The conversation with [Southwest Airlines chief executive Gary] Kelly, which [Mayor Sly] James initially denied but Southwest confirmed, happened early in the week. James, through a spokeswoman, said the conversation was about cost sharing among airlines for a baggage handling system at the KCI terminal, a $20 million element in the project but a fraction of the overall cost.

I don’t know why the mayor would have initially denied speaking with an executive at Southwest. However, it is the sort of tactic that proponents of the new single terminal have been employing since the very beginning. Remember that proponents of the new terminal told us that there is no correlation between ticket prices and the fees airlines pay to fund airports. But Spirit and Allegiant Airlines have made it clear there is a connection.

Then we learned the price for the terminal was going way up. Cat Reid’s story on November 1 for KSHB indicated that this wasn’t a big deal for the airlines:

The director of the Kansas City Aviation Department, who has been meeting with airline executives across the country, said they have “no anxiety at all” about the $1.9 billion price tag on the new terminal.

But that wasn’t true. The airlines did have problems with the $1.9 billion price tag, and are asking to have their own consultants look at the price.

Fox 4 reported on November 15 that Mayor James said the price problem was specific to a dispute about paying for the new baggage handling system. But that wasn’t true, either. While there is a dispute regarding baggage fees, Steve Vockrodt reported on December 2 in the Star that, yes, the price itself was a point of contention.

Part of the reason why airline buy-in is so important is that Kansas Citians have been told all along that the airlines would be footing the bill without taxpayer funds. But this might not end up being the case—finance department representatives said they might use the general fund to cover initial costs. Now the city council is acting to make sure that those previous promises are honored.

Regardless of whether officials are misleading the public or simply do not know what they are doing, the airport project appears to be a mess. But civic leadership is willing to look the other way. Good public policy is unlikely to result from such an awful process.

The post What Is Going On with the KCI Project? appeared first on Show-Me Institute.

The argument about ticket prices is so misleading that it could seem to be intentionally so. Consider this: Airlines pay rent to airports that is measured in terms of cost per enplanement (CPE)—in other words, per person boarding the plane. In 2016, Lynn Horsley wrote in The Kansas City Star,

In 2015, based on an industry measurement, the cost of operating KCI was $6.70 per enplaned (departing) passenger. With a $970 million improvement project, which is the estimated cost of a new terminal, that cost per passenger boarding would bump up to about $9.00 in 2015 dollars.

Since that story, the cost of the new terminal has more than doubled that $970 figure. Will the new CPE really be $18 or over? This chart of the top 50 airports ranked by CPE suggests that an $18 CPE would make Kansas City International the 7th most expensive airport in the country. This is the higher cost that Allegiant and Spirit Airlines say they cannot bear. According to the Star:

Matt Klein, senior vice president and chief commercial officer for Spirit, said in his letter that Kansas City’s aging airport should be updated and is “not befitting of a major U.S. city.”

“However, we believe the current investment proposal is simply … too costly for smaller new entrant carriers to bear and still deliver the value that we deliver to the community in terms of low airfares,” Klein said.

Allegiant’s vice president of airports and government affairs, Keith Hansen, wrote to reiterate the airline’s support for the project, but said larger airlines were expecting smaller airlines to shoulder an unreasonably large portion of the costs of operating the airport.

“Given that the terms for the new airport rates and charges agreement remain unknown and considering the larger carriers continue to reject equitable cost allocation, Allegiant cannot support the terminal development program at this time,” Hansen said.

So . . . if KCI is too expensive for these low-cost airlines, they may just stop serving Kansas City altogether. Less competition at KCI will mean higher fares, higher parking fees, and so on to cover the monstrous amount of debt that a $2 billion airport terminal requires. And if it is too expensive for the remaining airlines, they may also stop serving KCI. Who makes the bond payments then?

Taking on such a large amount of debt to build a new single-terminal airport includes a significant amount of risk—not just for the airlines and bond holders, but for the airport and the city itself. Giving taxpayers the impression that all of this is free is irresponsible and suggests a lack of candor from policymakers.

The post KCI Airlines Links New Terminal Costs with . . . Service appeared first on Show-Me Institute.

