FRANCIS S. GABRESKI AIRPORT BUSINESS PLAN
Prepared for: New York State Department of Transportation in behalf of Sullivan County Department of Public Works Monticello, NY Suffolk County New York
February 2002 TABLE OF CONTENTS
1. INTRODUCTION ...... 1 1.1 Vision ...... 1 1.2 Key Issues ...... 2 1.3 Desired End Products ...... 4 1.4 Report Outline ...... 4
2. BACKGROUND AND MANAGEMENT STRUCTURE ...... 5 2.1 Historical Mission of the Airport ...... 5 2.2 Historical Performance Meeting the Mission ...... 6 2.3 Airport Management Structure ...... 7
3. EXISTING AIRPORT CHARACTERISTICS...... 9 3.1 Introduction ...... 9 3.2 Airport Development Plan ...... 15 3.3 Market Analysis ...... 23
4. BASELINE FINANCIAL AND ECONOMIC OUTLOOK ...... 29 4.1 Historical Revenues and Expenses ...... 29 4.2 Baseline Forecast of Revenues & Expenses ...... 31
5. BUSINESS PLAN ALTERNATIVES ...... 34 5.1 Area-wide Factors Supporting Growth and Development of the Airport ...... 34 5.2 Obstacles to Airport Performance and Goal Attainment...... 35 5.3 Revenue Enhancement ...... 36 5.4 Cost-Efficiency/Management Structure Options...... 43
6. RECOMMENDED PLAN...... 46 6.1 Recommended Management/Administrative Actions ...... 46 6.2 Revenue Enhancement Recommendations ...... 47
7. SUMMARY OF BUSINESS PLAN RECOMMENDATIONS ...... 54 7.1 Timetable and Trigger Points ...... 56
8. ECONOMIC IMPACT ASSESSMENT ...... 58 8.1 Goals and Methods of Analysis ...... 58 8.2 Results of Analysis ...... 59 8.3 Non-monetary Impacts ...... 60 TABLE OF CONTENTS (Cont.)
LIST OF TABLES Table 1 - Airport Development Areas...... 20 Table 2 - Airport Capital Improvement Plan (ACIP) ...... 22 Table 3 - Facility Comparisons ...... 27 Table 4 - Service Comparison...... 27 Table 5 - Rates and Charges Comparison...... 28 Table 6 - Suffolk County Gabreski Airport Historical Revenues ...... 30 Table 7 - Suffolk County Gabreski Airport Historical Expenses ...... 30 Table 8 - Baseline Forecast of Airport Revenues ...... 32 Table 9 - Baseline Forecast of Expenses: Suffolk County-Gabreski Airport ...... 33 Table 10 - Potential Demand Changes by Year 2005 ...... 40 Table 11 - Potential Increases Resulting from All Revenue Enhancement Strategies . . 42 Table 12 - Forecast of Expenses Associated with Revenue Enhancement Options ....45 Table 13 - Action Plan Trigger Points: Suffolk County - Gabreski Airport ...... 56 Table 14 - Direct, Indirect, and Induced Economic Impacts ...... 59
LIST OF FIGURES Figure 1 - Organization Chart ...... 8 Figure 2 - Location Map ...... 10 Figure 3 - Existing Airport Layout ...... 13 Figure 4 - Surrounding Land Use ...... 17 Figure 5 - Airport Development Plan ...... 19 Figure 6 - Airport Service Area...... 24 Figure 7 - Historical Revenues & Expenses ...... 31 Figure 8 - Impact of Market Factors: Aviation Lease Fees...... 44 Figure 9 - Impact of Market Factors: Non-Aviation Fees...... 44 Figure 10 - Strategic Impact of Market Factors on Revenues...... 44 Suffolk County - Gabreski Airport Business Plan February, 2002
SUFFOLK COUNTY - GABRESKI AIRPORT BUSINESS PLAN
1. INTRODUCTION
UFFOLK COUNTY HAS ACCEPTED SERVICES TO conduct an airport business plan for the Gabreski Airport to examine potential development and operational options for the purpose of providing Sincreased benefits to the County and local community. This evaluation must consider all of the on-airport and off-airport impacts associated with various development options. Key to this understanding is the fact that the local residents are adamant about limiting Airport-related aircraft noise. Mindful of this position, the business plan must examine the operation and business practices at the Airport and suggest improvements that will benefit the local area without noticeably increasing the level of noise exposure associated with the Airport’s operation.
1.1 Vision
When the 1,486 acre Airport was first acquired by the County in 1971, the acquisition came at short notice and without a plan for its operation and development, as was the case for other military air base transitions. For many years, the Airport served primarily as an Air National Guard facility, housing the military operations and providing a base for training. However, the general aviation and business segment of the airport remained somewhat dormant and without a plan for the Airport=s business development nor a role in the County=s transportation infrastructure. That changed in 1995-1996 when a Gabreski Task Force was commissioned to study the development of the Airport. From that Task Force work, a vision for the Airport began to take shape. Since that report was issued, the County has added other components, but the main focus can be summarized to include: security plan, continued maintenance and upgrade of existing facilities, potential economic development of Airport property, strict interpretation of environmental laws and regulations, and continued convenience for all users.
! Security Plan: In light of the terrorist attack on the U.S., all airports will need to reevaluate their security plans. Gabreski Airport, as an Air National Guard facility will have heightened security issues that will require separate planning and analysis.
! Maintenance and Upgrading of Existing Facilities: The County recognizes that the Airport represents a significant investment in air transportation infrastructure. The Airport also serves a role in support of the Air National Guard. For these reasons and in order to upgrade safety margins at the Airport, a capital improvement program has been submitted in the 2003 budget that will address a number of infrastructure aging needs at the Airport.
! Potential Economic Development of Airport Property: In 1998, the FAA released 58.6 acres for development as a light industrial park. This property has been
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designated a Planned Development District (PDD) by the Town of Southampton. As a former military base, Gabreski Airport has a significant amount of property that is not being used for aviation purposes. It is believed that more land, in addition to the 58.6 acres, is available for compatible development - both aviation and non-aviation. This development will help to offset the cost of operating the Airport, while at the same time produce jobs and income for the local community.
! Strict Interpretation of Environmental Laws: The location of the Airport near residential sections of Westhampton Beach has underscored the need to be environmentally sensitive to the concerns of local residents. This facet of the overall vision for the Airport is meant to create trust between the County leaders who manage the Airport and the community. This principle, however, is two-edged in that economic development often requires some trade-offs. A zero-growth policy, for example, precludes the increase in revenues that would occur with greater Airport activity.
! Continued Convenience for All Users: Despite a desire by some local citizens to limit growth and activity at the Airport, there is a genuine desire on the part of the County to serve all airport users. The Air National Guard is a tenant with a long term lease. Their presence incorporates aspects of national security, disaster relief, and other essential programs. In addition, a number of companies have aircraft based at the Airport and need access during all types of weather conditions. While there are some negative attitudes toward the Airport in adjacent residential sections, these concerns must be balanced against the necessary air transportation function that the Airport provides. For this reason, it is important to show both the economic and intangible benefits associated with the Airport.
1.2 Other Key Issues
There are a number of key issues that must be addressed by this analysis. These issues are varied but all carry a theme of improving airport facilities, financial performance, and area economic development:
! Integration of the Airport into the Local Economy: There is a need for a plan that expresses the vision for the Airport=s future use and integration into the local economy. Development of a strategic plan to achieve the objectives of the Airport sponsor in consideration for the concerns of: the aviation community, the military, the residential community, business interests, and FAA, will meet this need.
! Infrastructure Needs: Approach lights and localizer to Runway 24 have been out of service since 1999. These conditions, along with any other runway, taxiway, or apron paving needs should be addressed in order to maintain safety margins at the Airport. In addition, basic maintenance of terminal facilities and bathrooms, etc., is required to attract corporate clientele and project a high-quality image to users.
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! Local Environmental Concerns: A balance needs to be worked out between the development of Airport assets and noise concerns of area residents. One method of dialogue is to consider noise reduction plans with new abatement procedures for aircraft operations. In addition, any development at the Airport must be compatible with the Central Pine Barrens Plan.
! Jurisdictional County/Town Issues: Jurisdiction of the Town and County at the Airport concerning its operation, management, and marketing to business and industry should be addressed. The length of local review time to advance development is considered excessive by applicants. In addition, potential development measures such as a special tax district, a sub-area of the Foreign Trade Zone, and an Airport oversight entity need to be coordinated in a manner that is agreeable to both Town and County.
! Interaction with Air National Guard: Operational and cost issues associated with the Air National Guard need to be reviewed. The most advantageous operational arrangement for both military and airport sponsor is desired, and this study can comment on that arrangement.
! Corporate Aviation Users: Assessment of the benefits versus costs of attracting more corporate aviation users to the Airport should be undertaken.
! Excess Property Release: Identification and release of Airport property that is not needed for aviation use should be structured for optimum benefit to the Airport and the community.
! Revenue Diversion: FAA requires that money earned from Airport operations not be diverted to other uses within a community. They also require open competitive services. A segregated accounting system and attention to FAA concerns may help to facilitate capital funding.
! Economic Benefits of the Airport: The County desires that economic benefits associated with the Airport be quantified. These benefits are usually stated in terms of jobs, income, and output. But there are other intangible benefits associated with the Airport. These benefits, described earlier, relate to the use of Airport property for community outreach and economic development. It is important that the full value of the Airport be identified as a means of “balancing” those benefits against any negative perceptions about the Airport.
In essence, the Airport has development potential that requires a strategic focus. Given the size of the facility and the options for noise abatement procedures, the Airport can be a very good neighbor and still reach a high degree of optimum use. However, the direction and scope of the Airport=s development must be amenable to the County, town, community, and FAA before any significant plan can be implemented.
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1.3 Desired End Products
The end products resulting from this analysis include the following:
! A well-defined mission statement for the airport. ! An identification and evaluation of needs, opportunities, and challenges facing the Airport. ! An evaluation of current Airport business operating practices. ! Strategic planning recommendations for the Airport. ! A five year projection of revenues and expenses at the Airport for the baseline case and alternative scenarios. ! Graphic materials for Airport promotion and marketing. These may include color ALPs, photos, and/or brochures, depending upon specific needs. ! An economic impact evaluation of the Airport, identifying jobs, income, and total output associated with the facility.
1.4 Report Outline
In order to address the issues described above and to produce the desired end products, this report has been organized to include the following sections:
! Section 1 - Introduction ! Section 2 - Background and Management Structure ! Section 3 - Existing Facilities and Infrastructure ! Section 4 - Baseline Financial and Economic Outlook ! Section 5 - Business Plan Alternatives ! Section 6 - Recommended Plan ! Section 7 - Summary of Business Plan Recommendations ! Section 8 - Economic Impact Assessment ! Appendix A - Lease Agreement Summaries ! Appendix B - Innovative Marketing Strategies
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2. BACKGROUND AND MANAGEMENT STRUCTURE
NDERSTANDING THE BACKGROUND AND MANAGEMENT STRUCTURE of the Airport helps management identify some of the challenges and opportunities facing the County. UManagement structure affects the ability of the Airport to reach its potential. A clearly defined, current, and realistic mission for the Airport provides the oversight framework to achieve opportunities as they arise. Therefore, this analysis is geared toward the future and toward positioning the Airport to take best advantage of its assets and strengths. As such, this section is organized to include the following:
! Historical mission of the airport ! Historical performance toward meeting that mission ! Airport management structure S Organizational structure S Airport staffing
2.1 Historical Mission of the Airport
Although there is no written mission statement for Gabreski Airport, the following overall mission statement could be used for the Airport:
! Suffolk County Gabreski Airport strives to provide safe, quality airport facilities and services to its based aircraft owners and the flying public, while at the same time, operating compatibly with its neighbors, and providing an economic benefit for eastern Long Island.
Performance goals supporting this mission would include:
Performance Goals ! Operate the Airport in a safe, efficient, and convenient manner. ! Strive to reduce expenditures and increase revenues at the Airport, without sacrificing needed services. ! Encourage private sector investment in the utilization of the Airport’s facilities. ! Pursue funding for and implementation of capital improvement projects to improve safety and usability of the Airport. ! Supplement economic development goals of Suffolk County and the local area as opportunities arise within the Airport Planned Development District. ! Encourage compatible public use of Airport facilities or property, where possible and appropriate. ! Respond to noise and other complaints quickly and courteously.
Operating objectives supporting the mission and spelled out in the Joint Use Agreement between the County and the Air National Guard include the following:
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Operating Objectives ! Perform any and all maintenance on the Airport including but not limited to: S Joint sealing, crack repair, surface repairs, airfield markings and repair or replacement of damaged sections of airfield pavement; S Runway, taxiway, and approach lighting and their regulators and controls; S Beacons, obstruction lights, wind socks, and other navaids (except TACAN) S Grass cutting and grounds care, drainage, and dust and erosion control of unpaved areas adjacent to runways and taxiways; S Sweeping runways and taxiways; S Controlling insects, pests, and mammals. ! Furnishing utilities necessary to operate the Airport ! Removing disabled aircraft ! Providing maintenance for the airport control tower
2.2 Historical Performance Meeting the Mission
Discussions with Airport management and County leadership indicate that the Gabreski Airport has met and is meeting most of the performance goals and operating objectives described above. This would include the following:
! Strive to reduce expenditures and increase revenues at the Airport, without sacrificing needed services. ! Encourage private sector investment in the utilization of the Airport’s facilities. ! Pursue funding for and implementation of capital improvement projects to improve safety and usability of the Airport. ! Supplement economic development goals of Suffolk County and the local area as opportunities arise within the Airport Planned Development District. ! Encourage compatible public use of Airport facilities or property, where possible and appropriate.
