Consultant: Commercial service not likely to return to Lake Tahoe Airport
June 2, 2014
Attracting airline carriers back to Lake Tahoe Airport to restore the commercial passenger service that ended in 2000 would likely require large public or private subsidies that could total as much as $2 million per year.
"It appears to us it's unlikely to have commercial service return to South Lake Tahoe in the 20-year forecast period," said Michael Hotaling, vice president of C&S Companies. "Is that an absolute? No. Is there a potential to do something? Maybe. But it would largely be driven by subsidies."
C&S Companies of San Diego is working with South Lake Tahoe officials on a $350,000 master plan study for the city's general aviation airport. They held a second public meeting on that process Thursday.
The Federal Aviation Administration is paying for 90 percent of the study's cost. Master plans are an airport planning tool FAA requires for airports it funds. Lake Tahoe Airport's last master plan was completed in 1992.
South Lake Tahoe's proximity to Reno and Sacramento airports and major airline industry changes over the past 14 years are largely responsible for the difficulty of restoring commercial service to Lake Tahoe Airport, Hotaling said.
The number of major carriers operating in the United States has dwindled from seven to three, while the number of low-cost carriers has shrunk from six to three. Jet fuel prices have increased from 78 cents to $3.05 per gallon and airlines are much more selective about where they operate, targeting passenger load rates of at least 83 percent now compared to 67 percent in 2000.
Analyzing the feasibility of restoring commercial service, C&S Companies looked at Mammoth Yosemite Airport, which offers commercial flights to and from San Francisco and Los Angeles. With passenger load rates of 52 percent for San Francisco and 59 percent for Los Angeles, that area offers carrier subsidies estimated at about $1.5 million to $2 million per year.
With the return of commercial service unlikely, the question becomes what to do with Lake Tahoe Airport, and how best to use it.
Preliminary forecasts envision limited growth in Lake Tahoe Airport's general aviation use, with annual flight operations increasing from about 24,000 now to about 29,000 over the next 20 years. Flight operations include both landings and takeoffs.
"If we want to have commercial airport service it's likely to take about a $2 million subsidy. If the community doesn't want to subsidize the airport to bring more tourists in, then what is the next best thing for the airport? That's where we are right now," Lake Tahoe Airport Manager Sherry Miller said.
Lake Tahoe Airport receives subsidies of about $300,000 each year from South Lake Tahoe's general fund — a figure that has been reduced from about $600,000.
City Manager Nancy Kerry on Thursday suggested asking El Dorado and Douglas counties to help fund the airport because visitors it draws also benefit their communities.
Kerry said city officials have heard strong opinions from some people who want to see commercial service restored.
"But as we get into the facts, it would take a lot of money. And we have lots of other infrastructure needs and other places to put it. I've looked for the $2.5 million but I can't find it," Kerry said about the city budget. "That would mean going to the business community. Anybody know of a business in town that might want to fork over a couple million dollars?"
Aviation demand forecasts, facility needs, and public input will help drive the creation of several development alternatives for Lake Tahoe Airport. The process ends with a proposed airport layout plan with a demand-driven improvement schedule and maintenance and funding plans for South Lake Tahoe City Council to consider adopting.
Thursday's meeting also touched on closure of Lake Tahoe Airport. That's an outcome some people have said they want to see pursued.
South Lake Tahoe could pursue that option, Hotaling said, but there's a formal process and the final decision would be up to FAA. Closure also requires paying back money FAA has given the city to develop its airport.
Grant assurances that come with FAA funding require airports to remain open for the life of funded improvements, or for up to 20 years. Over the last 20 years, South Lake Tahoe has accepted more than $18 million in FAA grant money. More than $13 million of that has been accepted in the last seven years.
City officials continue to pursue FAA funding. On South Lake Tahoe City Council's June 3 agenda is a resolution authorizing grant applications for $1.5 million in grants to reconstruct one-third of the ramp, reseal taxiway joints and runway cracks, create a pavement maintenance management program and complete an obstruction study.