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Ready to take flight – officials say daily air service could begin in March (Pikeville) Appalachian News-Express

Article originally posted on August 31, 2013 to the Appalachian News-Express Web site http://news-expressky.com/

BY RUSS CASSADY

EDITOR

The first concrete steps toward establishing a commercial air service out of the Pikeville-Pike County Airport were taken Friday, with two bodies approving agreements with a company which wishes to have a daily service out of, and back into, Pikeville.

During a special joint meeting on Friday of the Pikeville City Commission and Pikeville-Pike County Airport Board, the agreements and funding sources were approved to get the project off the ground.

According to documentation obtained by the News-Express, the two companies involved in the project, Corporate Flight Management (CFM) of Smyrna, Tenn., the service provider, and Public Charters, Inc., of Avoca, Penn., the ticketing and ground service company, plan to have the service operating by March.

The agreements approved on Friday outline airport services that the airport will provide to the airline and the fees the airport board will charge for the services, as well as how the City of Pikeville will manage its revenue guarantee fund to support the service. 

How the service will operate

The service, according to a statement from the organizations working on the project, will feature nonstop turboprop flights operated by CFM to travel from Pikeville to the Nashville International Airport. Because of the involvement of Public Charters Inc., the statement said, sales platforms for tickets for the new flights will be available on virtually every Internet travel site, such as Expedia, Kayak, Travelocity and others.

From Nashville, passengers can reach the world, officials said.

“The new flights to Nashville will be time to allow Pikeville travelers to connect to nonstop connecting flights to 49 destinations throughout the U.S., Canada and Mexico,” said Luke B. Schmidt, the consultant for the City, Chamber and airport on the project. “Travelers will be able to connect to any of the nine airlines which serve (Nashville), including low-cost carrier Southwest Airlines, which has a major presence in Nashville.

“Fully 23 of the 25 business destinations for Pikeville travelers will be only one stop away by connecting in Nashville,” Schmidt continued. “This new service will eliminate the need to drive to Lexington, Charleston and Huntington/Ashland when it comes time to travel.”

Those flights, unlike a charter service, will operate seven days a week, with one flight departing Pikeville and traveling to Nashville, and another flight returning from Nashville later that day. The flights, officials said, will run seven days a week, and, because of the regulations under which the service will operate, flights can only be cancelled because of extreme circumstances, such as weather or a nationwide or regional grounding of flights.

The service, officials said, differs greatly from a proposal made a few years ago by a company called Locair.

According to documents provided to the News-Express, the current proposal differs from what Locair offered in “every” way, including:

• The airports and flight schedule are approved by the U.S. Department of Transportation (DOT) Special Authorities Division; no changes can be made to either without DOT approval.

• The service will be daily, including weekends.

• All passenger seats on the aircraft are available for sale on each flight.

• There will be combined itineraries with many carriers, including Southwest.

• There will be connecting service at the hub airport’s main terminal — in Transportation Safety Authority “sterile” conditions to hundreds of destinations.

The sterile conditions will mean TSA screeners and inspectors, who will be employed and paid by the TSA, and stationed in Pikeville. Because of the “sterile” treatment, Schmidt said, the planes from Pikeville to Nashville will actually pull up to a terminal, eliminating the need for a second security check to get on another flight. 

Funding source has changed

When the project was in its early stages, it was subjected to a high level of controversy, when it became clear to organizers that they would have to have the support of the Pike Fiscal Court to apply for a $1 million multicounty coal severance grant.

After weeks of controversy, the fiscal court approved by a 5-2 vote applying for the funding for the project, which was later received.

However, this week, documents show, the full $1 million in funding was not obtained through coal severance.

According to a letter obtained by the News-Express, earlier this week, Pikeville City Manager Donovan Blackburn was notified by the Kentucky Department for Local Government that the agency would be funding a grant for $200,000 for the air service project from coal severance.

The reduction in coal severance, Schmidt said, is a direct result of the reduction in mining in the region, which has caused severance tax receipts to fall.