There are two areas where there is room for improvement. The first involves the maintenance operating objective. In this regard, the approach lights and localizer to Runway 24 have been out of service since 1999. These landing aids need to be maintained and recommissioned in accordance with the joint use agreement with the military. The second area involves the Airport’s mechanism for responding to noise and other complaints. Many successful programs ensure that complaints are answered and specific actions are taken to respond to the complaint. Despite to staff shortages, these types of programs are being implemented at Gabreski.
On the positive side, the County is encouraging economic development and private investment at the Airport. The designation of the Planned Development District at the Airport allows the adoption of specific development standards on a planned basis in order to conserve natural resources and provide opportunities for compatible growth in a way not achievable by conventional land use regulations. Strategic economic development actions by the Town of Southampton and the County have resulted in the development of roughly 59 acres for a non-
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aviation business/light industrial park on the Airport property. This property has been released by the FAA from Airport commitments and can be fully developed for non-aviation purposes. Additional airport property remains available, some of which was enhanced by the razing of over 60 small dilapidated Air Force buildings.
Several other factors position the airport for development including: a new waste water treatment plant, natural gas, new water service, and cable telecom on site as well as fiber optic cable being installed 2 miles north of the Airport. The Airport is a receiving zone for Pine Barrens development credits, which means that development density on the property can be increased with the purchase of these credits. There is also limited space around the airport for light industry development. This development can be supported by the newly operational sewage treatment facility serving the Air National Guard and future growth and redevelopment of the Airport. These factors all help to position the airport to attract businesses compatible with sponsor and community goals.
2.3 Airport Management Structure
The description of the Airport management structure includes a discussion of the formal lines of authority and decision making process along with Airport staffing.
Organizational Structure
The Gabreski Airport is operated by Suffolk County and as such is subject to the organizational and management structure of the County. The Airport is classified under the Suffolk County Department of Economic Development, which is in the direct line of communication and authority from the Office of Commissioner. The organizational chart for the Airport is shown in Figure 1. Most of the decisions concerning budgeting, grants, and policy must be taken through the appropriate channels within the Department of Economic Development. This system is relatively new and replaces the previous organizational reporting structure through the Department of Public Works. It is believed that this structure, if staffed appropriately, will work well in the overall development of the Airport and its economic assets.
One issue that involves the administrative structure is a desire on the part of the County to streamline the application approval process for businesses desiring to locate in the Airport Planned Development District. Waiting for Town approvals can take as long as 18 months. Many businesses looking for a place to locate can’t wait that long and ultimately go elsewhere. By streamlining the process, it is believed that marketing and new business attraction will be much easier. One advantage of the new administrative structure involves the marketing of the Airport. Since the Department of Economic Development is responsible for the Airport, marketing of the facility can be coordinated with County-wide projects. In this regard, the desire to develop Airport property for both aviation and non-aviation purposes could be enhanced by coordinated marketing that involves the Airport.
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Airport Staffing
Currently, the Airport Manager’s position is vacant and the Assistant Airport Manager has become the de facto Airport Manager. At some time in the near future, the County plans to promote the Assistant Airport Manager to Airport Manager and hire a new Assistant. Other Airport staffing requirements are being studied by the Department of Economic Development.
Given the size and complexity of Gabreski Airport, the facility is severely understaffed. With administration of both the aviation and non- aviation portions of the Airport, more than one person is needed to cover all of the required areas. The Assistant Airport Manager has a staff of four to help with the operation of the Airport. This small group is “stretched” to oversee and control all of the electric, maintenance function, all of the planning, all of the tenant relations (including the Air National Guard unit), all of the marketing, and all of the aviation/Airport operational issues including purchasing, public relations, lease review, grant applications, etc. In short there are classic “span of control” issues that should be examined as a part of this analysis.
Contractual requirements of the County in their Figure 1 - Airport Organization Chart lease agreement with the Air National Guard indicate a split in the facility maintenance and operation responsibilities. The County is responsible for daily inspection and maintenance of the aeronautical areas: 3 runways, perimeter taxiways, aircraft parking, electrical systems, lighting systems, water mains, fire hydrants, some snow and ice control, grass cutting, bird and deer control, various aviation buildings along with Airport roads and parking lots. In addition, administrative and planning responsibilities lie with the County. Staffing needs to fulfill these responsibilities will be assessed later in this report.
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3. EXISTING FACILITIES AND INFRASTRUCTURE
3.1 Introduction
he Francis S. Gabreski (Suffolk County) Airport is located adjacent to the Village of Westhampton Beach in the Town of Southampton, Suffolk County, New York (Figure 2). TThe Airport occupies approximately 1,486 acres of land 3 miles north of the Atlantic Ocean. Westhampton Beach is 78 miles east of New York City, in an area that has long been a popular summer vacation destination for residents of the metro area.
The Airport was established as a military facility in 1939, and has remained in continuous operation since that time. The current owner, Suffolk County, gained possession from the U.S. Air Force in 1971. The Airport has been designated as a Joint-Use Facility under a joint-use agreement between Suffolk County and the Federal Government. The Airport is included in the National Plan of Integrated Airport Systems (NPIAS), and is classified as a General Aviation (GA), Airport. It is eligible for federal and state funding assistance for the planning, design, and construction of non- revenue generating, public-use portions of the Airport.
Suffolk County Airport has three runways. Runway 6/24 is 9,000 feet long and 150 ft wide. Runways 1/19 and 15/33 are 5,000 feet long and 150 feet wide. Both 6/24 and 15/33 have 1,000- foot overruns at each end. The airfield has a partial parallel taxiway on the north side of Runway 6/24 and a circular type taxiway system connecting the remaining runways. Landside development, consisting of numerous military surplus buildings and approximately 12 acres of paved apron, is primarily on the west side of the airfield, along Old Riverhead Road (CR-31). The 106th Rescue Wing of the New York State Air National Guard (NYANG) occupies an 89.4-acre site in the southwest portion of Airport property.
Aviation Activity
Annual aircraft operations (landings and takeoffs) at the Airport totaled 98,223 in 1999, according to the FAA’s Terminal Area Forecast (TAF). Local GA operations have accounted for an average of 70% of all operations during the past three years. Aviation services available at the Airport include fuel sales (both 100LL and JetA), major aircraft maintenance, avionics, charter flights, flight training, glider towing, aircraft rental, aircraft sales and banner towing. Aviation related businesses at the Airport include the following:
! Island Aerial (banner towing) ! Alli-Jen Aviation (parking, aircraft maintenance) ! American Airman School (flight instruction) ! Daedalos Flight School (flight instruction) ! Eastview Flyers (hangars) ! Long Island Early Flight (aviation museum storage)
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! Ocean Aviation (airplane rides) ! Oldham Construction (hangars) ! Long Island Jet Center (FBO, charter, car rentals, fuel, flight instruction) ! Malloy Air East (FBO, fuel, hangars) ! Sea Empty (hangars) ! Sky Sailors (flight instruction, tours)
The Airport’s primary tenant, however, is the New York Air National Guard. The NYANG operates an enclave within the Airport boundary that consists of approximately 89.4 acres, most of which is extensively developed with hangars, maintenance facilities, training facilities, administrative offices, and parking areas. This area is located in the southwestern portion of the Airport and is restricted to NYANG personnel only. Access is available directly from County Road 31, separate from the main Airport entrance. Other NYANG facilities outside of this area include a new fuel farm and a fire training area and munitions storage in the southern quadrant of the Airport.
The Guard conducts approximately 500 operations per month, although during summer months operational totals can exceed 800. These operations are primarily conducted by large transport aircraft, such as the C-130 and HH60 helicopters.
Capacity
According to the New York State Aviation System Plan (SASP) prepared in 1998, the Annual Service Volume (ASV), or operating capacity, at Suffolk County Airport is 230,000 operations. At the current level of 98,223 operations, the Airport is operating at approximately 43 percent of capacity on an annual basis. The critical aircraft for design purposes is the Lockheed- Martin C-130 Hercules. This is a large four-engine aircraft with a maximum takeoff weight of 155,000 pounds. Based on the C-130’s approach speed, wingspan and weight, the Airport Reference Code (ARC) for the Airport is C-IV. Given the large demand/capacity ratio, no operational capacity constraints are anticipated within the foreseeable future.
Airfield Conditions and Needs
The Airport's existing Airport Layout Plan (ALP) indicates that the Runway Safety Areas (RSA) and Runway Object Free Areas (ROFA) surrounding the runways meet standards for all six runway ends. For Runway 6/24, these areas are based on the design aircraft (ARC C-IV). For Runways 1/19 and 15/33 they are based on use by small aircraft exclusively. Recent activity reports indicate that Runway 15/33 may be upgraded to a more demanding category of use, but if so the provision of standard safety areas is not expected to be a problem as sufficient clear land is available. High intensity runway edge lighting is installed along Runway 6/24, medium intensity runway edge lighting is along Runway 15/33, and no runway edge lighting is provided for Runway 1/19. The existing airfield layout is illustrated in Figure 3.
The New York State Aviation Pavement Management System Report, published in 1999,
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evaluated the airfield pavement conditions at the Airport and other airports throughout the state on a system-wide basis. The Runway 1/19 pavement surface includes areas of Portland cement, asphalt overlay and asphalt reconstruction. The overall condition of this runway was rated at a PCI (Pavement Condition Index) of 60.5, which requires immediate attention in order to prevent complete deterioration.
Runway 6/24 was constructed in 1943 of Portland cement and received a partial asphalt overlay in 1985. Runway 6/24 is the Airport’s primary instrument runway. It has precision instrument markings and was rated in very good condition during the pavement study. Runway 15/33 was also constructed with cement in 1943, and reconstructed with asphalt in 1991. The runway has military maximum effort landing strip markings, and was rated as being in excellent condition. The taxiways were rated in very good to good condition, with only a small portion (4%) rated in fair to good condition.
Instrumentation
The immediate repair of the Airport’s instrument landing system (ILS) is a significant concern of users. Suffolk County is the only ILS equipped Airport east of Long Island MacArthur with a runway length of 5,000 feet or greater. The nature of the NYS Air National Guard’s mission is air-sea rescue, which often requires the ability to conduct operations under IFR conditions. The basic components of the system, the glideslope and localizer, have been out of service since about February 2000, the approach lights have been out since about 1999, and the sequenced flashing lights have been out since about 1996. Under terms of the Joint Use Agreement, the NY Air National Guard is responsible for maintaining this equipment.
The Airport has a total of three instrument approach procedures to Runway 24, excluding a helicopter only procedure. When the ILS is operational, this approach has lowest minimums, a horizontal visibility of ½ mile, and a ceiling minimum of 200 feet is required. The Localizer Runway 24 approach, which has minimums of ¾ mile visibility and a 493-foot ceiling, is also unavailable at the current time. The third approach procedure available to Runway 24, and the only one now available, is the NDB or GPS. This procedure has minimums of 1-mile visibility and a 573-foot ceiling. These minimums are based on minimums for the design aircraft. Circling to the remaining runways is authorized off of each procedure.
Pilots have stated that Runway 6 needs a straight-in non-precision approach procedure. Circling to land is not efficient for high performance aircraft. This runway is used more frequently in the winter and availability of the procedure would enhance year round business use.
Under the terms of the Joint Use Agreement, the NYANG provides for ATC services which are supplied via contract through Dynamic Science Inc. An on-airport Automated Surface Observing System (ASOS) provides weather information, which is disseminated by the tower. Visual navigational aids include four box VASI serving Runways 6, 24, and 33.
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Airspace Obstructions
The Photoslope analysis of the runways at Suffolk County Airport commissioned by NYSDOT in 1998 indicates the presence of FAR Part 77 obstructions to Runways 6 and 24. These obstructions are primarily trees, but also include some areas of terrain. All of these obstructions can be removed and are eligible for AIP funding.
Landside Facilities
The location of landside facilities is shown in Figure 3. The majority of aviation use facilities are grouped to the west of Runway 1/19 alongside an 11.7 acre apron. At the northern end of the apron is the airport administration building that houses the airport management staff. This is a one-story post WW-II brick building that was originally constructed by the military. It contains 4,200 square feet of space and is in good condition.
The Airport has two full-service FBOs: Malloy Air East and Long Island Jet Center. Malloy occupies approximately four buildings, including the Airport terminal and two large hangars. This FBO also operates 5.6 acres of apron at the south end of the terminal area, adjacent to the NYANG area. Long Island Jet Center occupies a separate terminal building, and operates approximately 1.5 acres of terminal apron tie-down space adjacent to the Airport administration building at the north end of the terminal area.
All T-hangars at the Airport, and two conventional hangars, are privately owned and operated. On the north side of the airfield, between runway ends 19 and 24, are a total of 25 T- hangars and one conventional hangar. Airport leases indicate that 14 units are owned by Eastview Flyers, and Sea Empty owns eleven T-hangars and a conventional hangar. On the south side of the airfield, between runway ends 6 and 33, are ten T-hangars owned by Oldham Construction.
