The Show-Me Institute published a new analysis this week of the potential costs for a new single-terminal Kansas City International Airport.
By DAVE HELLING
“An optimistic projection of future income still shows that Kansas City International Airport will lose tens of millions of dollars a year trying to pay down the debt for a proposed new $1.2 billion terminal,” the column says.
Well, maybe. Let’s look at some numbers.
The column suggests the debt service on a $1.5 billion bond issue would be an additional $68 million a year. (That actually seems a bit low. It would have to be a 30-year issue, or $68 million might not be enough.)
For the sake of argument, though, let’s round up annual debt service to $70 million.
More than five million people fly out of KCI each year. Assuming traffic remains steady, that means five million passengers would have to provide an additional $70 million a year to meet the debt service.
My calculator shows that’s $14 per passenger.
And that’s all revenue sources, not just tickets. (Kansas City now collects a $4.50 passenger facility charge, the maximum allowed.)
The $14 isn’t peanuts, of course. But it isn’t impossible to see how a combination of higher airline charges, more concession revenue, higher parking fees, cost reductions, and other steps could provide an additional $14 of revenue per passenger per year.
Right now, most airlines charge passengers another $20 just to carry a piece of luggage.
That doesn’t mean building a single terminal airport is a good idea, by the way. That $14 per passenger is money spent on the airport that could not be spent on groceries, or a movie ticket, or a new pair of shoes. Or maybe that $14 could be collected from everyone and spent on other pressing city needs, like roads and bridges.
The merits of a new airport remain a subject for examination.
But the financing may be easier than opponents suggest.
Here’s Lynn Horsley’s story.