In the same letter, the agency confirms that it is the intent of the Kentucky Transportation Cabinet to fund the rest of the project, contributing a total of $470,588 to ensuring the operation of the service.

The funding, according to documentation provided to the News-Express, will be used to fund a monthly revenue guarantee program, which officials said will only be paid to the carrier if the company’s actual revenue trails the agreed upon monthly revenue target, and in an amount equal to the shortfall.

The service, according to the documents, is projected to carry a total of 5,244 passengers in the first year, with that number climbing to 13,223 the following year.

“The service should start with an average of three revenue passengers per flight in month No. 1 and build to an average of 18.5 revenue passengers per flight in month No. 14,” the documents said.

According to documents, the total amount of revenue guarantee which is planned to be available to the company is $1.425 million, between March of next year through February of 2016, the end of the agreement, with city officials planning to ask the state legislature to fund an additional $104,412 to bring the total available to that amount.

Approximately $750,000 is coming from the U.S. DOT’s Small Community Air Service Development Grant Program, from a grant first approved in 2011. 

Not all convinced of the good of the project

While the Pikeville City Commission unanimously approved the agreements during the meeting on Friday, the Pikeville-Pike County Airport Board approved the agreements by a 5-1 vote, with member Brent Wagner voting against the measure.

During the meeting, Wagner questioned Schmidt on several points of the airport’s end of the contract, including what the airport’s rights and responsibilities are.

Wagner told Schmidt that he was disappointed the board had only received the agreement 16 hours before the meeting.

“It’s hard to prepare and have valid questions when you don’t have the documents in front of you,” Wagner said.

However, Wagner pointed out that one part of the agreement commits the airport board to spending a maximum of $210,000 to bring the service to Pikeville. In response to Wagner’s questioning, Schmidt said that no matter what, the amount the airport would have to contribute cannot exceed that amount.

Also, Wagner pointed out that the contract is written in such a way that it would prevent the airport board from backing out without the city’s permission and that it would lock the airport board in to only being able to add a “mark up” of 50 cents per gallon on the fuel sold to the airline.

Schmidt said the fuel cost being locked is simply an incentive to attract the company, which wants to purchase fuel from the Pikeville Airport to contribute back to the community. The plane, Schmidt said, could fly from Nashville and back without having to fuel up in Pikeville.

“In reading this, I get the impression that there’s a lot of things in line for this company … to make it work,” Wagner said. “But we’re being restricted in many ways. We’re restricted on our profitability. We’re restricted about not being able to take this agreement and speak to the public, the people that’s spending the money for it.” 

Project first-of-a kind

According to Schmidt, the project to bring air service to Pikeville, as far as he is aware, is the first of its kind, in that the airline expects its involvement with the Pikeville-Pike County Airport to be profitable and it could become a model project for the nation.

But, he said, it doesn’t come without risk.

“All this requires a bit of a leap of faith,” Schmidt said.

Pikeville Mayor Pro-Tem Jimmy Carter agreed there is some risk before casting his vote, but said that the possible reward makes the risk worth it.

“We have to take the calculated risk to make sure that we succeed here in Eastern Kentucky,” Carter said. “If we don’t, we’re dead in the water.”

A formal community announcement of the project is currently scheduled for Oct. 17 at the airport. Schedules and ticket prices will be announced at a later date.

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Addington Field – Elizabethtown (KY) Regional Airport Airline Service Project

EKX Logo

Introduction

The Elizabethtown (KY) Airport Board (EAB) operates the city’s municipal airport, Addington Field – Elizabethtown Regional Airport (EKX).  The EAB decided to respond to numerous inquiries received from area citizens and businesses regarding the establishment of passenger airline service at EKX.

