San Diego County Regional Airport Authority -- Untitled Document

State of the Authority Address

Joe W. Craver, Chairman
San Diego County Regional Airport Authority

11:00 a.m., Wednesday, February 23, 2005
Commuter Terminal,
Wright Brothers Conference Room

Introduction

Good morning everyone. On behalf of the entire Board of the Airport Authority, thank you for joining us today for the second annual State of the Airport Authority Address.

First, I’d like to say that I’m honored to have been elected by my fellow Board members to serve as Chairman in 2005. In so many ways, 2005 will be the Airport Authority’s most critical year. This Board – one of the most regionally diverse Boards in the county – will make 2005 our most successful year.

Airport Site Selection

In the year ahead, the Board will work toward a consensus on what is the best long-term air transportation solution for the region. We have a commitment to the voters of San Diego County to place an airport site selection measure on the ballot in November 2006. During the past year, the Airport Authority made a lot of progress moving the Site Selection process forward.

We worked with community stakeholders and employed innovative Geographic Information System technology to scour every inch of land and ensure that no stone was left unturned in identifying potential future airport sites. The Airport Authority’s staff and consultants conducted extensive analysis of potential sites, and that work will continue in 2005. The Authority’s Board also committed not to study any military bases until after the BRAC list is released later this Spring.

We want to state very, very clearly: The Authority Board fully supports the military and our military facilities. We do not see any conflict between our Airport Site Selection process and the BRAC process. And we will do everything we can to make sure that we do not in any way undercut our united regional effort to protect the military presence and bases in San Diego County.

Our Airport Site Selection Program is focused on bringing to the voters in 2006 a recommendation that offers the best solution to the air transportation capacity crisis that looms large over this community. Throughout the process, we have maintained our commitment to providing open and thorough communication and information to engage the public in this critical issue, and to help them make a well-informed decision in 2006. The region’s quality of life and economic health, for generations to come, will be shaped by the voters’ decision in 2006.

We want to thank our regional partners for their continued support and assistance:

ASAP-21
San Diego Regional Economic Development Corporation
San Diego Regional Chamber of Commerce
San Diego Convention & Visitors Bureau
San Diego World Trade Center

There are many other organizations and businesses who have our thanks. We will continue working with these and other stakeholders to build consensus on this crucial regional issue.

These organizations have supported our Aviation Education Forums, which bring together the region’s community and business leaders and other interested citizens on important airport and air transportation issues. We’ve learned from the experiences of such prominent speakers as Federico Peña, the former Denver Mayor and U.S. Transportation Secretary who built Denver International Airport. These Forums will continue in 2005. They will focus on important topics such as travel and tourism, air cargo, and international trade – and other issues to help the community understand what’s at stake. They will also address how important our current and future airport will be to the economy and competitiveness of the San Diego region.

We’d also like to pay special recognition to the members of the independent Public Working Group. These community stakeholders represent military, environmental, business, airline, local government and other community interests. Their input has been valuable and will be crucial to helping us arrive at the best long-term air transportation solution for the region. On behalf of the Board we would like to thank the Public Working Group members for their tremendous service.

Our challenge in 2005 will be to awaken and engage the public and community at-large to the importance of the airport issue. Only by coming together will our community solve this crisis. We cannot afford to put the hard decisions off to the next generation. As crucial as this issue is, it’s important to remember that the Airport Authority’s state-mandated responsibilities include other areas of strategic importance beyond airport site selection.

San Diego International Airport

Among the most important is the Airport Authority’s management of San Diego International Airport – the busiest, single-runway commercial airport in the nation. And things have been anything but slow at the Airport.

In 2004, annual passenger numbers reached an all-time high, surpassing 16 million passengers for the first time in the Airport’s history. That represents a 7.3% increase over the 15.2 million passengers the Airport handled in 2003. And landings and take-offs increased by 3% -- to 209,000 total operations.

The Airport Authority has launched an aggressive air service development program, and it is really paying off. We welcomed new carriers and many new routes in 2004:

Aloha Airlines became the newest airline to serve San Diego with nonstop service to Reno and Maui.
America West started nonstop service to Puerto Vallarta and Cabo.
Aeromexico started nonstop service to Puerto Vallarta.

And our air service development efforts will bring even more new flights in 2005:

Aloha Airlines is planning to introduce a new nonstop flight to Honolulu.
America West and Alaska Airlines will begin new nonstops to Vancouver this Spring.
And JetBlue and Independence Air will both offer nonstop flights to Washington D.C. beginning this Spring.

We now have 19 passenger carriers operating 240 scheduled departures daily, in addition to 6 all-cargo carriers. That’s a lot of good news.

