Rural flight subsidies hit some turbulence

Missouri's Joplin Regional Airport has so few passengers in its new, big terminal that frequent-flier George Chen says "a novice golf hack can smack 10 drives and not come close to hitting a single person."

Only three commercial airline flights take off from Joplin on weekdays. Passengers board a 19-seat turboprop plane for a 48-minute flight on Great Lakes Airlines to Kansas City International Airport. There, they can connect to bigger cities on bigger airlines.

Last month, 316 passengers — an average of less than four per flight — departed from Joplin. The U.S. taxpayer subsidized those flights, and 412 passengers on arriving flights, by $129 per passenger.

Joplin is one of 152 rural communities with airline flights subsidized by the federal government's Essential Air Service (EAS) program. This year, taxpayers will pay about $123 million through the program to airlines to fly about 1 million passengers in and out of the communities, including 45 in Alaska. Without the subsidies, the communities wouldn't have airline service, because the routes aren't profitable.

The program — like the much larger $15 billion federal Airport Improvement Program, which funds small airports with no scheduled flights — is also controversial. Critics say the number of people flying doesn't justify the expense. Even supporters say it's fraught with problems.

The Essential Air Service program requires that a community be at least 70 miles from a large or midsize hub airport to qualify for a subsidy. But it's "a nice idea that's degenerated into a political boondoggle," says aviation consultant Michael Boyd.

Frequent-flier Chen, a Chicago consultant who has flown into Joplin, agrees. He says air service to small cities is "a noble concept," but government execution "is simply laughable."

Former president George W. Bush tried to substantially reduce funding to it but was blocked by Congress. President Obama said in his budget proposal this year that the program was inefficiently designed and needs to be more cost-effective.

The Transportation Department, which administers the program, said on Sept. 14 that it agreed with a July Government Accountability Office report recommending the agency evaluate whether air taxis or ground transportation might be better than airline flights for rural communities in the contiguous 48 states. Yet, the program has support. It's popular with many in Congress who represent the communities, which say air service is vital to their economic health.

"Good air service is essential to attracting business, maintaining a tourist industry and promoting jobs," says airline consultant Barbara Beyer. "For every dollar spent on aviation, $70 to $200 goes to the community in terms of jobs, hotel rooms, restaurants" and other areas.

Despite his concerns, Obama recommended that funding for the program increase to $175 million — and Congress will likely oblige before it recesses for the year.

High fares among problems

Although the airline industry has changed, the subsidy program hasn't since it began in 1978, when airlines were deregulated and could decide on their own where to fly. The program was designed to make sure service to smaller communities wasn't abandoned.

Now, airlines operate widespread hub-and-spoke route systems, giving fliers more options. Many low-fare airlines provide inexpensive flights in many small cities within driving distance of rural communities.

The drive from a rural community to a small-city airport may take less time, Boyd says, than a resident in a big city commuting to a local airport. He points to two communities with subsidized air service: Pueblo, Colo., which is 50 miles from the Colorado Springs airport, and Manistee, Mich., which is 59 miles from Traverse City, Mich., airport.

There are other concerns about the program:

•Fewer airlines participate. For various reasons, including high operating costs or lack of sufficient profit, only 10 airlines are in the program now compared with 34 in 1987, according to Transportation Department and GAO statistics.

•Number of flights. Airlines are required to provide a minimum of two daily round-trip flights, six days a week, to a hub airport. Though the recession has decreased the number of passengers, airlines can't reduce the number of flights.

•Aircraft requirements. Airlines are required to use planes with a minimum of 15 seats in flights to most communities. But aircraft manufacturers are no longer building the 19-seat planes used on most subsidized routes. They're also costly to refurbish and operate, and have too much capacity for the needs of some communities.

•Unattractive airfares. Fares for subsidized flights are 50% higher on average than for non-subsidized flights of similar distance, according to the GAO.

•Unreliable flights and unattractive schedules. Delays, cancellations and route and schedule changes are common for subsidized flights, the GAO found. There are fewer connecting flights than at larger airports, flight times are not as convenient, and flights aren't as frequent.

