Subsidy on Brainerd Airport Radar Screen as Delta Prepares Departure

Since Delta announced the end of flights to Brainerd, the future of the north central Minnesota airport has remained in a holding pattern. One thing, however, appears all but certain. Taxpayers will begin subsidizing flights there, even as an air service waiting in the wings claims it could provide passenger service at no cost to taxpayers.

“My whole model is based on no subsidy, a basically different airline concept. You get paid at the end of the day from your wallets,” said Robert Powell, Sr., owner of Anoka-based Airmax Airlines in a recent conversation. “The market is there and it’s established. All you have to do is provide the service and the customers are there. It’s not like it’s a new service to Waxahachie.”

Airmax may be a long shot for now. While a 40-year veteran of the charter flight business, Powell would need to procure the planes to make it happen. His plan also hinges on not having to compete with a government subsidized carrier in the market. Still, it’s a sign of the times that Brainerd airport officials are keeping the door open, even a crack.

“We certainly aren’t saying no to anyone else. They (Airmax) were even talking about using a different hub, maybe Brainerd to Chicago. We’re very interested in all that,” said Beth Pfingsten, chairman of the Brainerd Lakes Regional Airport commission.

The two daily Delta flights averaged about 53 percent capacity and were not subsidized. Delta’s departure, however, opens the gate for Brainerd to join the list of 140 small airports subsidized under the Essential Air Service (EAS) program.

“Now that the government is broke, they’ve had another round of EAS bids for these routes and right now they’re offering $800,000 to subsidize service into Brainerd. It doesn’t make sense,” Powell said.

Before Delta takes off for good, the feds require another regional carrier service to be in place.  Great Lakes Airlines submitted the only official bid for the route, reportedly factoring in the federal subsidy as part of the deal. In 2010, Great Lakes Airlines’ parent company collected about $60 million in EAS payments on its routes, according to Aviation Week. The Wyoming-based carrier did not respond to FFM’s inquiries.

Yet the 1970’s vintage federal ESA program may be bracing for a crash landing in the current Congress, even potential elimination. Funding for the $200 million a year freebie runs out again in January, as Congress continues to work toward agreement on the Federal Aviation Administration reauthorization and reform.

While relying on the federal subsidy may buy Brainerd time, it could be a temporary fix that effectively postpones the inevitable—identifying a sustainable solution.

“How long is this EAS subsidy going to be around?  They’re looking at it going away. Where are we going to be in 3 years, 5 years and we have a carrier that can’t make it? Will these small carriers pull out because they can‘t make a buck without the subsidy? That’s a concern I have,” Pfingsten said.

All this uncertainty comes as the Brainerd Lakes Regional Airport wraps up a $7.4 million renovation, largely with federal funding.  The remodeling will be completed about the time Congress may be deciding on the federal subsidy that could ultimately make or break air service to Brainerd.  Despite the questions swirling over future services, airport officials stand by the terminal upgrade.

“I’m a pretty fiscally conservative person. I’m not the kind of person that just because the money is available that I’d say just because it’s there, it’s free, that’s not my philosophy or those on the commission either,” Phingsten said. “We take pride in that and it was time to do a renovation of the main terminal. Had we known Delta was pulling out, I don’t know what the commission would have done at that point.”

Brainerd passengers will face another unanticipated twist to the ground plan here. It turns out the new jet bridge that’s part of the renovation works with Delta’s planes, but not Great Lakes’ fleet. Passengers will still be braving the outside elements to board their flight.  With the onset of the EAS subsidy, taxpayers will also be left out in the cold—year around.                                   

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Tips or comments?  Contact Tom Steward at 612-354-2192.


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