Public facility uses on the Airport include a road maintenance shop on the south side of the Airport, County Public Works facility, and a County waste water treatment facility adjacent to it. The treatment plant was built as a joint project by Suffolk County and the NYANG. It provides service for the National Guard base and will serve future non-aviation development on the Airport. The capacity of the facility is 100,000 gallons per day, with 60,000 gallons allocated to NYANG (Current use is approximately 20,000 gpd).
Non-aviation uses are also an important element of the Airport’s landside facilities. Due to the Airport’s large land area, and the availability of numerous former air base buildings on the site, a number of start-up and other businesses have rented space from the County on the Airport. These include:
! A.H.R.C. (workshop for developmentally disabled) ! A&M Electronics (mobile radio repair shop) ! Black Sheep (T. V. production) ! Belle’s Café (Airport restaurant)
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! DBA Transport (AHRC bus depot) ! Gibson & Cushman (storage of dredging equipment) ! Hampton Interiors (upholstery and drape shop) ! Hampton Jitney (bus stop) ! Holey Moses Cheesecake (cheesecake bakery) ! Integral Design (windmill design) ! Relay Matic (electric relay manufacturer) ! Steve Roday/American Tap & Tool (tool distribution warehouse) ! Sheahan Communications (advertising publication) ! South Shore Boats (boat storage) ! Tradecon (terracotta products) ! Wilson Marketing Enterprises (storage of vintage cars)
Most of these businesses are located in an area between the terminal area and Old Riverhead Road, north of the NYANG.
A final element of the Airport’s current landside facilities is the previously mentioned 58.6 acre site that is in the process of being readied for development of light industrial uses and has been zoned as Planned Development District. It is located immediately north of the NYANG area, between Old Riverhead Road and the Airport’s landside aviation facilities. The site is currently occupied by some of the existing Airport tenants, but relocation is in process and is expected to be completed by the end of 2002. As part of the planning for this development, Suffolk County has obtained permission from FAA to release this property from aviation use, with revenues derived from this use flowing back to the Airport.
3.2 Airport Development Plan
Development Considerations
The most significant development consideration at the Airport is the fact that it is bordered on two sides by the Central Pine Barrens Core Preservation Area. The Central Pine Barrens is an area of approximately 102,500 acres within the central and eastern portions of New York's Suffolk County. The center of this area contains pitch pine and pine-oak forests, coastal plain ponds, marshes, and streams. This area provides deep flow recharge to the aquifer from which Long Island draws significant portions of its drinking water. This area is designated Pine Barrens and Special Groundwater Protection Areas (SGPA).
The Pine Barrens Compatible Use Plan has delineated Core Preservation Areas, in which no new development is permitted, and Compatible Use Areas, in which proposed development must meet certain environmental tests for compatibility. Most of the Airport itself is designated a Compatible Use Area. Additionally, the Airport Planned Development District has been designated as a “receiving zone” for transfer development credits obtained as a result of development restrictions within Core Preservation Areas. Any proposed development within the Core Preservation boundaries will require review and approval by the Pine Barren committee.
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Because of the Pine Barrens Core Preservation Area, much of the land use on all sides of the Airport except the south is conservation and open space. A notable exception is land east of the Airport, in which several residential subdivisions were built prior to the Pine Barrens designation. To the south, in an area outside of any Pine Barrens jurisdiction, residential development is increasing and homes are now being built beneath the approach to Runways 6 and 1. This new development has the potential to result in increased complaints about aircraft noise. Surrounding land use is shown in Figure 4.
The Airport falls within the zoning jurisdiction of the Town of Southampton, except for a very small portion in the southwest corner of the Airport, which is within the Village of Westhampton Beach. The Airport property is zoned Light Industrial; the 58.6 acre parcel that has been identified for non-aviation use is zoned as Planned Development District, (PDD). The majority of the land south of the Airport is zoned as Country Residence (CR), and light industrial (LI). The Town zoning ordinance does not contain specific airport zoning provisions that restrict the height of objects, or inhibit potentially incompatible uses near the Airport. The addition of zoning provisions to the ordinance protecting airport operations is strongly recommenced. This is usually accomplished through restrictions on the permitted height of objects, and prohibition of light or electrical emissions that would adversely affect airport safety.
A second major development consideration is the availability of utility service to serve future development. The on-airport utility system is old, and has outlived its useful life. Rehabilitation of water, sewer, electric, and gas lines will be necessary prior to any significant development on Airport property. The Suffolk County Water Authority serves the Airport. An eight-inch main runs along Old Riverhead Road and delivers to one station on Airport property, near the main entrance. From there, water mains branch off to serve the NYANG complex. Sewer service is provided through the new wastewater plant on Airport property. Electric Power is provided by Long Island Power Authority. Natural gas, provided by Brooklyn Union/KeySpan, is scheduled for on-site availability in spring 2002.
Adequate infrastructure, for both aviation needs and business needs, is essential to future development of the Francis S. Gabreski Airport. In addition to the site specific recommendations to follow, the rehabilitation and maintenance of aviation facilities should be a top priority for the airport. Recommended aviation related capital improvements have been added to the airport's ACIP. These include security fencing, rehabilitation of Runway 1/19, rehabilitation of the approach lighting serving Runway 24, repair of the ILS serving Runway 24, and acquisition of snow removal equipment. Non-aviation related capital improvements consist primarily of improvements to the utility systems on the property, and site development activities. The latter would include such actions as demolition of abandoned military buildings, road construction, and landscape improvements. The suggested method of addressing non-aviation capital needs is through a project- based approach focused on individual development sites.
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Development Plan
The development plan for the Airport is illustrated in Figure 5. The plan recommends future development that is compatible with the County’s goals for the Airport and the continued use of the Airport by the NYANG. Implementation of the development plan would permit the siting of convenient facilities to support growth in general aviation activity, as well as permitting Airport revenue enhancement through more productive use of land not needed for aviation purposes.
Seven potential development sites covering approximately 402 acres are illustrated. These sites cover most of the perimeter of the Airport. Most of the land within the perimeter taxiway is needed for aviation use, either civil or military, and is not suitable for revenue producing development. The plan includes approximately 32 acres for additional general aviation development, 112 acres for Airport related business development, and continued aviation development within the 89.4 acre NYANG leasehold. A total of 175.3 acres are recommended for non-aviation development, including the 58.6 acre Planned Development District and 9.1 acres identified for public facility use. Not included in these totals are approximately 166 acres of Airport property within the Central Pine Barrens Core Preservation Area, which are recommended for future Open Space and Conservation use. Table 1 provides specific details about each of the development areas shown in Figure 5.
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Table 1 - Airport Development Areas Site No. Type of Development Acreage Proposed Uses Attributes Development Issues Aviation Non- Aviation NY Air National Guard base Primary Airport Tenant. Operates NYANG utilizes additional 1 / 89.4 currently under long-term lease. ATCT. Airport joint use property. Non-aviation related light Site development now occurring Some current Airport tenants in industrial and commercial uses. includes sewer service, new water this area will remain. Most new 2 / 58.6 main to site, and gas service. tenants will be new to the Airport. Revenues from leases must be used for Airport expenses. Hangars and Aprons, Airport Adjacent to general aviation area. Water and sewer service required, administration. Most convenient location to two but would be relatively 3 / 32.1 general aviation runways. inexpensive because of proximity to Planned Development District. Aviation related business. Air Adjacent to primary instrument Requires extension of water and cargo or commercial aircraft runway. Large site has possible sewer lines. Some existing GA Maintenance/Repair/Overhaul direct access to Riverhead Road hangar leases in area. 4 / 112.2 type business opportunity. and Sunrise Highway. Separated Improvements to on-Airport from major general aviation and access road needed. military use areas. Material storage and staging Large level site on interior of Access is from existing Airport areas for non-aviation Airport, buffered from adjacent owned road through portion of 5 / 50.6 businesses. residential areas and transportation Pine Barrens Core Preservation corridors. Area. No current plans to improve water and sewer service. Light industrial, including Portion of site currently used for No current plans to improve water 6 / 57.0 material storage and staging outdoor storage. Visible from and sewer service. areas. Long Island Railroad. Public facilities. Air National Guard Site is near developing residential 7 / 1.0 area south of Long Island Railroad. Suffolk County - Gabreski Airport Business Plan February, 2002
Airport Capital Improvement Program
The Airport is eligible for capital project funding assistance from FAA through the Airport and Airway Improvement Program (AIP). As such, the Airport is required to prepare, update annually, and submit to FAA a five-year Airport Capital Improvement Program (ACIP) to apply for federal grants. These grants typically fund 90 percent of eligible development costs. AIP eligible projects include the planning, design, and construction of projects associated with public use non- revenue generating facilities and equipment of the Airport. Typical AIP eligible projects include: airport master plans and airport layout plans; land acquisition and site preparation; airfield pavements, e.g. runways, taxiways, and transient aprons; lighting and navigational aids; safety, security, and snow removal equipment; selected passenger terminal facilities; and obstruction identification and removal. Items not eligible for AIP funding include hangars; automobile parking facilities; private use areas of terminal facilities and other revenue generating facilities. Highest funding priority according to FAA’s rating procedure is generally offered those projects that are safety related such as obstruction removal, runway safety area improvements and facility improvements to meet current FAA Airport Design Standards.
A recommended ACIP for Suffolk County Airport is summarized in Table 2. This is based on a review of the airport’s current ACIP and discussion with the airport’s planning consultant. It should be noted that further modification to the recommended ACIP contained herein may be required pending the completion of the on-going Airport Master Plan.
Various airport compliance and project eligibility issues have prevented the airport from receiving AIP grants for the past five years. The most recent projects were a Master Plan (1995) which is still under FAA review, and a taxiway lighting project (1996). However, FAA has recently agreed to issue a grant for design and construction of approach lighting, and runway edge lighting with the understanding that the Air National Guard will in return commit to and bear the complete expense of rehabilitating the airport ILS. The ACIP lists five projects that are to commence in 2001. The total planned and recommended airport capital investment through the year 2005 is $20,838,500. Federal grants will make up $16,540,200 of this amount, and State grants will contribute $918,900. The airport owner will be responsible for the remaining $3,379,400 (including the NYANG contribution for ILS rehabilitation).
Local/Private Funding
Local funding of publicly-owned general aviation airports is usually accomplished through a public sponsor’s general fund. This expenditure may be offset by airport generated revenues. Public bodies may also issue general obligation (GO) or revenue bonds. Private investors are also a potential source of funds for revenue producing development. Tenants and/or investors may finance the construction of facilities from which they derive income.
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Table 2: Airport Capital Improvement Plan Francis S. Gabreski Airport
Year Project Description in Priority Order Federal State Sponsor Total 2002 Pavement Management Study $67,500 $3,750 $3,750 $75,000 2002 Upgrade RW 24 Approach Lighting $823,500 $45,750 $45,750 $915,000 System 2002 ILS Replacement $0 $0 $700,000 $700,000 2002 Replace VASI w/PAPI RW 33 $337,500 $18,750 $18,750 $375,000 2002 Install PAPI RW 15 $180,000 $10,000 $10,000 $200,000 2002 Obstruction Removal RW 33, 6, 15 $270,000 $15,000 $15,000 $300,000 2002 Rectangular Hangars $0 $0 $1,115,000 $1,115,000 2002 T-Hangars $0 $0 $500,000 $500,000 2002 Rehab Apron (Transient) $2,340,000 $130,000 $130,000 $2,600,000 2002 Security Fencing & Gates $2,700,000 $150,000 $150,000 $3,000,000 2003 Rehab Runway 6-24 $855,000 $47,500 $47,500 $950,000 2003 Land Acquisition (Fee) $16,200 $900 $900 $18,000 2003 Maintenance Facility $0 $0 $33,000 $33,000 2003 Equipment Purchase $0 $0 $12,500 $12,500 2003 Emergency Rehab Fund $0 $0 $100,000 $100,000 2004 GPS Instrument Approach $135,000 $7,500 $7,500 $150,000 2004 Control Tower Construction $1,350,000 $75,000 $75,000 $1,500,000 2005 Install Taxiway Edge Lights (N & E) $607,500 $33,750 $33,750 $675,000 2005 Rehab Runway 1-19 $4,320,000 $240,000 $240,000 $4,800,000 2005 Land Acquisition (Easements) $612,000 $34,000 $34,000 $680,000 2005 New Aircraft Parking Apron (5 acres) $1,296,000 $72,000 $72,000 $1,440,000 2005 General Aviation Apron $630,000 $35,000 $35,000 $700,000 GRAND TOTALS $16,540,200 $918,900 $3,379,400 $20,838,500 * New York Air National Guard contribution
AIP Matching Grants
The New York State Department of Transportation provides 50 percent of the sponsor’s match on each FAA grant, or 5 percent of the total project cost. A review of NYSDOT records reveals that two of these State grants are currently open, meaning that funds are still payable to the Airport Sponsor. These grants are:
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PROJECT TOTAL COST STATE GRANT PAYABLE
Master Plan Update $63,560 $3,178 $2,766 South TW Lighting and Signage $765,760 $38,288 $36,963
State Grant Programs
New York State also provides wholly funded State programs to assist aviation development. These programs are targeted toward projects that may not be eligible for AIP funding, such as airport owned fuel facilities, hangars, and terminal buildings. From 1993 to 1996 the Special Aviation Transportation Program (SATP) disbursed about $2.5 million per year for these projects. From 1996 to 2000 the Multi-Modal program provided $350 million in grants for all modes of transportation, including aviation. The total amount granted to aviation projects was approximately the same as through the earlier SATP program. For both of these programs, members of the State Legislature submitted project requests. Suffolk County Airport requested state grant funding of $5,407,000 for a variety of projects and equipment including new lighting electrical cable for Runway 6-24, replacing approach lights, water main replacement, and the purchase of a snow broom. Funding limitations of the State program did not permit these projects to be funded, however.
