ACA Press Release: COVID-19 Impact to Alabama Airports

March 20, 2020
FOR IMMEDIATE RELEASE

Airports across the state of Alabama are being critically impacted by the COVID-19 outbreak. The Aviation Council of Alabama has gathered data from both commercial and general aviation airports throughout the state that all paints a very bleak picture.

Commercial service airports have reported a range of revenue loss from a minimum of 50% all the way up to 85%. The hardest hit appear to be Dothan Regional Airport and Huntsville International Airport. “Huntsville International Airport projects that we will lose 75% of revenue for the next three months or a total of $7-$10 million dollars,” said Rick Tucker, CEO. “Our airport is operating in mission critical mode and without emergency assistance the outlook for us seems grim.” Just a few miles away in Decatur the sentiment is similar. “Pryor Field Airport Authority is seeing a drastic decrease in business traffic,” said Adam Foutz, Airport Manager. “Tenants are not flying very much and none of the airport’s regular business travelers have utilized the facility in the last week.”

Other general aviation airports across Alabama like Tuscaloosa National Airport report losses in the 20-30% range. Auburn University Regional Airport is now experiencing a 95% reduction in flight school operations and a 50% reduction in itinerant aircraft operations, resulting in a projected revenue loss of nearly $600,000 in the next three months. In Gulf Shores at Jack Edwards National Airport the impact has been slower coming with losses reported of only about 10%, but with Alabama beaches now closed, revenue there too will decrease further.

“The abrupt decline in air travel that has resulted from the COVID-19 outbreak has forced Alabama airports, like our counterparts across the country to quickly and decisively implement alternatives to our operations”, said Todd Storey, Aviation Council of Alabama President. “While, all of our airports operate independently, the challenge we are facing right now is the same- an immediate decline in revenue that was expected. Despite revenue declining, we have continued operational costs in order to continue running our airports and to clean our facilities in order to ensure the health of employees, passengers and tenants. We urge the federal government to provide emergency assistance in order to help offset these unexpected losses that are constraining our budgets. Airports are a vital component to the country’s transportation infrastructure and without assistance now we could be critically crippled.”

Funding to support airports across the country, to include Alabama airports, has been requested by Airports Council International- North America and the American Association of Airport Executives. The request is for the federal government to provide emergency assistance to airports in the amount of $10 billion. “The operational costs for airports continue despite the steep downturn in revenue, creating challenges and forcing operational changes. MGM is experiencing an average 60% decline since Monday of this week.  This includes both our aeronautical passenger counts and non-aeronautical revenue categories such: as parking, terminal concessions, and rental car revenues,” said Marshall J. Taggart Jr., Montgomery Airport Authority Executive Airport Director.  “We continue to prioritize the safety of our employees and passengers and have measures in place to thoroughly clean the facility while remaining open. These critical measures to operate the airport daily and continue safe service for passengers cost money, and without assistance the outlook is dire.”

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Supplemental Editorial as an Addendum to Press Release:

Currently, it is evident to the entire world that the COVID-19 Virus has had unprecedented and devastating effects on international health, financial markets, and national psyches. Given this situation, we as a nation must work together to implement policies, procedures and personal actions to minimize the spread of this disease and work diligently to minimize its adverse effects in our lives…until a cure is found.
 
 In that regard, the Aviation Council of Alabama (ACA) has worked diligently with state airports, aviation businesses, state and elected leaders in the Congress, to mitigate the inevitable damage to Alabama and our national aviation infrastructure. We have the finest and safest aviation system in the world; it is at risk and we must protect it as a national security asset; as well as part of our unrivaled communication and logistics capability, that is the envy of the world. History has taught us that our American ingenuity, work ethic, manufacturing and entrepreneurial spirit allowed us to win WWII and will help us overcome the effects of COVID-19.

The Aviation Council of Alabama (ACA) has collected data from Alabama airports, reviewed available nationwide aviation data and has joined the six leading organizations in American aviation in supporting a letter to Speaker Pelosi and Leaders McConnell, McCarthy and Schumer. We ask that you, after reading this report, call or write our elected leaders and request that they fully support our devastated aviation community in this time of national crisis. First, let us address our situation in Alabama.

 “The abrupt decline in air travel that has resulted from the COVID-19 outbreak has forced Alabama airports, like our counterparts across the country, to quickly and decisively implement alternatives to our operations”, said Todd Storey, Aviation Council of Alabama President. “While all of our airports operate independently, the challenge that we are facing right now is the same…an immediate decline in revenue that was unexpected. Despite declining funds, we must cope with continuing operational costs in order to maintain the running of our airports, clean our facilities and to protect the health of employees, tenants and passengers. We urge the federal government to provide emergency assistance in order to help offset these unexpected losses that are constraining our budgets. Airports are a vital component of the country’s transportation infrastructure; without serious financial assistance now aviation will be critically crippled”, said Todd. Let us look at the situation at a few Alabama airports.

 Rick Tucker, Executive Director of the Port of Huntsville Airport and the ACA Legislative Committee Chair stated, “Today, I have been overwhelmed with airports throughout Alabama sharing the impact of COVID-19 on their respective locations. So as not to overwhelm you with data from all reporting airports, I will simply provide a range of impact statement from both General Aviation (GA) airports as well as the Commercial Service Airports (Passenger Airports). I will begin with our Passenger Service Airports.
 
