Washington Aviation Economic Impact Study Final Technical Report July 2020 Prepared for 7702 Terminal Street | Tumwater, WA 98501 Prepared by In conjunction with NOTE The preparation of this document was financed in part through a planning grant from the Federal Aviation Administration (FAA) as approved under the Airport and Airway Improvement Act of 1982. The contents of this report reflect the views of WSDOT, which is responsible for the facts and the accuracy of the data depicted herein, and do not necessarily reflect the official views or policy of the FAA. Acceptance of this report by the FAA does not in any way constitute a commitment on the part of the United States to participate in any development depicted therein, nor does it indicate that the proposed development is environmentally acceptable in accordance with applicable public laws. Table of Contents Introduction ............................................................................................................................................. i Study Components ........................................................................................................................ i Purpose, Benefits, and Study Tools ............................................................................................... ii Changes Over the Study Timeframe Including the Effects of COVID-19 ........................................ iii Study Airports and Regions ........................................................................................................... v Differences with 2012 AEIS .......................................................................................................... xi Chapter 1. Economic Impact Approach .............................................................................................. 1.1 1.1 Overview ........................................................................................................................... 1.2 1.2 Approach to Data Collection and Calculation ..................................................................... 1.4 1.2.1 On-airport Activities .............................................................................................. 1.6 1.2.2 Off-airport Visitor Spending ................................................................................. 1.10 1.3 Economic Modeling Process ............................................................................................ 1.18 1.3.1 Use of IMPLAN .................................................................................................... 1.19 1.4 Approval and Validation Methods .................................................................................... 1.22 1.4.1 Data Inputs ......................................................................................................... 1.22 1.4.2 Direct Impacts ..................................................................................................... 1.23 1.4.3 Multiplier and Total Economic Impacts ................................................................ 1.23 1.5 Methodology to Estimate Data for Non-responsive Airports ............................................ 1.24 1.5.1 Direct On-airport Jobs ......................................................................................... 1.24 1.5.2 Capital Improvements ......................................................................................... 1.26 1.5.3 Operating Expenses ............................................................................................. 1.27 1.5.4 Visitor Spending .................................................................................................. 1.28 1.5.5 Summary of Methodology for Non-responsive Airports ........................................ 1.28 1.6 Summary ......................................................................................................................... 1.29 Chapter 2. Economic Impacts of Washington Airports ....................................................................... 2.1 2.1 Introduction to Impacts ..................................................................................................... 2.2 2.2 Economic Impacts of On-airport Activities and Visitor Spending......................................... 2.6 2.2.1 Economic Impacts of On-airport Activity ................................................................ 2.7 2.2.2 Economic Impacts of Visitor Spending ................................................................... 2.9 2.2.3 Multiplier Effects – Impacts to Supplier Sales and Income Re-spending ................ 2.13 2.2.4 Economic Impacts to Industries ........................................................................... 2.14 2.3 Impacts by Region ........................................................................................................... 2.16 2.4 Economic Impacts by Legislative District .......................................................................... 2.18 July 2020 | Table of Contents 2.5 Tax Revenue Analysis ....................................................................................................... 2.20 2.5.1 Washington State Taxes and Fees ....................................................................... 2.20 2.5.2 Visitor Spending Tax Impacts ............................................................................... 2.21 2.5.3 State Aircraft Taxes ............................................................................................. 2.23 2.5.4 Total Statewide Tax Impacts of Washington Airports ........................................... 2.23 2.6 Summary ......................................................................................................................... 2.24 Chapter 3. Key Washington Aviation Activities .................................................................................. 3.1 3.1 Key Aviation Activity Forecasts .......................................................................................... 3.2 3.2 Direct Economic Impacts of Washington’s Key Aviation Activities ...................................... 3.2 3.2.1 Commercial Passenger Service .............................................................................. 3.3 3.2.2 Agriculture ............................................................................................................ 3.8 3.2.3 Pilot Training and Certification ............................................................................ 3.11 3.2.4 Business and Corporate Aviation ......................................................................... 3.15 3.2.5 Air Cargo ............................................................................................................. 3.19 3.2.6 Aerospace Manufacturing ................................................................................... 3.23 3.3 Economic Impacts of Air Cargo ........................................................................................ 3.26 3.3.1 Data Sources ....................................................................................................... 3.27 3.3.2 Washington’s Air Cargo Volume and Value .......................................................... 3.28 3.3.3 Methodology....................................................................................................... 3.31 3.3.4 Total Economic Impacts of Air Cargo ................................................................... 3.37 3.4 Economic Impacts of Aviation on the Agricultural Sector ................................................. 3.43 3.4.1 Agriculture’s Economic Contribution .................................................................... 3.43 3.4.2 Aerial Application ................................................................................................ 3.43 3.4.3 Economic Impact of Washington’s Agriculture Sector .......................................... 3.47 3.4.4 Total Contribution of Industries Supported by Aerial Application ......................... 3.48 3.4.5 Agricultural Impacts Conclusion .......................................................................... 3.50 3.5 Summary ......................................................................................................................... 3.50 Chapter 4. State Aviation Investments ............................................................................................... 4.1 Overview of System Drivers ............................................................................................... 4.1 Review of Previous Studies ................................................................................................ 4.4 4.2.1 WASP Economic Vitality Goal, Performance Measures, and Metrics ...................... 4.4 4.2.2 Airport Investment Study Recommendations ......................................................... 4.6 Economic Performance Measure Considerations ............................................................. 4.10 Key Considerations .......................................................................................................... 4.11 4.4.1 Potential Preliminary Economic Measures Evaluated ........................................... 4.11 July 2020 | Table of Contents Performance Measure Recommendations ....................................................................... 4.17 4.5.1 Metric: Value of Enplaned & Deplaned Air Cargo ................................................. 4.19 4.5.2 Performance Indicator: Airports that Report Air Cargo Activity to WSDOT