The current state grant program is Air 99, and project eligibility is also directed to non-AIP eligible projects. For the Air 99 program, the airport owner submitted a request for approximately $1,494,000. Funding requested included snow removal and ground maintenance equipment, and airfield rehabilitation. Again, due to the volume of eligible projects from across the State, these grant requests were not funded.
3.3 Market Analysis
Airport Market Area
Figure 6 illustrates the Suffolk County Airport’s service area, other nearby public use airports, and the distribution of registered aircraft by zip code. The Airport service area is roughly based upon a 45 minute driving distance. This distance is considered appropriate for general aviation airports having facilities capable of accommodating business jet service. Other public use airports located within Suffolk County’s service area include Brookhaven, East Hampton, Bayport, Long Island MacArthur, Mattituck, and Spadaro. In addition, Calverton Airport is a publicly- owned, private use airport. As a former Navy facility this airport has a large airfield that may be suitable for future corporate aviation activity. There are no based aircraft at Calverton, and no aviation services are currently available, but future development there could impact the competitive position of other area airports. Another facility in the service area, Lufker Airport, has recently closed due to Town zoning regulations.
Two of these six airports offer commercial service, East Hampton and Long Island MacArthur. MacArthur offers scheduled service from ten passenger air carriers, including low-fare carriers, to all parts of the United States. East Hampton offers seasonal scheduled service and group charters to LaGuardia Airport and Manhattan during the summer months.
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Facilities
Six other public-use airports are located within the service area of Suffolk County Airport. As illustrated in Table 3 (presented later), Facilities Comparison, Suffolk has the longest runway of any public-use airport in the service area, at 9,000 feet, with two 1,000-foot overruns. This is approximately 2,000 feet longer than the commercial service airport Long Island MacArthur. Suffolk County is also one of only three airports in the service area (the others being MacArthur and Brookhaven) offering a precision approach. Suffolk County’s runway length gives it the capabilities to accommodate large air carrier aircraft, both passenger and cargo, as well as the largest corporate jets.
Based Aircraft
There are a total of 812 aircraft based at the airports within the Suffolk County Airport service area. This includes 27 jets, 87 multi-engine, 676 single engine, 5 gliders, and 17 helicopters. The most populated airports in terms of based aircraft are Long Island MacArthur, Brookhaven, and Suffolk County with 253, 229, and 110 aircraft, respectively. East Hampton is tied for third in based aircraft with 110 and Bayport has 68 based aircraft. The least populated airports in terms of based aircraft are Spadaro with 20 aircraft, Lufker with 22 aircraft and Mattituck with 28 aircraft. All three airports are private.
The recent sale and closure of Lufker Airport will cause a redistribution of affected based aircraft. The close proximity, (approximately 5 miles), of Suffolk County Airport make it a likely candidate for at least a portion of Lufker’s 22 based aircraft.
Aviation Services
Table 4, Service Comparison, presents the availability of various aviation services at each of the area airports. Suffolk County compares well with other airports in the region, with two full- service FBOs. Long Island Jet Center offers charter flights, car rentals, fuel sales, and flight instruction. Malloy Air East offers similar services and Alli-Jen Aircraft Maintenance provides avionics support, as well as major frame and powerplant work. It is one of only two airports in the service area offering avionics support. The potential business opportunities for aircraft maintenance at Suffolk County Airport are excellent due to the long runway length. Jet-A fuel sales have increased each year indicating a larger volume of jet traffic. This is a trend that is expected to increase even further provided the necessary planning and airport development is completed.
Hangars and Tie-downs
There is significant variation in aircraft storage rates at the various airports throughout the service area as indicated in Table 5, Rates and Charges Comparison. Assuming comparable airfield, hangar, and tie down characteristics, the highest rates generally coincide with those airports that are located closest to New York City and offer the most services. East Hampton with its eastern Long Island location is the exception. Tie down rates range from a low of $40.00 at Spadaro to a high of
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$115.00 at Long Island MacArthur. The cost of conventional hangar space ranges from $200.00 at Bayport to $550.00 at Long Island MacArthur, while T-hangar rates range from $275.00 at Brookhaven to $475.00 at Long Island MacArthur. The only airport in the service area that currently has available T-hangar space is Long Island MacArthur. Suffolk County has competitive rates on tie down, and conventional hangar space.
Fuel Prices and Landing Fees
Fuel prices and landing fees charged at airports in the service area are also illustrated in Table 5. For 100LL, prices range from a low of $2.50 at Brookhaven to a high of $3.10 at Suffolk County and Long Island MacArthur. Jet-A is available at Suffolk County, East Hampton and Long Island MacArthur at $2.93, $2.60 and $2.76 respectively. As indicated by these numbers fuel prices tend to be higher than average at Suffolk County, both for 100 LL and Jet-A. The landing fees at Suffolk County are also higher than average at $8-10 and $.80 per 1000 pounds for aircraft over 12,500 pounds. Long Island MacArthur charges $1.05 per 1000 pounds. Brookhaven charges $2 and East Hampton charges $2-12. The remaining airports do not charge landing fees. More competitive fuel prices and the reduction or elimination of landing fees for small aircraft could be expected to increase activity and fuel flowage.
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AIRPORT OWNED ACRES ARC NUMBER OF BASED AIRCRAFT RUNWAY NAVAIDS TOWER
JET MULTI SINGLE HELI GLIDER TOTAL FIRST SECOND HIGHEST L x W L x W Francis Public 1,486 C-IV 3 20 80 2 5 110 9,000' x 150' 5,000' x 150' ILS Yes Gabreski* Brookhaven Public (R) 606 B-II 12 217 229 4,200' x 100' 4,225' x 150' ILS, GPS No East Hampton* Public 570 C-II 1 12 89 2 104 4,255' x 100' 2,501' x 100' VOR/DME, No GPS Spadaro** Pvt. (R) 50 B-I 20 20 2,200' x 20' Visual No Bayport Public 50 B-I 68 68 2,740' x Visual No 150' T Long Island Public (P) 1,311 D-III 23 43 174 13 253 7,002' x 150' 5,036' x 150' ILS Yes MacArthur* Mattituck Pvt. (R) 18 B-I 28 28 2,200' x 130' Visual No TOTAL 27 87 676 17 5 812 Source: Airport Master Record as Published 05 March 2001 (www.airnav.com) R= Reliever, P= Primary, Runways: T=turf * These airports have three runways. The third runway for Gabreski - 5,000' by 150'; for MacArthur - 3,212' by 75'; for East Hampton - 2,223' by 75' (seasonal). ** Seasonal Operation Only
Table 4 - Service Comparison Airport Frame Power Flight Charter Avionics Aircraft Sales Aircraft Other Repairs Repairs Instruction Service Rentals Francis Gabreski Major Major Yes Yes Yes Yes Yes Banner towing Brookhaven Major Major Yes Yes Yes Yes Banner towing East Hampton Major Major Yes Yes Yes Yes Oxygen Spadaro* Major Major Yes Yes Yes No Parachute jumping Bayport Minor Minor Yes No No No Long Island MacArthur Major Major Yes Yes Yes Yes Oxygen Mattituck Minor Major No No No No Source: Airport Master Record as published 05 March 2001 (www.airnav.com) * Seasonal Operation Only Table 5 - Rates and Charges Comparison
Airport Tie-Down Conventional Hangars T-Hangars Lowest Fuel Price ($/gallon) Landing Fee
$/month Available $/month Available $/ month Available 80 ll 100 ll Jet A
Francis Gabreski $55-$65 Yes $250 Yes No Not $2.99- $2.73- $8-$10; over Available $3.10 $2.93 12,500# $0.80/1000#
Brookhaven $45 (T) Yes $400 No $275-$375 No Not 2.50 Not $2.00 $50-$90 (P) Available Available
East Hampton $75 (P) Yes $450 No Private No N/A $2.89 $2.60 $2.00-$18.00
Spadaro* $40 (T) Yes -- No No Not Not Not None Available Available Available
Bayport $50 Yes $200 Yes No Not $2.95 Not None Available Available
Long Island $90-$115 Yes $550 Yes $425-$475 Yes Not $3.10 $2.76 $1.05/1000# MacArthur Available
Mattituck $55 (T) Yes Private No Private No Not $2.80 Not None $65 (P) Available Available Source: McFarland-Johnson, Inc. Telephone Survey 3-27-01. (P) = Paved, (T) = Turf. * Seasonal Operation Only Suffolk County - Gabreski Airport Business Plan February, 2002
4. BASELINE FINANCIAL AND ECONOMIC OUTLOOK
HIS SECTION IDENTIFIES HISTORICAL REVENUES AND expenses attributable to Gabreski Airport and projects those revenues and expenses to the year 2005. This projection will only consider Ta baseline or status quo scenario - using historical performance to project future performance. In a later section, alternative projections of financial performance will be developed, based upon suggested improvements and marketing pro-formas. To properly frame these financial statements, this section is organized to present the following:
! Historical Revenues and Expenses ! Baseline Forecast of Revenues and Expenses
4.1 Historical Revenues and Expenses
Historically, the local economy surrounding Gabreski Airport has been geared toward agriculture, tourism, real estate, and business and light industry. A portion of the Airport has been designated a Planned Development District and as such is the focus of economic development efforts of the County and Town of Southampton. In this regard there is a desire to create a unique non- aviation employment and business center on the Airport that will not compete with existing village and hamlet centers in terms of retail sales, services, and visitor attractions. This means that targeted industries include complementary light industrial, office, transportation, lodging, and related uses. Numerous bed-and-breakfasts are located in the area, but there is a genuine shortage of hotel rooms. Service and support retail will also be permitted in the PDD, but only to a maximum of 5 percent of the total occupancy.
The Airport PDD is expected to serve as a distinct business address through the redevelopment efforts of the County and Town. This business magnet is designed to supplement the existing industries in the area, including the important tourism industry. Each summer, the beach communities in the area attract a large itinerant population, as tourists and wealthy residents return to their beachfront property and other inland homes and estates. The Gabreski Airport is packed each weekend with business jets and helicopters - taking executives to and from the New York metro area. In addition to the local area, the Airport serves residents from as far east as East Hampton.
Both the aviation-related activity combined with non-aviation revenues at the Airport have created revenues at the Airport that are slightly less than annual expenses. It is against this backdrop that the historical revenues and expenses for Gabreski Airport are presented. Table 6 presents a summary of the historical revenues for the Airport from 1997 forward. As shown, Airport Fees and Rentals for both aviation and non-aviation sources have constituted the bulk of all Airport revenues, averaging 94 percent of total over the 1997-2000 period. Also noteworthy is the fact that 1998 and 2000 non-aviation revenues have been larger than aviation revenues - pointing to the importance of the on-airport economic development.
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Table 6 - Suffolk County Gabreski Airport Historical Revenues REVENUE SOURCE 1997 1998 1999 2000 Aviation Tenants Airport Fees and Rentals $187,822 $240,193 $169,120 $240,706 Landing Fees- Totals $2,177 $2,368 $2,048 $952 Other Unclassified $12,500 $2,644 $167 - - Total Aviation $202,499 $245,205 $171,335 $241,658 Non-aviation Tenants Airport Fees and Rentals $193,958 $171,719 $170,138 $175,897 Departmental Interest $2,024 $1,662 $1,656 $1,498 Other Unclassified $1,000 $4,750 $3,800 - - Cash Account- Taxes $14,495 $13,007 $12,752 $14,735 Total Non-Aviation $211,477 $191,138 $188,345 $192,130
TOTAL REVENUES $413,976 $436,343 $359,680 $433,788
Table 7 presents a summary of the historical expenses for the Airport from 1997 forward, while Figure 7 presents a graphic comparison of expenses and revenues for the period. As shown, the primary expense at the Airport is for labor - representing an average of 52 percent of total operating expenses. The next highest expenditure is for utilities - 27 percent of total. Other expenses cover the need for supplies, maintenance, repair work, and travel.
Table 7 - Suffolk County Gabreski Airport Historical Expenses Expenses 1997 1998 1999 2000
Personal Services $203,744 $251,580 $233,617 $189,738 Supplies and Materials $22,847 $29,612 $30,487 $32,609 Repairs: Building & Equip. $88,575 $31,546 $18,605 $19,488 Utilities $126,625 $104,340 $113,316 $112,423 Travel $235 $180 $672 $627 Fees for Services $0 $0 $9,000 $19,000 Interfund Transfers $28,374 $34,685 $0 $0
TOTAL EXPENDITURES $470,401 $452,790 $405,697 $373,885
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4.2 Baseline Forecast of Revenues & Expenses
This baseline forecast presents a status quo look at revenues and expenses, influenced primarily by historical activity. It does not consider the potential changes that are presently occurring in the Town of Southampton economy that might change the historical trend. However, it is important to see the forecast results of what could be called a “Do Nothing” alternative, where no proactive measures are taken to increase airport usage. This projection gives a base upon which to compare various growth strategies. In this regard, the Figure 7 - Historical Revenues & Expenses FAA’s Terminal Area Forecasts were used for the projection of based aircraft and operations at the Airport. Revenues were tied to these activity measures while expenses were trended from past performance and inflation. In many cases, expenses are not volume-related but instead are related to the size of the infrastructure and local weather conditions.
