Dive Brief:
- Pittsburgh International Airport is gearing up for a $1.1 billion overhaul to account for lower traffic volumes than it saw when it opened in 1992, the Pittsburgh Post-Gazette reported.
- The airport was built to handle 32 million travelers a year but today it sees only about 8.3 million annually. The new facility, which will include a new terminal, will be able to handle more than 18 million travelers, and costs per passenger will be lower upon completion.
- Bonds, grants, passenger facility charges and income from on-site natural gas drilling will be used to finance the project, along with savings from closing some current operations at the airport.
Dive Insight:
The reshaping of the domestic airline industry over the last two decades is a major contributor to Pittsburgh's need to downsize. The airport's construction was driven by U.S. Airways during a period of health for the airline and the industry, The New York Times reported. It soon became one of the airline's largest hubs.
As the airline's financial troubles grew, however, it began walking those plans back, including gradually reducing capacity and shuttering a 600-person operations center at the airport. By the end of 2015, the company had wrapped up its consolidation with American Airlines.
Beyond an overreliance on one airline, as was the case in Pittsburgh, changes in the regional economy can impact the health and wealth of its airports.
St. Louis’s Lambert International Airport, once one of the busiest airports in the country, saw annual passenger counts drop by nearly 70% from 2000 to 2015. That's in part due to high gate access fees charged by the cash-strapped airport, deterring airlines from flying in and out of the Midwest city, the St. Louis Post-Dispatch reported.
The Federal Aviation Administration has issued more than $2.3 billion in grant funding across 1,210 airports this year as part of its Airport Improvement Program (AIP). That money is typically used for infrastructure improvements, such as modest upgrades to runways, taxiways, signage and lighting that allow airports to maintain safe operations and increase capacity.
However, the AIP's $3.35 billion annual budget is not enough to handle large overhauls, like Pittsburgh's. U.S. airports face a $100 billion deficit for infrastructure improvements, and the user fees, grants and revenue that typically fund the work generate only half that amount, according to The Airports Council International–North America.