•A population shift from rural to urban areas. This is particularly true in the Midwest and may be partly responsible for a passenger decline in some communities with subsidized flights, the GAO says.

While the number of communities with subsidized flights has grown from 87 in June 2003 to 152 today, the number of passengers hasn't changed much.

The number of passengers fell from 1.1 million in 2007 to 960,000 last year. But the recession and service interruptions by airlines that stopped flying on some routes may account for the decrease, the GAO says.

The subsidized community with the fewest number of departing passengers is Alamogordo, N.M., which averages less than one a day on subsidized flights, according to Transportation Department statistics.

Many subsidized flights of New Mexico Airlines depart or arrive at Albuquerque with no passengers, says Parker Bradley, airport manager of Alamogordo-White Sands Regional Airport.

The government spends nearly $1 million annually to subsidize air service for Alamogordo, which has a population of about 35,000. It's a 31/2-hour drive to Albuquerque and less than two hours to El Paso, which has an international airport.

Bradley says subsidized flights benefit Alamogordo's community. Military personnel at nearby Holloman Air Force Base and medical personnel use them, he says, and they help attract business.

"For some businesses, it's the end of the conversation if you don't have scheduled service," Bradley says.

Airline consultant Beyer says it'd be "a disaster" for many communities — particularly isolated ones in the Midwest and West — if Congress heeded calls to eliminate the program.

Many in Congress agree. In a statement in May supporting Obama's proposed increase in funding for subsidies, Sen. Charles Schumer, D-N.Y., said, "Small local airports are expensive to run but vital to the communities they serve."

A 'mixed bag' in Joplin

Many frequent fliers, including some who've flown subsidized flights, question the program.

Bob McBride, a corporate recruiter, lives in Omaha. Nebraska has seven cities with subsidized air service.

"While I live in a state that is one of the major beneficiaries of the EAS program, the staggering subsidies required to support this program seem unjustified," he says.

McBride says the western two-thirds of the state is rapidly losing population, and flights there sometimes operate with no passengers in one direction and one passenger in another. He says subsidies could be eliminated for Alliance and Chadron, which are 57 miles and 99 miles, respectively, from Scottsbluff, another city with subsidies.

Frequent-flier John Cline, of Poland, Ohio, says he has considered flying into Joplin and other cities with subsidized air service, but found no convenient flights and fares more expensive than those to cities within a two-hour drive.

Cline, a technical service manager in the steel industry, says he saved money on a business trip by flying into Tulsa, then driving to Joplin.

Joplin's airport manager, Steve Stockam, says fares offered by Great Lakes Airlines on subsidized flights to Kansas City are reasonable.

Unlike many small communities who welcome subsidized airline service, Stockam says the program has been a mixed bag for Joplin.

Scheduled flights benefit businesses in the Joplin area, but program rules restrict flights to one airline, and passenger volume has been low, Stockam says. Great Lakes was chosen by the government to provide Joplin service, but it is not affiliated with a major airline and doesn't have a nationally known brand name, he says.

Joplin's airport hopes to get out of the program by persuading two or three airlines to serve their airport, which opened a new 22,000-square-foot passenger terminal last year. The airport has handled more passengers in the past, and there's a big enough market today to support non-stop flights to Dallas, Chicago, Memphis and St. Louis, besides Kansas City, Stockam says.

Consultant Boyd, whose company has worked with Joplin to try to increase air service, says the program is "a double-edged sword" for the area and a waste of money in places such as Pueblo and Manistee. But he says there's no doubt the program is vital in providing air service in Presque Isle, Maine, and rural communities in western Kansas.

Politicians "don't have the guts to fix" the program, Boyd says, although "triage has to be performed."

"(The program) is now aimed at running airplanes into small cities, not providing air service access to the rest of the world," he says. "No business traveler from Shanghai is going to jet into Atlanta and then cross the airport to get on a single-engine airplane for that last leg to Augusta, or wherever."

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