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An Airport Management Method for Canada in the 1990'S: Lessons from the Canadian and American Experience

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An Airport Management Method for Canada in the 1990'S: Lessons from the Canadian and American Experience AN AIRPORT MANAGEMENT METHOD FOR CANADA IN THE 1990'S: LESSONS FROM THE CANADIAN AND AMERICAN EXPERIENCE BY ROBERT GERALD LEWIS BRENNAN B.A., Carleton University, 1983 A THESIS SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS in THE FACULTY OF GRADUATE STUDIES (School of Community and Regional Planning) We accept this thesis as conforming to the required standard THE UNIVERSITY OF BRITISH COLUMBIA MAY 1988 Copyright, ROBERT GERALD LEWIS BRENNAN, 1988 In presenting this thesis in partial fulfilment of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. I further agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission. Department The University of British Columbia 1956 Main Mall Vancouver, Canada V6T 1Y3 DE-6(3/81) ii ABSTRACT During the last forty years metropolitan airports in Canada have been controlled by a federal authority and managed with a minimum of input from local sources. The situation under which this control was first initiated has changed radically since that time; a shrinking world combined with greatly increased traffic means that airports require more efficient planning and management of resources than in the past when they were not effectively integrated into an urban planning scheme. The thesis examines the effectiveness of airport management using five criteria: the implementation of a national aviation policy, the adrninistration of technology and aviation growth, the acquisition of funds for airport development, the effect of political suasion on airport management and the balancing of airport management goals and community goals. Several models of airport management from both Canada and the United States are used. The main aim is to show how decentralization of airport management is necessary to meet late- twentieth century and future demands. The research method for the thesis is a comparative analysis of airport management's effectiveness in Canada and the United States using the five criteria. The airports chosen for the thesis for both Canada and the United States represent the centres for moving seventy to eighty percent of the passenger traffic in these countries. It is concluded that the present Canadian federal ministerial management iii method has been unsuasessful in: implementing fully national aviation policies, responding effectively to the process of deregulation, reducing the political nature of development decisions at the airports, and providing funds for airport development where required. While American methods of airport management furnish useful insights they can not be applied in the same way in Canada because of different political structures. Airports under municipal control risk domination by local political issues and ineffective integration into a national and international network. The airport authority as an autonomous body offers the best structure for responding to the changing needs of a wide variety of users. The less partisan nature of the decision-making process of the airport authority would be a vast improvement over the ministerial approach for: implementation of a national aviation policy, the management of the process of deregulation, the elimination of unnecessary political intervention with airport decisions, and increased access to funds for airport development. iv TABLE OF CONTENTS TITLE i ABSTRACT ii CHAPTER ONE: CURRENT ISSUES IN AIRPORT MANAGEMENT 1 1.1 Management of airports, aviation & the cxxnunity 1 1.2 Purpose and Scope 6 1.3 Method of Research 7 1.4 Research Airports: Defintion 8 1.5 Thesis Organization 11 CHAPTER TWO: CANADA'S EXPERIENCE IN AIRPORT MANAGEMENT 12 2.1 Canadian Aviation History 1900-1960 12 2.1.0 Constitutional Jurisdiction 12 2.1.1 Canada 1900-1919: The Formative Years 13 2.1.2 Canada 1920-1929: Governments First Steps 15 2.1.3 Canada 1930-1939: The Depression Years 17 2.1.4 Canada 1939-1945: World War II 19 2.1.5 Canada 1950-1960: Airport Development & Surburbanization 21 2.2 Canadian Aviation Policy 1960-1986 23 2.2.0 Traditional Role of Government 23 2.2.1 Royal Commission on Transportation Policy 1961 23 2.2.2 Task Force on Transportation 1979 25 2.2.3 Airport Development & Environmental Concerns 28 2.2.4 Alberta Land Use Policy & Airports 1978 29 2.2.5 Liberalization of Airline Regulations 1984 30 2.2.6 Government Spending Reviews 1985 32 2.3 Canadian Airport Management Structure 34 2.3.0 Canadian Federal Ministerial Management Structure 34 2.3.1 Restructuring of Department of Transport 1969 34 2.3.2 Airport Authority Group 1985 37 2.4 Canadian Aviation Growth & Technological Change 39 2.4.0 Impact of Technological Advancement on Airports 39 2.4.1 Aviation Growth: Passenger Trends 1968-1984 44 TABLE I Canadian Eastern Airport Passenger Movements 45 TABLE II Canadian Western Airport Passenger Movements 47 2.4.2 Mega-Carriers and Canadian Airports 49 2.4.3 Hub-&-Spoke Operations and Canadian Airports 50 V 2.5 Canadian Airport Financing 53 2.5.0 Traditional Financial Sources 53 2.5.1 Approval Process (1986): Step One - Approval in Principle 53 2.5.2 Approval Process (1986): Step Two - Project Approval 55 2.5.3 Airport Financial Management (1986): Bottlenecks 57 2.6 Effects of Political Suasion on Airport Management in Canada .. 