To us, one of the main selling points of the proposed new terminal is the expectation that airlines would add more direct flights out of here, and maybe even some international flights.

Two days later, Star reporter Steve Vockrodt authored a piece that made clear there was no guarantee of new flights should voters approve a new terminal. Vockrodt clarified:

A new terminal, by itself, won’t lead to more direct flights to more destinations.

“That’s probably fair,” said Steve Sisneros, senior director of airport affairs for Southwest Airlines, the dominant airline flying in and out of KCI.

The editorial board did eventually correct their error, stating on October 15 that, “There are no guarantees that more flights will be added by the airlines if voters agree to construct a new single terminal.” The next day, Vockrodt caught pro-terminal mailers making the same mistake.

In that October 15, the Star editorial board again endorsed a new terminal vote, but seems to have made a second error, stating that, “if nothing is done, the number of flights out of KCI will continue to dwindle.”

Dwindle? According to the Aviation Department’s own statistics, enplaned passengers (those boarding an airplane) are up 4.5% over last year. Likewise, air carrier operations showed an increase in flights of 5%. Southwest Airlines—the biggest carrier at MCI—saw an increase of enplaned passengers of 5.6% over last year. Passengers and flights are increasing, not dwindling.

Two emails obtained by the Show-Me Institute (see links at the bottom of this post) and sent by Mark Nevins of the Dover Strategy Group—the company running the yes vote campaign on the airport—indicate that members of the Star editorial board are apparently committed to supporting the effort with regular editorials. In an October 8 email, Nevins links to a supportive op-ed and writes that single-terminal backers “can expect to see more of these kinds of generally supportive editorials in the weeks ahead.” Then in an October 15 email Nevins reiterates that the Star “will continue to publish editorials supportive [sic] Question 1 on a regular basis through Nov 7.” I hope the editorial board is not simply working as a mouthpiece for the yes campaign. Of course, that could explain why the latter’s misleading claim about increasing the number of direct flights also appeared in a Star editorial. It might also explain why the Star is running editorials pushing the new terminal regularly—so as to make them more a part of the campaign than an expression of editorial board views.

This same editorial board has decried the airport bidding process as “marked by distrust, misinformation, unnecessary secrecy and conflict.” It would be a shame to learn that in its zeal to promote a single terminal, the Star editorial board has contributed to the very atmosphere of distrust that it decries by helping spread misinformation about the airport.

The post Is the Fate of Kansas City’s Airport Terminal In Its Star? appeared first on Show-Me Institute.

In opinion survey research, the number of people surveyed is less important than randomness. A survey of 2,000 people who themselves decided to complete an online questionnaire, for example, may be less valuable than a survey of 200 people who were contacted at random. Without adequate randomization, survey results may over-represent the views of a group of passionate partisans.

Unscientific survey data—data lacking adequate randomization—has played a big role in the debate about whether or not to build a new single terminal at MCI. Some of it is due to passionate partisans; some of it is due to questionable reporting. Much if not all of it creates the sense that building a new terminal is more popular than it is.

Consider some questionable reporting. The Kansas City Business Journal published a front-page piece indicating that the average TSA wait time at MCI was 29 minutes. Anyone who has flown from Kansas City would be suspicious of that figure, and other average wait times should have suggested to reporters that the data was problematic. (Jacksonville and Phoenix airports both listed an average TSA wait time of zero!). Kevin Koster, who served on the Mayor’s Airport Terminal Advisory Group, was skeptical, and he followed up with his own research (see here and here). In short, the TSA reports that MCI’s actual average wait time was 3.63 minutes. The discrepancy is due to the fact that the Business Journal data came from a website in which travelers report their own wait times without any independent verification. The Business Journal basically relied on an online survey that has little or no scientific validity—perhaps travelers whose wait times were uncharacteristically long were overrepresented among the website’s respondents.

Even some of the other, likely scientifically valid polling that has been reported fails to meet the ethical standards set by the American Association of Public Opinion Researchers (AAPOR) because it does not disclose all the questions asked.