The EAB initially retained Luke Schmidt and L.B. Schmidt & Associates, LLC for the purpose of conducting a market feasibility study to confirm the presence of a viable passenger airline service market in Central Kentucky.  Following the completion of the feasibility study, the EAB elected to proceed with the project to formally recruit an airline to EKX and again retained L.B. Schmidt & Associates, LLC to direct the project

Project Scope

The Market Feasibility Study (276 pages) included detailed demographic research into each of the 24 counties in the regional air service market.  Highlights of the Study (and the updated market profile which followed) include:

  • Analysis of Fort Knox travel patterns
  • Summary of Fort Knox market (current Commands and incoming Commands)
  • Projected annual passenger enplanements by developing the Origin & Destination Study
  • Detailed demographic information on Elizabethtown Metro area
  • Analysis of regional driving distances, costs and times to all regional commercial airports

OLYMPUS DIGITAL CAMERAAdditional work on the project continued, focusing on the following areas:

  • Develop communications/promotion strategy for the airport
  • Develop regional support for passenger airline service
  • Address airport infrastructure issues
  • Recruit airlines to EKX

Project milestones include:

  • Re-branded the airport by changing the airport’s name to reflect new regional mission
  • Developed new airport logo and related collateral materials
  • Developed new airport Web site
  • Developed concept design for new passenger terminal
  • Developed an unprecedented level of regional support for new passenger service at EKX along with key support at Fort Knox (included 72 resolutions and 200+ letters of support from government jurisdictions and chambers of commerce from 22 counties in support of EKX’s USDOT Small Community Air Service Development grant proposal)
  • Began efforts to develop contract military airfares
  • Started airline recruitment process with formal and ongoing discussions with all major network carriers and one low-cost carrier
  • Attended the airline industry JumpStart Conference in Pittsburgh
  • Established a schedule of airline airport charges and fees

EKX TerminalLuke Schmidt also worked with the EAB to address airport infrastructure issues.  Luke Schmidt facilitated initial meetings with former Congressman Ron Lewis for the purpose of securing funding for an Instrument Landing System (ILS) Glide Slope (which will be installed in 2013).  This included multiple trips to Memphis, TN with airport board members to meet with FAA regional officials.

The EAB commissioned a set of concept drawings for a new passenger terminal.

100_3122[2]In 2012 and in response to this project, the runway at EKX received a significant pavement overlay which now will allow for sustained operations of 76-passenger Canadair CRJ-900 regional jets for the next 15 years (along with occasional Boeing 737/757 charter flights).

Summary

Significant progress has been made towards the attainment of the goals set forth with this project.  This ongoing project has the potential to substantially impact future economic development efforts in Central Kentucky and will assist in creating new jobs.

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Airport Survey Confirms Potential (Somerset) Commonwealth-Journal

 

Article was originally posted to the (Somerset) Commonwealth-Journal’s Web site http://somerset-kentucky.com/newslive/x1951907198/Airport-survey-confirms-potential

by Bill Mardis Commonwealth Journal

Somerset —

Results of a regional survey of airline travelers announced Tuesday indicate a robust market in this Southern Kentucky area for commuter airline service at Lake Cumberland Regional Airport.
Released by the Somerset-Pulaski County Development Foundation, the survey indicates a potential annual enplanement of 142,166 passengers who would use airline service in and out of the Somerset airport.
Both Martin Shearer, executive director of the development foundation and Luke B. Schmidt, president of L.B. Schmidt & Associates, LLC, project consultant, said a airline company is interested in providing commuter service at the local airport.
“It’s like recruiting an industrial prospect,” said Schmidt. “Name of the interested commuter service is confidential at this point.” He said there is still a lot of work to do, “ … dotting i’s and crossing t’s … like putting together a jigsaw puzzle.”
Schmidt noted the survey’s two strategic goals:
• Recruit a regional airline that is aligned with a major carrier such as American, Delta or US Airways.
• Establish service to a major connecting hub.
Schmidt said the interested airline service meets these objectives. The company has service in several small markets and  “ … has been around a long time,” Shearer revealed. He said the company is interested in establishing connection with a major airline hub and flying out of Somerset.
“We have made a lot of progress toward establishing a major market profile,” said Schmidt. The survey’s findings include the following information:
• Responding companies reported booking a total of 312 round trips by air each month.
• Approximately 612 visitors fly to the region each month to meet with responding companies.
• Total number of round trips by air to/from the region with responding companies equals 923 each month.
• Lexington is currently the preferred airport for flyers in Somerset, London and Corbin.
• Hours required to drive (one-way) to the primary airport in Lexington averaged 1.5 hours.
• Ninety-one percent of responding companies will use the service if a major connecting hub with reasonable fares is provided.
Although a commuter airline service out of Lake Cumberland Regional Airport would ultimately serve 16 counties in Southern Kentucky, Schmidt said the survey focused on the Somerset, London and Corbin areas. The reason, he said, is because these communities are the core of the proposed market with a combined population of 384,000. Schmidt met personally with several large employers in Somerset, London and Corbin areas.
A Florida-based commuter airline operated out of Lake Cumberland Regional Airport, first to Nashville and then to Washington, D.C., for a little more than two years. It was subsidized with about $900,000 obtained by Congressman Hal Rogers from the U.S. Department of Transportation and $100,000 in local matching funds. No sustaining local source of funding developed before the federal funds were exhausted and the airline shut down February 19, 2010.
The survey to reestablish commuter air service out of Lake Cumberland Regional Airport is an effort by Somerset-Pulaski Development Foundation, Somerset-Pulaski County Chamber of Commerce, Somerset-Pulaski Convention & Visitors Bureau, Corbin Economic Development Agency, London/Laurel County Chamber of Commerce, local airport board and Somerset and Pulaski County governments

