A Study of the Potential Economic Impacts of

Commercializing a General Aviation Airport

by

Jeremy Paul Stephens

A Graduate Capstone Project

Submitted to ERAU Worldwide

in Partial Fulfillment of the Requirements of the Degree of

Master of Science in Management

Embry-Riddle Aeronautical University

Worldwide

Atlanta Campus

March 2012

ii

A Study of the Potential Economic Impacts of

Commercializing a General Aviation Airport

by

Jeremy Paul Stephens

This Graduate Capstone Project

was prepared under the direction of the candidate’s Project Review Committee Member,

Dr. Merrill E. Douglass, Associate Professor, ERAU Worldwide,

and the candidate’s Capstone Review Committee Chair,

Dr. Debra Bourdeau, Director of Academics, Atlanta Campus, ERAU Worldwide, and has been

approved by the Capstone Review Committee. It was submitted

to ERAU Worldwide in partial fulfillment of

the requirements for the degree of

Master of Science in Management

Project Review Committee:

//SIGNED//

___________________________

Merrill E. Douglass, D.B.A.

Committee Member

//SIGNED//

___________________________

Debra Bourdeau, Ph.D.

Committee Chair

iii

Acknowledgements

It is a pleasure to thank those who made this project possible. I would like to thank Drs. Debra

Bourdeau, Merrill Douglass, and Charlie Allen, for their guidance throughout. I am also grateful

to the following people for taking their time to discuss my project and providing access to vital

research data: Brett Smith, Propeller Investments; Amanda Hill, Georgia Department of

Transportation, Aviation Programs; and Trisha Lambert, New Hampshire Department of

Transportation, Bureau of Aeronautics. I owe my deepest gratitude to my wife, Kara, and my

entire family, whose support and encouragement made this all possible.

iv

Abstract

Researcher: Jeremy Paul Stephens

Title: A Study of the Potential Economic Impacts of

Commercializing a General Aviation Airport

Institution: Embry-Riddle Aeronautical University

Degree: Master of Science in Management

Year: 2011

The purpose of this study was to investigate the potential economic impacts of commercializing

a general aviation airport. The study investigated the possible overall economic implications in

the forms of direct, indirect, and induced monetary effects; the number of jobs

commercialization could add; and the effect of a commercial airport on local property values.

Utilizing quantitative methods, economic and passenger data collected from economic impact

studies completed at the federal, state, and airport authority levels were used to test the scientific

hypotheses. Data was obtained from a sample of general aviation and commercial airports,

which are approximately the same sizes as the current operations and the proposed commercial

operations for the airport at Briscoe Field, Lawrenceville, Georgia. A primary goal of this

research was to determine if commercialization is an effective way of generating additional

revenue and promoting economic growth in the local area.

v

Table of Contents

Page

Abstract iv

List of Tables vii

Chapter

I Introduction 8

Background of the Problem 8

Researcher’s Work Setting and Role 10

Statement of the Problem 11

Purpose and Importance of the Study 11

Assumptions 11

Limitations 12

Delimitations 12

List of Definitions 12

List of Acronyms 13

II Review of Relevant Literature and Research 14

The Search for New Revenue Streams 14

Privatization Gains Momentum 16

Lessons from the United Kingdom 19

The Aerotropolis 20

Property Value Concerns 21

Economic Impact Studies 24

Summary 27

vi

Statement of the Hypotheses 27

III Research Methodology 29

Research Model 29

Target Population 29

Sources of Data 29

Treatment of the Data 30

Sub Problem One and Hypothesis One 30

Sub Problem Two and Hypothesis Two 31

Sub Problem Three and Hypothesis Three 31

IV Results 33

V Discussion 39

VI Conclusions 41

VII Recommendations 44

References 46

Appendix

A Table of Economic Studies 49

vii

List of Tables

Table Page

1 Decibel Level Study on Aircraft Takeoff: Select Aircraft 23

2 Sample Economic Impact Summary 25

3 Sample Median Property Values Near Airports 31

4 Airport Enplanement and Economic Activity 32

5 Airport Enplanement and Jobs Created 33

6 Commercial Airport Median Property List Values 35

7 General Aviation Airport Median Property List Values 36

8

Chapter I

Introduction

Background of the Problem

Since the Wright brothers introduced aviation to the world, this sector has grown from

strictly the domain of militaries, governments, and the privileged few, to a means of

transportation for businesses and recreational travelers of all income levels. Bill Gates stated

that the Wright brothers “ushered in an age of globalization, as the world's flight paths became

the superhighways of an emerging international economy” (Air Transportation Association of

America, 2001). The positive economic impact of the aviation industry in the United States is

undeniable, as civil aviation accounted for 12 million jobs and $1.3 trillion in total economic

activity, equating to 5.6% of the Gross Domestic Product (GDP), in 2007 (Federal Aviation

Administration, 2009). Just from these facts alone, it is easy to see the effect aviation has on the

economy at large.

