TAMPA — The pandemic’s damage to Tampa International Airport’s bottom line is big, but not bigger than the airport’s ability to respond, officials said Thursday.
As travelers vanished in March, the airport lost $5.9 million in revenues, and that’s just the start.
Damage to air travel is projected to cost the airport another $41 million in revenue from April through September. After factoring in cost reductions, the airport is likely to be $31 million off its budget for the second half of its fiscal year, which ends Sept. 30.
For the year, the airport projects it will see 13.2 million passengers — 40 percent fewer than last year’s record number of 23.3 million.
“We’ve seen a complete decimation of demand," said Chris Minner, the airport’s executive vice president of marketing and communications. “Most airlines were down somewhere between 40 and 60 percent for the month of March. ... By the end of the month, passenger activities had ground almost completely to a halt.”
For April, the airport has been running 97 percent lower than normal. That includes a complete stop of all international flights.
Although airlines have reported seeing a “very slight” uptick over the last seven to 10 days, Minner said, “we do not know what the shape of recovery from this COVID pandemic is going to be.”
After the Sept. 11 terrorist attacks and the Great Recession, “it took literally years for passenger traffic to recover,” he said. “Beyond that, it took even longer for airline operating revenues to recover. ... We’re expecting that the recovery from this pandemic will take time.”
After a strong start to the year, the authority expects to end its fiscal year with $226 million in revenues, or 16 percent less than budgeted before the pandemic, according to airport executive vice president of finance and procurement Damian Brooke.
As a result, the authority anticipates using $25 million from reserves to help cover its expenses. The authority started its fiscal year with $106 million in unrestricted reserves and also has reserves from customer facility charges that it collects on each car rental made at the airport, officials said.
Those resources, plus the strong start that the authority had early in the year, mean that airport officials expect to make all of their debt payments this year. In addition, the $81.2 million in pandemic relief funds that the U.S. Department of Transportation has said the airport will receive can be used to repay debt, if necessary.
In the meantime, the aviation authority is taking steps to provide relief to airlines, concessionaires, rental car companies and the operators of its smaller airports in Tampa and Plant City whose business has been hammered by the pandemic.
“Nearly every tenant of the Hillsborough County Aviation Authority at this point has requested some form" of assistance, Minner said.
Authority board members voted to March rents and other fees to some companies that agreed to repay what they owed in July, August and September. The authority will cover those waived fees from its reserves.
Board members approved a total of $4.93 million in waivers for 10 airlines: American, Delta, FedEx, Southwest, Spirit, United, UPS, Air Canada, American and Lufthansa.
The authority also waived $2.2 million in March rents and fees for five rental car companies (Enterprise, Hertz, Ace, Executive and Fox) and $1 million for five concessionaires (Host International, TPA Hospitality Partners, HBF Tampa Partners JV, Paradeis-TPA, and Stellar Partners Tampa).
“I think it’s probable that concessionaires aren’t going to be able to pay this back," Tampa Mayor Jane Castor said before the vote. She suggested the airport review that in three months, which airport officials said can be done. “I know that everybody’s hurting, and it’s going to be difficult ... to get out from under this.”
Several transportation companies that didn’t get waivers told the authority that having to repay the money could put them out of business forever.
Yellow Cab of Tampa president Louis Minardi asked the authority to waive all of its minimum monthly payments of $16,239 and just collect the fee of $5 per airport pickup.
“We have lost over 100 vehicles and drivers in less than a month, reduced our leases to drivers that have stayed, cut staff, applied for loans and on the heels of the introduction of ride-sharing our industry is devastated,” Minardi said in a statement read to the board. “Simply deferring the monthly minimum payments will just add unwarranted debt and increase the chances that our industry will never recover.”
The lost revenue and business disruption Tampa International is seeing is by no means unique.
Nationwide, travel lost to the pandemic is expected to eliminate 5.9 million jobs, according to the nonprofit U.S. Travel Association, which cited data from the research company Tourism Economics. The company projected the travel industry to lose 78 percent of its revenue in April and May and to see its business decline 34 percent for the year. Travel industry losses for the year, including air transportation, lodging, retail, restaurants and recreation, could reach an estimated $400 billion.
Overall, the U.S. Travel Association said the expected loss of travel-related economic output this year could be seven times greater than the impact of the 9/11 terrorist attacks and their aftermath.
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