Sunday, April 15, 2012

Airport needs more aggressive marketing effort

Oneida County’s contract with Freeman Holdings of New York to run fixed-base operations at Griffiss International Airport might best be described as a bittersweet work in progress.

On one hand, County Executive Anthony Picente says the deal is saving taxpayers money. But critics, citing profits far lower than anticipated, believe the county is getting a raw deal.

Who’s right? Maybe it’s a little of both.

What’s really needed is more aggressive marketing of the airport. That needs to be a combined effort, with the county, Mohawk Valley EDGE and the airport commissioner working in partnership with Million Air — Freeman Holdings’ franchise name — to secure more business. Their success would benefit everyone.

In 2008, Oneida County and Freeman Holdings entered into a 10-year contract, under which Million Air runs all airport operations, ranging from services offered to pilots, passengers and planes to fueling and food service. The county reaps a portion of the profits, but those profits haven’t been what were expected.

For instance, the county gets eight cents for every gallon of fuel sold, but sales have fallen short of projections. Payments to the county in 2009 and 2010 were $44,791 and $62,491, respectively. And in 2011, the take was $71,024, county figures show. Million Air had projected the county would make $190,000 off the deal in 2009 and $205,000 in 2010.

Even so, Picente says, the county is ahead of the game, saving an estimated $500,000 annually in salaries, benefits and equipment the county has not had to purchase.

Nevertheless, this operation could be much better — and should be — by securing more business at the airport.

A pending lease with MidAir to occupy the other half of Building 100, which could result in an additional 125 jobs, is a good step. But there’s much more work to do. More business could be a bargaining chip for the county when the contract with Freeman comes up for renewal in six years.

Raising the profit margin would also be advantageous for Million Air, which currently pays no rent to the county for office space like it does at some facilities. In Victorville, Calif., for instance, Million Air operates an airport at the former George Air Force Base and pays between $6,000 and $7,000 a month in rent. But there, the company has been able to attract military planes, and the city garnered close to $800,000 last year from its 10-cent-per-gallon share of the million gallons of fuel sold there.

That could happen here, especially with the spectacular Griffiss runway, and local leaders — with assistance of political representatives — need to ratchet up efforts to make it happen. Freeman has said that the lower-than-expected profits were the result of trouble attracting business, including issues setting up a U.S. Customs office here.

Currently, when military or civilian flights arrive from overseas, customs officials from Syracuse need to be called in. That makes Griffiss less attractive as a destination for such flights.

Setting up a customs office here could change that and would likely increase business. That needs to be a goal of local officials, with assistance from U.S. Sens. Charles Schumer and Kirsten Gillibrand, as well as Rep. Richard Hanna. After all, this is economic development for the Mohawk Valley, and our political leaders need to become allies in the effort.

Million Air has six years left on its contract. At that point, either side can opt to part company — Freeman can walk away or the county can terminate the deal and resume base operations itself.

Neither sounds like a good idea at this point. The potential for profitability here would strongly suggest that both sides could prosper by working together to boost business at Griffiss Airport. That’s exactly what they need to do.