As the current recession continues to drag on throughout the country, it is becoming

increasingly important for local governments to find methods in which to remain fiscally

responsible while still providing their citizens with the necessary services to function as a safe,

happy, and healthy society. Local governments are analyzing and debating options that will

allow them the ability to tighten the budget, while at the same time creating new revenue streams

that will keep them from cutting necessary services such as police and fire protection (Dugan,

2010). One option that is available to the government of Gwinnett County, Georgia, is the

privatization and subsequent commercialization of the general aviation airport that it currently

owns, Briscoe Field, in Lawrenceville, Georgia.

9

Privatization is the act of transferring a commodity, business, or object from public or

government control, to that of a private entity or enterprise. If one considers all management

activities that the operation of an airport requires, airports in the United States are actually some

of the most privatized in the world. While the actual ownership of airports in the United States

still lies mostly with State or Local governments, only 10% to 20% of the workers at these

airports are typically government employees. Virtually all services available at an airport are

owned and operated by a private entity. This arrangement of ownership contrasts deeply to the

model in most of the rest of the world, where virtually every aspect of an airport is controlled by

the owning government. This situation is what has lead to massive privatization of airports

throughout the world. Despite the level of privatization that has been achieved, these

governments still exercise some form of regulation or minority ownership in the airport due to

concerns over monopoly business practices, and to protect the public interest in an enterprise

such as air travel (Neufville, 1999).

While the level of privatization at an airport, such as Briscoe Field, is something that will

need to be addressed with the best interests of the community in mind, the reason behind

pursuing privatization is one of fiscal concern. Due to the airport grant-funding guidelines from

the Federal Aviation Administration (FAA), it is federal law that any profits from the operation

of an airport must be used strictly for the airport (Poole, 2006). Because Gwinnett County has

received funding from the federal government for Briscoe Field, it is precluded from using any

profits derived from operations at the airport for other budgetary line items, such as education,

police, fire, or infrastructure (Poole, 2006). The privatization of Briscoe Field would allow

Gwinnett County to use profits from the airport to fund a myriad of other projects and line items

10

within its budget, thus releasing one of the constraints that it faces in the current economic

climate.

Based on this information it is evident that the primary concern in this matter is not the

privatization of Briscoe Field, but how to increase revenue from the airport. The currently

proposed method in which to increase the airport’s revenue and profitability is in the addition of

commercial service at Briscoe Field. This would transform the airport from strictly a general

aviation airport to a regional community airport which offers both general aviation and

commercial passenger services. Leading the way in the case for commercialization of Briscoe

Field is Propeller Investments. Propeller has stated in their proposal that they will build a

passenger terminal with 10 gates that is capable of handling four commercial flights per hour, or

about 2.5 million passengers per year. Propeller estimates that in approximately 10 years, when

the airport should reach peak capacity, it will also account for 20,000 direct and indirect jobs

(Fly Gwinnett Forward, 2011).

Researcher’s Work Setting and Role

The researcher is a Master of Science in Management student at Embry-Riddle

Aeronautical University, Atlanta, Georgia, campus, and has a Bachelor of Science in Technical

Management from Embry-Riddle Aeronautical University. The researcher has 12 years of

practical and academic experience in the aviation industry, and has completed coursework in

Airport Management, Airline Management, Macroeconomics, Microeconomics, Strategic

Management, and World Economic Analysis.

11

Statement of the Problem

It is already evident from the facts stated in the FAA’s civil aviation study that the

aviation industry has an enormous impact on the economy. What sort of impact would a

commercial airport have on the economy of Gwinnett County? How much revenue could the

proposed airport generate, both directly and indirectly? To what extent would the new airport

affect the number of jobs in the area? Would the airport cause an increase or decrease in area

property values? This study is focused on answers to these questions.

Purpose and Importance of the Study

With Gwinnet County searching for ways to increase revenue to the county without

raising citizens’ taxes or cutting necessary community services, it is vitally important that the

option of privatizing and commercializing the county’s general aviation airport be thoroughly

studied. If commercialization is shown to be an effective way of generating revenue and

boosting the local economy, the county could then use the increase in revenue to bolster its

services and infrastructure.

Assumptions

The first assumption is that the proposals of privatization and commercialization are

independent issues and thus should be studied independently. The second assumption is that all

data collected and presented by third parties is accurate and without bias. The third assumption

is that the sample is sufficiently large and sufficiently representative of the target population to

warrant the findings and conclusions. The fourth assumption is that 2.5 million enplanements for

a commercial airport the size of Briscoe Field is realistic. If additional research indicates that the

12

target number should be higher or lower, the hypotheses to be tested will be adjusted

accordingly. Refer to the Treatment of Data section in Chapter III for a discussion of the data

analysis.

Limitations

The limitation of this study is that the economic impact studies, from which all data were

derived, were completed in different years. In an effort to properly analyze the data, the figures

given will be adjusted for inflation to 2010 dollars in an effort to obtain accurate statistical

analysis of the problems.

Delimitations

Because the researcher was interested in using the results of this study in relation to

Gwinnett County airport, the population from which the sample was drawn was limited to those

airports with one million to four million enplanements. The findings and conclusions are based

on an investigation of the variables identified in the problem statement and sub-problems.

