During the Tallahassee annual city retreat discussion about the airport, Mayor John Dailey proposed using minimum revenue guarantees to incentivize air carriers to establish service in Tallahassee.
“I am also formally asking that we formally engage with the state to bring back a contract as part of that minimum revenue guarantee. And how can the state participate, allowing the state workers to be able to fly through our airport to and from and participate in that minimum revenue guarantee,” he said.
Dailey’s proposal would create a partnership between the city and state that would help with financial incentives.
Minimum revenue guarantees ensure an airline receives at least a minimum amount of revenue. Other cities -who have issues with market forces impacting consumer options – are employing this approach.
For example, the mayor of Pensacola recently signed off on an incentive program for air carriers. Adopted on Marh 15, 2024, the Air Carrier Incentive Program “is intended to encourage new non-stop air service,
promote competition and improve or enhance existing air service at Pensacola International Airport (“PNS”). The Program offers a range of support to assist an airline expanding its service at PNS.”
Tallahassee has a history with minimum revenue guarantees. In 2001, the city agreed to subsidize AirTran for up to three years, providing approximately $1.5 million per year in revenue guarantees and $600,000 in marketing services. After the subsidies ended, AirTran – which no longer exists – ended service in Tallahassee.
Way back when I was on the commission, one of the airport administrators came to me with a plan to attract and put more passengers into seats of the existing current airlines carriers. I believed it would have worked. When I presented to the commission the plan was not completely finished so some said it would not work without even reading the plan because they had made up their mind to subsidize Bringing in a new low cost airline company’ AirTran ‘ . Maybe the city should go back a take another look at that plan again! FYI , Just thinking!
Way back when I was on the commission, one of the airport administrators came to me with a plan to attract and put more passengers into seats of the existing current airlines carriers. I believed it would have worked it when I presented it some said it would not work without reading the plan because they had made up their mind to subsidize Bringing in a new low cost airline company’ AirTran ‘ . Maybe the city should go back a take another look at that plan again! FYI , Just thinking!
Investigate the monopoly on Aviation Fuel at TLH.
It’s all about “the “brothers.”
@ Mr. Worrel
You hit the nail on the head! There's no profitable airline business coming out of Tallahassee. This city is a small, sleepy little town in Northern Florida......always has been and always will be.
panama city airport is always half the price or better compared to Tallahassee. It is not such a bad drive, you definitely get used to it.
David is correct. No government entity should bribe a business to do business in a City or County, else they know they have the taxpayers by the "short ones."
I’m guessing that if the airline fees are dropped, the taxpayers will have to pick them up.
On minimum revenues guaranteed: if the airline doesn’t generate that on their own, again the taxpayers will have to pick up the difference.
Instead of using minimum revenue guarantees to incentivize air carriers to establish service in Tallahassee, how about just lowering some of the Fee's and ending others. There was an article in the Democrat several Years ago about all the Fee's an Airline Pays every time one of their Planes lands at our Airport..............It's a lot of Fee's. TR should do a full Investigated Report on it now. We should NOT be PAYING Businesses to come here.
So, we incentivize them simply existing and when we stop paying they leave? That's the plan?
The fares are only part of the problem. The volume of passengers is also a problem. We don't have enough business interests flying into and out of this city to attract air carriers who would then be incentivized to attract flyers with lower rates.
How about we work to bring more business to the capital other than fast food and convenience stores? Yes, I still want my 7-11, but having a manufacturing facility or a media company, or a big internet/software company would be a huge win. We have two universities and we can't attract companies to recruit and hire from them?