Then there is the Aviation Department’s own online survey. At the City Council’s August 10 Business Session, department officials provided an overview of their presentations to groups across Kansas City about the need for a new terminal. After their presentation (which included a long discussion of the Aviation Department’s own scientifically invalid survey of session attendees), Councilman Jermaine Reed offered a startling admission [starts 19:26],

I can tell you that every time I fly I certainly try to get on the survey and make sure I mark everything bad about the airport. I don’t say anything good. I put no, no, one, one, zero, zero. What can we improve? Everything.  In my comments so … I shouldn’t probably tell you that. If you see the comments it is probably me.

Proponents for a new terminal are aware of public misgivings. Sadly, rather than having the serious and legitimate concerns of skeptics addressed, we have seen favoritism, secrecy, and now questionable polling that creates the misleading impression that the public is on board with their plans. Kansas City deserves better. 

The post About All Those Airport Surveys appeared first on Show-Me Institute.

Could the airport just be a legacy project? Two years ago, then–Aviation Department Director Mark VanLoh made it seem that way when he told the Northland Regional Chamber of Commerce, “You don’t have [all the information] yet. We don’t even have it yet. I know what I want because I want a new airport.” He just wanted it.

VanLoh is gone, but the strange enthusiasm for a single terminal continues. The new plan is just as over-the-top as the old one. The justifications for the spending come and go—claims of EPA mandates, TSA concerns, and airlines’ refusal to expand services—but the project itself remains the same: a $1.2-billion single terminal that is actually a downsizing of what we have now.

What is new in this round of the discussion is the financing and no-bid contracting. But regardless of who finances and builds the airport, the risk to Kansas City comes from the possibility of increased fees to airlines and passengers. Right now, Kansas City’s airport is very cheap for airlines, and travelers benefit with lots of flights from here. Increase the costs to airlines, and we risk losing that competitive advantage. Other airports have suffered after building new terminals for just that reason (Consider Cincinnati, Sacramento, or San Jose.).

The good news is that the city is no longer claiming that the airlines agreed to finance the project. This was never the case, despite incorrect claims from the Kansas City Star and the Kansas City Business Journal. In truth, the airlines merely agreed to pay higher rent for a new terminal while reserving their right to renegotiate once the terminal is built. They did not issue or back any debt; they accepted no risk.

Proponents of a new terminal are fond of telling us that the new terminal idea is not a Taj Mahal. In fact, they’ve been using that curious term over and over again for years (see the Google search here). The Taj Mahal, of course, is a 400-year-old elaborate mausoleum in India built to house an emperor’s wife. Such determination to settle for nothing less than a new terminal, however, combined with the candor of Mark VanLoh and the out-of-hand dismissal of cheaper alternatives, suggests that this is exactly what the new terminal is: a modern monument to political ego—not what is best for Kansas City.

The post Kansas City’s Airport: A Monument to Political Ego appeared first on Show-Me Institute.

• People in Kansas City love their airport. Pride in a local airport probably isn’t very common around the country, but it is a very important aspect of this campaign. Mayor James, before celebrating criticism of the airport, counseled consultants not to criticize the airport for that very reason.
• The plan at hand is to spend $1.2 billion to reduce the number of gates we have now. Where else does a city spend that sort of money to get less service?
• The matter of financing has never been an issue with the Show-Me Institute. Back in 2014, we listed some reasons to oppose the airport terminal, but the cost to taxpayers is not one of them. Financing only became an issue when city leaders said that the airlines agreed to finance the project. They didn’t.
• Regardless of whether the financing is done publicly or privately, it would result in a higher cost to travelers to pay down the debt. That higher cost would make MCI less attractive to airlines and travelers alike. Consider Cincinnati, where ticket prices were so high that local businesses flew employees out of Dayton, an hour away. Or consider Sacramento. Or San Jose.
• We published a piece in 2014, “Five Good Reasons to Reject New KCI Terminal.” At least four of those reasons still stand, and the piece remains a worthwhile read.

According to the Star story, Kansas City engineering firm Burns & McDonnell has proposed to privately build and finance a new single terminal at MCI. However, there appear to be strings attached:

One key to the proposal for Burns & McDonnell is that it would get an exclusive arrangement with the city to provide the design and come up with a guaranteed maximum price.

Other firms would not have access to make their own offer, nor would the city request bids.