Baseline Revenue Forecast
When forecasting revenues and expenses, the future trend and direction of aviation activity growth is an important input. In this regard, the FAA’s Terminal Area Forecasts for Suffolk County-Gabreski Airport estimate the number of annual aircraft operations and based aircraft remain constant throughout the 15 year forecast period. Obviously, this includes the first 5-year forecast period (2001-2005) associated with this business plan. If this projection is used, volume-related increases in aviation revenue could not be expected with the exception of the minor impacts of inflation and cost-of-living indexing on applicable lease agreements.
Examination of the lease agreements, landing fees, and fuel flowage fees, shows that there are some mechanisms to support partial cost-of-living indexing of revenues. These provisions are incorporated into a number of the lease agreements and can be extrapolated for the aviation-related revenue forecasts. In some cases, the rate increasing mechanism is inadequate, causing the procedure to wait until the lease option renewal period. For example, one of the FBOs, Malloy Air East, has a provision for lease rate increases that must wait until each of the two 10-year renewal option periods occur to take effect. In essence, the rates paid by Malloy will be 10 years old each time they renew their lease. Put another way, only three years out of the thirty year leases will be using rates currently adjusted for inflation/GNP growth. Therefore, the forecasting process took this into account and used lease agreement rate increases where provided, along with constant revenues for volume-related items such as landing fees and fuel flowage fees.
Many of the non-aviation revenues come from the PDD at the Airport. Lease agreements with companies generally involve a 1 year lease with 2 renewal options. This permits the increase in lease rates every three years. Revenue increases from non-aviation sources are expected to come
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from increases in rates plus more leases let during the forecast period. Although the history (1997- 1999) shows a negative growth in leases and fees, there are leases pending that total $85,600 in annual fees. It was assumed that these leases would be finalized in 2001 and that other revenues in this category would grow by 3 percent annually - slightly less than projected inflation. Table 8 shows the baseline forecast of revenues for Gabreski Airport. The baseline forecast of revenues was assumed to increase from a recent average of $403,300 to $550,400 by the year 2005.
Table 8 - Baseline Forecast of Airport Revenues
REVENUE ITEM Current* 2001 2002 2003 2004 2005
Aviation Tenants
Airport Fees and Rentals $199,045 $203,046 $205,076 $207,127 $209,198 $211,290
Landing Fees - Totals $2,198 $2,198 $2,198 $2,198 $2,198 $2,198
Other Unclassified $5,104 $5,104 $5,104 $5,104 $5,104 $5,104
Total Aviation $206,346 $210,347 $212,377 $214,428 $216,499 $218,591
Non-Aviation Tenants
Airport Fees and Rentals $178,605 $275,282 $283,540 $292,047 $300,808 $309,832
Departmental Interest $1,781 $1,889 $1,946 $2,004 $2,064 $2,126
Other Unclassified $3,183 $3,377 $3,479 $3,583 $3,690 $3,801
Cash Account- Taxes $13,418 $14,235 $14,662 $15,102 $15,555 $16,021
Total Non-Aviation $196,987 $294,783 $303,627 $312,735 $322,117 $331,781
TOTAL REVENUES $403,333 $505,130 $516,004 $527,164 $538,617 $550,372 * 3 Year Average (1997-1999)
Baseline Expense Forecast
Expenses are somewhat different from revenues in that they can more easily increase as a result of price inflation. For example, the cost of labor, the cost of utilities including fuel, and the cost of materials and supplies are subject to price inflation that is beyond the control of the local airport. For this reason, the baseline expense forecast included a 4 percent inflation factor for non- labor spending over the five year projection period. Labor expenses were increased to reflect the filling of the Airport Management vacancy. Currently the Assistant Airport Manager has been serving as the acting Airport Manager. Either the Manager position or the Assistant Manager position is assumed to be filled in 2001. After that time, labor costs are inflated at half the rate of projected inflation, or 2 percent per year. In addition to these factors, the historical trends in expenses were examined to see if quantities of cost items used would increase faster than inflation.
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In this regard, examination of the historical expenses shows no significant increases in other cost areas. Building and Equipment Repairs expense has actually declined from 1997-1999, however, this is believed to be a temporary decline. Table 9 presents the baseline forecast of expenses for Suffolk County-Gabreski Airport through the year 2005.
Table 9 - Baseline Forecast of Expenses: Suffolk County-Gabreski Airport
Expenses 1999 2001 2002 2003 2004 2005
Personal Services $233,617 $290,000 $295,800 $301,716 $307,750 $313,905
Supplies and Materials $30,487 $32,975 $34,294 $35,666 $37,093 $38,576
Repairs: Building & Equip. $18,605 $20,123 $20,928 $21,765 $22,635 $23,541
Utilities $113,316 $122,562 $127,465 $132,563 $137,866 $143,380
Travel $672 $727 $756 $786 $817 $850
Fees for Services $9,000 $9,000 $9,000 $9,000 $9,000 $9,000
TOTAL EXPENDITURES $405,697 $475,387 $488,242 $501,496 $515,162 $529,253
When these baseline costs are compared with the baseline forecasts of revenues, the net costs for the Airport can be predicted for the Status Quo scenario:
Expenses Revenues Net Revenues ! 2002 $488,200 $505,100 $16,900 ! 2003 $501,500 $516,000 $14,500 ! 2004 $515,200 $527,200 $12,000 ! 2005 $529,300 $550,400 $21,100
Comparison of the baseline forecasts of revenues and expenses show an initial operating deficit turning into a positive net revenue growth. Key to any surplus revenues are the impacts of non- aviation rentals and fees. The actual breakeven time period will depend upon when the Airport Management vacancy is filled and when the pending leases for non-aviation businesses are executed.
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5. BUSINESS PLAN ALTERNATIVES
IVEN THE FORECAST OF BREAKEVEN REVENUES and expenses under the status quo scenario, several business plan alternatives were developed. Their purpose was to explore a variety Gof methods designed to increase both economic development opportunities for the County and net revenue buffers at the Airport. In order to present these alternatives, this section is organized to include the following:
! Area-wide factors supporting growth and development of the Airport ! Obstacles to Airport performance and goal attainment ! Revenue enhancement ! Cost efficiency/Management structure options
5.1 Area-wide Factors Supporting Growth and Development of the Airport
In the Town of Southampton, there are a number of factors that now support the potential growth and development of the Airport. These factors are briefly described below.
! Business Climate and Airport Development District: Depending upon the location, business growth and development in the Town of Southampton is encouraged. In this regard, a local zoning amendment, passed in 1998, established an Airport Planned Development District at Gabreski Airport. The intent of the ordinance was to enable the adoption of specific development standards on a planned basis that would provide opportunities for compatible development at the Airport that would not otherwise be possible. Development at the Airport permitted by the APDD includes light industrial, office, service, support retail, transportation, and lodging. It is believed that this non-aviation business development has the potential to concurrently increase aviation activity by bringing a segment of the itinerant business and corporate aviation market to the Airport.
! Socioeconomic Trends: The primary population growth in Suffolk County came in the 1950s and 1960s, growing from 276,100 in 1950 to 1,284,200 by 1970. Since then, growth has dramatically slowed, totaling 1,370,500 by 1998. In the 1990s a net gain of only 48,500 has occurred between 1990-1998 in the County. This slow down in population growth has been attributed to the real estate market recession in the late 1980s, coupled with national economic slow down in the early 1990s. Only now are the signs of renewed population growth beginning to appear in and around the Gabreski Airport. New residential subdivisions are being constructed south of the Airport and subdivision permit applications have been on the increase.
Per Capita Personal Income in Suffolk County grew from $10,866 in 1980 to $32,648 by 1998. Employment, over the same period, grew from 483,100 in 1980 to 692,600 by 1998. For the future, higher growth estimates in terms of population,
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income, and employment are anticipated as growth from the New York City metro area continues to push outward onto Long Island. Constraints to this growth will continue to be high real estate costs, restrictive zoning, and environmental barriers such as a lack of adequate wastewater treatment facilities and the Pine Barrens.
! Air National Guard (ANG): A significant contributor to the operational make up of Gabreski Airport, the Air National Guard staffs (under contract) the Air Traffic Control Tower, provides some snow removal services, and operates the Airport Rescue and Fire Fighting station. The joint use agreement between the County and the ANG serves to strengthen the ability of the Airport to serve all types of air traffic in all weather conditions. This is important for existing and potential businesses using the Airport, since they must often travel without regard to the weather conditions.
! Increased Use of Fractional Ownership of Aircraft: The national trend toward greater use of fractional ownership of jet and high-performance aircraft and helicopters is evident on Long Island. Many wealthy residents and their guests use this form of air travel in accessing their homes near Westhampton and East Hampton, New York. Weekend travel to and from both Gabreski and East Hampton Airports by these jets and helicopters is up significantly over the last two years. It is likely that this travel mode will continue to be a source of operational growth at the Airport.
! On-Airport Sewage Treatment Plant: The County has just completed a new on- Airport sewage treatment facility that will accommodate both the Air National Guard facility needs and the APDD needs. This plant will expand the potential for growth and development in the vicinity of the Airport and should serve to facilitate increased Airport use.
5.2 Obstacles to Airport Performance and Goal Attainment
In addition to the positive trends, there are a number of factors that present challenges to the attainment of stated goals and objectives for the Airport. These obstacles include the following:
! Citizen Support: One of the greatest assets that any airport has is the support of its neighboring citizens. At Gabreski Airport, residential development around the airfield increases the potential for disagreement over growth policy issues. Citizen opposition to Airport growth could limit its ability to serve business and aviation interests associated with business/industrial park development in the immediate area.
! Aging Infrastructure: Another challenge for the County is to maintain the Airport facilities. Already, infrastructure problems with the lighting and navaids has created usage issues with certain pilots’ groups. Finding the resources to maintain the large infrastructure will require efficient use of funds from both on and off-Airport
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 35 Suffolk County - Gabreski Airport Business Plan February, 2002
sources. Given this need, the development of Airport property for non-aviation uses should consider first the re-investment of rents and fees back into the Airport infrastructure. Without proper maintenance, safety issues can present problems for aviation users, which translate into liability and economic issues for the Sponsor.
! Long Review/Approval Process: One challenge that is being addressed involves the long review and approval process for new business locations at the Airport. In the past, this process could take as long as 18 months - far longer than most businesses have to wait for a location to expand or start up. Streamlining the application process will be an important move toward the growth of the APDD. To be successful, both the County and the Town must communicate and cooperate in this effort.
! Administrative Staff Shortage: Although this constraint is in the process of being addressed, the current shortage of Airport staff makes it difficult to cover all of the areas required for both aviation and industrial growth at the Airport.
! Revival of Calverton Airport: There are discussions underway for the potential re- opening of the Calverton Airport, which is located within 20 miles of Gabreski. This airport has a runway length of more than 10,000 feet and can provide services similar to Gabreski. If this airport does re-open, it will provide competition for Gabreski in attracting some types of corporate general aviation aircraft.
5.3 Revenue Enhancement
There are only two ways to improve the financial performance at Gabreski Airport: increase revenues or cut costs. In this section, revenue enhancement strategies will be discussed. Elements of these strategies include the following:
! New or Improved Terminal Services, Amenities, and Activities: As far as the terminal building itself is concerned, there are very few revenue producing options, apart from those already in effect. The restaurant facility in the terminal has attracted both air patrons and local regulars and provides the Airport with rents exceeding $12,000 annually. Other money making activities in the past have included an air show and other community outreach programs. The County will lease property for special events to non-profit organizations for between $750-$1,000 per acre per day. For profit-oriented events, the fees include a percentage of gross sales up to 10 percent and/or a daily rental fee of $10,000-$20,000 per acre. These types of events should be promoted and encouraged.
Several surveys of airport users suggested a need to renovate the restrooms in the terminal building. This, along with general interior renovation would serve to keep patrons and attract new business. Often, the terminal building is the gateway to the community for aviation users. If it is uninviting and in disrepair, it not only reflects
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poorly on the community and Airport Sponsor, it also tends to discourage future business.
! Identification of Developable Airport Land: Aviation and non-aviation revenues can be generated through the development of Airport property for specified purposes. In this regard, aviation uses of property adjacent to the airfield can be developed for specialty FBOs that perform services such as avionics repair or aircraft painting. These uses would be aviation-related and would require some Airport property to be reconfigured or developed for these purposes, along with the requisite access.
In addition to aviation uses, non-aviation uses of Airport property can produce revenue to benefit the Airport. In this regard, there is believed to be land that is not needed for aviation purposes in addition to the 59 acres already designated for Light Industrial use. Figure 5 (shown earlier) presents a concept drawing of potential areas for non-aviation use. The release of those parcels and development for non-aviation use is dependent upon the speed at which the existing APDD is filled with occupants. Currently, it is estimated that 25 percent of the vacancies are filled and that an additional 75 percent could be filled by the year 2005. The key to assisting the Airport will be a structured program of land development that targets revenues received from the land to the operation and maintenance of the Airport.
One non-aviation use of Airport land identified through this business plan is a potential staging area for small businesses serving eastern Long Island. Because of the scarcity of industrial land on the east end of the Island, small businesses must truck materials and supplies in each day from bases of operation to the west. Airport property not needed for aeronautical purposes could be used as storage and staging areas for businesses in the region. Storage of building materials, landscaping plants and equipment, and other bulk items would serve to reduce transportation costs and ground traffic congestion on the east end of the Island.
