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EDA hears air-service update; staff says six-day initial billing was $76,009 and FAA grant of about $600,000 is expected
Summary
EDA staff reported progress on United air service, said the initial six-day service period generated a $76,009 invoice and that a roughly $600,000 FAA grant contribution will be realized later; board discussed tracking performance and the 18-month subsidy commitment.
EDA staff provided an air-service development update during the May 21 meeting, reporting early usage and billing for a newly sponsored route and discussing subsidy terms and grant support.
Staff said the airline began service in late March and that the first billing period (six days in March) resulted in a charge of $76,009. "6 days was 76,009," Margette said when asked about the invoice for the initial service days. Staff explained that the contract for the service is with the City of Lynchburg and that the EDA is providing funds to support the subsidy.
Staff also said a grant from the Federal Aviation Administration (FAA) will contribute roughly $600,000 toward the program; staff stated, "So that $600,000 will be at the end of the, either the agreement or whichever comes first." Board members asked whether the airline’s own assessment of the route would be available before the 18-month subsidy period ends so the EDA can reassess if performance is below expectations.
A board member asked about ongoing monitoring; staff replied that Cedric (project staff) maintains the operational data and that the invoice will include some of that information. Staff said they will continue to track booking and operations metrics and will report data to the board on a regular basis. The board discussed the risk that fuel or operating costs could increase and affect route economics and that staff would engage with the airline partners (SkyWest and United) and other carriers as needed.
The staff report also included brief highlights on business retention and tourism: staff described visits with local firms including Belvac and Framatome and noted year-to-date tourism economic impact exceeds $24,000,000 and that Lynchburg was named among Livability’s Top 100 Places to Live for a third consecutive year.
No formal board action on the air-service subsidy was recorded in the transcript; the update was presented as part of the staff report and board members requested continued monitoring and airline feedback.