Not surprisingly, Steve McDowell, CEO of BNIM (another architectural firm in KC), expressed concern that such a deal would exclude a great deal of area architectural and engineering talent, telling the Star that “some of the best work in the country is coming out of our city, and I’d hate to see that not taken advantage of for the design of our gateway.”

• The Show-Me Institute is aligned with The Kansas City Star editorial board calling for a policy debate that is “open, fair, complete, fact-based and inclusive.” If the past four years are any indication, it’s fair to wonder whether that debate will happen.
• Lastly, the Star mentions that privately financed airports are nothing new; they’re common in Europe. And therein lies an idea worthy of consideration in Kansas City. If Burns & McDonnell is eager to build and operate a new terminal, why don’t they buy the whole thing? The Show-Me Institute published a paper on this not too long ago. (See page 17.) Not only is Branson’s airport privately owned, but the Kansas City Council previously considered privatizing MCI.

If the City is open to private financing and private operations, how far are we from private ownership?

The post Important Background on the Airport Discussion appeared first on Show-Me Institute.

It appears that some people can’t take No for an answer. The Aviation Department has announced what it calls “listening sessions” on its webpage, stating:

The listening sessions will be an open forum for residents to discuss their thoughts and concerns about the airport with Aviation Department leadership, and will include a short presentation to bring everyone up-to-date on previous planning efforts. Information gathered through community listening sessions will directly influence the terminal facility planning process and will be shared with City Council members. [Emphasis added.]

If the past is any indication, I question how much listening will occur. Will Aviation Department officials hear and understand the great risk to Kansas City travelers of spending over $1 billion and passing those costs onto airlines? Or will attendees be told that all the options have been considered, that mere renovation is just too expensive, and that the airlines have agreed to pay for everything? And while proponents probably won’t say that if we build a new terminal we’ll get more flights, but they will likely leave you with that impression. If it all sounds too good to be true, be on guard.

Who supports the new terminal? We can expect most members of the City Council to support a new terminal, as will the Chamber of Commerce. The usual pundits will weigh in with their usual opinions. The Kansas City Star will likely endorse a new terminal, as it has in the past. Not to be outdone, The Kansas City Business Journal has already weighed in with an underresearched story and editorial on security check point wait times.

We’ve seen it all before.

Stiffen your resolve, Kansas City. The proposal, the arguments and the supporters will likely be the same. They say they are listening—but who are they listening to?

The post Brace Yourselves: Another Single Terminal Sales Pitch Is Coming appeared first on Show-Me Institute.

quarrel, make up, contemplate suicide, try to sleep, eat a carrot and gnaw on some chicken bones. Two other characters appear, a master and a slave, who perform a grotesque scene in the middle of the play. A young boy arrives to say that M. Godot will not come today, but that he will come tomorrow.

One doesn’t need too much encouragement to see the parallels. We’ve seen a petition to require a public vote on a new terminal, a show trial of advisory group meetings, a group of airlines who seem to change their views, an ineffective public relations campaign, and then finally we are told that the VanLoh Plan will not come this year. Maybe next year.

The former Aviation Department director and architect of the new terminal plan, Mark VanLoh, did not survive this effort. His career ended as a result of the mismanaged new terminal campaign. Mayor Sly James said in a tweet recently , “VanLoh is not here to kick anymore.” But make no mistake, even with a new department director, the $1.2 billion new terminal plan before us is very much the VanLoh plan. And despite claims that supporters have put the matter on the back burner, the Mayor and City Manager are still active in pushing for a new terminal. It even has its own hashtag: #NewKCI.

Architectural design company Crawford and Associates have their own solution for the airport. While they have not been permitted to present to the City’s Airport Committee, they did present to a meeting of the Urban Summit with several members of the committee in attendance. The Crawford Plan is compelling; it would preserve much of Terminal A while providing the amenities that VanLoh Plan proponents demand. Importantly, it is one-third of the cost of the VanLoh plan. Yet it allows for the same renovation to be done to a second terminal if air traffic continues to increase.

That last part may be why fans of the VanLoh plan don’t like it. Where they seem to prefer one big billion-dollar bet, the Crawford Plan is measured. One might even call it fiscally responsible.