! Attraction of Corporate Aviation: Corporate aviation can base their jets at locations much farther from their corporate users since professional pilots flying the planes can live near the home airport. For example, a corporate jet based at Gabreski Airport can make a 20 minute flight into New York City and pick up passengers at one of the airports there. Convenience is not sacrificed by basing the aircraft away from the corporate center. As an example, Penn Yan Airport is home to Seneca Flight Operations. This company owns 3 corporate aircraft and manages 4 others for companies mostly in Rochester and Buffalo. Fuel utilization for all these aircraft averages 12,000 gallon per week. A normal use for a Cessna Citation is 240 gallons/hour with a typical 4 hour mission. Employment at Seneca Flight includes 17 pilots, 9 mechanics, and 7 other office and line personnel for a total of 33.
For one corporate jet at Gabreski Airport, the numbers could add up to 5 personnel and between 1,000 and 1,500 gallons of jet fuel per week. This doesn’t include
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 37 Suffolk County - Gabreski Airport Business Plan February, 2002
leased land for hangar space or use of other airport services. For fuel sales, the revenue to the County could approach $2,500 annually from the fuel flowage fee. When the employment benefits and the hangar lease aspects of the operation are included, there is a significant revenue impact of attracting corporate aircraft to Gabreski Airport. The Airport’s attractiveness to corporate aircraft is underscored by the primary runway length (9,000 feet), control tower, ILS, no air traffic congestion, and appropriate services.
! Other Potential Demand Increases: There are a number of other potential sources of increased aviation demand that would increase activity at the airport and thereby increase revenues. The two most likely for Gabreski Airport include:
S Local business and industry expansion S Possible closure of nearby privately owned airports
The second item - possible closure of nearby privately owned airports - is a reference to the fact that Lufker Airport is currently for sale and others may close in the future. Gabreski Airport is in an ideal position to capture based aircraft that are looking to relocate from these privately owned facilities.
! Additional Specialty FBOs: Specialty Fixed Base Operators (FBO’s) such as paint shops and aircraft engine overhaul shops attract clients from an entire multi-state region. These companies employ significant numbers of trained workers and provide incomes to local families. Economic activity from specialty shops includes the attraction of aircraft to the airport, the employment of local residents, and the purchase of supplies and materials both locally and from outside the County. A modest shop of only 20 people could generate payroll of over $500,000 annually. If a marketing program could attract a paint shop or specialty engine overhaul operation to Gabreski Airport, additional jobs and income could be generated in the local area.
! Hangar Development Options: The Airport can increase revenues through the development or acquisition of aircraft hangars. Many airports earn revenue through the lease of land for hangar space, or in the outright development of aircraft hangars for lease. If an owner is permitted to construct a hangar on airport property, most of these agreements provide for a reversion of ownership to the Airport after 20 years or more. The Airport can then charge full market rates for these facilities. Condominium hangar development is another option that other airports have used, where a developer is permitted to build hangars on long-term leases. The developer charges maintenance fees to hangar owners and in turn, pays the Airport Sponsor a set yearly fee. At Gabreski Airport, 24 condominium hangars have been constructed and sold, yielding $5,000 per acre annually.
If the Airport Sponsor wants the FBO to invest in and to construct aircraft hangars,
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there are several options. One method used by Brookhaven Airport has been highly successful. Under the current lease agreements with the FBOs, title of all hangar buildings are conferred to the Town of Brookhaven. The FBO is charged a flat annual fee and can build as many hangars as the market will bear. The revenues from all hangars, will revert to the Town after the lease and its option periods are finished (between 22 and 24 years for the two FBOs). Because the hangars are tax exempt, the FBOs can recoup more of their construction costs in the rents. A total of 62 new T-hangars will be constructed in the next two years as a result of this policy change. At Suffolk County-Gabreski Airport, this policy might encourage private development of more hangar space on the Airport. These hangar development options do not prevent the County from leasing property to corporate aviation interests for the construction of hangars elsewhere on Gabreski Airport.
! Rates and Charges/FBO Agreement Structure: The current agreements between the County and its two FBOs - Malloy Air East and Jet Air Services - was based on an appraisal performed for the County in 1996. That appraisal listed market lease rates and comparable pricing for other FBOs at airports in the region. Jet Air Services is a relatively new addition to the Airport, providing a healthy competition between the two FBOs. A summary of the current lease agreements, rates, and contract details is shown in Appendix A. Because the term of lease agreements runs for 10 years before the option period to renew, no improvements to the current set of agreements can be made before 2009, without the written concurrence of both the Sponsor and the lessee. Two areas that need improvement include the fuel flowage fee and the method for increasing lease rates. The fuel flowage fee is low, 2 - 3 cents per gallon, and needs to be increased to the average of around 7 cents. This change would yield an additional $25,200 in the first year implemented. In addition, the provision of the lease for increasing rates states that they are to be adjusted only during the 10 year renewal periods. This should be changed to annual adjustments (or at worst case a 3 year adjustment period) based on the Consumer Price Index (CPI).
! Other Aviation-related Development: The County is looking to attract corporate aviation or commuter airline operations to Gabreski Airport. It is believed that continuing congestion at airports within the NY metro area will force corporate aviation to use airports farther out on Long Island. Similar hopes for commuter service and air cargo carriers have been expressed. It was assumed that impacts from commuter carrier operations would not occur during the planning period of this analysis, but instead, would occur after the year 2005.
! Federal/State Grants: Another area that can help balance the books in terms of overall spending at the Airport involves the efficient use of Federal and State grants. In this regard, a total of $22.05 million is shown on the Airport Capital Improvement Program for the years 2001-2005. In the past, some of this money has been held up due to master planning and other administrative issues with FAA. Recently, these administrative issues have been resolved and money is again flowing to the Airport.
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Impact on Revenues
Quantifying the levels of potential additional revenue that would result from implementing the strategies listed above is highly subjective. The only reasonable method is one where the assumptions for each strategy are stated, along with the resulting impact. Then, if the assumptions are not met, deviations from the predicted revenues can be expected. It is believed that the most significant changes in revenues to the County would come primarily from increased land development and leases for non-aviation activity. Other revenue increases could come from increased aviation activity including more based aircraft and hangar development.
Changes in Aviation Activity
The first and most important step in determining the impacts of these strategies is to predict the change in aviation demand that would occur if each strategy were implemented. Table 10 presents a listing of the potential demand changes along with the assumptions used in estimating demand changes.
Table 10 - Potential Demand Changes by Year 2005 ITEM Assumption Operations Based Aircraft Current Activity 98,200 88
New Terminal services Most being done already - minor impacts to 1% 0 demand Hangar Acquisition/Development Services existing based aircraft and natural NA NA growth. Can limit growth if not performed. Developable Airport Land Non-aviation development that generates NA NA revenues for the Town. The APDD and other property would be included. Other Demand Increases Natural growth plus possible closure of one 15% 20 or more nearby private airports Corporate Aviation Derived from marketing NY metro area, and 5% 5 attracting corporate aviation to the Airport Planned Development District. Air Cargo, Commuter Carriers Significant activity not likely to occur before NA NA the year 2005. Specialty FBOs Specialized engine maintenance, avionics, 2% 0 paint shop will bring in outside aircraft, but not to base at the Airport Additional Potential Growth 23% 25 Total Potential Activity 120,800 113
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 40 Suffolk County - Gabreski Airport Business Plan February, 2002
Table 11 presents a listing of how these potential demand increases could impact the revenue picture for Gabreski Airport, if the assumptions for each scenario are met.
Non-aviation Development
In addition to aviation demand induced revenues, other revenue activity will occur as a result of non-aviation development of Airport property. In this regard, it has been estimated that the existing Airport Planned Development District is roughly 25 percent occupied by businesses. Demolition of almost 70 old buildings used originally by the Air Force was needed to clear space for the light industrial park. Many of the current leaseholders are expected to move into new facilities developed on the APDD. If the lease of the remainder of the APDD conforms to this first 25 percent, total revenues could reach $750,000 annually. Already, $85,600 in leases are pending for the property and are expected to be signed in 2001.
The large size of the Gabreski Airport (1,486 acres) implies that other property besides the 59 acres already released from FAA could be identified for non-aviation use. In this regard, it is estimated that an additional 117 acres are not needed for aviation use. Some of this land - perhaps as much as 20 acres - could be developed for use by non-aviation business and industry for staging and storage of equipment and supplies. This use would, of course, be subject to zoning approvals by the Town. If approved, conservative estimates of revenues from other development sites could reach $5,000 per acre or $100,000 in total by the year 2005. It is this revenue production, combined with the lease fees from the existing APDD, that will support the aviation infrastructure at Gabreski for the long-term.
In addition to land development, a second, non-aviation demand source of revenue was examined - possible adjustments to rates and charges at the Airport. Unless rates are unusually low, increased rates at general aviation facilities are generally offset by a resulting decrease in activity. Also, rates cannot be adjusted by the County until the term of the lease expires with Airport tenants, or at the initiation of the tenants. The current lease with Malloy Air East runs through the year 2009. No adjustments can be made prior to this expiration unless Malloy desires to change the agreement. The lease with the Air National Guard expires September 30, 2001. This lease is to be re-negotiated at that time and potential rate increases can be discussed. Currently, the Air National Guard (ANG) pays $35,400 for the lease and an additional $16,000 for utilities annually. The ANG does provide air traffic control, fire protection, and some snow removal1.
Table 11 presents a listing of how all of the potential changes could impact the revenue picture for Gabreski Airport through the year 2005.
1 The snow removal by ANG occurs only when snowfall accumulation has reached ½ inch - and then only for the runway and some taxiways. Clearly, this is not sufficient for General Aviation traffic using the unplowed Airport ramp areas or taxiway system, or during times of less than ½ inch of snow.
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Table 11 - Potential Increases Resulting from All Revenue Enhancement Strategies Current 2001 2002 2003 2004 2005 Aviation Revenues Airport Fees $199,045 $227,889 $256,733 $285,576 $314,420 $343,264 Landing Fees $2,198 $2,497 $2,796 $3,094 $3,393 $3,692 Other Unclassified $5,104 $5,339 $5,574 $5,808 $6,043 $6,278
Total Aviation Revenues $206,347 $235,724 $265,102 $294,479 $323,857 $353,234
Non-Aviation Revenues Airport Fees $178,605 $305,764 $432,923 $560,082 $687,241 $814,400 Departmental Interest $1,781 $2,844 $3,908 $4,972 $6,036 $7,100 Other Unclassified $3,183 $5,087 $6,990 $8,893 $10,797 $12,700 Cash Account $13,418 $13,994 $14,571 $15,147 $15,724 $16,300
Total Non-Aviation Revenues $196,987 $327,689 $458,392 $589,095 $719,797 $850,500
Total Airport Revenues $403,334 $563,414 $723,494 $883,574 $1,043,654 $1,203,734
Priority/Value of Alternative Components
Figures 8 and 9 present graphic charts for each of the major revenue categories with more than one component part. For example, Figure 8 presents the component revenues for Aviation Lease Fees, showing that 62 percent are derived from baseline revenues,18 percent from additional corporate aviation, 10 percent from natural demand growth or possible private airport closures, and 10 percent from new or specialty FBOs and aviation businesses. Non-aviation related lease fees are shown in Figure 9. Key to growth in this area is the continued development of the Airport Planned Development District (50 percent of future revenues). Other land leased for business purposes, such as storage and staging areas, will potentially provide 12 percent of future revenues.
Figure 10 presents all of the component strategies and their cumulative impact on total revenues. The priority of various alternative components needs to be measured against their impact on net revenues. For example, additional development of non-aviation commercial property within the APDD represents one third (33.6 percent) of year 2005 total revenues. Similarly, other development of non-aviation property has the potential to generate an additional 8 percent of year 2005 revenues. Attracting a small number of corporate aviation operators will have a disproportionately larger impact on future revenues. Looking at the alternatives strategically, a priority emerges, based upon revenue contributions (Figure 10):
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! Priority 1 - Keep existing aviation and non-aviation business on Airport (baseline revenues) - 45.7% of year 2005 revenues. ! Priority 2 - Fully develop the Airport Planned Development District (APDD) - 33.6% of year 2005 revenues. ! Priority 3 - Develop other non-aviation property for business use - 8.3% of year 2005 revenues. ! Priority 4 - Attract Corporate Aviation - 5.0% of year 2005 revenues. ! Priority 5 - Pursue all other revenue growth strategies (new FBO, more small GA aircraft, etc.) - 7.4% of year 2005 revenues.
These priorities apply only to the potential Airport revenues that each action might generate. A complete listing of recommendations, trigger points, and time frames and logistics are shown later in Table 13.
5.4 Cost-Efficiency/Management Structure Options
As mentioned previously, there are only two ways to increase net revenues for Suffolk County - Gabreski Airport: increase revenues or cut costs. Examination of the costs at Gabreski Airport indicates that very few options exist for improving cost-efficiency. For example, there are vacancies in the staff and management at the Airport. These vacancies have resulted in some missed opportunities and can not be considered cost-efficient. Therefore, full staffing would result in a requirement for more expenditures for labor. Similarly, the recommended full development of
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 43 Suffolk County - Gabreski Airport Business Plan February, 2002
Figure 8 - Impact of Market Factors: Aviation Lease Fees Figure 9 - Impact of Market Factors: Non-Aviation Fees
Figure 10 - Strategic Impact of Market Factors on Revenues
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 44 Suffolk County - Gabreski Airport Business Plan February, 2002 the APDD will require additional staffing and maintenance costs. Table 12 presents a summary of the costs associated with the implementation of the revenue enhancement options.