Unidentified confounding variables may have a negative impact on the findings and conclusions.

Although the research report is free of intentional bias, the researcher recognizes the probability

of bias of some type and cautions the reader to be cognizant of that possibility.

List of Definitions

Enplanements - The number of passengers boarding an aircraft at an airport. Does not include

arriving or through passengers.

13

Commercialization - the act of commercializing something; involving something in commerce;

in aviation this typically consists adding commercial airline service to an airport.

Noise Contour Band – existing level of noise exposure as delineated on a map. Bands are

expressed in highest decibel level of exposure within the marked area. Example: 65 dB

Noise Contour Band.

Privatization - act of transferring a commodity, business, or object from public or government

control or ownership to that of a private entity or enterprise.

List of Acronyms

BEA Bureau of Economic Analysis

DOT Department of Transportation

FAA Federal Aviation Administration

GA General Aviation

GAA General Aviation Airport

GDOT Georgia Department of Transportation

14

Chapter II

Review of Relevant Literature and Research

The Search for New Revenue Streams

Due to the current economic climate, cities, counties, and states are looking for ways to

meet budget gaps created by lower tax revenues and unfunded pensions. According to Dugan,

these municipalities are searching for assets to sell or lease to private entities and using the funds

generated to plug holes in their budgets. Local and state governments are selling or leasing

everything from airports to zoos, including buildings, parking and toll services. Dugan also says

that municipalities traditionally do a poor job of running these types of services and

infrastructure is deteriorating because of the shrinking revenues. Many of these deals are being

cited as a one-time budget maneuver, used to plug a hole in the budget with little regard as to the

long-term fiscal effects of such endeavors. The key to brokering deals regarding public assets is

to ensure that there is a viable model that will increase long-term revenue for the government.

This will enable them to build more long-term assets, boost efficiency, and avoid raising taxes.

Governments must also be sure that the private investor takes on the operating risk, and that the

risk to taxpayers is minimized, both in the short and long term (Dugan, 2010).

Dr. Neufville (1999) argues in his paper “Airport Privatization Issues for the United

States,” that if the entire structure of the airport business, including planning, design, finance,

and management is taken into consideration, the United States’ airport industry is actually one of

the most privatized in the world. He contrasts the global and United State’s industry structures

in the following manner:

In most other countries airports have been:

· The complete responsibility of the national government,

15

· Financed by the national government, and

· Entirely controlled by political masters through a national civil service centered on the

capital.

In the countries with centralized national control over airports there have been

correspondingly enormous opportunities for the devolution of initiative away from the

political capital toward local communities, and away from governmental processes

toward a competitive commercial environment.

In the United States, commercial airports have traditionally been:

· Independent of national control, being operated locally by municipalities or regional

authorities; and

· Decisively influenced by competitive private interests, particularly by airlines that have

had the power (through their ability to veto airport projects through the majority-in-

interest clauses of their leases) to shape virtually all the major aspects of airport

development and management. (Neufville, 1999, pp 8-9)

Dr. Neufville states that the privatization of airports can take on many forms. A government

considering privatizing its airport should look at the full range of options available and take into

account the degree of government participation and strategic direction necessary for the public

good, in addition to the debate of the issue of actual ownership. He also makes the point that

activities which involve a substantial public interest should not be relegated solely to private

interests. If the activity is central to the community’s welfare, and potentially open to,

“monopolistic exploitation of the public,” then that activity should not be completely privatized.

He suggests that a shared partnership in which the government maintains strategic control to

protect the public interest is the best path to privatization of airports in the United States.

16

Privatization Gains Momentum

Privatization has garnered a lot of interest lately due to legislation passed in 1996 which

created the Airport Privatization Pilot Program. As summarized by Robert Pool in his article,

“Should Milwaukee’s Airport be Privatized?” this legislation allows up to five U.S. airports to be

privatized whether that be through sale or long-term lease. The federal funding regulations that

require repayment of a portion of received federal grants upon sale of the airport would be

waived, as long as airports agree to abide by all standard grant agreements in the future. Under

this program the restriction by grant agreements that no airport revenue may be used for any

other purpose other than the funding of activities and projects at the airport, is lifted.

Municipalities may use ongoing profits from operations at the airport so long as a super-majority

(65%) of airlines serving the airport approve. The specifics of the program and funding

requirements can be found in the Privatization Pilot Program statute 49 U.S.C. §47134.

Also in his article, Poole mentions that privatization is a good move on the city’s part

because airport companies create additional value to the airport by reducing costs, and increasing

revenues. In the case of Milwaukee’s airport a private company could increase the passenger

facility fee by $1.50 per enplaned passenger. Based on the number of enplaned passengers per

year at the airport, this could mean an additional $4.5 million each year in revenue.

