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Staff explains SCASDP grant, revenue guarantees and limits on local exposure
Summary
Staff told the board they will apply for the federal Small Community Air Service Development Program and said revenue guarantees would be funded by the federal grant if awarded; local TERS 2 funds would instead be used for marketing and the proposed $300,000 match.
Staff said the airport will apply for federal support through the Small Community Air Service Development Program (SCASDP) and outlined how revenue guarantees would work if the grant is awarded. Adam explained the guarantees set a target load factor and make up the revenue shortfall toward that target in early months to help a new flight reach break-even.
Adam described the mechanics: "The target goal is to have 70% of those seats filled," and the revenue guarantee would compensate when actual demand falls short. Board members pressed that the revenue-guarantee portion would be federal funds in the grant rather than McKinney tax dollars; staff confirmed that distinction and noted that without the competitive federal grant the program would rely on marketing-only incentives from local funds.
