Massport Board Approves Mid-Year Adjustment in Logan's Landing Fee and Baggage Screening Fee
The Massachusetts Port Authority (Massport) Board of Directors met today and approved a mid-year adjustment in Logan's landing fee and baggage screening fee effective April 1. Both the landing and baggage screening fees are formula-driven and computed annually to cover the capital and operating costs associated with the operation and maintenance of the airfield and the baggage screening system. The rates do not represent a source of net revenue for Massport and are established based on service projections provided by the airlines.
The baggage fee will be adjusted from $1.26 per checked bag to $1.38. The airport's landing fee will be adjusted from $4.56 per 1,000 pounds of landed aircraft weight, to $4.82 per 1,000 pounds. Initial projections from the airlines called for a 15% drop in the number of screened bags in FY09, current data shows the decline to be 18.6%. Aircraft landed weights are down 6%, which exceeds the original 3.5% decline anticipated when the rates were set last fall. Massport last adjusted the landing fee in September 2008.
Since the start of FY09, Massport has cut its budget by more than three percent and instituted a hiring freeze which has resulted in 66 positions – 6.3 percent of the workforce – not being filled, at an annual savings of more than $4.6 million. Massport is targeting additional cuts of at least $17 million in the next fiscal year. Going forward, we have set the goal of cutting some $100 million from capital projects in the next fiscal year that would have been funded from operating revenue.
The Board also took action to file with the Federal Aviation Administration authority to impose a Passenger Facility Charge (PFC) to finance the design and construction of airfield projects including the Runway 33L Safety Ends project, Runway Status Lights and various runway and taxiway rehabilitation projects. The FAA Passenger Facility Charge Program allows the collection of PFC fees up to $4.50 for every enplaned passenger at commercial airports. Airports use these fees to fund FAA-approved projects that enhance safety, security, reduce noise; or increase air carrier competition.
Massport receives no state tax funding and is governed by a seven member Board appointed to staggered seven-year terms by the Governor of Massachusetts.