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Airport gets $1 M pledge (Pikeville) Appalachian News-Express

 

 

Article originally posted to the (Pikeville) Appalachian News-Express Web site http://news-expressky.com/

BY RUSS CASSADY

Editor

After months of waiting, the controversy over whether coal severance funding should be used to finance a commercial air service project at the Pikeville-Pike County Regional Airport ended Friday when it was announced that $1 million had been allocated to the project.

In a press conference at Pikeville City Hall on Friday, representatives of the groups working to establish commercial air service at the airport gathered to make the announcement, made official by a statement from Gov. Steve Beshear that the project would receive the funding.

Pikeville City Manager Donovan Blackburn, who has been an active participant in several events and announcements this week regarding new projects in the City of Pikeville, said during the press conference that the air service project is “extremely important” to the success of the region.

“The face of Pikeville is forever changing,” he said. The commitment of $1 million in multi-county coal severance funding, Blackburn said, brings the total that those working on establishing the service have to $1.75 million, which will be used to establish a revenue guarantee program for the carrier which commits to coming to Pike County.

And, with the commitment, the air service could be established fairly quickly, according to Luke Schmidt, the consultant hired by the Southeast Kentucky Chamber of  Commerce, City of Pikeville and Pikeville-Pike County Airport Board to work on establishing the service.

“We hope to have a commitment in hand by the end of the first quarter of next year,” Schmidt said.
According to Schmidt, he works in several communities throughout the state, but that this one sets itself apart. “This is clearly one of the most progressive cities in the state,” he said. And according to Chamber President Jared Arnett, this project is just one of many that is helping to change the  business climate in Eastern Kentucky, despite questions over the energy industry.

“It’s imperative that we step up … and create a climate conducive to new investment,” Arnett said.

A statement from Beshear’s office said the successful recruitment of an airline will “significantly enhance economic development efforts and the creation of new jobs not only in Pikeville and Pike County, but also in the surrounding 12 counties.”

The funding was almost not obtained earlier this year. After announcing that the funding was  possible and that the support of Floyd County’s fiscal court had been obtained, organizers ran into questions from the Pike County Fiscal Court over the viability of the project and whether the multi-county coal severance funding, which had been uncommitted, should be used for the project.
After weeks of debate and a public forum hosted by the Appalachian News- Express, the Pike Fiscal Court voted 5-2 to support the funding. The county’s support was required for the funding to be processed.

One of the “No” voters, Dist. 6 Magistrate Chris Harris compared the funding, which will guarantee revenue for an airline, to “corporate welfare.”

“Many of us here would like to see commercial air service in Pike County; that’s not the issue,” Harris said during a fiscal court meeting. “The issue is, ‘At what cost do we want to see commercial air service in Pike County?’ At a time when we are looking at a loss of jobs, declining tax revenue, a limited amount of funding, I don’t think Pike County, right now, I don’t think we can afford this kind of project.”

