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How Federal Funding Supports Service to Small U.S. Airports

From Washington to Tennessee, 20 small airports are receiving nearly $15 million in federal subsidies this year.

An American Eagle E145 (Photo: AirlineGeeks | William Derrickson)

The Small Community Air Service Development Program is another government-funded program that is used to provide the funding smaller communities need to develop their air service portfolios. Generally, it is not as well-known compared to the widely-used Essential Air Service (EAS) program.

This program is meant to benefit communities and assist with the implementation of the air service initiatives proposed in their grant applications. Essentially, it provides mostly revenue guarantees, so airlines will be more willing to start new services; that way they can develop the route enough to where they won’t need a grant and will become economically self-sustainable. But, there are a couple of basic rules that are laid out in the program;

  1. The airport serving the community or city is not larger than a small hub airport, which is determined using the Department of Transportation (DOT)’s most recently published classification.
  2. The airport has insufficient air carrier service on a specific market/route or unreasonably high airfares, the latter of which most of these airports are.
  3. The airport presents characteristics, such as geographic diversity or unique circumstances, that demonstrate the need for, and feasibility of, the Small Community Program.
  4. If awarded a grant, An applicant may not receive an additional grant from the federal government (local or state governments are allowed to), to support the same project more than once in a 10-year period, except in certain circumstances.
  5. And finally, an applicant may not receive an additional grant prior to the completion of its previous grant.

Plus it Is pretty strict, as there can’t be more than four cities in the same state that get awarded a grant during the fiscal year. This also doesn’t guarantee that cities will acquire the air service that the grant is made for, as sometimes airlines just don’t want to operate a particular service even with the revenue guarantees, or they will start it but then end it once the revenue guarantee money is all gone.

In this grant awarding term, 20 cities have been given grants which include the following communities along with the amount they were awarded, according to publicly available documents on Regulations.gov. Also included is what they “plan” on doing with the funding.

Monterey, Calif. – $750,000

They would use the grant to provide a revenue guarantee to start and support nonstop flights to Chicago. The community would provide significant local funding for the project as well. Although it didn’t say which Chicago airport, American Airlines has provided a letter of support for the project, which means the airport would probably be Chicago O’Hare.

Dubuque, Iowa – $1,500,000

The funding will be used for a revenue guarantee and marketing to support new services to a large or medium hub. While they do currently have service to Orlando and Las Vegas on Avelo, the service is not daily, and the town is looking for more sustained daily flights as Avelo is currently the only airline serving this airport.

Denver Air Connection, or DAC for short, has provided a letter of support for the project, and while they didn’t name a specific airport, the closest medium or large hub airport that DAC serves is Chicago O’Hare located 147 miles away.

Denver Air Connection planes lined up in Denver. (Photo: AirlineGeeks | Joey Gerardi)

Idaho Falls, Idaho – $950,000

The funding in this city will be used for a revenue guarantee to initiate and support new service to a Los Angeles area airport, as the airport currently has no nonstop flights to anywhere in California. Alaska Airlines provided a letter of support for this project, and the airline already operates a hub at LAX.

Peoria, Ill. – $500,000

The funding here will be used for a revenue guarantee and marketing to initiate and support new daily services to a west-central hub, preferably Denver, Houston, Phoenix, or Salt Lake City. The community states that it has lost prior west-central hub service to Denver and that it has “adversely affected its economy and its travelers.” They also state that starting service to one of these airports alleviates that deficiency.

They also plan to increase sustainability by installing solar panels and EV parking spaces in the airport parking lot. American and United have provided letters of support for the project to their own hubs.

Springfield, Ill. – $250,000

The funding here will be used for a marketing campaign to support its existing Allegiant Air and American Airlines service. American already serves Charlotte, Chicago, and Dallas/Fort Worth; while Allegiant flies to Austin, Las Vegas, Los Angeles, Orlando, Phoenix, Punta Gorda, St. Petersburg/Clearwater, Destin, and Houston Hobby.

Allegiant’s “Winter The Dolphin” livery departing for a flight (Photo: AirlineGeeks | Joey Gerardi)

The municipality has also said that over the past decade, the number of scheduled departures from Springfield’s airport has declined by at least half and proposed a marketing program tailored to increase public awareness of its remaining service. American Airlines has provided a letter of support for the project.

South Bend, Ind. – $750,000

The funding in South Bend will be used for a revenue guarantee and marketing to initiate and support new service to the West Coast, more specifically San Francisco or Los Angeles, but would alternatively accept Washington D.C. as a compromise if the West Coast isn’t an option.

Hometown of Secretary of Transportation Pete Buttigieg, substantial local funding for the project has also been announced, including state funding from the Indiana Economic Development Corp., and while they didn’t say what airline specifically, they did say “a confidential airline letter of support was filed with the Department.”

Ft. Wayne, Ind. – $600,000

This community will use the funding to provide a revenue guarantee and marketing to initiate and support new services to Denver, as they state they have no service to the western United States as the farthest westward destination is Chicago. The community is going to provide very substantial local funding for the air service, and United provided a letter of support for the Denver flights.

An United Express Embraer E175 (Photo: Embraer)

Monroe, La. – $500,000

The funding in this community would be used to provide a revenue guarantee and marketing to initiate and support new services to Charlotte, as they have lost a lot of service in recent years and this service would help regain some of its capacity. American Airlines has provided a letter of support for this air service.

Traverse City, Mich. – $750,000

Funding here would be used for a revenue guarantee and marketing to initiate and support new services to Houston. It would provide the community another option to get to and from the southwestern part of the country as well as provide connections onward. Although they didn’t say what Houston airport they would serve, United has provided a letter of support, so it is assumed service will be to Houston-Bush.