In the meantime, supporters who loudly declared that, “doing nothing is not an option,” have themselves opted to do nothing; not even renovation. They just want a new terminal, and so we’re all still waiting for VanLoh.

The post Waiting for VanLoh appeared first on Show-Me Institute.

In fairness, my colleague Joe Miller recently wrote that there are some reasons why a city might rightfully consider building a new terminal. The cost of current maintenance may be more expensive than a modern replacement, or a new terminal may be needed to accommodate increased traffic. Neither of those apply to MCI. While our traffic is up moderately, no one is arguing that we need to build for increased capacity. In fact, the new terminal proposal from the Aviation Department would reduce the number of gates we have now.

No one is arguing that the costs of maintaining the current MCI are prohibitive, either. Supporters of a new terminal seem to have strictly cosmetic concerns.

As for doing what we want airports to do, MCI is serving admirably. Consider the recent developments.

• In 2014, MCI picked up service from Spirit Airlines, and Seaport Airlines added service. Southwest announced that service to Ronald Reagan National Airport in Washington, D.C. has been approved.
• In 2015, Spirit started offering direct nonstop flights to Los Angeles. Allegiant Airlines will be flying nonstop to Florida from MCI, and Southwest offers new direct service New York LaGuardia, and Orange County, California. American Airlines added nonstop flights from Kansas City to Miami.
• And in 2016, Frontier Airlines will add flights to Atlanta, Chicago, and Philadelphia. Southwest recently expanded service in the form of direct flights to San Antonio.

In January, the Star catalogued some of MCI’s gains, including that annual traffic has grown each year since 2012 with the terminal we have now. Supporters of a rebuild point to possible (but by no means certain) increases in traffic as a result of a new terminal. But as Miller concluded in 2014:

To sum it up, the airlines (and common sense) say that building an expensive new terminal will not increase demand for air travel. Quite the contrary, the higher costs to airlines and passengers may mean fewer flights. Even if we agree with business leaders that MCI requires more amenities, certainly there is a cheaper way of providing these than a $1.2 billion new terminal plan. The cost is so much greater than the supposed benefits that the plan looks more like a vanity project than a sound investment.

In short, Kansas City’s airport is doing well. It has won high marks for its convenience; we’re unlikely to suffer the long waits seen at other airports because MCI does not use the TSA for security. Importantly, airlines seem eager to come and expand their service (despite their claims to the contrary). It is unlikely that Kansas City could improve on this. In fact, in taking on mountains of debt we risk losing the competitive advantage that many of us now take for granted. 

The post MCI Is the Envy of its Peers appeared first on Show-Me Institute.

Just days ago the Mayor was calling a new terminal inevitable, echoing a similar claim in 2012 from former City Councilman Ed Ford (who subsequently apologized for the comment). Indeed there may someday be changes proposed for MCI—changes welcomed by airlines and voters alike—but how do we get there from here?

The first thing Kansas City needs to do is jettison anything having to do with this new terminal process. Despite years of hearings, presentations, and public forums on the matter, a large swath of voters remains skeptical. Second, Kansas City needs a new Aviation Department director with experience running an airport, perhaps even building a new terminal, and most importantly who possesses integrity, a commitment to transparency, and a respect for the airlines and the people they serve. That search should be nationwide and should begin immediately.

Once installed, that person needs to assess MCI’s condition and capabilities. (One can only imagine the state of Terminal A right now.) Where MCI needs maintenance, it should get it. Where it needs rehabilitation, it should get it. And perhaps, if it needs a major structural overhaul, it should get that too. That will only come once the public trust has been restored. The city manager and Council have an opportunity to rebuild that trust with a new Aviation Department director.

The post Moving Forward on MCI appeared first on Show-Me Institute.

City officials have talked recently about trying to hold that election either in August or November of this year, and they said it was important to have airport leadership that the public trusts.

So in order to restore trust in the Aviation Department, city leaders have undertaken a nationwide search for a qualified and well-trusted airport administrator who will come in, clean house, and present to voters a new and more thoroughly considered airport plan. Right?

