A proposal to defund the Essential Air Service program could devastate Laramie’s economy, but Laramie Regional Airport Manager Jack Skinner said he’s keeping his chin up.

“This program has been on the chopping block before,” Skinner said. “There’s a concern, but I’m optimistic.”

If Congress approves President Donald Trump’s proposed budget, 112 communities including Laramie could lose Essential Air Service subsidies, which help make rural flights economically viable for air service providers such as SkyWest Airlines.

“If Essential Air Service is totally eliminated, it would be hard for SkyWest to fly in and out of here,” Skinner said. “SkyWest is one of the best commuter airlines out there. It would be hard to find somebody that provides the same quality of air service SkyWest does.”

Without the subsidy, the city would either need to provide SkyWest with the $2 million or lose a significantly larger contribution to the economy, Mayor Andi Summerville said.

“In 2013, the Wyoming Department of Transportation did an economic impact study,” Summerville said.

“They showed the Laramie airport contributes a little over $30 million to our economy.”

Since the study was conducted, the number of passengers has doubled using Laramie’s commercial air service.

The airport served 14,427 passengers in 2012. SkyWest Airlines took over commercial air service in November 2012. In 2016, the airport served 29,280 passengers.

“The increase is largely due to SkyWest improving the quality of air service,” Skinner said.

Without quality commercial air service, Summerville said Laramie’s economic development, tourism and the University of Wyoming would suffer.

“To not have air service to the state’s only four-year institution is almost unthinkable,” Summerville said. “They bring in potential business prospects, donors to the university and athletes for our teams. The loss of that air service would be an absolutely detrimental blow to our economy.”

The Essential Air Service was created in 1978 after the federal government deregulated air service.

“They didn’t want to leave a lot of these rural communities without any air service at all,” Skinner said. “Funding was developed to subsidize these airlines to fly into these rural communities.”

In two-year intervals, the Department of Transportation requests proposals from rural-serving airlines detailing estimated biannual revenues and expenditures.

“For instance, with SkyWest to serve Laramie, they’re saying they’re losing $2.18 million a year to operate their airline in and out of here,” he said. “(The subsidies are) based on flights operated. So if we have cancellations, they don’t get paid for that.”

SkyWest Airlines estimates their current passenger load to be about 46 percent with a maximum of 50 passengers a flight, Skinner said.

At 10 flights a week and one on the weekends, he said SkyWest Airlines is allotted $1,784 per flight in subsidies from Essential Air Service through the Department of Transportation with a weekly ceiling of $42,816.

While Wyoming also has an air service enhancement subsidy, Skinner said many of the funds are earmarked for other airports.

The average subsidy per passenger is about $71, documents provided by the Essential Air Service stated.

Because SkyWest Airlines works directly with United Airlines, Skinner said many flights out of Laramie that link with United Airlines are tacked on as a secondary cost of only $40-60.

While airfare prices are variable, he said a round-trip flight to Denver, Colorado, could cost around $128 if it didn’t link with a United Airlines flight.

If the subsidies were removed and the airport charged the passengers an additional $71 each flight, he said the airport could feel the pinch in other areas.

“I’m sure you would still have some fly out,” Skinner said. “But we would lose passengers.”

As long as 10,000 people board planes at Laramie Regional Airport each year, the Federal Aviation Administration provides the airport with a $1 million grant for capital construction projects such as runway maintenance.

“Ten thousand is the magic number,” Skinner said. “If we get anything less, we only get $150,000. There’s not much you can do with $150,000 at an airport.”

Without SkyWest Airlines, he said reaching the 10,000 mark could be difficult.

Referred to as a “skinny” budget, Trump’s proposal requires congressional approval, but Skinner said many Midwest congressional delegates are supportive of the program.

Summerville said she didn’t think the proposal could be overlooked.

“Unfortunately in the political climate we’re in, I can’t take for granted that it could be hot air or political posturing,” Summerville said. “There are a lot of programs on the chopping in the president’s budget. If all those cuts were to pass, the community would feel the effects.”