Both Blackburn and Schmidt spent time on Friday thanking Pike Judge-Executive Wayne T. Rutherford and Floyd Judge-Executive R.D. “Doc” Marshall for their support. Blackburn said that a formal check presentation ceremony for the funding, which will include Beshear’s presence will be held at a later date.

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Pike airport receives $1M grant Williamson (WV) Daily News

Pike airport recieves $1M grant

Pike_airport_recieves_1M_grant0_1351912898
 Julia Roberts Goad

Staff Writer

PIKEVILLE, Ky. — The Pikeville/Pike County Airport came a step closer to commercial air service with the announcement of $1 million in grants from the Kentucky Department for Local Government from multi-county coal severance tax money.

The grant will be awarded once an airline is selected to provide commercial air service to the airport (PBX).

In addition, a Federal Small Aviation Grant granted the Pikeville City Commission received in 2011 was granted an extension of the $750,000 grant that was received for commercial air service last year, bringing the total of funds for the airport to $1.75 million.

Two commercial airlines have expressed interest in serving PBX, although both companies have remained anonymous.

Recruiting an airline to provide commercial service is one of the purpose of the grant. One of the methods of recruiting an airline is a revenue stream package. An airline doing business in the county would set a financial goal for each month. If the company falls short, money from the revenue guarantee package would be used to bring the amount of money the airline makes up to the monthly goal. The money would be given to the airline on a monthly basis so the company would not incur financial losses during the first two years of operation.

Luke Schmidt of LB Schmidt Associates, a consulting company which has been working with the City of Pikeville and the East Kentucky Chamber of Commerce on the airport project, said the revenue stream package is essential to an airline.

“It is expensive to for an airline to start a new route,” Schmidt said. “They have to invest in new planes, employees, equipment. If they lose too much money too soon, they aren’t going to stay. We need to make it profitable sooner rather than later.”

The grant was obtained after garnering support from the Floyd and Pike Counties Fiscal Courts.

However, the support of the Pike Court was not unanimous vote. Two of the six magistrates on the Court were not in favor of asking for coal severance tax money for the airport. Both Chris Harris and Jeff Anderson said they felt the airport would not be profitable. After initially refusing to throw his support behind the request for coal severance funds, Judge Executive Wayne T. Rutherford did vote in favor of the request.

Millions of dollars have already been used in the development of PBX, Pikeville City Manage Donovan Blackburn said, including $3,383,971 to complete the parallel taxiway alongside the airport’s primary runway, $330,513 in improvements and repairs to the primary runway, 679,000 for a new nine-aircraft T-hangar and $109,304 for the installation of a new Automated Weather Observation System.

Jared Arnette, President of the East Kentucky Chamber of Commerce, said the airport is the result of groups working together.

“This is the best example I have ever seen of teamwork,” Arnette said. “Our businesses spoke in one voice. The airport is part of the vision of economic development, they see value of a commercial airport. It is a milestone we have reached. In a time when people are concerned with energy, it is important to step up and say we are creating opportunity.”

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Governor Beshear Announces Airline Service Grant in Pikeville (Press Release)

 

Press release originally posted to Kentucky.gov Web site http://kentucky.gov/Pages/home.aspx

Friday, 11 02, 2012

Kerri Richardson
Terry Sebastian
502-564-2611

Multi-county coal severance tax grant to support new airline service at the Pikeville – Pike County Regional Airport

PIKEVILLE, Ky. – Governor Steve Beshear and the Kentucky Department for Local Government today announced a pledge of a $1 million multi-county coal severance tax grant to the city of Pikeville. The grant will be used to support the development of new airline service at the Pikeville – Pike County Regional Airport (PBX).

Pikeville’s elected officials, along with the Pikeville – Pike County Airport Board and the Southeast Kentucky Chamber of Commerce have been spearheading efforts to develop scheduled passenger airline service at the Pikeville field for more than two years. The grant will be awarded once an airline is selected to provide the public service. The proceeds of the grant will be matched with a $750,000 federal grant that the city of Pikeville received last year, and will be used as part of the project’s revenue guarantee program to assist a carrier in reaching sustainability during the start-up phase of service.