No. The Aviation Department will be led by Pat Klein, who, according to his LinkedIn page, has been a city employee for 20 years, but with no apparent experience leading an aviation department. According to that same Star piece, Klein will present to the Council and voters the same airport plan that VanLoh and Mayor James have been pushing.

If city leaders want to restore public trust in them and their policy proposals, they need to do more than merely swap out department heads.

The post Shake-Up at KC Aviation Department appeared first on Show-Me Institute.

There are good reasons to build new airport terminals, whether at MCI or any other airport. It may be that continuing to maintain and operate existing buildings is just too expensive compared to a modern replacement, especially given possible service upgrades. Many airports also build new terminals to accommodate increased flights or different carriers that existing terminals cannot.

However, the cost of any terminal plan needs to be taken into consideration. If an airport like MCI takes on too much debt, the results can be higher prices (for parking, car rentals, etc.) and fewer flight options for residents. Right now, MCI is in a good financial position, and has a relatively low debt load for an airport of its size. That allows MCI to offer low fees to airlines and moderate prices for terminal services, and to borrow cheaply. As a counterexample, consider the most indebted of MCI’s peers, San Jose International Airport (SJC).  After completing a $1.3 billion new terminal a couple years ago, SJC struggles to keep airline costs low so it does not lose service.  Doing so is causing SJC to burn through reserves at a rate of $30 million per year, which is not sustainable. If SJC cannot significantly increase revenue, San Jose may have to subsidize the airport’s debt through the city’s general fund.

If MCI had gone forward with the erstwhile “New Terminal Plan” (priced at $1.2 billion) its debt level (and debt payments) would have become the highest among its peers, including San Jose:

This would have been a risky move for MCI and Kansas City residents. Unfortunately, despite our objections and common sense, some in Kansas City’s leadership seem to think that costs do not matter at airports, and that MCI can simply pass extra costs onto airlines and travelers without consequence.

Kansas City International Airport may be better off with a new terminal. The city’s aviation department may put forward a plan that makes sense for travelers and the airport’s finances. Our main criticism over the late “New Terminal Plan” was that because of the $1.2 billion price tag and the fact that the plan would have resulted in less capacity, the proposal seemed more about civic ego than helping residents get good flights. We hope any new plan won’t have the same problem.

The post Debt, Airports, and Kansas City appeared first on Show-Me Institute.

At the latest meeting, the Aviation Department told the Council that building a new terminal would cost less than refurbishing the existing terminals. The department claims that refurbishing the current configuration would cost more than $1.1 billion dollars, while a slate of new terminal plans would cost less than $1 billion.

Two things are interesting to note here. First, the Aviation Department’s cost of refurbishing the terminals has escalated dramatically from July 2013, when the initial new terminal plan was proposed. At that time, keeping the existing design was supposed to cost up to $785 million, not more than $1.1 billion. This is likely due to the scale of the refurbishment now proposed, which is more extensive than what the department had previously recommended. The cost escalation underscores the fact that the scale of the refurbishment is directly related to the cost. Certainly, fixing up the existing terminals could cost less than $1.1 billion, but that would mean a different and possibly less desirable end product.

The second interesting point is the cost of the new terminal plans, which range between $900 million and $1 billion. The Aviation Department claims that these are not “Taj Mahal” plans, that is to say they are cost effective. However, the department said the same thing for the plan that they proposed in 2013, which was $1.223 billion. The ability to find more than $200 million in savings indicates that either the “old” new terminal plan was in fact more expensive than was necessary, or that the “new” new terminal plans have lowballed cost estimates (or are insufficient).

We will continue to follow this story as the Aviation Department prepares a final recommendation. 

The post New Terminal Plans on the Table in Kansas City appeared first on Show-Me Institute.

Kevin Koster, a member of the Airport Terminal Advisory Group empanelled by the mayor two years ago to consider the wisdom of a $1 billion new terminal, reacted on Twitter,

A single terminal would have had to be completely evac. TSA told KCI task force this was advantage of current design

Back in March 2014, The Kansas City Business Journal reported that a TSA official did exactly that [emphasis added]:

The post MCI and the Evacuation That Wasn’t appeared first on Show-Me Institute.

