NEW YORK – Port Authority commissioners are expected to renew an incentive program that has been used to maintain existing and attract new passenger service to Stewart International Airport when they meet Thursday.
The program, in use in some form since 2010, gives a two-year package of discounts and credits to airlines that provide scheduled nonstop service to any new domestic or international destination not already served from Stewart.
It expires March 31 and would be extended through March 31, 2020.
The incentives are designed to make Stewart more attractive to airlines than such competitors as Albany, Hartford and Westchester and to offset their costs in scheduling and marketing new services.
Most recently, the Port Authority has cited the program as contributing to Allegiant Air's decision to return to Stewart and offer flights to Myrtle Beach, S.C., and St. Petersburg/Clearwater, Fla.
"They're significant incentives, and if they get an airline to come to Stewart or expand service at Stewart, they're a good thing,'' said Lou Heimbach, chairman of the Stewart Airport Commission.
These airport rents, fees and charges represent the Port Authority's leading source of revenue and are expected to raise $2.6 billion toward this year's $7.4 billion budget.
Stewart, where passenger volume has been declining, is forecast to collect $8.5 million.
Heimbach said the action only raises more questions about why the Port Authority appears to be abandoning its ancillary project to expand the terminal at Stewart to process more passengers overall, and domestic and international passengers simultaneously.
"They obviously go together,'' said Heimbach, who has been lobbying commissioners to restore the $20 million for the project to their 2017-2026 capital plan.
When the Port Authority introduced the incentive program in 2010, it allocated $2 million to design a 25,000-square-foot expansion of the terminal to accommodate a federal inspection station for U.S. Customs.
Then, in 2012, it renewed the program for five years, extended it to international airlines and approved $20 million for the expansion.
The design is still incomplete, and now, the $20 million has been removed from the capital plan that commissioners will vote on Thursday.
"What happened to their vision?" said Maureen Halahan, president and CEO of the Orange County Partnership.
"They promised to invest $500 million in Stewart when they took it over (in 2007) and, sure, they've spent some, but there's still a lot of money left on the table."
Halahan, who criticized commissioners on this point when they held a public hearing on the capital plan last week in Jersey City, N.J., called the expansion of the terminal central to Norwegian Air's pending start of low-cost flights to Europe from Stewart – the airport's first scheduled international service.
"Look at all the major companies that are investing hundreds of millions of dollars in Orange County now,'' said Halahan. "And they can't come up with $20 million, a $20 million that was a promise?"
Orange County Executive Steve Neuhaus, who also spoke at the hearing, said he was equally baffled that the Port Authority would back away from this commitment just when Norwegian Air was in the wings.
"Why now?" said Neuhaus. "Without explanation?"
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