Lynchburg Regional Airport Economically Stable

Lynchburg News & Advance
Published: March 26, 2008

The Lynchburg Regional Airport is like the rare teenager that asks for a smaller allowance.

The airport has become increasingly self-sufficient over the past six years, using less money from Lynchburg city’s general fund each year.

This fiscal year, the airport administration expects to use only $364,813 of the $430,000 in general fund money that was budgeted. That would be 40 percent lower than the $614,000 the airport used in 2002.

“They’ve done a great job at the airport of generating revenues and controlling costs,” said Vice Mayor Bert Dodson.

As a businessman who uses the airport regularly, Dodson said the airport is vital for the region’s economy. “We subsidize it for the good of the community,” he said.

City Council discussed the airport’s fiscal year 2009 budget during a work session Tuesday afternoon.

The airport’s managers requested the city set aside $408,000 in general fund dollars for the airport, about $22,000 less than was requested last year.

The budget by City Manager Kimball Payne recommends a subsidy of about $378,000, reducing some of the airport’s requested miscellaneous and public safety money.

Payne said the airport’s managers have done well at reducing the operating costs and increasing revenues.

That can be a balancing act as the airport struggles with reduced commercial flights. About six months ago, Delta cut a daily flight that was worth $19,000 a year to the airport.

Income from other areas has increased to make up for that, said Mark Courtney, airport director.

“It’s not really a magic bullet anywhere, but it’s in all areas of the business, watching the bottom line,” he said.

Some of the revenue increases come from increased parking fees and rental car concessions.

A significant income boost has come from an increased number of tenants renting facilities and parking planes there.

One of those tenants, Falwell Aviation, has a lease to build a new hangar, which could mean more rental income.

The airport also receives income from a fuel flowage fee charged for each gallon of fuel sold at the airport. The airport considered raising that fee earlier this year, but threw out the idea because sales were up.

Virginia Aviation has sold fuel there for years. Falwell Aviation began selling retail fuel at the airport in December.

In February, the airport collected more than twice the fuel flowage income than in the same month last year, according to an airport report.

That’s partly due to Falwell Aviation’s sales.

However, a current civil suit challenges Falwell Aviation’s franchise at the airport. Virginia Aviation filed the suit last July saying that the city skipped some legal requirements in the process of awarding the competing franchise last year.

Courtney and Payne both said they would not comment on how the outcome of the litigation could affect airport revenues.

Courtney said decreasing the general fund subsidy more will be a challenge.

“All the low-hanging fruit is gone,” he said. “Our focus has been on becoming more efficient.”

Future revenues could come from attracting a third carrier. Courtney said he’s in discussions with several possible carriers now.

Also, the runway extension that was finished in August could attract more charter or freight flight services, Courtney said.