Legislative Budget and Finance Committee
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Legislative Budget and Finance Committee A JOINT COMMITTEE OF THE PENNSYLVANIA GENERAL ASSEMBLY Offices: Room 400 • Finance Building • Harrisburg • Tel: (717) 783-1600 Mailing Address: P.O. Box 8737 • Harrisburg, PA 17105-8737 Facsimile (717) 787-5487 SENATORS JOHN R. PIPPY Chairman GERALD J. LAVALLE Vice Chairman JAY COSTA, JR. ROBERT M. TOMLINSON ROBERT C. WONDERLING Economic Impact of the Proposed JOHN N. WOZNIAK Greater Hazleton Air Cargo Airport REPRESENTATIVES ROBERT W. GODSHALL Secretary DAVID K. LEVDANSKY Treasurer STEPHEN BARRAR H. SCOTT CONKLIN ANTHONY M. DELUCA T. MARK MUSTIO Conducted Pursuant to SR 2007-144 EXECUTIVE DIRECTOR PHILIP R. DURGIN CHIEF ANALYST JOHN H. ROWE, JR. June 2008 Economic Impact Of The Proposed Greater Hazleton Air Cargo Airport Prepared For: Pennsylvania Legislative Budget and Finance Committee June 2008 MARTIN ASSOCIATES WEBBER AIR CARGO Hazleton, PA Cargo Study TABLE OF CONTENTS INTRODUCTION AND OVERVIEW CHAPTER – 1 PROPOSED AIR CARGO AIRPORT MARKET ANALYSIS 1.1 Introduction.................................................................................................................................... 1-1 1.2 The Air Cargo Industry: Condition................................................................................................. 1-1 1.3 The Air Cargo Industry: Components............................................................................................ 1-3 1.3.1 Integrators............................................................................................................................. 1-3 1.3.2 All-Cargo Airlines .................................................................................................................. 1-7 1.3.3 Passenger & Combination Carriers ...................................................................................... 1-9 1.3.4 Freight Forwarders ............................................................................................................... 1-9 1.4 All-Cargo Airports ........................................................................................................................ 1-10 1.4.1 Fort Worth Alliance ............................................................................................................. 1-11 1.4.2 Rickenbacker International Airport (LCK)........................................................................... 1-13 1.4.3 Midamerica (St. Louis) Airport ............................................................................................ 1-14 1.4.4 North Carolina’s Global Transpark ..................................................................................... 1-15 1.4.5 Other North American All-Cargo Airports ........................................................................... 1-17 1.5 Regional Airports......................................................................................................................... 1-18 1.5.1 Regional Trends ................................................................................................................. 1-19 1.5.2 Carrier Composition............................................................................................................ 1-19 1.5.3 Other Regional Airports Offering Cargo Capacity .............................................................. 1-22 1.5.4 Other Regional Air Cargo Reports...................................................................................... 1-22 1.6 Forecasts..................................................................................................................................... 1-26 1.6.1 Overview............................................................................................................................. 1-26 1.6.2 Years One Through Five: Integrator Regional Hub Operation........................................... 1-28 1.6.3 Years Six Through Twenty: Diversification Of Carriers ...................................................... 1-29 1.7 Air Cargo Market Conclusions..................................................................................................... 1-34 CHAPTER – 2 AIR CARGO INFRASTRUCTURE NEEDS 2.1 Introduction ................................................................................................................................... 2-1 2.2 Infrastructure Requirements ......................................................................................................... 2-1 2.2.2 Runway Length Analysis .......................................................................................................... 2-2 2.2.3 Taxiways .................................................................................................................................. 2-4 2.2.4 NAVAIDS ................................................................................................................................. 2-5 2.2.5 Apron ........................................................................................................................................ 2-5 2.2.6 Air Traffic Control Tower .......................................................................................................... 2-6 2.2.7 Airport Rescue and Fire Fighting Building and Equipment...................................................... 2-7 2.2.8 Snow Removal and Airport Maintenance Equipment Building ................................................ 2-7 2.2.9 Airport Administration Building ................................................................................................. 2-7 2.2.10 Aircraft Fueling ..................................................................................................................... 2-8 2.2.11 Aircraft De-icing ................................................................................................................... 2-8 2.2.12 Fencing and Security ........................................................................................................... 2-8 2.2.13 Airport Access ...................................................................................................................... 2-8 2.2.14 Airport Utilities ...................................................................................................................... 2-8 2.3 Estimates of Probable Construction Costs ................................................................................... 2-9 2.4 Summary .................................................................................................................................... 2-13 Table of Contents June 2008 Hazleton, PA Cargo Study CHAPTER – 3 ECONOMIC IMPACT ASSESSMENT OF THE PROPOSED HAZLETON CARGO AIRPORT 3.1 Overview and Approach ................................................................................................................ 3-1 3.2 Review of Developer Economic Impact Assumptions, Methodology and Results........................ 3-1 3.2.1 Review and Assessment of Developer Assumptions and Methodology in Developing Economic Impact Analysis ...................................................................................................................................... 3-1 3.2.2 Review of Developer Economic Impact Results ....................................................................... 3-4 3.2.3 Summary of Developer’s Economic Impact Analysis Methodology and Assumptions............. 3-5 3.3 Consultant’s Independent Economic Impact Analysis of Air Cargo Activity at the Proposed Hazleton Cargo Airport............................................................................................................................... 3-6 3.3.1 Consultant’s Approach to Airport Economic Impact Analyses.................................................. 3-6 3.3.2 Impact Structure........................................................................................................................ 3-7 3.3.3 Methodology.............................................................................................................................. 3-9 3.3.4 Data Collection........................................................................................................................ 3-12 3.3.5 Comparison Of Consultant And Developer Air Cargo Impact Results ................................... 3-13 3.3.6 Summary Of Impacts Based On Consultant’s High Case Forecast ....................................... 3-16 3.3.7 Tax Impacts............................................................................................................................. 3-20 3.4 Economic Impacts Of Proposed Construction Activity................................................................ 3-20 3.5 Economic Impacts of Industrial Development of Adjacent Land................................................. 3-21 3.6 Summary of Economic Benefits to the Commonwealth.............................................................. 3-23 CHAPTER – 4 ECONOMIC IMPACT ASSESSMENT OF THE PROPOSED HAZLETON CARGO AIRPORT 4.1 Transportation Impact Assessment............................................................................................... 4-1 4.1.1 Background........................................................................................................................... 4-1 4.1.2 Highways .............................................................................................................................. 4-2 4.1.3 Railroads............................................................................................................................