On Tuesday, Allegiant Air announced it will start nonstop service from Kansas City to Orlando, Southwest Florida and Tampa in mid-November. The Las Vegas–based low-cost airline is operated by Allegiant Travel Co.

In an interview on KMBZ radio, Bill Grady asked airport administrator Mark VanLoh if this new service announcement raised questions about the real need for a new terminal. Mr. VanLoh replied, “I don’t see how the two are connected.”  

In fact, the two are very much connected.

The news of Allegiant Air is not only good news in and of itself, but it demonstrates exactly why Kansas Citians ought to be skeptical of taking on an unnecessarily large expense at the airport. Allegiant Air is a “low-cost” airline. According the The Memphis Business Journal: 

Allegiant often serves smaller markets like Orlando-Sanford International Airport instead of Orlando International Airport to avoid pricey landing fees.

Advocates of spending a great deal of money at the airport tell us that only travelers and airlines will pay the price. That is largely true. They also tell us that the prices airlines pay to serve an airport have little to do with ticket price; that may also be true. But pricey landing fees of the type that would follow an expensive rebuild or remodel may chase away airlines like Allegiant. And they would be a disincentive for bigger airlines like Southwest, too. A Southwest vice president said as much to the airport advisory group, “Higher costs can lead to less service, not more.” They have left other airports over similar price increases.

If Southwest wants to pour hundreds of millions of dollars into a new KCI, that might be welcome. But if improvements require issuing bonds resulting in higher fees to airlines, city leaders should think twice. A shiny new airport is of no use if airlines choose not to service it.

The post How a Cheap Airport Helps Kansas City appeared first on Show-Me Institute.

This week, the city received a status report on the negotiations. Nothing is final, but refurbishment plans have been shelved as “too expensive,” and the city and the airlines are now looking for a cost-effective new terminal plan. While most news outlets appear to take that as meaning a new terminal is definitely going to happen, that assumption is premature. If Southwest and the other airlines do not like the terminal plan that comes out of negotiation, refurbishment plans can be unshelved.

However, at this point it looks as though the city and airlines are looking at new terminal options, but it generates more questions than it answers. Will it be the same as the terminal plan from last year? Will it be a more modest proposal? Is Southwest planning to make the kind of investments it has made in Houston, Fort Lauderdale, or Dallas? Will Kansas City voters, many of whom enjoy the convenience of the current layout, support such a new terminal plan?

One new terminal proposal under consideration

Old New Terminal Plan (2013)

We don’t know, and likely won’t know, until earlier next year. However, the flying public in Kansas City and the airport itself will be best served by a terminal system that is cost-effective and user-friendly.

The post New Airport Terminal Coming to Kansas City, Maybe? appeared first on Show-Me Institute.

Now that a year has passed we can return to the plain facts. The CEO of Southwest Airlines, the carrier with the largest MCI service, was recently in town to showcase a Missouri-themed airplane. While here, as the Star reported, he said of the MCI terminal:

“I agree and Southwest agrees we definitely could stand to make some improvements. The question still remains exactly what is the best way to do that in the most cost-efficient manner,” Kelly said.

Air travelers are sensitive to price, something Kelly said is evident each time oil prices climb and the cost of flying jumps.

“It absolutely kills traffic,” he said.

People use airports to get on and off planes. They do not go to airports to eat at fancy restaurants or to buy socks or baseball caps. MCI is a highly regarded airport by passengers exactly as it is, and any changes need to be sensitive to the costs and convenience to airlines and travelers.

MCI is a relatively cheap airport for airlines to serve. One benefit is the many morning flights out of MCI because Southwest parks their planes here overnight. If airport fees rose to cover the costs of a new terminal, these planes might find cheaper accommodation elsewhere. Same for those midday direct flights to LaGuardia that originate from the West Coast. They stop here because MCI is a cheap place for them to fuel up and collect passengers. If fees rise, they may choose to connect in other cities and cost us the direct service.

Going forward, it is still tough to know who to believe on even the simplest details of the negotiations. Aviation Department Director Mark VanLoh recently told a Northland chamber group that he expects to have a recommendation before the city council by the end of summer. That seems unlikely. According to Austin Alonzo, Southwest’s CEO said, “We’ll get there, and I think patience is probably the right thing because it is a pretty complicated question.” The Star reported that the deadline for a final recommendation is May 2016.