Table 12 - Forecast of Expenses Associated with Revenue Enhancement Options Expenses Current 2001 2002 2003 2004 2005
Personal Services $233,617 $290,000 $323,960 $340,940 $357,920 $374,900 Supplies and Materials $30,487 $32,975 $34,294 $35,666 $37,093 $38,576 Repairs: Building & Equip. $18,605 $20,123 $20,928 $21,765 $22,635 $23,541 Utilities $113,316 $122,562 $127,465 $132,563 $137,866 $143,380 Travel $672 $727 $756 $786 $817 $850 Fees for Services $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 APDD Development/Maintenance* $0 $42,960 $85,920 $128,880 $171,840 $214,800 Non-Aviation Area Development* $0 $50,000 $50,000 $50,000 $50,000 $50,000
TOTAL EXPENDITURES $405,697 $568,347 $652,322 $719,600 $787,171 $855,048 * Source: Consultant estimates
If every revenue-producing option and its associated cost were implemented and if they all produced the maximum benefits, the following financial projection of net revenues could be achieved:
Expenses Revenues Net Revenues ! 2002 $652,300 $723,500 $71,200 ! 2003 $719,600 $883,600 $164,000 ! 2004 $787,200 $1,043,700 $256,500 ! 2005 $855,000 $1,203,700 $348,700
As shown, the Airport could increase net revenues from a negative $4,900 to almost $350,000 by the year 2005, based primarily on a strong non-aviation revenue production from the APDD.
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6. RECOMMENDED PLAN
HE RECOMMENDED BUSINESS PLAN FOR Suffolk County - Gabreski Airport focuses on two primary strategic areas: attraction of corporate/business aviation and the full development of Tthe Airport Planned Development District. Cost efficiency actions were not identified in this report. Revenue and expense projections for the do-nothing or status quo option were presented earlier in this report. They show a breakeven financial performance over the five year planning period. If there is a desire to increase net revenues and spur economic development, the following range of options are available.
6.1 Recommended Management/Administrative Actions
From an administrative and management standpoint, Gabreski Airport was moved from the County Engineering Department to the Department of Economic Development. This move reflects the fact that economic development is important to the County and that Gabreski Airport is considered more than aging infrastructure. This move is a vital step toward developing the full potential of the Airport. The County is to be commended for this vision.
In addition to the revised organizational structure, there are additional staffing requirements if Suffolk County - Gabreski Airport is to successfully court business and corporate aviation, and fully develop the APDD. Currently, the facility is being operated with fewer staff than needed, which causes delays in response time and service. Filling staff vacancies would permit the County to better respond to service needs such as: administration of the APDD, the maintenance of the Airport, the response to citizen noise complaints, and some of the planning and marketing functions associated with the Airport. Negotiating with the Air National Guard and monitoring that lease also consumes time and requires staff. In short, the effectiveness of the Airport staff could be increased with key additions. Therefore, it is recommended that:
Additional Airport staff should be assigned to fill vacancies as soon as possible.
For the Airport, there is a vacancy in the Manager position. This should be filled as soon as is practical. Two other positions should be filled in the short term: an additional staff person is needed for clerical work, and an additional person is needed for Airport maintenance. For the APDD, 2 full time staff are needed to administer the APDD, including proposal review, utility access, and lease monitoring. Thus, a total of 5 additional staff are needed over the planning period to manage and administer both the aeronautical and non-aeronautical portions of the Airport.
One issue that came up during the study process involved the extraordinarily long period of review and approval for business applications for new businesses desiring a to locate at the Airport. Many businesses can’t wait through this process and choose to find other locations. These delays in the process are related to the fact that both the Town of Southampton and the County must review
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applications for space in the APDD. Therefore, it is recommended that:
The business application process for location at Gabreski Airport be coordinated/streamlined to ensure capture of new businesses.
Economic development efforts will be easier to implement with a faster approval process. In conjunction with this effort to market on-airport businesses, a standard set of lease agreement stipulations should be developed for both aviation and non-aviation businesses. Standard renewal options, fee reviews, and price indexing should be included in the language of future lease agreements.
The final area of examination was the Airport’s system of accounts. Review of the County’s system indicated that the establishment of an Enterprise Fund for the Airport is a positive move by the County that will help in accounting for all monies received and expended by the Airport. This will ensure that FAA requirements regarding revenue diversion can be observed. Therefore:
The establishment of an Enterprise Fund for the Airport by the County is beneficial for tracking all monies associated with the Airport.
The County is to be congratulated for implementing this accounting improvement for the Airport.
6.2 Revenue Enhancement Recommendations
The revenue enhancement recommendations did not focus on one strategic option to the exclusion of all others. Instead, a number of different revenue enhancement strategies are recommended for the Suffolk County - Gabreski Airport. These include:
New or Improved Terminal Services, Amenities, and Activities:
Developing and maintaining a business image for the Airport requires that the appearance and amenities be upgraded from current conditions. For example, several surveys of airport users suggested a need to renovate the restrooms in the terminal building. This, along with general interior renovation would serve to keep patrons and attract new business. Often, the terminal building is the “gateway to the community” for aviation users and reflects either positively or negatively, depending upon its condition. Therefore, it is recommended that:
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The County should invest in a newly remodeled or improved terminal building.
In like manner, many of the old military buildings that require demolition need to be removed to enhance the image of the Airport and to provide greater use of existing landside space.
Management should strive to provide full services at the Airport as a means of attracting high-end corporate aviation. In the winter time, this means keeping the Airport free from snowfall accumulation. Currently, the County and the ANG share snow removal responsibilities. The snow removal by ANG occurs only when snowfall accumulation has reached ½ inch - and then only for the runway and some taxiways. Clearly, this is not sufficient for General Aviation traffic using the unplowed Airport ramp areas or taxiway system, or during times of less than ½ inch of snow. Also, there are times when snowfall turns to ice and must be removed by the County. Some business aviation tenants have complained that there is inadequate snow removal such that they must move their aircraft to other airports at the hint of snow in the forecast. Therefore it is recommended that:
The County should take over all snow removal activities and share these costs with the ANG through lease adjustment charges.
Other amenities which contribute to this image should be supported. The restaurant at the Airport should be encouraged, as well as other revenue generating activities such as fly-ins, air shows, and other community outreach programs. Parts of the Airport can be leased from time to time to support community activities or private events. It is recommended that:
Suffolk County - Gabreski Airport should continue to be promoted as a venue for large outdoor activities and community interest events.
The Airport charges $750-$1,000/day for the use of portions of the facility for non-profit events. The last air show (1998) paid a lump sum fee of $25,000 to hold the two-day event at the Airport. More of this type of use of the facility would increase revenues and provide outreach to the community.
Full Development of the Airport Planned Development District
The APDD has the potential to generate more income to the County than from all other revenue producing enterprises at the Airport. Not only will the APDD benefit the financial performance of the Airport, it will also generate new economic development in the area. County officials have estimated that the APDD will be able to accommodate over 1 million square feet of development, supporting 600 jobs. Non-aviation revenues from the APDD have been estimated at
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 48 Suffolk County - Gabreski Airport Business Plan February, 2002 over $700,000 annually by the year 2005. Given this potential, it is recommended that:
Marketing efforts should continue to be directed at the attraction of compatible business and industry to Gabreski Airport’s APDD.
Needs and Opportunities ! Limited space on eastern Long Island for industrial development. ! Build-out would financially support the aviation operation at the Airport. ! Significant opportunities for job expansion in the area.
Challenges ! Project approval lead times are long, turning some businesses away. ! Infrastructure upgrade and development needs to keep pace with marketing efforts.
Recently, the County Legislature passed a resolution supporting an Aviation Sales Tax Free Zone. This resolution would exempt the sale of aviation parts, the rendering of aviation maintenance services, and the sale of airplanes from the Sales and Compensating Use Tax now charged in New York (8.5%). This business plan supports the notion that tax-free zones will bring new jobs and economic development to the area. Therefore, it is recommended that:
An Aviation Sales Tax Free Zone should be established at Gabreski Airport.
Attraction of Corporate Aviation
Most general aviation airport sponsors have learned that corporate aviation helps “pay the bills” by providing a disproportionately higher source of airport revenue than recreational general aviation. Gabreski Airport is ideally located to take advantage of corporate air travel to and from the New York metro area. For example, a corporate jet based at Gabreski Airport can make a 20 minute flight into New York City and pick up passengers at one of the airports there. Convenience is not sacrificed by basing the aircraft away from the corporate center. Therefore, it is recommended that:
Marketing efforts should be directed at the attraction of corporate aviation to Gabreski Airport.
Key to the success of such a marketing effort would be the location of available hangar space and the upgrading of aging infrastructure at the Airport. Corporate aviation requires all-weather airport operation. Problems with approach lights, power outages, and water main failures have underscored
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 49 Suffolk County - Gabreski Airport Business Plan February, 2002
the need to upgrade facilities at the Airport in order to attract and keep corporate aviation.
Needs & Opportunities: ! Runway length and Airport size is ideal for corporate aviation. ! Would increase operating revenues to the Airport via fuel sales and potential corporate aviation land leases. ! Fast growing corporate aviation market.
Challenges: ! Upgrading existing infrastructure to attract and keep corporate tenants. ! Public perception of potential noise. ! Developing enough corporate hangar space to attract users.
Aircraft noise is the single most controversial factor associated with airports. Although new jet engine technology provides quieter aircraft than many of the older piston powered propellor aircraft, the perception of business jet noise may be worse than the actual noise they produce. Noise abatement procedures, preferred runway designations, etc., can be employed to reduce both actual and perceived noise impact at the Airport.
In coordination with this direct marketing effort, the following recommendation can be made:
Information concerning the Airport and its amenities should be included with the APDD promotional literature and marketing activities.
Natural Demand Increases
As a result of a number of ongoing development projects in and near Gabreski Airport, the Airport may be the beneficiary of increased activity. This would include activity generated by APDD and the normal business expansion that is expected to occur throughout the area. In addition, the spillover of demand from the New York City metro area will continue to create growth, as will the potential closures of nearby privately owned airports. Fortunately, the County does not need to do anything to spur this activity. Most of the activity will occur independently of Airport management initiatives. Therefore, the only recommendation for the Airport is to:
Develop a follow-up program for inquiries from new or potential based aircraft owners.
When and if inquiries from new aircraft owners are made regarding possible location at Gabreski Airport, a program to accommodate these inquiries should be developed. This may be as
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simple as referring calls to FBOs with hangar or tie-down space or providing the prospective based aircraft owner with additional information about Airport services and facilities.
Additional/Specialty FBOs
Specialty Fixed Base Operators (FBOs) such as paint shops and aircraft engine overhaul shops attract clients from an entire multi-state region. These companies can employ significant numbers of trained workers and provide incomes to local families. Other aviation businesses such as air cargo companies would also have the potential to increase economic development in the area. It is recommended that:
Marketing efforts should be directed toward the attraction of specialty FBOs or aviation businesses for the Airport.
Hangar Acquisition or Development Options
The County can increase revenues through the development or acquisition of aircraft hangars. Recent hangar development has added 24 condominium units paying roughly $5,000 per acre to the Airport. One large conventional hangar is available for corporate aviation. By encouraging more hangar development, additional based aircraft demand can be accommodated and more revenues will be generated. Therefore, it is recommended that:
Hangar construction should be encouraged through lease agreement incentives.
Incentives for hangar development have been described where the Airport Sponsor (County) would take title to a newly developed hangar while giving a long-term flat lease to the developer. This permits tax-free development of hangars with reversion to Airport Sponsor control at the end of the lease period. In the long term, all revenues from the hangar would then go directly to the Airport Sponsor, strengthening its financial performance and long-term viability.
Needs and Opportunities ! Attraction of aircraft from other airports. ! Space available for development of hangars.
Challenges ! Meeting the current and future need with private sources of capital. ! Timing of development.
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Rates and Charges/FBO Agreement Structure
The current agreement between the County and Malloy Air East was recently renewed to the year 2009. Thus, nothing can be done to change the components of that agreement without the consent of the FBO. Long Island Jet Center’s agreement has 10 year renewal options, limiting the direct changes that can be made in the near term. Some of the other leases have long renewal periods preventing escalators from taking effect in intervening years. For this reason, it is recommended that
All future leases should include Consumer Price Index (or similar) escalators that take effect each year or every 3 years at a maximum, subject to negotiation.
One lease which is currently up for renewal involves the Air National Guard, a major tenant. This lease must be renegotiated with the military. Currently the ANG operates the Airport Rescue and Fire Fighting station, provides air traffic control services, and limited snow removal. The ANG has roughly $30 million in capital improvements to spend at the Airport over the next 5 years. No significant changes are anticipated with the new lease.
Other rates and fees include: Non-Commercial Commercial ! Landing fee S Single Engine $2 $8 S Twin Engine ( to 12,500 lbs.) $3 $10 S Aircraft over 12,500 lbs. $0.30/1000 lbs. $0.80/1000 lbs.
There are no landing fees for based aircraft. No increases in these fees were recommended.