While the Laramie City Council and Albany County Commission are slated to sign a joint resolution calling for Wyoming’s congressional delegates — Sen. Mike Enzi, R-Wyoming, Sen. John Barrasso, R-Wyoming and Rep. Liz Cheney, R-Wyoming — to support the Essential Air Service, Summerville said the community should contact the delegates as well.

“It’s very important that residents are very vocal and active with their federal delegation when they think the federal government’s actions are affecting them,” she said. “Right now, the airline requires a subsidy to be able to service Laramie.”

If the cuts are made, she said the city would work with the airport to ensure Laramie maintains air service.

“I have every faith in the airport manager and board to try to secure a viable air service,” Summerville said. “But it will be difficult to provide the level of service we currently we have.”

(7) comments

Ernest Bass
Ernest Bass

Here is an idea. Cancel these expenditures proposed by Janine for capital improvement projects (from City of Laramie Budget - FY2014-2015 & FY 2015-2016 Biennium):
Cirrus Sky Technology Park Phase 2: $4,960,492
Cirrus Sky Technology Park Phase 3: $4,953,952
Greenbelt Bike Path Expansion: $5,975,000
Scout Park Development: $512,000
East Grand Entrance Beautification: $375,000
LaBonte Lake Optimization: $1,861,250
Greenbelt Bike Path (Garfield to Wister Drive): $4,251,949
Public Works Service Center: $6,000,000

Grand Total Savings = $28,889,643. Enough to prop up AirWest for many years to come. Isn’t that what we do here in Laramie? Use taxpayer funds to subsidize private business?

clipper
clipper

What a wonderful world it will be when I get the government to take from them and give to me.

Wyovanian
Wyovanian

If the $2M in subsides results in $30M in revenues, it is purely a subsidy, or is it an investment? Kind of like infrastructure expenditures. Are those nothing more than subsidies for paving companies, etc., or are they investments that produce more than the initial expenditure?

clipper
clipper

Studies can show whatever the study requester wants the study to show. I suspect this study was in realty a grant request, otherwise why not just provide a link to the study for all to see.
If it were really $30M in benefits (note the article did not indicate $30M revenue) I would think that the city would be able to find the $2M subsidy with no problem.

waitasec
waitasec

So they need about 1/2 to 1/3 of the population of Laramie to fly to Denver at about $150 per ticket. That's ludicrous. Laramie needs an airport just as must as they need taxi service. The majority of the population has no business flying into DIA. The patrons of the airport are repeat flyers and are people of means, who can actually afford to fly...anywhere. Ten thousand RT tickets purchased at $150 each equates to about $1.5M

Matthew Brammer
Matthew Brammer

I mean, why do you have to take a stab at my business? At least I haven't depended on government subsidies to continue operation. Not one dollar of taxpayer money...not grants, not loans, nothing. Not even help from the LCBA or anyone else.

As far as the bigger picture goes, Laramie has always been able to comfortably support one or two cab companies. The problem starts when everybody and their dog thinks it's easy money, and we end up with 3 or 4 companies...with many cutting corners and not playing by the rules that everyone else has to play by. Similar situation playing out now, with Uber putting 4 to 5 more cars on the street on top of everything. Of course Laramie doesn't need that many taxis. But to say Laramie doesn't need any taxi service is absurd, and not in line with what the majority of the community thinks.

Matthew Brammer
Matthew Brammer

And by the way, also unlike the airport, I don't just serve a privileged few, an economic minority of Laramie's population. Most of my longtime regulars are lower-to-middle class; otherwise the economic distribution of my customers is pretty even. In fact, we rarely get calls from the elite.

Don't need a taxi? Don't call one. Don't think it's a sustainable business model? Don't start a cab company. But taking shots at other people's businesses (knowing they're regulars on this site) based on false equivalencies is absurd.

We may go out of business or choose not to continue someday. Heck, with the way things have been lately, that day might end up being sooner than we think. But the fact that we've been around nearly a decade as others have come and gone, without any material help from anyone else (in fact, quite the opposite...it hasn't been made easy for us) and with massive amounts of competition, unequal regulation, etc. should speak volumes as to the viability of the market with the right people at the helm.

Not. Even. Close. to the same thing.

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