Los Angeles World Airports presents $1.29B operating budget and offers to absorb city employees to soften layoffs

Los Angeles World Airports CEO John Ackerman told the City Council Budget, Finance and Innovation Committee on May 6 that LAWA’s 2026 proposed operating budget is $1.29 billion and that the airports authority remains financially strong even as passenger volumes lag pre‑pandemic levels.

Ackerman said LAWA sold $1.6 billion in revenue bonds in late March and maintains one of the highest credit ratings of major U.S. airports. But he warned that passenger numbers are down relative to 2019 and that tourism headwinds, especially a steep drop in air travel from Canada and Mexico, are squeezing revenue. “Our enplanements … are projected to be down by 13% relative to 2019,” Ackerman said.

Why it matters: LAX and Van Nuys generate operating funds from parking, concessions, rental cars and airline fees, not the city general fund. Declining passenger volumes reduce those revenues and can ripple into the broader local economy—affecting concessionaires, airport jobs and related city reimbursements.

Key details - Budget size and drivers: Ackerman told the committee LAWA’s planned operating expenses are $1.29 billion for FY 2026, about a 9% increase over prior years, driven primarily by higher staffing and contractual costs. Capital investment remains substantial: LAWA continues a multi‑decade, roughly $30 billion investment program for LAX. - Ridership pressure: Ackerman said LAX was “about 12% below” 2019 volumes and that many competitors have recovered more fully. He described LAX as “97 out of 100” on a recovery index of the busiest U.S. airports, a way to indicate its relative underperformance. - Airline and tourism trends: He cited sharp declines in Canada and Mexico air travel and said airlines have cut seats, particularly to LAX. Ackerman told the committee the LA tourism and convention bureau projects “year over year reductions in total international visitors to LA by between 25–30%.” - Offer to absorb city staff: In a notable proposal, Ackerman said LAWA is working with the CAO and personnel department to identify city employees who could be absorbed by LAWA if layoffs occur, and that LAWA may be able to backfill some airport vacancies with affected city workers. He said specifics remain under discussion, including classification compatibility and bumping rules. - Civilianizing some LAX police duties: Ackerman said a multi‑week study identified roughly 48 duties performed by sworn officers that are commonly civilianized at other airports (fleet assignments, lost‑and‑found, equipment checks). He proposed replacing those sworn positions with civilians at LAWA to return officers to higher‑value policing duties and to create positions that could absorb some civilians elsewhere in the city if layoffs occur. “Our common sense plan returns our police to the public where they were called to serve,” Ackerman said. - Project timing: Ackerman told the committee the Automated People Mover passenger service date is scheduled for Dec. 8, but he said LAWA does not plan to open passenger service for the public until early 2026.

Committee follow‑ups and concerns Committee members pressed LAWA on hiring delays and classifications, reimbursement timing for city services, and whether moving sworn work to civilians could increase overall costs (if done within LAPD). Council members also asked for memos on permit revenue, the airport sales effort, and whether LAWA could contract city departments to perform work. Ackerman said LAWA plans a package of proposals in the coming weeks and that LAWA is already in “high level” discussions with city personnel and the CAO.

What LAWA emphasized Ackerman repeatedly stressed that, although LAWA is an enterprise separate from the city’s general fund by federal law, it can be a partner to the city in a difficult budget year by absorbing staff, taking on work and identifying process efficiencies in hiring and permitting.

Ending note LAWA told the committee it will share more detailed recommendations and memos, including options for streamlining permitting and hiring, as the committee considers budget tradeoffs. The airport’s financial condition and the trajectory of international travel will be central to whether LAWA’s revenues improve or remain pressured in the short term.