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County to pay 5.5% of maximum commitment to SkyWest, agrees to subsidy extension

5/17/22 - CNCIA airport director Glenn Januska (Gregory Hirst, Oil City)

CASPER, Wyo. — Natrona County will end up paying about $25,109 to fulfill its original commitment covering up to $453,000 in projected losses by SkyWest to maintain a daily Delta flight between the Casper-Natrona County International Airport and Salt Lake City, Utah. At a work session Tuesday, the commission also gave an informal thumbs-up to continue the minimum revenue guarantee, up to $600,000, to the end of the year.

Last fall, airport director Glenn Januska told the commission that the airline was poised to pull the flight entirely, as it had from other unprofitable markets, unless the county agreed to cover the losses from November to April. Januska assured them the airline’s calculation that flight capacity would only be 55% was conservatively low.

Though the commission was initially reluctant, business leaders spoke in favor of keeping the Salt Lake City connection. The Wyoming Aeronautics Commission also approved paying 40% of whatever the county ended up owing.

For the life of the six-month MRG, flight bookings and fares consistently beat projections, Januska told the commission Tuesday. For the first three months, the county ran a credit on its commitment. Almost $44,000 of the cumulative $62,774 in losses over the six months was due to fuel costs.

Commission chair Paul Bertoglio asked Januska to address the prospect that the county may be granting an MRG into perpetuity.

“If this was a normal year, a pre-COVID, non-fuel-cost-issue year, we would not be talking about a Minimum Revenue Guarantee to begin with,”  Januska said, adding that leisure travel is likely to be steady throughout the summer. When the commission first approved the MRG last October, airlines nationwide were struggling with pilot shortages and waves of COVID and its variants.

Advance Casper CEO Justin Farley told the commission Tuesday that the newly established 501(c)(4) would pay 20% of the losses up to $80,000, including during the eight-month extension. Though city, county and airport officials sit on the board, Farley said the City of Casper “has not volunteered anything yet.”

Farley told Oil City previously that the business community knows the value of connectivity to growing and diversifying business, the SLC line particularly.

Januska said previously that airline subsidies, while virtually new to Natrona County, are common and ongoing throughout the state (including in Jackson, Gillette, Sheridan, and Cheyenne) and that many are managed by 501(c)(4)s or similar community coalitions.

The fact that the county’s final bill was a small fraction of what it agreed to cover is evidence that the airline operator was reporting losses in good faith, he added.