“So far, two airlines have expressed interest in serving PBX,” said Gov. Beshear. “Local officials have demonstrated strong leadership on this project, and the Commonwealth is pleased to partner with the community and airport officials to support ongoing efforts to develop new airline service.”

The grant will play an important role in the final stage of recruiting an airline to PBX. The successful recruitment of an airline will significantly enhance economic development efforts and the creation of new jobs not only in Pikeville and Pike County but also in the surrounding 12 counties.

“This is great news for our community,” said Sen. Ray Jones of Pikeville. “This grant puts us further down the road toward our goal of establishing scheduled airline service at PBX.”

“I want to thank Governor Beshear for his support of this important community goal,” said Rep. Leslie Combs of Pikeville. “We’re getting closer to our goal of new airline service to a major connecting hub which will truly connect Pikeville and Pike County to the global economy.”

“Our city appreciates the support of Governor Beshear and the Commonwealth,” said Pikeville Mayor Pro-Tem Jimmy Carter. “New airline service at PBX will help us to create new jobs in the coalfield.”

“The Commonwealth has been a wonderful partner at PBX ever since the field first opened in 1983,” said Bill Hickman, Chairman of the Pikeville – Pike County Airport Board. “This is yet another confirmation of this partnership as the airport continues to grow and serve the community.”

“New airline service at PBX will make it much easier for our business and professional community to compete in the global economy,” said Jared Arnett, president and CEO of the Southeast Kentucky Chamber of Commerce. “This grant helps us get closer to our goal of securing service.”

“This project enjoys widespread support,” said Luke B. Schmidt, President, L.B. Schmidt & Associates, LLC and consultant to the project’s leadership group. “Airline service will be a real game-changer for this community. I want to also thank Pike County Judge/Executive Wayne T. Rutherford and Floyd County Judge-Executive R.D. “Doc” Marshall for their support of our grant application.”

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Commercial air service funding secured for city of Pikeville WYMT-TV (Hazard, KY)Web site

 

Reporter: Paige Quiggins

PIKEVILLE, Ky. (WYMT) – It is a project that has been in the works for quite a while and on Friday, officials in the city of Pikeville announced they have been able to secure funding to bring commercial air service to eastern Kentucky.

“If it’s ever going to happen, this is going to be the time,” said Jared Arnett, President/CEO of the Southeast Kentucky Chamber of Commerce.

Officials said that time has come.

“It’s just not conducive to the global economy to not have ticketed service right here locally,” said Arnett.

Arnett and many others said it was the time for officials to announce $1 million in multi-county coal severance money has been set aside to help bring commercial air service to the region.

City officials said it is an economic boost that will help industrial parks within the region. He said when they are told the closest airports are in Lexington or Louisville, it changed the game for some.

“When these site developers say ‘we want to come look at it’ and when we tell them you have to fly in and drive three hours, we really don’t even get into negotiation stage,” said Arnett.
“If we could have the opportunity where they could fly right in, see our sites, it would make a tremendous difference.”

Mayor Pro-Tem Jimmy Carter of the City of Pikeville said it will affect more than a dozen surrounding counties.

“This definitely makes us the hub of eastern Kentucky and with commercial air service, it solidifies the whole deal,” said Carter.

The project’s consultant said carriers must agree before the project fully takes off.

“We are in a great position to go and make our final push on recruiting with the two airlines who have expressed interest in this market so our intent to be now to get in front of them as quickly as we can,” said Luke Schmidt.

Schmidt said they could know that answer by March of next year and if the two considering commercial carriers commit by then, it will likely take six months to a year from then for the services to begin.

Officials said this million is in addition to a $750,000 federal grant which has already been set aside for the project.

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Commercial flight info to be gathered (Corbin) Times-Tribune

Article originally posted to the Corbin Times-Tribune Web site http://thetimestribune.com/local/x543538315/Commercial-flight-info-to-be-gathered

 CORBIN — By Carl Keith Greene / Staff Writer


By Friday, Aug. 31, information regarding installation of a commercial flight from the Somerset airport will be ready.