The post Shocker! Airlines Want to Keep Costs Down appeared first on Show-Me Institute.

You don’t have [all the information] yet. We don’t even have it yet. I know what I want because I want a new airport.

With those words at Thursday morning’s Northland Regional Chamber of Commerce meeting, Aviation Department Administrator Mark VanLoh nicely summed up the reason that Kansas City taxpayers have been embroiled against their will in a discussion about building a $1.2 billion new terminal: He just wants it.

VanLoh has been criticized for his clumsy public campaign for a new terminal. And now, perhaps as part of a new approach to getting what he wants, he is revising history. At Thursday’s meeting, he clearly gave the impression that the airlines had to be dragged to the negotiation table.

What the 2013 [plan] did . . . was bring the airlines to the table because they saw something in Kansas City. Something was going to happen and they wanted to be part of it. And we welcome them to the table; we are meeting to this day with the airlines. I know the mayor’s Terminal Advisory Committee recommended a new terminal based on the evidence they had. And of course the Aviation Department recommends a new terminal based on what we know, but we wanted to get back with the airlines.

This does not square with the reported facts. In November 2013, Austin Alonzo of the Kansas City Business Journal reported that “Southwest was not satisfied with its minimal inclusion in vetting the airport proposal before VanLoh presented it to the City Council earlier this year.” The Kansas City Star reported that the airlines then sought to use their lease extension agreement to secure participation in future airport planning.

VanLoh is also overstating his role as champion of the people. He said on Thursday morning that the airlines were surprised to learn how passionate Kansas Citians are about the airport’s convenience, and that the Aviation Department would fight any design that didn’t preserve that convenience. Yet in April 2013 testimony before the city council, VanLoh’s consultants argued that the airport offered a “poor passenger experience.”

That’s when Mayor James advised the Aviation Department that they wouldn’t curry favor with the public by beating up on the airport. The talking point was removed. But even in Thursday’s chamber presentation, VanLoh argued that the perception Kansas Citians have about short walking distances is an “optical illusion.” Regardless of MCI’s convenience, it certainly isn’t the public’s belief that VanLoh is championing. He is merely doing whatever he thinks it takes to get what he wants.

VanLoh said that he expects to have a recommendation before the city council by the end of summer.

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Even if the report is factually flawed, it aspires to ensure good government. On page 30, the report recommends more transparency:

In addition to KCAD [Kansas City Aviation Department], the City should provide for additional oversight to maintain transparency and improve two-way communication. This oversight (possibly in the form of an informal oversight committee) would be responsible for insuring City involvement and help to oversee the process over the next two years. The oversight committee could also assist in vetting the planning and design process and communicating it to the Mayor of Kansas City, Kansas City Manager, City Council, as well as the general public and local businesses.

Several months have passed, and none of this has been acted upon. It was ignored on the day the City Council received the report. Mayor James said in the July 10, 2014, City Council business session that discussed the report (remarks begin at 37:52):

The question was, as currently configured, does KCI meet the needs of Kansas City now and into the future? And if not, what are our options? Now, the options are being determined now by the airlines as they are in consultations—secret, private consultations—with the Aviation Department. That is their job. They will determine how much money they want to spend. And when they determine how much money they want  to spend they will pretty much tell us what they think we ought to do.

So much for transparency. Also, so much for the work of the ATAG in the first place; a year’s worth of work and $100,000 spent on consultants seems to have been wasted. (As for the financial costs and benefits of a new terminal, the Show-Me Institute has issued its own report.)

Kansas City leaders need to make sure that the mistakes of the past are not repeated. While it is good that the airlines are involved—they should have been all along—it does not bode well that the process is again opaque. When the time comes to present options to the public, the truth still may be that, according to Kansas City Star editorialist Yael Abouhalkah, “Director Mark VanLoh does not have the public credibility to lead on this extremely crucial project.” The voters of Kansas City have spoken clearly on this matter, and they deserve to get the transparency and accountability necessary for good public policy.

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Read our analysis:

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