Friday, April 28, 2017

Newport News/Williamsburg International Airport (KPHF) gets into the restaurant business as state readies financial audit




NEWPORT NEWS  -  The short promotional video flashed a NASA logo and stock images of workers inside hi-tech factories to explain Newport News/Williamsburg International Airport's economic impact in the area. But an airport board member on Thursday wanted to see more about families flying in and out.

"There was other filming that Ken did that obviously we can't use right now," explained marketing director Jessica Wharton, referring to Ken Spirito, the airport's executive director who has been on indefinite leave since early March as the state audits the airport's financials.

It was a small reminder of the airport's competing issues at the moment.

A week since debuting $14.6 million in security checkpoint improvements that bridge two terminals for the first time at the small airport, and a week away from finishing construction on a new restaurant following a legal dispute with its prior restaurateur, the airport is still at least 30 days away from getting the results of a state audit looking into a questionable agreement with failed airline People Express.

First reported by The Daily Press in January, the Peninsula Airport Commission agreed behind closed doors in mid-2014 to be on the hook for a $5 million line of credit that struggling airline People Express secured from TowneBank. When People Express failed several months later, the airport used state money to pay off $3.55 million of the airline’s loan. The rest came from a U.S. Department of Transportation grant and the Regional Air Service Enhancement Committee.

Since March 1, board members have resigned, the executive director was put on leave and auditors expressed frustration in getting information. But perhaps more noticeable to passengers, the airport didn't have a single restaurant. Instead, beyond vending machines, it offered free coffee to morning flyers, bags of chips and water bottles past security.

After ending its lease agreement with a prior restaurant owner, the airport has gotten into the food business. It hired a food and beverage manager in January who will oversee Take PHFlight at Patrick Henry's, expected to open by June 1. Once the airport gets an ABC license, it expects to begin selling beer, wine and cocktails later that month.

Interim Executive Director Sanford B. Winner said he knows passengers have been frustrated with the lack of food.

"We hear more about that: 'I want a place to eat,' " he said.

The airport hopes to earn up to $183,000 in annual profit once it can sell alcohol and achieve a return on its investment within five to eight years. It has spent $890,000 to construct it so far. Officials said the prior restaurant operator earned $2.71 in revenue per passenger; the airport expects to make $3.15.

Word of the audit came as the airport aimed to improve the traveler experience in anticipation of more passengers using a new airline: Elite Airways. But the airline's plans to launch new flights between Newport News and Long Island have been in a holding pattern since January as it, too, awaits the results of the state's audit, hoping to launch when headlines are less about financial scrutiny of the airport and more about its own launch.

"We have the signage; we have the (ticket) counters ready," said Wanner. "We're ready to welcome them."

Brad Gales of the Virginia Department of Transportation's insurance and compliance unit told the Peninsula Airport Commission Thursday that efforts to get documents for the audit have improved and the agency has already compiled 200 pages detailing what happened and when, and has been combing through thousands of pages of emails, including 3,000 from the city of Newport News and another 12,000 he expects to receive soon.

"We have amassed a large number of observations now," he said.

Original article can be found here:  http://pilotonline.com

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