Revenue Guarantee For Charlotte Flights On Columbia Council's Agenda | KBIA

Revenue Guarantee For Charlotte Flights On Columbia Council's Agenda

Jul 21, 2020

The city is gearing up to establish passenger flight service between Columbia Regional Airport and Charlotte Douglas International Airport.

An $800,000 grant from the U.S. Department of Transportation and more than $300,000 in local and state contributions would allow the city to create a $1.1 million revenue guarantee fund that could be used to entice American Airlines to provide the service.

The Columbia City Council at its Monday meeting will hear the first reading of an ordinance that would establish the fund. A final vote would be scheduled for the council’s Aug. 3 meeting.

The grant was first awarded back in February and is a stepping stone in negotiations with American Airlines, which would be the company most likely to provide service between Columbia and Charlotte.

American now offers flights between Columbia and Chicago and Dallas. United Airlines flies to and from Denver and Chicago.

“Expanded air service to Charlotte means enhanced connections throughout the eastern U.S., which brings new and exciting economic and travel opportunities to mid-Missouri,” Mayor Brian Treece said back in February.

Charlotte Douglas International Airport ranks among the 10 busiest airports in the world, according to its website, which says it serves approximately 178 nonstop destinations around the globe and welcomes more than 50 million passengers per year. It would put Columbia travelers within easy reach of several Southeastern Conference destinations.

The $800,000 grant is part of the U.S. Department of Transportation’s Small Community Air Service Development Program. It would be supplemented with $150,000 from the Missouri Department of Transportation, $80,000 from MU and $80,000 from the city of Columbia, according to the memo.

Revenue guarantees are intended to encourage airlines to supply additional air service in smaller regional markets such as Columbia by ensuring they make at least a minimum amount of profit on the flights.

In 2013, the council approved a similar revenue guarantee to provide up to $3 million over two years to American Airlines to support its flights to Dallas/Fort Worth and Chicago O’Hare international airports. American tapped that fund only once, for $22,652 in March 2013.

In June 2017, the City Council approved a revenue guarantee of $600,000 for United Airlines’ flights to and from Denver, along with $250,000 to market the service. United billed the city for all that money about a year later.

Columbia Regional Airport has seen a decrease in the number of flights per day in the wake of the coronavirus pandemic. United Airlines suspended its flight from Columbia to Denver as a result of fewer travelers.

On the other hand, the airport received nearly $18.8 million through the federal Coronavirus Aid, Relief and Economic Security Act, which it can use for capital projects, operations or debt relief. The city plans to use some of that money for operations to free up some of the transportation sales tax proceeds it normally uses to subsidize the airport.