Airport’s deficit worries PR council

Susan Thompson
South Peace News

After announcing a request for proposals to operate and manage the Peace River Regional Airport, town council received a briefing report on their options and heard more about the process from CAO Chris Parker.

Parker made it clear at the Town’s regular council meeting on Sept. 9 that the airport has been running a deficit almost every year of its existence, and that’s the main reason council is looking at new options for running it.

The Town took over the airport in 1996.

“There was actually an airport committee, and the airport committee was made up of basically every one of our partners surrounding us including even the villages. They were to advise how the airport is to be operating and move forward. There was no funding from municipal partners at that time.”

Over time, some municipal partners began to contribute funding.

“Basically in 2016 it was agreed that we would have four of our municipal partners actually fund the airport but they wanted no participation in actually making decisions and they made that very clear.”

“I just think it’s kind of funny when you look at it originally they would say we won’t give you money but want to tell you how to run it, now here’s the money but we don’t want to run it so it’s funny how the pendulum swings both ways,” he said.

“It always has been council goal to keep the airport open,” Parker said.

Parker listed some 21 different studies and plans the Town has created, starting with the Peace River Airport Master Plan in 1986, and ending with the Peace River Airport Regionalization and Peace River Airport Area Concept Plan from 2015.

“It’s been studied to death,” Parker said. “You can’t say we have not done due diligence in everything we can do to make the airport operate.”

Parker said administration has been doing research into the history of the airport, and when the Town took the airport over in 1996, there were 27,501 people coming through the airport and about 20,000 aircraft movements.

In 2018, there were only 6,000 passengers and approximately 3,000 aircraft movements.

In 2010, one of the worst years for aircraft movement, only 3,398 people flew in and out.

However, even in the airport’s best years, when it had Air Canada, Jazz, Central Mountain Air, three car rental companies, an active cafe, Alberta Health Services dispatch, and other users, it was still running a deficit.

“There were only three years technically that we didn’t have a deficit: 2000, 2001, 2002,” Parker said.

However, Parker noted the Town took money from airport reserves in those years.

“So that kind of propped up those numbers,” he said.

Parker said other airports operating differently haven’t had the same problem with high deficits.

Parker said with lots of people contacting council about the airport, the RFP is meant to help council find new ways to either decrease or eliminate deficits and still keep the airport running economically.

“Especially since 2017 to 2019 there’s been a lot of vocal people. I like to call them armchair quarterbacks who have no skin in the game but they all know how to operate an airport, and they’ve been pretty vocal on how to do this,” Parker said.

“This will give them an opportunity also, that if they want to put in a bid, then they can do so, and as you’ll read the report, you’ll see the more skin in the game you have, the more decision making you get to do. The less skin in the game, the less decision making. But that also helps with the Town and our funding partners. The more you give up, the less you have to contribute, and the less risk you’re gonna have,” he said.

“It’s kind of like a give and take, it’s a sliding scale, and at some point you’re going to have to make a decision.”

A team of outside consultants is evaluating the RFPs, and will present a report on the RFPs to council, before the Town speaks with its municipal partners and makes a final decision.

Councillor Don Good said the briefing report Parker reviewed is one of best two or three pages he’s seen since he’s been on council.

“One of the difficulties council has been facing over the years is that you’ve got a bunch of competing interests at the airport, and to make one party happy … you’re in a situation where propping up one is seen as an activity against the other,” Good said.

He said the real bottom line is that every $1,000 from a tenant at the airport is $1,000 the taxpayers of the region don’t have to put in.

“It’s proper for a business to fight for their own survival. That’s absolutely 100 per cent proper. It’s proper for them to try to negotiate in good faith anything they can possibly do, and to be honest with you, without concern for their competitors or for other people. The Town, unfortunately, is not in that position. We have to be concerned about every single dollar that gets transferred to out citizens under all circumstances, and the corresponding benefit or loss of the service that comes to our town,” Good said.

He pointed out some of the parties at the airport have implied if they don’t get what they want they will leave.

“The problem is you can’t give everybody what they want without a substantial increase to the amount of funding that this airport would have to provide on the backs of regional taxpayers,” he said.

“That’s not an opinion, that’s just a fact.”

However, Good took issue with a line in the report stating “council members have been subject to political extortion,” saying it was too harsh, and was more like political pressure.

“Maybe sometimes a little over the line. I know personally I can’t even speak to anything that comes even close to extortion,” he said.

“Even the people that have criticized directly, with threats of if we don’t get what we want we’re going to do what we can politically to make sure you’re not here, to me that’s part of the ballgame, that’s part of being in politics.”

“I really respect those comments there,” Parker said.

He clarified it was more meant to highlight that four of the five major tenants at the airport are in direct or indirect support of provincial organizations, specifically Forestry and Alberta Health Services.

“Having to deal with that when you have a $740,000 deficit that 80 per cent is to support two provincial organizations, when we know they are not going to contribute any extra money, that’s where it’s sort of like the political extortion is coming out of.

“Provincially we’re kind of being a little extorted in a way,” he added. “But I fully understand that could be considered strong.”

Parker was also quick to praise the responsiveness of Peace River MLA Dan Williams.

Council moved to accept the briefing note and report as information.

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