He also states that airport companies further commercialize airports in an effort to

increase revenue from other sources, specifically in the area of concessions. His cited example,

Portland, OR, generates close to $9 per passenger in retail concessions compared to Milwaukee’s

$1.50 per passenger. By increasing revenues in other areas, private companies are able to

negotiate affordable rates and charges for the airlines serving the airport. Steps such as these

17

have allowed recently privatized airports to become more commercialized, increase their revenue

as well as increase their profitability and market value. (Poole, 2006)

According to an article appearing in the December 2008 edition of Airline Business, The

United States still lagged behind the rest of the world in the push to privatize the ownership of

airports. The author, David Field, notes that at the time, only one airport in the U.S. had been

privatized: New York State’s Stewart Airport. This airport has since been sold to the Port

Authority of New York and New Jersey because the initial investors decided to leave the airport

business to concentrate on other facets of transportation. Field also notes that other forms of

privatization have begun to increase in popularity. Indianapolis was privately operated for ten

years between 1995 and 2005. It was the first large airport to be privately operated in the U.S.

During the course of private operation, the airport’s net profit increased from $17 million to $28

million. At the time of the article, Midway (Chicago) was undergoing the final negotiations to

become the first airport to take advantage of the Airport Privatization Pilot Program. It was also

the program’s only large hub-style airport allowed to participate. The agreement took several

years to negotiate to ensure that all parties would be treated equitably, including airlines,

customers, union workers, and the new owners. The agreement went as far as to ensure airlines

would only see limited fare increases by freezing them for six years and then linking them to

inflation rates for the entire lease. All that remained of the privatization was FAA approval. The

author also emphasizes that in the arena of privatization, it is imperative that guidance and

oversight is still required from the government. His point is illustrated by the following quote

from International Air Transport Association (IATA) director Giovanni Bisignani:

I don't care who owns the airport. An airport is important for what it delivers not who

owns it. Providing the right incentives is the most critical part of the privatization

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process. We have seen too many privatizations fail because governments sold the crown

jewels without appropriate guidance to the new owners. Look at London Heathrow.

Failed regulation allowed for a 42% profit margin. The new Spanish owner is happy but

Londoners suffer with terminal facilities politely described as a national embarrassment.

There is no need to repeat the mistakes of others. (Field, 2008, p45)

While privatization at Heathrow allowed for an outstanding profit margin, the new owners did

not improve services at the airport, resulting in unhappy customers. Field insists that the types of

negotiations that took place in the privatization of Midway are imperative to ensuring

profitability for all parties involved in the process. (Field, 2008)

Not long after the article by Field was published, the process to privatize Midway quickly

fell apart. This was a direct result of the fact that the soon-to-be owners could not obtain the

financing required to fulfill its $2.52 billion bid. Due to this, Chicago decided to cancel its

application to privatize Midway. In an article appearing in Air and Space Lawyer in 2010, David

Bennett posits that the failure of privatizing Midway is not indicative of what would happen with

other airports. Two of the major hurdles in privatizing Midway were, first, that it is one of the 29

large-hub airports in the United States. Because of its size and the number of carriers that are

contracted at the airport, the negotiations and contracts that needed to be navigated were unique

to the situation. Second, there was no growth potential at Midway. Due to its size and a state

law that prohibited boundary expansion, the options to increase revenue and realize a sizable

return on the investment from a purchase were few. Bennett states that this is in contrast to

airports cited by the FAA in its 2004 report to Congress concerning airports that were in the

process of applying for participation in the same program. All of the mentioned airports were

underdeveloped in some fashion, and there was a large potential for future development and

19

growth of revenue. Bennett further points out that there are still other forms of privatization

available to airport owners, such as lease-management agreements, that do not fall under the

privatization pilot program. He states that airport owners who are specifically searching for a

way to remove restrictions placed on revenue usage from the airport are best served by this

program (Bennett, 2010).

Lessons from the United Kingdom

In their paper on airport privatization, commercialization, and regulation in the United

Kingdom, authors Humphreys, Francis, and Fry (2001) state that the pressures of funding future

development and growth of the airport business have led governments all over the world to

consider the options of privatization and commercialization. In the early 1980s, the U.K.

realized that it could not possibly continue to fund the growth necessary for this vital economic

link. The authors show that the government’s deficit disappeared due to privatization of 50% of

the public sector between 1979 and 1991. A large part of the massive privatization occurred

with the 1986 Airports Act. The purpose was to provide for the introduction of private capital to

encourage enterprise and efficiency at the major airports. The authors found through this study

that there was, “a general trend of traffic growth, financial self sufficiency, increased emphasis

on commercial revenue, and increased marketing activity in all of the privatized and

commercialized airports” (Humphreys, et al., 2001, p 16). Eighty-seven percent of airports

experienced a growth of 15% of commercial income. All airports included in the study saw an

increase in profitability; however, a few of the airports had reinvested profits into expansion

projects which affected the overall amount of increase. The authors conclude that this level of

growth is directly attributed to the removal of the financial burden of airport operation from the

20

government. Through varying degrees of commercialization and privatization, airports can

realize a growth in profit. They also further conclude that with the, “removal of such a financial

burden from the state, potential increase of the tax base, and improved commercial performance

could be achieved with protection against loss of control, monopoly abuse, and diversion of

funds” (Humphreys, et al., 2001, p 16).

