Eagle County wins federal grant to build air service

$1 million grant, local match aimed at expanding passenger service

Eagle County Regional Airport officials expect traffic volume to increase with the new flight option. (Vail Daily file photo)
A $1 million federal grant, and a local match, will be used to attract other airlines and new routes to the Eagle County Regional Airport.
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In the world of airports and airport construction, a $1 million grant doesn’t go very far. This grant is different.

The U.S. Department of Transportation on Aug. 3 announced that the Eagle County Regional Airport has been awarded a $1 million grant under the Small Community Air Service Development Program. Eagle County is one of 25 smaller communities sharing $16.9 million in grant funding.

The grant is for luring new business to the airport.

“This is great news for us,” Eagle County Aviation Director David Reid said.

Reid noted that the grant program is highly competitive. “You have to make a case your airport needs it.”

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Eagle County’s application must have been a good one. Only Eagle County and Rapid City, South Dakota, were awarded $1 million grants. Others ranged from $250,000 to $900,000.

The grants, along with local matches, will mostly go to providing revenue guarantees to airlines willing to bring new business to an airport. An airport and an airline will come to an agreement on what those guarantees are before launching a new route. If the route falls below an agreed-upon minimum, the guarantees kick in.

None of the flights currently coming to the airport are operating under those guarantees.

The cost of those guarantees varies flight by flight. For instance, a 2013 effort to lure a summer United Airlines flight from Houston came with a revenue guarantee tab of up to $485,000. That money was raised from local governments and businesses.

How guarantees work

That flight lasted only a few years. And that’s how revenue guarantees work.

Reid said revenue guarantees are intended to be used for only a few years. If a flight can’t stand on its own in that time, the route is likely to be dropped.

So what kind of flights will local authorities try to bring to Eagle County?

Peter Dann chairs the board of the EGE Air Alliance, the local nonprofit group that works to boost service to the airport.

Dann said the alliance is working to “balance” the airport’s service between both summer and winter and visitors and locals.

Dann added that county officials are set to meet soon with representatives of Alaska Airlines.

While no deal is done until the parties sign contracts, Dann said he’s optimistic a deal can be made.

Alaska Airlines has good revenue management, offers low-cost services and, perhaps most important, has experience flying into other mountain communities.

The lack of mountain-experienced pilots and mountain-capable aircraft have scuttled more than one potential deal, Dann said.

Creating competition

In addition to Alaska Airlines, Dann said county officials are also talking with other low-cost carriers.

A deal with Alaska Airlines would open up the Pacific Northwest to Eagle County. But other carriers could open even more of the country to locals and visitors.

Vail Valley Partnership CEO Chris Romer is also a member of the alliance board. Romer said local officials are looking at destinations including central Florida, Boston and, perhaps, Charlotte, North Carolina.

Bringing in a low-cost carrier or two will do more than just add flights to new destinations, Romer said, adding that new carriers will also create price competition with the big carriers.

Many small airports have various ways to find funding for revenue guarantees, from direct government funding to property taxes. Reid said Eagle County is fortunate to have its relationship with the EGE Air Alliance.

“Some communities don’t have anything like this, and for us to have that partnership with the alliance is so key for us,” Reid said.

Dann isn’t just a board member on the alliance. He’s also a frequent passenger on flights out of and into Eagle County. And, he added, he knows a number of other locals who use the airport as often as they can.

“I don’t know anyone who wouldn’t want to fly out of (Eagle County),” Romer said. “We need more competition to make that a better option, and this grant aligns with that.”

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