It’s good for air travelers, giving them more flights to more destinations – and more competition, which brings better air fares.
It’s good for San Diego businesses – more flight choices and nonstops that will save time and money for companies and business travelers.
It’s good for travel and tourism. According to the Convention and Visitors Bureau, visitors coming to San Diego by air increased 7.6% in 2004.
And it’s good for the San Diego economy and jobs. Remember that every new job created at the Airport generates 15 additional jobs in the community.

While that’s the good news, the bad news is that the Airport is quickly running out of space. We’re facing a real shortage of gates, ticket counters and other facilities that airlines need to grow and serve our customers. Unless we expand and improve facilities at the existing airport, there won’t be any more room before too long.

How soon? Well, the current forecast shows the number of passengers nearly doubling to a level of 27-33 million in the year 2030. But before that occurs, the Airport will likely face serious congestion when the number of aircraft operations reaches a projected level of 260,000 sometime between 2015 and 2022.

To address the near-term constraints at San Diego International Airport, we’re updating the Airport’s Master Plan. This will help the Board decide on measured improvements to the existing Airport that must be undertaken to ensure we can handle growing airline and passenger demand – and maintain the high level of customer service – for the near term. We emphasize “near term” because these improvements will not solve our airport capacity problem. They will only help us get by until we can find a permanent solution – a new, modern international airport that can serve the region for generations to come.

Customer Service

We’re proud to report that customer service at the existing Airport has been nothing short of world-class. In 2004, Lindbergh Field was named the second-best domestic airport in the world by the International Air Transport Association. The Authority also won numerous other awards, including the highest honor in the airport industry, the Airports Council International-North America Award for Excellence in Marketing & Communications. This award recognizes outstanding achievement in reaching the public and communities an airport serves.

Underscoring the Airport’s commitment to being a good neighbor, the Airport Authority completed sound attenuation on the 500th home in its Quieter Home Program. That program will continue, with support from the Federal Aviation Administration, to bring a quieter environment to nearby residents impacted by aircraft noise.

And our partnership with the Transportation Security Administration has been exemplary, ensuring a safe and secure environment for air travelers. In 2005, the Airport Authority will continue to enhance the customer experience at San Diego International Airport.

Airport Land Use Commission

The other major state mandate for the Airport Authority is for the Board to serve as the County’s Airport Land Use Commission. In this capacity, the Airport Authority helps ensure that airports and airfields throughout the county – and their adjacent communities – remain good neighbors.

In 2004, the Airport Authority worked with airport jurisdictions within the County to adopt annual amendments to all nine Comprehensive Land Use Plans for San Diego County airports. The Airport Land Use Commission reviews development proposals and issues recommendations designed to safeguard public health and safety. The Commission’s concern is minimizing exposure to excessive noise and safety hazards around airports. It also seeks to prevent development that encroaches on landing paths, which can seriously hinder an airport’s ability to serve the region.

Financial Overview

The Airport Authority is still a relatively new agency in the San Diego community. 2005 marks only its third year as an independent agency. But in that short time, much has been accomplished. In our first two years after the Authority was formed from scratch, we got busy building an organization designed to serve our region well. And an organization that is in good financial health.

As a financially self-sufficient agency, the Airport Authority does not rely on taxpayer dollars or City or County funds for our operations.

At this Authority, lean budgeting and fiscal prudence are the rule. But this in no way detracts from our commitment to operate San Diego International Airport at the peak of safety, security and efficiency for our passengers. This agency continues to exceed its bond covenant requirement, with total assets of over $500 million. We have copies available of our current annual report, which includes the audited financial statements for the last fiscal year.

In recognition of the quality of the Airport Authority’s financial reporting, in 2004 it received a Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers Association of the United States and Canada.

Conclusion

So the Airport Authority enters 2005 with the Airport having reached record-high passenger levels and adding exciting new routes. And we see the region closer than it’s ever been before to making a decision about the best way to address its long-term air transportation needs. With an eye toward November 2006, we know that the public will continue to expect much of us.

As the historic vote nears, the tasks before us are clear:

Careful analysis of the sites remaining on the Airport Site Selection list;
Ongoing extensive community outreach and stakeholder input, with the goal of building consensus;
Continued world-class operation of Lindbergh Field;
And continued responsible stewardship as the region’s Airport Land Use Commission.

In the State of the Authority Address last year, we stated that we are a new agency, and we have the energy and drive that comes with newness. Building on our successes of the first two years, and buoyed by strong partnerships with our community stakeholders, that energy and drive will only increase in 2005. Future generations – the children and grandchildren and great-grandchildren of today’s San Diegans – are counting on us to do a good job here and now.

We look forward to helping the region finally arrive at the best solution for its air transportation future. We know that San Diegans expect from us nothing less. Thank you.