Airport Commission approves 5% airline-rate increase and two-year operating and capital budget

The Santa Barbara Airport Commission on May 15, 2025, voted unanimously to approve a 5% increase in airline rates and charges for fiscal 2026 and to adopt a two-year operating and capital budget for fiscal years 2026–27 that funds parking expansion, terminal work and other capital projects.

Airport manager Jonathan Abad told commissioners the 5% increase is a negotiated deviation from the typical cost‑recovery calculation and was chosen “to balance affordability for the airlines and long term funding needs for the airport.” Abad said federal COVID relief funds totaling about $19 million kept rates lower after the pandemic and that those funds will be exhausted in fiscal 2026.

The budget package passed the commission after presentations and discussion of capital priorities and staffing. Abad said the airport is proposing 82 authorized positions, an increase of nine from the previous year, and budgeted operating surplus before capital of roughly $2.5 million in fiscal 2026 and $3.0 million in the following year. He identified key capital items including a Southfield Phase 2 long‑term parking project (estimated cost about $5.8 million), an administrative building relocation (about $2 million), and a $40 million terminal improvement program. Abad said the Southfield Phase 2 project is projected to add roughly 400 parking spaces and generate a net savings/additional revenue of about $1 million per year once completed.

Commissioners pressed staff on timeline and constraints for planned airfield and noise projects. Abad and other staff said the airport is negotiating with a consultant to develop at least two GPS approaches for Runway 7/25 intended to reduce noise and divert/“go around” events; that study and any subsequent FAA approval could take months to years depending on FAA publication timelines. On the Taxiway Bravo extension (previously referenced in materials as the Hotel extension), staff said they remain in the environmental and design phase and expect the airport's local share for current work is about $1.2 million (roughly a 10% local match to larger FAA grant funding).

The presentation also reviewed revenue drivers. Abad said terminal parking has grown from about $3.5 million in 2019 to an expected $9 million in 2027 and is now the airport’s largest operating revenue source. He noted five signatory airlines at Santa Barbara: United, Alaska, American, Southwest and Delta, and he cited record passenger totals through 2024 and into 2025. The presentation described funding sources including CARES/CRRSA/ARPA relief used to stabilize rates and the Passenger Facility Charge (PFC, $4.50 per ticket) and Customer Facility Charge (CFC, $10 per rental car contract) funds that help finance capital projects.

Commissioners also asked about pavement and creek maintenance after recent flooding; staff said pavement projects run roughly $5–6 million annually and that a Carneros Creek maintenance project was budgeted to restore constructed channel capacity to reduce future flooding.

Votes at a glance: - Consent calendar: approved unanimously (5–0). - Fiscal 2026 airline rates and charges (5% increase): approved unanimously (5–0). - Two‑year operating and capital budget FY2026–27: approved unanimously (5–0).

The commission directed staff to return with project details and timing for the airport approaches study and for the Taxiway Bravo environmental/design milestones; no additional policy changes were adopted that night.