in jet fuel taxes.
The incentives, offered to carriers that fly routes of more than 1,000 nautical miles from Missoula, include fee waivers, free ground handling and some marketing dollars. American service to Dallas-Fort Worth qualified, as will Alaska Airlines’ new nonstop service to Los Angeles, which begins in March.
Service through Alaska wasn’t known when the original incentive package was authorized.
“Alaska entered our market to Los Angeles, so we want to provide around $25,000 to market that Alaska service, along with the Real ID program, in addition to the marketing dollars we did budget for,” Ellestad said.
Montana passengers must adhere to the Real ID program by next October in order to access federally controlled facilities, including U.S. airports. While it’s not the airport’s responsibility to market the program, Ellestad called it good business.
Funding allocated on Tuesday will help promote the Real ID program to local passengers while also marketing various routes, including service to Los Angeles.
“Staff believes we need to do everything in our power to try to make this new service successful, as it may lead to other service opportunities,” said airport director Cris Jensen.
While the incentives carry upfront expenses, the airport expects to see a net gain over the long term, primarily through passenger revenues. That includes concessions, car rentals and parking fees.
American operated at roughly 85 percent capacity over the past five months while service on Alaska offered similar results. If the new LA route proves successful, the airport could be considered for similar nonstop service to San Francisco or San Diego.
“For the first time, we just inched ahead of Billings by 1,000 passengers,” said Ellestad, citing the latest statewide passenger counts. “It’s the first time we’ve pulled ahead of them.”
Year to date, Bozeman has enplaned 557,500 passengers, making it the state’s busiest airport. Missoula was second at 309,000 passengers, followed by Billings at 307,500.
Kalispell recorded 253,000 passengers, followed by Great Falls at 120,000 passengers, and Helena at 78,700.