Tupelo Regional’s financial hurdles will increase

By Sarah Robinson/NEMS Daily Journal

TUPELO – Air service industry experts said Tupelo Regional Airport will face yet another round of financial challenges in the near future.
Taxpayers may have to consider how important it is to maintain commercial airline service in the city, according to industry expert Mike Mooney.
Mayor Jack Reed Jr. said the community has to step up to support it.
“One of the things most great cities have is commercial air service,” said Reed.
The latest bad news for the Tupelo airport was delivered in a report by Mooney on Monday. At a Community Development Foundation briefing, he reiterated prior warnings the airport will see cuts in federal subsidies if the number of commercial air travelers remains low.
The airport has struggled since Delta airlines pulled out and was replaced by Silver Airways in October 2012. Mooney, an air service strategist with Sixel Consulting Group, was involved in the initial recruitment of Silver to take over commercial flight operations.
Josh Abramson, executive director of the airport, said the grant the airport receives from the federally funded Airport Improvement Plan fund will drop from $1 million in 2012 to $150,000 for 2013.
These funds are specified directly for capital improvements. An airport must have 10,000 boardings a year to qualify for the $1 million grant. Tupelo is on track to come in with less than 8,000 based on 2013’s current levels.
From October 2012 to January 2013, boardings were 51 percent lower than the same time the previous year.
The combined effect of sequestration and low travel volume could also effect Essential Air Service subsidies. This per passenger subsidy directly impacts operational revenue.
Silver provides service through the EAS program.
The real impact of potential cuts is not yet known as industry officials have yet to determine which funds are subject to sequestration and which are immune.
Abramson said the airport is prepared to kick off the “Fly Local” marketing campaign aimed at drawing travelers back to the city’s airport. He said community buy-in “is the only way we’re going to make it.” He added, “The airline, in return, needs to provide reliable service.”
Customer service has been an issue since Silver took over commercial service in October. Abramson said the airline has taken big measures to improve service and has purchased additional aircraft, provided additional staff training and continues to work toward better online booking options.
The announcement comes at a particularly difficult time for the airport as sequestration threatens to cut other important programs, including funding for the airport traffic control tower.

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