The Aerotropolis

According to John D. Kasarda, airport owners looking to maximize the economic

footprint of their airport are expanding their horizons beyond just that of commercial air service.

He states that through various commercial endeavors, airports and their immediate surroundings

are becoming commercial anchors in their area. Passenger terminals no longer house rows of

seats for passengers to wait in; they are now becoming shopping malls, art galleries, and

recreational venues. Some airports have even gone further by adding gourmet and culinary

clusters, meeting venues, high-end designer clothing stores, cinemas, saunas, and even a tropical

butterfly forest. This extra commercialization in airports leads to increased revenue and profits

for the airport. The long shopping corridor alone in Dubai International’s terminal pulled in $1.1

billion in sales in 2008 (Kasarda, 2009).

Mr. Kasarda states that airports are quickly becoming economic powerhouses, and that

the economic influence is extended beyond simply transit-oriented development. There are even

airports that alone employ over 50,000 workers, which by definition of the U.S. Census Bureau,

qualify the airports as cities. Airport retail space actually pulls in more revenue than the average

shopping mall. These stores generated between $600 per square foot and $2,500 per square foot

in sales in 2007, depending on location. The average non-anchor tenant in a shopping mall only

21

generates $450 per square foot says the International Council of Shopping centers. Retail sales

at some airports in the world are growing at a 20% rate (Kasarda, 2009).

As more developers recognize the economic potential of an airport, they are slowly

creating what the author dubs as an “airport city.” Developers are adding hospitality,

entertainment, and recreation clusters, office and retail complexes, conference and exhibition

centers, and more. The Sofitel Lux Le Grand hotel at London Heathrow is the nation’s third-

largest conference venue. As more and more developers see the economic benefits of airports,

these airport cities are morphing into new anchors of development. As the business and

commercial clusters expand in the area of airports, these airport cities are giving rise to the

aerotropolis. These aerotropolises are the reflection of the economy’s need for connectivity,

speed, and agility (Kasarda, 2009).

Airport areas are also attractive to business sector services and are increasingly drawing

corporate regional headquarters and various other sectors which require executives and staff to

frequently engage in long-distance travel. These types of airport cities are also attractive to the

technology sector as high-tech professionals tend to travel more frequently than most other

workers. The author states that this trend of aerotropolis development will continue as

commercial aviation continues to drive economic development. He also states that urban regions

would be wise to position their airports as a critical infrastructure asset for the region that must

compete and attract investment and development (Kasarda, 2009).

Property Value Concerns

While there are numerous potential benefits that may be realized from a commercial

airport in an area, the impact that airports have on area property values is a major concern.

22

“Citizens for a Better Gwinnett Inc. is a Georgia 501(c)(3) non-profit corporation organized for

the purpose of promoting civic betterment and improving the quality of life for the residents of

Gwinnett County, Georgia” (Citizens for a Better Gwinnett, 2012). This group is a vocal

opponent to any type of commercial service at Briscoe Field, and its primary complaint with

commercialization is that it will decrease area property values due to noise, traffic, and pollution

(MyFoxAtlanta, 2010).

In his 1997 study of property values in the vicinity of the Los Angeles International

Airport (LAX), Randall Bell showed that a property’s proximity to an airport has a continued

negative impact on its value, and that single-family residences near airports are worth

considerably less than comparable properties that are located elsewhere. Mr. Bell states that

diminution in value ranges from -15.1% to -42.6% and averages -27.4%. He also states that

although there are over 200 factors that affect real estate values, an airport is classified as a

“Class V Detrimental Condition,” meaning that it is an imposed condition. He defines this

imposed condition as, “an act or forced event that affects value, usually long-term or permanent”

(Bell, 1997). Bell’s study also included data for commercial properties as well. His study found

that despite having readily available and convenient transportation access, commercial properties

in the vicinity of LAX had rental rates that were 19.1% to 43.3% lower than any other office

market in the surrounding area. He also notes that the vacancy rate of 38.1% was the highest in

the area as well (Bell, 1997).

In a study published in 2004, Daniel McMillen noted that the majority of studies

concerning airport noise and property values are in agreement that airports reduce local property

values. His study found that home values were about 9.2% lower in the area within the 65 dB

noise contour band. Although this is on the high side of empirical studies stated by McMillen,

23

he notes that this may be due to the excessive amount of aircraft traffic at Chicago O’Hare as

well as the denseness of the population in the surrounding area. He also mentioned that recent

studies were conducted on airports smaller than that of Chicago O’Hare. McMillen also found

that due to the quieter engines that are now being used by modern aircraft, the 65dB noise

contour band had contracted by a third, and that property values in the now quieter area had

actually increased. His study also showed that because of the proposed expansion, which would

reroute a portion of air traffic, and quieter aircraft engines, that the property value in the area of

the airport would actually increase by a total market value of $284.6 million (McMillen, 2004).

The findings of McMillen are echoed in the information published by Propeller

Investments. If Briscoe Field is developed as they propose, the aircraft that will be able to make

use of the airport are actually quieter than the aircraft that currently make use of the airfield (Fly

Gwinnett Forward, 2011). This information is reported in Table 1.

