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Tampa airport planning staff buyouts, ‘three to four years’ for recovery

The airport's proposed new budget projects a big drop in revenue, with passenger traffic recovering slowly from 2020

As the airline industry braces for a years-long recovery from the coronavirus pandemic, Tampa International Airport on Thursday laid out budget shortfalls and cuts it’ll see into 2021 — including a round of staff buyouts starting Friday.

Airport executives outlined ongoing struggles during a Hillsborough County Aviation Authority meeting, including a projected $74.6 million shortfall in operating revenue for the fiscal year ending in September.

Damian Brooke, executive vice president of finance and procurement, said the airport faced a “gradual, almost linear recovery” to its pre-2020 levels of growth, expansion and passenger traffic.

“Obviously, there’s been a lot of unknowns with traffic projections over the next 18 months,” Brooke said. “We’ve based our longer-term forecast more on the generally accepted recovery timeline of about three to four years for the industry.”

For the full fiscal year, ending in September, the airport anticipates seeing 13.2 million passengers, about 43 percent lower than their budget and 40 percent lower than the previous year. Despite savings measures already taken this summer, it expects a net loss of more than $40 million.

The airport will offset those losses through an $81.2 Coronavirus Aid, Relief and Economic Security (CARES) Act federal grant, using $44.2 million of that money to cover its debt. It plans to use the remaining grant money next year.

And next year doesn’t look much brighter. From 2010 to 2019, the airport’s passenger traffic rose every year, from 16.6 million to 23.3 million. In 2021, it expects passenger traffic to be 15.7 million, its lowest tally since the Great Recession. Operating revenues are budgeted at $219.4 million for next year, an 18.6 percent drop from 2020.

“I’ve looked at our county budget for the next year, and because of this COVID-19, we’re all going to be suffering, and we don’t know what’s going to happen here,” said board member and Hillsborough County Commissioner Les Miller. “This could be a very, very difficult year for the Aviation Authority, and all budgets with agencies across this county and across the state.”

Starting Friday, the Authority will offer buyout packages aimed at cutting employee expenses by $2.5 million. The Authority has 657 employees who have until Sept. 22 to take the buyout. There’s no set head count for the reductions, said airport spokeswoman Emily Nipps, as compensation will be based on service time.

“We felt this was the best way to approach payroll expense cuts because it gives our employees a choice,” Nipps said, “and we have many employees that have been with the Authority for 30-plus years who may consider this to be the best option for them.”

At least 10 airlines, concessionaires and rental car companies operating at the airport have laid off or furloughed staff since March, or said they will do so this fall. The airport has waived rental fees through September for 16 tenants during the pandemic, including $16.2 million from rental car companies and nearly $11 million from concessionaires. The board voted Thursday to extend those waivers into 2021.

The board approved $47 million in capital investments during the next fiscal year, including work on the airport’s shuttle cars, elevators and employee buses. Some projects will be covered through bonds and grants from the Florida Department of Transportation.

One bit of airport business that got tabled: CEO Joe Lopano’s annual performance and salary review. Board members commended Lopano on his leadership during the pandemic, but with the airport having frozen hires and merit-based raises, they agreed Thursday wasn’t the best time to talk pay bumps.

“If we were not going through a pandemic, if we had not got a presentation of what our budget looks like in the future, I would be the first one to make a motion to do whatever we could to compensate him,” Miller said. “But today is just not the day to do that.”

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