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Airports are flying high

In the history of Canadian airports, there are two eras: before the 1990’s, and after. Why? Because in the 1990’s, Canada’s airports – once managed by the federal government – were transferred to local airport authorities under a not-for-profit model where all revenues are reinvested back into airport operations and capital expenditures.

“Today Canada’s model is unique in the world,” says Daniel-Robert Gooch, president of the Canadian Airports Council. “We were ahead of the curve. The combination of private expertise with community-based boards is admired by jurisdictions around the globe.”

Airports have never looked back, and for good reason. The benefits have been extensive.

“The current airport authority model has served Canadian air travellers very well over the past 25 years”, notes Halifax International Airport Authority President & CEO Joyce Carter. “Halifax Stanfield, for example, has seen infrastructure investments of over $550 million in the past decade, under the watchful eye of our locally-appointed Board of Directors, all directed toward increasing the airport’s economic and social contributions to our region.”

Canada’s air transport sector, of which airports are a big part, contribute $35 billion in economic activity and $7 billion in federal taxes. They have also paid $5 billion in rent to the federal government since 1992.

Beyond the numbers, airports have made an incomparable impact on building Canada into an economic powerhouse.

“Think of all the links airports enable – trade links, business links, between communities in Canada and around the world,” says Gooch. “Airports are truly Canada’s gateways to the world, connecting communities at home and abroad.”

To understand success today, you must understand the struggles of yesterday. Before the 1990’s, airports were centrally managed by the federal government. Operating at a significant loss, by the time airport ownership was transferred, the cost to taxpayers was $135 million per year.

Beyond the cost deficit was the infrastructure deficit. With little money to go around, infrastructure investments were few and far between. Airports aged and repairs were desperately needed.

“The airports that were transferred absolutely needed to be reinvented,” says Gooch.

Reinvention was called for, and the calls got louder and louder. It was around this time that leaders at the Greater Vancouver Board of Trade came together and said, our airport needs to be doing more for us. Vancouver was poised to be a gateway city between the Asia-Pacific and North America. To do it, they needed a better airport. How? Through local control.

Today, officials on the boards of Canadian airports are nominated by local business groups, the municipalities and provincial and federal governments. Airports currently all operate on a not-for-profit basis. That’s led to $22 billion in infrastructure investment without a penny of taxpayer support.

But at the end of the day, the greatest benefit is local orientation.

“Airports have been transformed over the last couple of decades – they are now proper gateways to their communities,” says Gooch.

 

 

Airports’ Tax Contributions

Passenger Flow

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