Table 1

Decibel Level Study on Aircraft Takeoff: Select Aircraft

Current Aircraft dBA Proposed Aircraft dBA

Gulfstream II 84.2 MD90 73

Learjet 24D 80.6 Boeing 737-700 65.8

Global Express 74.6 Airbus A-319 65.7

Cessna 206 70.2 Boeing 717 64.7

24

Economic Impact Studies

The economic impact that Mr. Kasarda’s aerotropolis’ provide to the country are best

presented by economic impact studies. The most recent federal economic impact study was

completed by the FAA in 2009, and utilizes data from 2007. This impact study shows that the

aviation industry generated 12 million jobs and $1.3 trillion in total economic activity for the

United States in 2007. The total economic activity of $1.3 trillion is equal to 5.6 percent of the

GDP.

Many states in the U.S. also release economic impact studies on the aviation industry in

their region. These studies are broken down by airport and compiled for state-wide information.

Due to the far-reaching economic impacts of any industry, some of the impacts cannot be

directly measured quantitatively. Economists and planners use software that estimates the

figures that cannot be directly quantified, such as an industry’s secondary or multiplier impacts.

The aviation industry uses either the Bureau of Economic Analysis Regional Input-Output

Modeling System (RIMS-II) or the IMPLAN software to produce a measure of the industry’s

total economic impact. The FAA study utilized the RIMS-II software to estimate secondary

impacts. In this software, primary economic impact data is collected from direct and indirect

sources, and entered into the system. The software then uses a series of multipliers based on

known data from 500 different industries, including spending, income, worker and proprietor

wages, and industry structure and trading patterns to estimate secondary impacts. This data can

be scaled down to a regional or local level for a more accurate estimate of the associated impacts

(Bureau of Economic Analysis, 1997; FAA, 2009).

25

Primary impacts are defined as the summation of direct and indirect economic impacts,

which include: air transportation and supporting services; aircraft, engines, and parts

manufacturing; travel and other trip-related expenses by travelers. The direct impacts are a result

of manufacturing and transportation as measured by employment, payroll, and sales generated by

the following: scheduled and non-scheduled airlines and air couriers, airport and aircraft service

providers, air cargo, general aviation (GA) operators including flight schools, and

manufacturing. The indirect impacts are derived from the expenditures of air passengers other

than airfares and other fees paid directly to airlines. These visitor expenditures create sales,

payroll, and employment for the following industries: accommodations; restaurants, bars, fast-

food outlets and stores; arts, entertainment, and recreations; travel services such as sightseeing

and other tourist services; ground transportation; other on and off airport purchases of goods and

services. The main identifying factor of primary impacts is that these impacts are all directly

quantifiable (FAA, 2009).

Secondary impacts, also known as induced or multiplier impacts, are estimated by the

software based on the data input from the primary impacts and the set of multipliers related to

the given industry. These secondary impacts are a result of the expenditures made by industries

included in the primary impacts to supporting businesses, as well as the spending of direct and

indirect employees. These induced or multiplier impacts account for the secondary impacts to

the economy such as direct and indirect sales, and payroll impacts that are disseminated

throughout supporting industries in a series of multiplier effects. For example, employees at the

airport spend their salary for housing, food, and recreation. These expenditures create more jobs,

payroll, and further increased spending throughout the region. The RIMS-II software uses all of

the information to calculate the induced economic impact through expenditures, earnings, and

26

jobs creation. Economic impact studies that use this software can reliably report information as

summarized in Table 1 (FAA, 2009).

Table 2

Sample Economic Impact Summary

Primary Impacts Multiplier Impacts Total Impacts

Output Jobs Output Jobs Output Jobs

Industry 1 $$$ ### $$$ ### $$$ ###

Industry 2 $$$ ### $$$ ### $$$ ###

Totals $$$ ### $$$ ### $$$ ###

The IMPLAN software is an economic impact modeling software that is similar to the

RIMS-II software. The major difference is that the IMPLAN software uses what is referred to as

Social Accounting Matrices (SAM) to calculate the multiplier effects in a given economy. These

matrices are developed by capturing the “actual dollar amounts of all business transactions

taking place in a regional economy as reported each year by businesses and governmental

agencies” (Alward, 2009), as well as non-market transactions such as taxes. The information

used to build each SAM is derived from unique local and census information, and is not

estimated from national averages. The multiplier models are built directly from the SAM for a

given region which reflects its unique structure and trade situation. Because of these factors in its

27

design, the IMPLAN model is more accurate in estimating induced economic impacts than other

modeling software (Alward, 2009).

Summary

While privatizing airports in the United States is proving to be a slow process, there are

many things that can be learned for ongoing privatization in other areas of the world. Studies

show that privatization can increase profits at an airport; however, due to the public interest in

such a vital infrastructure, government guidance or oversight is necessary. These reports also

show that the level of privatization is not necessarily the largest factor in airport profitability.