The Commercial Service Airports losses range from a minimum of 50-60% to some as high as 75-85%! The hardest hit appears to be Dothan Regional Airport and Huntsville International Airport. As for the smaller General Aviation Airports, most are experiencing losses in the 20-30% range, as reported by Jeff Powell, an ACA Board Member from Tuscaloosa. However, Auburn University, one of the oldest and a premier University Flight Training Program, reports a 95% reduction in Flight School Operations and about a 50% reduction in itinerant aircraft operations. The projected revenue loss is expected to be nearly $600,000.00 in the next three months. Only one GA Airport (Gulf Shores), was experiencing losses in the 10% range, but it could dramatically worsen as people cancel beach vacations.
 
Clearly, things are getting worse by the day. Huntsville International Airport had expected parking to be down about 75% this week, instead, it is down by 86%. Additionally, passenger boarding were down 75% today and projected to be down 84% tomorrow. I think that it is safe to characterize our aviation situation in the state as dire”, Tucker said.

The ACA support of the attached letter to Congress by the major Aviation Organizations is critical to saving our aviation infrastructure. Think of it as the airborne Interstate Highway System that connects all of us by airways. The system supports seamless and virtually unnoticed: lifesaving medical flights, economic development, forestry, banking, manufacturing, tourism and thousands of daily actions in our lives. 


The Congressional request from the Aviation Community is $58.0 Billion for the airline industry and $10.0 Billion for the nation’s airports. The funds will provide critical financial liquitidy for the survival of our Airline Industry and support and stabilize General Aviation Airports and our Aviation Logistics Infrastructure. We are convinced that it will permit us to navigate beyond the COVID-19 devastating storm that currently threatens the entire nation.


We can use the Air Transportation Safety and System Stabilization Act, passed by the Congress after the September 11 terrorist attacks, as a model. We must act NOW!


 
Fellow Alabamians, we ask that you review the below correspondence, a letter to the Congressional Leadership, contact them and voice your strong support to save Aviation as we know it in America.





Colonel R. J. Lewis, USAF (Ret)
The Aviation Council of Alabama Board






March 17, 2020 


The Honorable Nancy Pelosi 
Speaker 
U.S. House of Representatives 
Washington, DC 20515 


The Honorable Mitch McConnell
Majority Leader
United States Senate 
Washington, DC 20510 


The Honorable Kevin McCarthy
Minority Leader 
U.S. House of Representatives
Washington, DC 20515 


The Honorable Charles Schumer 
Minority Leader 
United States Senate 
Washington, DC 20510 


Dear Speaker Pelosi and Leaders McConnell, McCarthy and Schumer,


The United States business and general aviation industry, which includes all operations other than the scheduled commercial airlines and military, supports 1.2 million jobs and $247 billion in economic impact. Across the country, thousands of small and mid-size businesses generate $77 billion in labor income that pays the bills for families and supports communities throughout the country.  


With the unprecedented challenges our nation is confronting, these companies are facing increasing financial uncertainty. Due to the nature of the COVID-19 pandemic, there is currently no certainty as to when economic conditions will improve, which threatens the survival and prospects of thousands of general aviation businesses. Further, the threat of potential domestic travel restrictions and locally imposed travel restrictions have the potential to cause even more significant harm to these companies as this crisis continues.  


We applaud your decisive actions to provide rapid relief during this crisis. As you consider the third relief package, we respectfully request that all air carriers, including air charter and fractional operators, be included as was the case in Air Transportation Safety and System Stabilization Act passed after the September 11 terrorist attacks. These companies are a vital part of our transportation network and serve as a lifeline for communities large and small throughout the country.   


With scheduled airlines serving only ten-percent of our nation’s 5,000 airports, air carriers that provide charter services under Part 135 of the Federal Aviation Regulations, and fractional providers operating under Part 91 subpart K provide connectivity to thousands of communities with no other air service. In addition to transporting passengers, Part 135 operators conduct almost all air ambulance flights and are a critical part of the network to deliver organs for transplant. Without both near and medium to longterm relief, many of these air carriers will not survive, resulting in job losses and significant disruptions to the critical services that they provide every day.  


As you consider a potential relief package for FAR Part 121 air carriers, we request that those same programs be made available for companies conducting operations under FAR Parts 135 and 91 subpart K. Programs that would provide the most support to our industry include medium to long-term liquidity assistance and relief from air transportation excise taxes. With the majority of business aviation air carriers being private companies, their access to capital is more constrained. In the current environment, private equity markets are not able to provide financing, eliminating an important source of liquidity for the industry.  


 
Both relief and rebates for air transportation excise taxes paid by these air carriers would also provide much-needed assistance. Part 135 air carriers remit excise taxes on amounts paid for air transportation under Internal Revenue Code (IRC) sections 4261(a), 4261(b), 4261(c) and 4271. Also, both Part 135 and Part 91, subpart K operators remit fuel taxes under IRC sections 4081 and 4043. Including these operators in potential excise tax relief or rebates is critical and will provide them with additional flexibility during these uncertain times.  


The business aviation industry is resilient and has a proven track record of providing humanitarian assistance during times of need. However, the air carriers within our industry are facing unprecedented challenges, and we appreciate your consideration of our requests. We look forward to being engaged in discussions on a potential relief package for all air carriers and thank you for your leadership.  


Sincerely,  
Mark Baker President Aircraft Owners and Pilots Association  
Jack Pelton CEO & Chairman of the Board Experimental Aircraft Association  
Pete Bunce President & CEO General Aviation Manufacturers Association  
James Viola President & CEO Helicopter Association International  
Tim Obitts President & CEO National Air Transportation Association  
Ed Bolen President & CEO National Business Aviation Association