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Allegheny County Airport Authority still employs at heyday level

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Sunday, May 4, 2014, 10:50 p.m.
 

The Allegheny County Airport Authority employs about the same number of people as it did a dozen years ago, before US Airways dismantled its Pittsburgh hub and passenger traffic plummeted more than 50 percent, records show.

“Companies in the private sector all go through some weight loss when going through difficult times. There's no reason why the public sector shouldn't do the same,” said Satish Jindel, a transportation and logistics consultant based in Franklin Park.

Savings from scaling back Airport Authority employment could drive down airlines' costs in Pittsburgh and spur them to boost flights, Jindel contends. Pittsburgh's eight airlines make an average of 138 daily flights to 36 destinations, down from more than 600 flights to 110 destinations in 2002.

“That's the No. 1 complaint we get. If you want to go somewhere, there's a good chance you'll have to connect through someplace else first,” said Jeff Underwood, president of the Carnegie-based Tzell Travel Group.

The Airport Authority employed 462 people at the end of last year, up slightly from the 460 it employed at the end of 2002, records show. The authority operates Allegheny County Airport in West Mifflin, a general aviation facility with no commercial passenger traffic.

The number is higher than employment at agencies running comparable airports in Cleveland, Columbus, Indianapolis, Milwaukee and San Antonio, records and interviews show. Employment at the other airports ranged from 334 to 450.

Pittsburgh officials insist they run a lean operation and that employee numbers don't go hand-in-hand with passenger traffic.

“It's not like we're Maytag repairmen, just sitting around waiting for something to break or something to do,” said James R. Gill, the authority's acting executive director, noting the authority has the same amount of airfield and roads to maintain. Its terminals are more than 20 years old and require attention.

Gill said the authority's Airline Services Department assumes duties that airlines once handled, including maintenance and operation of the baggage system, and repairing jet bridges that carry passengers between planes and the terminal.

That department was established in 2004, when US Airways closed its hub after emerging from its second bankruptcy in two years, Gill said. The department employed one person then, grew to 52 in 2005 and peaked at 76 the next year. Today, it has 68.

“The department exists only at the request of, and in consultation with, our airlines. I think our staff handles the work more effectively than it's ever been handled before, with one set of standards instead of different ones for each airline,” Gill said.

Still, Jindel thinks the Airport Authority should slash employment at least 10 percent. That would eliminate 46 jobs and cut annual spending on wages and benefits by about $3.8 million, based on the authority's average labor costs of about $85,000 per employee.

Airlines are set to pay $57.1 million to operate in Pittsburgh this year, records show. If officials used the savings Jindel recommended to reduce airlines' costs, Pittsburgh's cost per enplaned passenger — an industry benchmark — would drop from $13.92 to an estimated $13.

The median cost per passenger for midsized airports is $7.76, according to Moody's Investors Service.

Mike Boyd, a Colorado-based airline industry consultant, told the Tribune-Review that passenger demand trumps all other factors, including airport costs, in influencing airlines to add or cut service in a market.

“You have virtually all the air service you're going to get,” he said.

Jindel conceded such a reduction by itself might not be enough to entice airlines to boost flights, but he added: “(Airport officials) should always be looking in the mirror and saying, ‘What can I do to bring costs down and bring in more flights?' ”

Gill said the authority spends about $33 million a year from various sources to reduce airlines' fees, including $12.4 million in tax revenue from Pennsylvania's casinos; $15 million collected from a passenger facility surcharge on airline tickets; and, new this year, about $5 million from a deal that will allow Consol Energy Inc. to drill for natural gas on airport property.

Without it, airlines would pay more than $21 per passenger to operate in Pittsburgh.

Cecil-based Consol paid a $46.3 million signing bonus last year. The authority plans to spend that during five years; about half of the money will go toward reducing airlines' costs. More money will arrive when Consol starts drilling. County officials expect more than $500 million in royalties during 20 or more years.

Airlines' costs could further decrease in 2018 when the authority pays off two-thirds of its debt — most related to $1 billion in airport construction in the early 1990s. That will slash annual debt payments from about $66 million to just more than $20 million, Gill said.

Bijan Vasigh, economics professor at Embry-Riddle Aeronautical University in Daytona Beach, Fla., said airports need to cut costs where possible just to maintain service, because airlines continue to reduce flights and shed planes through mergers and economic turbulence. The nation's domestic flights dropped in each of the past five years, falling a combined 16 percent, federal data show.

“That's a fact of life these days,” Vasigh said.

Comparing employment numbers at airports is difficult, Vasigh and airport officials said. Some use consultants or subcontractors for work that others handle in-house, and some airports include certain types of workers on payrolls that others do not, they said.

“It's often not apples-to-apples,” said Angie Tabor, spokeswoman for the Columbus Regional Airport Authority, which runs the 6.2 million-passenger Port Columbus International Airport as well as a separate airport dedicated to air cargo operations and a general aviation airport.

Columbus does not count seasonal employees, including firefighters and workers who help clear runways of snow and ice, Tabor said.

The Allegheny County Airport Authority employment roster includes about 20 seasonal employees and 54 in fire services but does not include police, placing it alone among the comparable airports. Neither airport officials nor Allegheny County police would say how many officers work on airport duty, citing security reasons.

Tom Fontaine is a Trib Total Media staff writer. Reach him at 412-320-7847 or tfontaine@tribweb.com.

 

 

 
 


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