The other major factor is the level of commercialization that is developed at or around the

airport, whether that be the addition or expansion of commercial flights, shopping and dining

choices for travelers, or the development of the surrounding areas for industries that rely on

airports for their livelihood. Conflicting studies show that airports can decrease or increase the

value of property in the vicinity. The effects can be positive or negative based on the orientation

of the runways, and the types of aircraft and engines used. Finally, the impact study performed

by the FAA proves the enormous impact that aviation has on the economy. If airport owners and

developers take all of this information into consideration and act appropriately, their airports can

become the hub of an economic powerhouse for their areas.

Statement of the Hypotheses

Based on the review of literature and personal experience, the following three hypotheses

are posited for this study.

28

Hypothesis One: Commercialization of Briscoe Field would result in at least $1.5 billion

per year in economic activity for the area.

Hypothesis Two: Commercialization of Briscoe Field would account for at least 20,000

jobs, once the airport’s full operating capacity has been reached.

Hypothesis Three: Commercialization of Briscoe Field would, in general, decrease the

median property value within the area of the three closest zip codes.

29

Chapter III

Research Methodology

Research Model

This research project will be based on the quantitative method using economic and

passenger data collected from various federal, state, and airport authority conducted economic

impact studies to test the scientific hypotheses. The overall strategy for the research is to

estimate the impact of selected variables if the airport at Briscoe Field should be converted from

a general aviation airport to one that offers commercial flights. Data will be obtained for a

sample of airports, general aviation and commercial, which are approximately the same sizes as

Briscoe Field’s current operations and the proposed commercial operations.

Target Population

The target population for this study will consist of commercial airports in the United

States that are about the same size as the proposed commercial operations at Briscoe Field. The

proposed passenger terminal for Briscoe Field can process 2.5 million enplanements per year.

Airports used for this study had more than 1 million enplanements, and less than 4 million

enplanements per year. Findings and conclusions may be applied to any airport considering

expansion from general aviation to commercial service that falls within the above parameters for

number of enplanements per year.

Sources of Data

The sample will include economic and property value data from 10 commercial airports

in the United States. Since the target population for the findings and conclusions of this study

30

consists of airports about the size of Briscoe Field, the sample was restricted to commercial

airports of similar size. Consequently, the sample was drawn from airports having enplanements

between 1 million and 4 million per year.

The economic data will be collected from state, local, or airport authority economic

impact studies. These studies were completed in conjunction with or under the authority of the

airport’s home state’s Department of Transportation. The specific data collected will include the

following: total number of passenger enplanements, total economic impact in dollars, total

primary (direct) impact in dollars, total secondary (indirect) impact in dollars, total multiplier

(induced) impact in dollars, total number of jobs. The property value data will be collected from

the real estate website Trulia.com. The median sales price for homes in the zip codes closest to

the airport will be used.

Treatment of the Data

Sub Problem One and Hypothesis One

How much revenue could the proposed airport generate, both directly and indirectly?

Hypothesis one is that commercialization of Briscoe Field would generate at least $1.5 billion in

total economic activity for the area. For each airport in the sample, the direct, indirect and total

economic output will be adjusted for inflation to current dollars. The same categories will then

be divided by the number of passenger enplanements per year to estimate the amount of

economic activity generated per passenger per year. Assuming that the mean number of

enplanements per year is 2.5 million, the revenue per enplanement would be $1.5B/2.5M or

about $600 per enplanement. The sample mean and sample standard deviation will be

calculated. A 95% confidence interval will be used as the population estimate. If the entire

31

confidence interval is greater than $600 per enplanement, the research hypothesis will be

supported.

Sub Problem Two and Hypothesis Two

To what extent would the new airport affect the number of jobs in the area? The second

hypothesis is that commercialization of Briscoe Field would account for at least 20,000 jobs.

Assuming the commercialized airport would result in 2.5 million enplanements per year, the

number of jobs per enplanement would be 20k/2.5m or about 0.008. For each airport in the

sample, the number of jobs produced will be divided by the number of passenger enplanements

per year to estimate the number of jobs generated per passenger per year. The sample mean and

sample standard deviation will be calculated. A 95% confidence interval will be calculated. If

the interval is entirely above 0.008, the research hypothesis will have been supported. In that

case a test for means will be conducted. To test the null hypothesis a test for means will be

conducted at the 0.05 level of significance. The null hypothesis is that the population mean is

equal to 0.008. The alternate hypothesis is that the population mean is greater than 0.008.

Sub Problem Three and Hypothesis Three

Would the airport cause an increase or decrease in area property values? The third

hypothesis is that commercialization of Briscoe field would decrease the median property value

within the area of the three closest zip codes. Five general aviation airports that are of similar

size and scope to the operations at Briscoe Field will be selected from the population, and five

commercial airports will be selected that are of similar size and scope to the commercial

operations proposed at Briscoe Field. The median property values will be summarized in a table

32

similar to Table 2. Property values are reported as medians for a particular zip code. Averaging

medians yields a nonsense number (Jones, 2004). Consequently, a test for means cannot be used

to test this hypothesis. A Wilcoxon test for independent samples will be conducted at the 0.05

level of significance to test the null hypothesis that the distribution of property values for general

aviation airports is equivalent to the distribution of property values for commercial airports. If

the null hypothesis is rejected, the median of medians for each sub-set will be found, to

determine the direction of that difference.