59 2.6.0 Political Suasion and the Ministrial Structure 59 2.6.1 Intention of Ministerial Decisions 60 2.6.2 Implementation Ministerial Decisions 60 FLOWCHART 1 Ministry of Transport Management Structure 61 2.6.3 Flexibility of Ministerial Decisions 62 2.6.4 The Hidden Agenda of the Ministerial Decisions 63 2.6.5 Symbolic Ministerial Decisions 64 2.6.6 Ideological Content of Ministerial Decisions 65 2.6.7 Financial Accountability of Ministerial Decisions 65 2.6.8 Social Costs of Ministerial Decisions 66 2.7 Canadian Airports: Balancing Ccflffliunity & Management Goals . 67 2.7.0 Airport Development and Community Input 67 2.7.1 Solution One: The Environmental Airport 69 2.7.2 Solution Two: Expansion of Airports 73 2.7.3 Solution Three: The "No-Build" Option 74 2.8 Conclusions: lessons Learned from Canadian Experiences .. 76 2.8.1 Early Canadian Aviation 1900-1960 76 2.8.2 Government Aviation Policy 1960-1986 76 2.8.3 Canadian Airport Management Structure 77 2.8.4 Canadian Aviation Growth & Technological Change 77 2.8.5 Financing Canadian Airports 78 2.8.6 Impacts of Political Suasion on Canadian Airports 78 2.8.7 Canadian Airports: Balancing Community & Management Goals 79 CHAPTER THREE: AMERICA'S EXPERIENCE IN AIRPORT MANAGEMENT 81 3.1 American Aviation Early History 1900-1960 81 3.1.0 United States 1900-1930: Early Beginnings 81 3.1.1 United States 1930-1939: The Depression Years 82 3.1.2 United States 1939-1945: World War II 83 3.1.3 United States 1950-1959: Airports & Suburbanization 84 3.2 American Federal Policy 1960-1986 86 3.2.0 Department of Transportation Act 1966 86 3.2.1 Airport and Airway Development Act 1970 (AADA) 87 3.2.2 Airport and Airway Development Revenue Act 1970 (AADRA) 87 3.2.3 American Airport Development & Environmental Concerns 88 3.2.4 American Domestic Airline Deregulation 1978 90 3.2.5 Airport and Airway Improvement Act 1982 (AAIA) 92 vi 3.3 American Airport Management Structures 93 3.3.0 Historical Choices 93 3.3.1 The Municipal Department and the Municipal Gsmmission 94 3.3.2 The American Airport Authority 96 3.3.3 The Federal Component of American Airport Management 100 3.4 American Airport Growth & Technological Change 101 3.4.0 American Airports and Technological Advancements 101 3.4.1 American Passenger Trends 1960-1984 107 TABLE III American Eastern Airport Passenger Movements 109 TABLE IV American Western Airport Passenger Movements 112 3.4.2 Mega-Carriers and American Airports 113 3.4.3 Hub-&-Spoke Operations and American Airports 114 3.5 American Airport Financing 120 3.5.0 Approaches to Financial Management 120 3.5.1 The Use of Majority-in-Interest Clauses 121 3.5.2 Types of Bond Issues 123 3.5.3 Impact of Airline Deregulation on Airport Financing 123 3.5.4 The Future of the Airport & Airways Trust Fund (AATF) 125 3.6 Effects of Political Suasion on Airport Management in America . 127 3.6.0 Political Suasion and American Airport Management 127 FLOWCHART 2 Municipal Department Management Structure 128 FLOWCHART 3 Municipal Commission Management Structure 129 FLOWCHART 4 Airport Authority Management Structure 130 3.6.1 Accountability of Political Suasion 132 3.6.2 Flexibility of Political Decisions 133 3.6.3 Hidden Agenda of Political Decisions 134 3.6.4 Speed of Implementation of Political Decisions 136 3.6.5 Social Costs of Political Decisions 137 3.7 American Airports: Balancing Qxmunity & Management Goals .. 139 3.7.0 Airport Development and OOTnunity Input 139 3.7.1 Solution One: The Environmental Airport 142 3.7.2 Solution Two: Expansion of Airports 143 3.7.3 Solution Three: The "No-Build" Option 144 3.8 Conclusions: Lessons Learned from the American Experience .. 146 3.8.1 American Early Aviation 1900-1960 146 3.8.2 American Government Policy 1960-1986 147 3.8.3 American Airport Management Structures 147 3.8.4 American Aviation Growth & Technological Change 148 3.8.5 Financing American Airports 149 3.8.6 American Airports: Impacts of Political Decisions 150 3.8.7 American Airports: Balancing Community & Management Goals 150 vii CHAPTER FOUR: AIRPORT MANAGEMENT IN CANADA: BEYOND 1990 152 4.0 Conclusions 152 4.1 Method of Management: Airport Authority 152 TABLE V Evaluation of Airport Management Methods 153 4.2 Method of Management: Municipal Commission 155 4.3 Method of Management: Municipal Department 157 4.4 Method of Management: Federal Ministry (CANADA) 159 4.5 Recommnedations: Airport Management in Canada in the 1990s .
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