Information will be released from a survey that has been taken in the Corbin, London and Somerset areas to help with the decision whether or not to seek a commercial flight.

In February, the Somerset-Pulaski County Development Foundation began to survey 15 counties in the area.

The counties have a population of 384,000.

Martin Shearer, executive director of the foundation, said, “Business and industry leaders throughout the region have asked repeated when air service will be restored” at Somerset.

He added that “A bigger reason is that all of us in the community, from a business and economic standpoint, should be able to make our existing business and travel connections.”

The nearest commercial flight locations are at Lexington to the north and Knoxville, Tenn. to the south.

He also said that if local commercial flight will be out and in at the Lake Cumberland Regional Airport, it could boost the future of economic develop in the region.

There has been no charter service at either the Somerset or London fields for several years.

So, Shearer said, commercial flights will simplify travel efforts to get to and from the Somerset area.

Luke B. Schmidt, who worked up the first survey, said he is in the middle of a more detailed survey sent by e-mail in the past week.

That went to every member of the Somerset, London and Corbin chambers of commerce as well as members of industrial communities in each city.

He added, “This second survey builds on the first and is to provide a bit more information regarding demand for air service in southern Kentucky.”

In the first survey, the Lexington airport is the regular airport for travelers from this region followed by Louisville and Cincinnati.

Survey participants want air service to key business destinations.

The participants recognized that having reliable airline service in Somerset is good. It would eliminate early morning drives to Lexington.

And for air service to be successful, service to a major connecting hub is needed.

Schmidt encouraged business and professional people who have received the current survey to complete it and return it to him no later than Aug. 31.

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Fiscal court approves air service resolution (Pikeville) Appalachian News-Express

Article originally posted to the Appalachian News-Express Web site: http://news-expressky.com/