Identification of Other Developable Airport Land
In addition to the APDD, other Airport property is available for non-aviation use. One non- aviation use of Airport land identified earlier in this plan is a potential staging area for small businesses serving eastern Long Island. Because of the scarcity of land on the east end of the Island, small businesses must truck materials and supplies in each day from bases of operation to the west. Airport property not needed for aeronautical purposes could be used as storage and staging areas for businesses in the region. Outdoor storage of building materials, landscaping plants and equipment, and other bulk items would serve to reduce transportation costs and ground traffic congestion on the east end of the Island. Figure 5 (presented earlier) shows potential areas of developable Airport land for this and other purposes. For this analysis, significant revenues were assumed to come from developable Airport land within the 5 year forecast horizon. Therefore, it was recommended that:
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Non-aviation Airport land (in addition to the APDD) should be examined for potential use by businesses needing storage and staging areas.
Needs and Opportunities ! Long-term growth potential, with revenues benefitting the Airport operations. ! Maintains buffer zone between residential uses and Airport uses. ! Facilitates businesses serving eastern Long Island.
Challenges ! Providing adequate surface access to remote Airport areas. ! Preparing property cost-effectively for use by businesses.
State and Federal Grants
It is recommended that grants for all eligible projects be sought from both the FAA and NYSDOT. All open grants should be closed out immediately following project completion.
Any uncollected grant money for work in progress should be requested and completed projects should be closed out as soon as practical.
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7. SUMMARY OF BUSINESS PLAN RECOMMENDATIONS
NUMBER OF RECOMMENDATIONS HAVE BEEN made as a part of this business plan study, all with the goal of increasing net revenues at the Airport and increasing economic development Aand employment in the area. The recommended plan of action from this report rests on six primary strategic initiatives:
1) Airport Appearance/Infrastructure: In order to keep existing clients and attract new business, the Airport pavements, lighting, and instrumentation systems must be physically maintained to permit all-weather use. Many of the dilapidated military buildings need to be removed and issues such as snow/ice removal, terminal building appearance and cleanliness need to be addressed by Airport management. 2) Airport Planned Development District: Full development of the Planned Development District has the potential to exceed earnings from all aeronautical activities at the Airport. 3) Attraction of Corporate Aviation: A strategic shift toward the attraction of corporate aviation is needed to bolster revenues and on-airport employment. Corporate and business aviation represent a large, lucrative segment of the general aviation market. Gabreski Airport is ideally suited to take advantage of this market niche. 4) Other Non-aeronautical Land Development: The large amount of Airport land area provides adequate space for other non-aeronautical development. Suggested land uses have included storage and staging areas for small businesses serving eastern Long Island. 5) Continue to Serve Existing Client Base: Gabreski Airport’s existing client base is anticipated to provide up to 46 percent of future revenues. In addition, Airport tenants such as the Air National Guard provide jobs and millions of dollars in local economic impact. 6) Additional Airport Staffing: The County should add staff to the Airport to increase the service levels, response time, and administrative capacity of the current staff. The current staff is strained to manage, market, and administer both the Airport and the APDD.
Specific recommendations by timeframe are as follows:
Immediate ! 1st Priority - Airport Security Plan: An Airport security assessment should be undertaken as soon as the FAA issues guidelines. ! 1st Priority (tie) - Airport Staffing: Additional Airport staff should be assigned to fill vacancies as soon as possible. ! 2nd Priority - Streamlined Application Process: The business application process for location at Gabreski Airport should be coordinated/streamlined to ensure capture of new businesses. ! 3rd Priority - APDD Marketing: Marketing efforts should continue to be directed
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at the attraction of compatible business and industry to Gabreski Airport’s APDD. S Standard Lease Language: As part of the marketing effort to on-airport businesses, a standard set of lease stipulations should be developed for both aviation and non-aviation uses. Standard renewal options, fee reviews, and price indexing should be included. ! 4th Priority - Federal & State Grants: It is recommended that grants for all eligible projects be sought from both the FAA and NYSDOT. All open grants should be closed out as soon as allowed by project completion.
6/2002-12/2005 ! 1st Priority - Attract Corporate Aviation: Marketing efforts should be directed at the attraction of corporate aviation to Gabreski Airport. ! 2nd Priority - Improved Terminal Building: The County should invest in a newly remodeled or improved terminal building. Bathrooms and other areas should be kept clean at all times to attract and keep aviation business. ! 2nd Priority (tie) - County Snow Removal: The County should take over all snow removal activities and share these costs with the ANG through lease adjustment charges. ! 3rd Priority - General Airport Promotion: Information concerning the Airport and its amenities should be included with the APDD promotional literature and marketing activities. ! 4th Priority - Specialty FBOs or Aviation Businesses: Marketing efforts should be directed toward the attraction of specialty FBOs or aviation businesses for the Airport. ! 5th Priority - Follow-up Program: Develop a follow-up program for inquiries from new or potential based aircraft owners. ! 6th Priority - Develop Other Non-aeronautical Land: Non-aviation Airport land (in addition to the APDD) should be examined for potential use by businesses needing storage and staging areas. ! 7th Priority - Airport Venue Promotion: Suffolk County - Gabreski Airport should be promoted as a venue for large outdoor activities and community interest events.
6/2003-12/2005 ! 1st Priority - Develop New Hangars: Hangar construction should be encouraged through lease agreement incentives. ! 2nd Priority - Lease Agreement Escalators: All future leases should include Consumer Price Index (or similar) escalators that take effect each year or every 3 years at a maximum.
Other Items: ! Air Cargo/Commuter Airlines: It is believed that a significant presence of air cargo or commuter operators will not occur at Gabreski until the post-2005 period. This does not preclude marketing those businesses in the interim. ! Accounting: Creation of an Airport Enterprise Fund to allow for accurate accounting
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of Airport revenues and expenses is recommended.
If these recommendations are followed it is estimated conservatively that deficits at the Airport can be trimmed as follows: Expenses Revenues Net Revenues ! 2002 $652,300 $723,500 $71,200 ! 2003 $719,600 $883,600 $164,000 ! 2004 $787,200 $1,043,700 $256,500 ! 2005 $855,000 $1,203,700 $348,700
As shown, the Airport is likely to increase net revenues over the period to almost $350,000 by the year 2005. This growth in net revenues is based on continued growth in corporate aviation and development of the APDD over the period.
7.1 Timetable and Trigger Points
Table 13 presents a timetable and listing of trigger points for implementation of the recommended plan, grouped by type of action (administrative, marketing, etc.).
Table 13 - Action Plan Trigger Points: Suffolk County - Gabreski Airport
Action Description Trigger Point Timeframe Administrative Additional staff Vacancies in staffing should be filled as Immediate 3/2002 soon as possible. Business applications The business application process for the Immediate 3/2002 APDD should be streamlined to reduce lead times for site approvals. Airport Security Plan Develop Airport Security Plan in Immediate 3/2002 accordance with FAA directives. System of accounts Establish Airport Enterprise Fund as soon Immediate 1/2003 as practical. Marketing Market APDD Continue to attract compatible business Immediate 3/2002 and industry. Market corporate Begin direct marketing of corporate After brochures become 6/2002 aviation aviation in NY metro area. available Market specialty FBO Attract new specialty FBO or aviation After brochures become 6/2002 business to the Airport. available Market regional based Develop a follow-up program for After brochures become 6/2002 aircraft inquiries from potential based aircraft available owners.
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Table 13 - Action Plan Trigger Points: Suffolk County - Gabreski Airport
Action Description Trigger Point Timeframe Market Airport venue Market the Airport as a venue for large Immediate 8/2002 outdoor activities and community interest events. Airport Development Aircraft Hangars Hangar construction should be Upon securing enough 6/2003 encouraged through lease agreement firm commitments from incentives. based aircraft owners Terminal Building Invest in improved and clean terminal Maintenance - Immediate - building. Immediate. Remodeling 12/2002 -when funding is available. Develop other Airport Identify and develop other non-aviation After brochures become 10/2002 land property at the Airport for business use. available Rates & Charges Lease agreement Future leases should include annual Begin with new and 6/2003 escalators escalators (CPI). renewed leases State/Federal Grants Close out open grants permitted by As soon as practical 3/2002 project completion.
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8. ECONOMIC IMPACT ASSESSMENT
HE PURPOSE OF THIS SECTION IS to quantify the economic impact and contribution of Gabreski Airport to the local economy for both the existing situation and for the Recommended Plan. TBy showing the existing and newly created jobs, income, and total economic output, support for Airport projects may be generated. This analysis demonstrates the economic effects of Airport and aviation use within the Town of Southampton and Suffolk County by tracing the movement of expenditures through the various economic sectors until the money is exported incrementally from the County through purchases of outside goods and services.
8.1 Goals and Methods of Analysis
The goal of this analysis was to quantify the following economic aspects of Gabreski Airport both for the existing situation and for the year 2005 Recommended Plan:
! Direct Spending: On-airport spending on employment, operations, and capital projects. Associated with providers of services at the airport. ! Indirect Spending: Off-airport spending by air travelers for rental cars, hotels, restaurants, etc. Associated with the users of airport services. ! Induced Benefits: Impacts created by the successive rounds of spending in the local economy until the original direct or indirect impact has been incrementally exported from the local area. ! Jobs and Income: Quantify the income generated by aviation and the number of jobs supported by the Airport. ! Total Output in Dollars: The combined impacts of direct, indirect, and induced spending. ! Taxes: Tax revenue contribution of the Airport and aviation industry to local and State units of government in New York.
To accomplish this goal, the study utilized the following simplified process and methodology:
! Collect data on direct and indirect impacts through survey and secondary source published means. ! Apply regional multipliers to direct and indirect impact numbers. ! Describe non-monetary impacts of Gabreski Airport and local aviation.
Two surveys were developed and administered to different segments of Gabreski Airport’s aviation economy: Aircraft Tenant Surveys and On-Airport Business Surveys. Airport management surveys were not needed, since much of that data had already been collected for the business planning effort. From the surveys, results indicated that average spending on single engine and twin engine propellor based aircraft totaled $8,163 in 2000.
Surveys of on-airport employers revealed that 1,408 full and part time jobs and over $27.2
McFarland-Johnson, Inc., in association with R.A. Wiedemann & Associates, Inc., & Shumaker Consulting Engineers, P.C. 58 Suffolk County - Gabreski Airport Business Plan February, 2002 million in local expenditures are a direct result of on-airport businesses and organizations. A major portion of this total comes from the Air National Guard unit based at Gabreski. It should be noted that the impact of all of these numbers is multiplied by successive rounds of spending within the local economy.
8.2 Results of Analysis
The economic impact methodology first identified the direct spending and employment at Gabreski Airport (called direct impacts) and included the direct spending at off-airport sites such as hotels and restaurants (called indirect impacts in this study). Armed with this information, regional respending multipliers derived from IMPLAN software were applied to the data to determine the multiplied impacts of direct and indirect spending (called induced impacts). Table 14 presents a summary of Gabreski Airport’s direct, indirect, and induced economic impacts.
Table 14 - Direct, Indirect, and Induced Economic Impacts
Item Total Current Recommended Total 2005 Impacts Plan Add-on Impacts Impacts Direct Impacts On-Airport Income* $13,659,800 $8,477,600 $22,137,400 On-Airport Expenditures (Total including capital costs) $26,199,100 $27,972,400 $54,171,500 On-Airport Employment (Total including capital 633 283 916 development)** Indirect Impacts Indirect Expenditures $1,008,400 -- $1,008,400 Number of Jobs Supported 22 -- 22 Induced Impacts*** Induced Direct and Indirect $10,519,900 $15,799,000 $26,318,900 Total Induced Employment Impacts 124 169 293 Estimated State/Local Taxes $2,543,000 $2,437,258 $4,980,258 Grand Total Dollar Impacts $37,727,400 $43,771,400 $81,498,800 Grand Total Income Impacts* $17,875,300 $14,758,200 $32,633,500 Grand Total Employment Impacts 779 452 1,231 * Includes indirect incomes from visitor spending and capital development. This is a subset of the total impacts and is already included in the output number. ** Employment estimates for part-time military personnel equates 4 part-time to 1 full-time employee. *** Source: IMPLAN Software - Developed originally by the US Forest Service, it is a comprehensive impact system built on the framework of input-output and social accounting methodology.
As shown, Gabreski Airport supports 779 full-time-equivalent jobs, $17.9 million in incomes, and
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$37.7 million in total economic output. If the Recommended Plan is implemented, it will create 452 additional jobs, $15.8 million in additional incomes, and $43.8 million in additional economic output.
8.3 Non-monetary Impacts
There are a number of non-monetary benefits of aviation that have not been mentioned in this analysis. Some of these benefits include:
! Transportation Benefits: Defined as the time saved and cost avoided by travelers who use airports rather than the next best alternative. Gabreski Airport provides access to the National Air Transportation System.
! Stimulation of Business: Airports have been shown in other studies to be an important factor in the attraction and siting of new businesses in a community. This is particularly true for businesses with over 100 employees.
! Aeromedical Evacuation: Airports often serve as bases for aeromedical evacuation teams or flight services. This life-saving function has intrinsic value that often cannot be adequately quantified.
! Recreation: Roughly 50 percent of commercial airline travel and 60 percent of general aviation travel is for recreational purposes. This includes the valuable tourist trade which brings economic activity to the study region.
All of the above factors point to a value of an airport that is not easily quantified. The impacts that were estimated within the body of this report - direct, indirect, and induced - are only one facet of the overall picture. Gabreski Airport enjoys a significance that is much larger than these numbers can estimate. It is part of a scarce resource that needs support, protection, and appreciation from all the citizens that benefit from its operation, both directly and indirectly.
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