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The economic engine that could

Scott N. Miller/Eagle Correspondent
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That air traffic translates to a lot of jobs and money moving through the local economy.

A study commissioned by the Colorado Department of Transportation’s Division of Aeronautics estimates that when direct employment, visitor spending and the “multiplier effect” of money being circulated through the regional economy are added up, airports in Colorado created more than $23 billion in economic activity in 2002.

Eagle County’s share of that number is impressive: more than $316 million in economic activity related to the airport was reported for 2002. That number represents a combination of employee payroll and passenger spending. That money “multiplies” as it works its way through the local economy – such as a waiter spending tip money on local goods and services, a single mom using wages earned as a baggage handler to help cover rent or a college student earning money for books over Christmas break.

The state study also indicates the local airport generates more than 4,500 full-time, part-time and seasonal jobs. The jobs – more than 500 of which require security badges – add up beyond the airport’s boundaries. The study’s authors used a “multiplier” of 1.25 when calculating employment, meaning that every 100 jobs created at the airport will generate another 125 positions elsewhere.

“No room for growth’

The numbers in the most recent study are big, but may not tell the tale of just how many dollars start their trip through the local economy at the airport, according to county officials.

Compared to a 1998 state study, 2002 passenger numbers were down and economic activity was up only marginally from the $308 million reported in 1998.

Eagle County Administrator Jack Ingstad said the numbers reported in the 1998 survey may have been on the high side, but added evidence suggests the statistics in the most recent study are probably low.

“We have six commercial carriers serving almost every major city in the country,” said Ingstad. “On busy weekends, there’s no room for growth at the terminals.” He said United Express, which shuttles passengers from the local airport to DIA, over-sold seats and recently had to add another flight to meet passenger demand.

Division of Aeronautics Director Travis Vallin acknowledged that the most recent numbers from Eagle County are probably low. He said the survey, which was a statewide effort, depended on local airport administrators putting out and collecting survey information. Vallin noted since there was turnover at the top of the airport’s administration in 2003, it’s possible some survey data slipped through the cracks.

What the survey does show, Vallin said, is the economic power of airports around the state. “It’s really started people thinking about the fact that the basis of economic development is transportation,” he said.

Vallin added that surveys such as the one recently published provide the public with data about just what kind of contributions airports can make to local economies.

While most of the passengers arriving through the airport are people bound for resorts in the eastern part of the valley, a lot of money from those travelers stays downvalley.

Gypsum annexed much of the airport property several years ago, so sales tax levied on rental cars stays in town. Town Manager Jeff Shroll said that money makes up between 65 percent and 75 percent of the town’s sales tax revenue. In 2002, the town collected just more than $1.3 million from all sales tax sources.

“It’s a huge economic engine for us,” said Shroll.

Driving demand

How huge? During off-peak times during ski season, a mid-sized car such as a Ford Taurus will rent for around $350 per week, with full-sized SUVs commanding more than $500 per week. Gypsum gets 3 percent of that revenue, while Eagle County gets 1.5 percent. From a $350 car rental bill, the town gets $10.50, while the county gets $5.25. There are hundreds of cars rented every week during ski season, so the numbers add up quickly.

The engine doesn’t just pump out sales tax revenue. Shroll works part-time at the airport for Gypsum Mayor Steve Carver’s towing company and said a lot of locals work there.

“I’m amazed at how many people from town I run into there. Those people shop at Columbine Market, pay taxes and so on. It’s a huge number,” he said, adding that working at the facility yields a sense of how busy the place is.

“They were expecting 4,500 people to come through just on Dec. 27. That’s a lot of people,” he said.

Eagle doesn’t receive any tax revenue from the airport. But Mayor Roxie Deane said the town receives its benefits through the airport from people on the payrolls of firms there. “It’s a real job generator,” Deane said. “I know a lot of people who work at the airport: kids on school breaks and people who need part-time work.” Those people, in turn, spend their paychecks at City Market and other stores in town.

Many of those flying in would come to Vail, Beaver Creek, Aspen and Glenwood Springs regardless of the airport’s presence. But Kent Myers, an airport consultant who has been hired by the county to drum up airport business, said at least some travelers come to Eagle County because of convenient air service.

When Myers was working for Vail Associates more than a decade ago, numbers from the then-budding flight program indicated that 30 percent of those flyers represented “incremental” business, or people who wouldn’t have come without local air service. Today, Myers said direct air service creates an advertising advantage over resort areas that lack convenient airline connections.

“It’s part of the strategy,” said Myers. “There’s a substantial savings in time, effort and brain damage to fly directly into Eagle County.”

Last year’s single summer flight from American Airlines brought nearly 10,000 visitors to the valley. County figures indicate those visitors pumped more than $211,000 into the county’s sales tax coffers. Gypsum’s rental car revenue for the summer flight increased more than $35,000.

Revving the engine

The people who fly in and out through the commercial terminal represent only a part – albeit the major part – of the passenger traffic.

Not noted in the state study were the 60,000 to 70,000 people a year who come in on private aircraft and use the Vail Valley Jet Center as their gateway to the valley. Jet Center President Bryan Burns said his customers have an impact all through the valley, from using caterers to renting cars to dining out.

But the impact Jet Center customers have may not be as obvious. Burns said several large firms hold corporate retreats at private facilities throughout the year. People who attend those conferences help keep the valley’s service businesses humming.

If current trends hold, expect the airport’s economic engine to hum even more. Ingstad said the Federal Aviation Administration recently approved a plan to extend the airport’s runway 1,000 feet to the east, a massive construction job with an estimated $20 million price tag. The FAA will pay 90 percent of that cost.

The project will move hundreds of thousands of cubic yards of fill dirt to the east side of the airport, and will require re-locating Cooley Mesa Road on the south side of the airport.

The runway extension will allow bigger planes to use the airport, but will also allow the current crop of Boeing 757 jets to carry more fuel when taking off in the summer.

“There’s tons of opportunity with summer flights,” said Ingstad. “It’s just a matter of putting the deals together.”

This story first appeared in the Eagle Valley Enterprise.


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