Gulfport/Biloxi, Miss. – $365,000

Funding for this Mississippi airport will be used for a revenue guarantee and marketing to initiate and support new services to the Washington D.C. area. They also state that Hurricane Katrina, the Deepwater Oil spill, and the COVID-19 pandemic have negatively impacted the area’s long-term growth, and this new service will assist in the economic recovery.

The State of Mississippi is also going to be providing substantial funding for the project, with additional funding coming from the community. American Airlines and Breeze Airways provided letters of support for the project, American would most likely serve Washington-Reagan, but is unknown which airport Breeze would serve in the D.C. area.

Billings, Mont. – $1,000,000

Funding here would be used for a revenue guarantee and marketing to initiate and support new services to Los Angeles and/or San Francisco. They state that it needs additional air service destinations in order to combat its high airfares. The community will also be providing substantial local funding for the project, and Alaska Airlines has provided a letter of support for the project, they have hubs at LAX as well as San Francisco.

Fargo, N.D. – $500,000

Funding in Fargo would be used for a revenue guarantee and marketing to initiate and support new service to Charlotte and is the only one of two communities that specifically names a carrier they wanted to start the service rather than just getting a letter of support, seeking American Airlines.

They state that the proposed service will significantly increase connectivity to the eastern United States through American Airlines’ extensive hub network at Charlotte, including operations to points on the East Coast, the Caribbean, and Europe. American Airlines has already provided a letter of support for the service.

Ithaca, N.Y. – $750,000

Funding in the New York community will be used to start and provide a revenue guarantee for service to a Washington D.C.-area airport or a similar southern hub. They state that the proposed service to Washington, and the additional seat capacity it will bring, will address its need for expanded air service, and will complement its existing New York City-area service.

As with most communities, they will be providing substantial local funding for the project. United has provided a letter of support which means the Washington D.C. area airport will most likely be its Dulles hub.

Wilkes-Barre/Scranton, Penn. – $500,00

This is the only community that would use its funding in this round of awards to get an ultra low-cost carrier. They would use it to have a revenue guarantee and marketing to initiate and support new services to Ft. Myers, Orlando, Sarasota, and/or Tampa, FL, on Avelo Airlines.

Avelo’s 737-800 aircraft in Burbank (Photo: AirlineGeeks | Ryan Ewing)

They have also partnered with surrounding counties and organizations to develop the new service, which they believe would help restore capacity that was lost during the COVID-19 pandemic. Avelo has provided a letter of support for the service.

Chattanooga, Tenn. – $750,000

Funding here would be used for a revenue guarantee and marketing to initiate and support new services to Denver, but would alternatively support Houston instead if Denver cannot be attained.

They state that seat capacity and traffic have suffered a recent decline at Chattanooga, and service to a hub in the west would restore this lost traffic. The community is providing substantial local funding for the project, and United Airlines has expressed interest with a letter of support.

Tri-Cities/Blountville, Tenn. – $900,000

Funding would be used to provide a revenue guarantee and marketing to initiate service to Chicago. They have no air service to the north and only fly to places south of the region, and this new service will address this shortfall in service.

The community is providing substantial local funding for the project, and while no specific airport in Chicago has been noted, given that American Airlines has expressed support the airport is assumed to be Chicago O’Hare.

Del Rio, Texas – $1,200,000

Del Rio lost all air service in April of last year and this grant would provide a revenue guarantee and marketing to initiate and support the resumption of service to the community. They would like to re-gain air service to Dallas/Ft. Worth or a similar destination, which was what service the airport had before American ended service here in 2022.

An American Eagle Embraer E145 departing (Photo: AirlineGeeks | Joey Gerardi)

The community is providing substantial local funding for the project, but they are the only community in this list that does not have a letter of support from an airline, confidential or otherwise, to start service to their desired airport.

Lynchburg, Va. – $600,000

This community will use the funding to have a revenue guarantee and marketing to initiate and support new service to Chicago, as well as support an aircraft ungauge and increase frequencies to Charlotte.

This will provide additional options for passengers with a western hub and increase connectivity as well as capacity. The community is providing very substantial funding for the project, and American Airlines has provided a letter of support for the service.

Richmond, Va. – $1,000,000

This community will use the funding to start more service to the West Coast, but more specifically Seattle. This will provide increased connectivity to Alaska, Hawaii, and western Canada as well. While they have service to the West Coast, they currently have no service to the Pacific Northwest. The community is providing substantial local funding for the project, and Alaska Airlines has provided a letter in support of the project.

An Alaska 737-900ER in Phoenix (Photo: AirlineGeeks | Katie Bailey)

Yakima, Wash. – $700,000

This funding will be used to restore something they had in the past; a second frequency on their current Seattle flights, but would accept and support service to an additional hub instead of the extra Seattle frequency.

The second frequency is crucial to the welfare of its business community and thus its local economy, and as such the community is providing local funding for the project as well. Alaska Airlines has provided a letter in support of the project.

Bottom Line

Just because a community has been awarded the funding or even has a letter of support, this doesn’t guarantee that an airline will start service on the desired or requested route. In fact, sometimes the awards and letters of support have fallen through in the past and communities don’t get the air service that they desire.

Joey Gerardi

Author

  • Joey Gerardi

    Joe has always been interested in planes, for as long as he can remember. He grew up in Central New York during the early 2000s when US Airways Express turboprops ruled the skies. Being from a non-aviation family made it harder for him to be around planes and would only spend about three hours a month at the airport. He was so excited when he could drive by himself and the first thing he did with the license was get ice cream and go plane spotting for the entire day. When he has the time (and money) he likes to take spotting trips to any location worth a visit. He’s currently enrolled at Western Michigan University earning a degree in Aviation Management and Operations.

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