Airports, no matter what legal structure, tend to be considered by their owners to be attractive nuisances—on the positive side: they are huge economic magnets; on the negative side: many citizens are opposed to them due to the noise issue. Consequently, many governments try to put this infrastructure in their backyards, hoping that the runways will bring business, but simultaneously hoping that the voters will overlook its presence back there.
In contrast, here are three recent stories about communities which step up, put their airports in the front yard and deal with it affirmatively.
The first is an article from the financial world in which Xavier Giroud, a professor at MIT’s Sloan School of Business; Shai Bernstein, an assistant professor at Stanford’s Graduate School of Business; and Richard Townsend, an assistant professor at Dartmouth’s Tuck School of Business, make a very convincing case in a Journal of Finance support the correlation between success of startups to attract capital with “how many flights their local airports can handle.” Their thesis is summarized in this quote:
“Using a difference-in-differences estimation framework, we find that the introduction of a new airline route leads to a 3.1% increase in the number of patents the portfolio company produces and a 5.8% increase in the number of citations per patent it receives. Furthermore, the treatment increases the probability of going public by 1.0%, and of having a successful exit (via IPO or acquisition) by 1.4%. These results indicate that VC involvement is an important determinant of innovation and success.”
[academic to English translations are available; emphasis added.]
In addition to this quantitative review, there is a confirming qualitative conclusion of Red Wilson, a co-founder at partner at the VC firm Union Square Ventures, that “efficient travel options will even improve startups’ chances at getting funding in the first place.” He has written that “investors value their time and focus it on markets that they can get in and out of easily. I think that has a big impact on where money flows.”
Almost every US city needs more jobs. The three scholars have provided hard evidence that size matters when it comes to airports and their schedules. Thus, local communities and their airports should not be bashful in promoting their aviation facilities.
The next report signals that the existing airport governance structure in Hawaii should be altered to make the state’s most important transportation infrastructure more responsive to the travelers’ needs. The Aloha State owns all of the airports on its islands; flights to/from the state and intrastate schedules are not just essential, but vital to its economy.
A legislator has recommended a foundational change; state Sen. Lorraine Inouye, who chairs the Senate Committee on Transportation and Energy: “Our airports are much busier now, and we need to catch up with lots of modernizations.” Even DOT Airports director Ford Fuchigami is quoted as saying, “What an authority does is it gives the airport system the ability to move things along at a much quicker pace.” The triumvirate of interest is completed with this statement from the Airline Committee of Hawaii co-chairs Blaine Miyasato and Matthew Shelby wrote that “the [Airlines Committee of Hawaii]…is grateful the Legislature recognizes the need for a single entity with overall consolidated jurisdiction.”
The politicians who control the HI airports, the state employee who manages them and the tenants who use these facilities all agree—sounds like a likely change in governance.
The last may be the most impressive initiative—in the Commonwealth of Virginia which does not own the airport in question. The VA governor, Terry McAuliffe announced that he planned to use millions to drive down the costs of flying out of Dulles International Airport. By spending $100M of state funds it is expected that IAD’s cost per enplaned passenger, or CPE, would be reduced by as much as $2.50 per year, from its 2014 level of more than $26.
Part of the rationale for this local support of a federally funded airport is the repeated Congressional actions which have disturbed the original balance between IAD and DCA. A geographical perimeter limitation on flights to/from the airport was based on safety and environmental concerns. Congress’ judgment has been blurred by Reagan National’s location minutes from the Capitol. Each Hill amendment has moved flights from Mr. Dulles’ airport to the more proximate facility.
These are three different, strong examples of communities initiating support for their airports, moving from their backyards to more prominent position in front. With these actions one can forecast that these forward acting communities will bring more jobs through their front yards