By: Chris Anderson News Editor
Efforts to establish commercial air service in Pike County got a boost on Tuesday, as the Pike County Fiscal Court, after weeks of heated controversy, approved a resolution supporting the use of multi-county funds in the effort to establish the service.
During a special meeting Tuesday, court members, by a 5 – 2 vote, approved the resolution, bringing about the end of weeks of speculation over whether the effort to attract commercial air service to the Pikeville – Pike County Regional Airport would die at thte court’s feet.
Only Dist. 6 Magistrtate Chris Harris and Dist. 1 Magistrate Jeff Anderson voted against the resolution, with both officials expressing the opinion that they don’t think the proposal to establish the service will be successful.  Harris, who discussed the plan in depth during the meeting, has been outspoken in recent weeks with his opposition to the proposal.  He cited a study which showed the plan by which the City of Pikeville, the Southeast Kentucky Chamber of Commerce and the Pikeville – Pike County Airport Board are operating has a low success rate.
Anderson, in whose district the airport lies, said he wants the service to succeed, but does not think it will.
Dozens of people attended the meeting to hear the court’s decision on the resolution.  Among those were representatives of the City of Pikeville, the chamber and other organizations.  Airport consultant Luke Schmidt gave a presentation similar to the one he presented previously at a commercial air service forum hosted by the Appalachian News-Express in which he detailed the plan to attract a commercial carrier.
However, Schmidt’s presentation was unsuccessful in swaying Harris’ opinion of the plan.
Following Schmidt’s presentation, Harris, while thanking Schmidt for coming before the court and presenting his information, criticized parts of the plan which called for a “revenue guarantee” plan to be established in the event flights from the Pikeville – Pike County Airport are not profitable.  Such a plan, Harris said, is akin to “corporate welfare.”
Harris conceded that the county needs commercial air service but questioned the cost of establishing the service.
“Many of us here would like to see commercial air service in Pike County: that’s not the issue,” Harris said.  “The issue is, ‘At what cost do we want to see commercial air service in Pike County?’  At a time when we are looking at a loss of jobs, declining tax revenue, a limited amount of funding, I don’t think Pike County, right now, I don’t think we can afford this kind of project.”
Harris said he believes the information provided thus far regarding the plan has been “one-sided” as a result of a “publicity campaign” by those in support of the plan, which he said, includes the chamber of commerce, and the News-Express.
Harris questioned Schmidt about the plan and its perceived requirement for matching funds in addition to federal grant funds already secured for the project.  He also presented figures from a 2008 U.S. Office of the Inspector General audit regarding the Small Community Air Service Development Grant which showed the grant has a “dismal track record” of success.
Harris said proposals to attract commercial air service using the Small Community Air Service Development Grant as its foundation have been successful only 30 pecent of the time, according to the study.  He added that the study shows that the success rate did not increase more than 10 percent, even with increase community financial support.
He said such a success rate is an unsafe investment.
“That’s not the kind of investment I would make with my money,” Harris said.  “If you only had a 30 percent chance to get a return, to get a success, ‘Is that the kind of investment I would make with my money?’  And that’s the way I look at the public’s money.  ‘Is this something that I would do with my money?’  And it’s not: a 30 percent success rate is not a good track record.”
Harris added that the audit shows that cost subsidy plans such as that proposed for Pike County has a zero percent success rate.
Schmidt said he had read the study and agreed that the plan using the grant has a low success rate.  He added, however, that many of the failed plans were for areas of the country with only a small population base and which were hundreds of miles away from larger population bases.
Anderson followed Harris comments with comments of his own, expressing a belief that the service will fail.
Those magistrates’ voices, however, were the only ones of opposition.
Dist. 5 Magistrate Hillman Dotson said he is unsure if the proposed plan will be successful in establishing a profitable commercial air service in Pike County.  He added, however, that investing in the plan to attract commercial iar service is similar to the county investing in the development of industrial parks.
“I’ve been on the cour for several years now and we’ve invested millions of dollars in our industrial parks and we’ve seen some of them pass and some of them fail,” he said.  “That’s an example of what we’re doing today: we’re putting multi-county money to test to see if it will make money.”
Dotson, who along with Dist. 3 Magistrate Leo Murphy, attended the News- Express air forum, said the proposal could fail, jsut as what happened with the investment the county made in the former Sykes call center at Mossy Bottom.  The center, most recently operating under the name ACS, closed in May.
“This might fail, but it might be a success,” he said.
He went on recall the developemnt of the Eastern Kentucky Exposition Center, saying that some on the court was in favor of the facility while others were against it.  He said the issues surrounding commercial air service are similar to those which were considered when the Expo Center project was in development.
“I think the Expo has not made money.  I don’t thnk it will make money, but it has brought a lot of good things to Pike County,” Dotson said.
Southeast Kentucky Chamber of Commerce President and CEO Jared Arnett, who was the only person who chose to speak as part of the meeting’s public comments portion, said commercial air service will help to maintain industries currently established in Pike County and will also help attract new industries to the county.
Arnett said the air service will help to begin to diversify the region’s economy.  He adeed that the plan should be given the chance to succeed, even if it is only a slim chance as illustrated by the study presented by Harris.
“I’ll say that, 30 percent likelihood of success is better than 100 percent likelihood of failure,” Arnett said.
The resolution nearly died for lack of a second after Pike County Judge/Executive Wayne T. Rutherford made a motion to put the resolution to a vote.  Dotson seconded Rutherford’s motion after several seconds of silence from the court.
As the court members were polled for their vote, Dist. 2 Magistrate Vernon “Chick” Johnson said his opinion on the plan has shifted several times..  He went on to say that he would vote in favor of the plan, but warned those spearheading the effort to not come before the court to ask for more money in the future.
Similar warnings accompanied votes by Murphy, and Dist. 4 Magistrate Kenneth Robinson before the magistrates voted in favor of the resolution.
Rutherford, who has been outspoken in his belief that the county had been left out of the development of the plan, did not comment on the plan prior to the vote by the court to adopt the resolution.  Following the the passage of the resolution, Rutherford, who also voted in its favor, siad commercial air service will be another tool in the county’s “tool box” for economic development.