Table 3

Sample Median Property Values Near Airports

General Aviation Commercial

$$$

$$$

$$$ $$$

33

Chapter IV

Results

The first sub-problem was to determine how much revenue could be generated by a

commercial airport of the size proposed at Briscoe Field. Data was collected from economic

impact studies completed for various airports that were close to the same scope of operations that

are proposed for Briscoe Field. The proposed commercial airport will be able to handle 2.5

million passenger enplanements per year. Airports chosen for the sample reported no fewer than

1 million enplanements for the year of their study, and no more than 5 million. Table 4

summarizes the data collected for the first sub-problem.

Table 4

Airport Enplanement and Economic Activity

Airport Enplanements Total Economic Impact Impact /Passenger

Austin-Bergstrom Int. 3,841,773 $ 2,540,000,000.00 $ 661.15

Dallas Love Field 2,954,800 2,190,000,000.00 741.17

El Paso Int. 1,685,723 1,041,300,000.00 617.72

Houston William P Hobby 4,151,974 2,890,000,000.00 696.05

San Antonio Int. 3,712,992 3,920,000,000.00 1,055.75

Raleigh-Durham Int. 4,701,950 3,180,056,600.00 676.33

Bob Hope - Burbank 2,837,872 4,206,556,000.00 1,482.29

Manchester-Boston Regional 1,861,695 1,251,906,000.00 672.45

Fort Myers Southwest Florida Int. 3,770,681 3,811,047,000.00 1,010.71

Jacksonville Int. 2,965,973 2,209,596,000.00 744.98

34

Palm Beach Int. 3,232,009 2,540,184,100.00 785.95

Tucson Int. 1,808,043 956,440,000.00 528.99

Norfolk Int. 1,664,735 1,064,117,000.00 639.21

Richmond Int. 1,660,876 1,071,389,000.00 645.07

Note: All figures have been adjusted for inflation to 2010 dollars using the Bureau of Labor

Statistics CPI Inflation Calculator.

The sample mean was found to be $782.70, and the sample standard deviation was $247.45. The

95% confidence interval was found to be $639.83 < mean < $925.57. Since the entire

confidence interval was found to be greater than $600 per enplanement, the hypothesis that

commercialization at Briscoe Field could generate $1.5 billion in economic activity is supported.

The second sub-problem was to determine to what extent the new airport would affect the

number of jobs in the area. Data was collected using the same criteria set forth in sub-problem

one. Table 5 contains the data collected for sub-problem two.

Table 5

Airport Enplanement and Jobs Created

Airport Enplanements Total Jobs Created Jobs / Passenger

Austin-Bergstrom Int 3,841,773 38,920 0.0101

Dallas Love Field 2,954,800 32,745 0.0111

El Paso Int 1,685,723 17,613 0.0104

Houston William P Hobby 4,151,974 44,839 0.0108

35

San Antonio Int 3,712,992 51,588 0.0139

Raleigh-Durham Int 4,701,950 18,327 0.0039

Bob Hope - Burbank 2,837,872 36,226 0.0128

Manchester-Boston Regional 1,861,695 3,820 0.0021

Fort Myers Southwest Florida Int 3,770,681 41,588 0.0110

Jacksonville Int 2,965,973 23,040 0.0078

Palm Beach Int 3,232,009 37,504 0.0116

Tucson Int 1,808,043 17,000 0.0094

Norfolk Int 1,664,735 10,170 0.0061

Richmond Int 1,660,876 10,820 0.0065

The sample mean was found to be 0.0091069 and the sample standard deviation was found to be

0.0034. The 95% confidence interval showed that the population mean is within the range

0.0071434 < mean < 0.0110704. Since the entire confidence interval was not above 0.008, the

research hypothesis is not supported. Because the hypothesis is not supported, the test for means

was not conducted.

The third and final sub problem was to determine if commercialization would cause an

increase or decrease in the area property value. In this sub-problem the sample consisted of

five general aviation airports of similar size and scope to the current operations at Briscoe Field,

and five commercial airports of similar size and scope of the proposed operations at Briscoe

Field after commercialization. For each airport in the sample, the zip codes containing the

airport, as well as three of the surrounding zip codes were used for the test. The zip codes and

the median property list value near commercial airports are summarized in Table 6, and median

property list value near general aviation airports are summarized in Table 7.

36

Table 6

Commercial Airport Median Property List Values

Airport Enplanements Zip Median List Price

Dallas - Love Field 2,954,800 75235 $125,000

75220 $265,000

75209 $465,000

75219 $245,000

Jacksonville International 2,965,973 32218 $140,000

32011 $190,000

32097 $175,000

32226 $200,000

Bob Hope - Burbank 2,837,872 91505 $475,000

91352 $280,000

91504 $539,000

91506 $499,000

Austin 3,841,773 78719 $170,000

78742 $178,000

78617 $113,000

78747 $195,000

Manchester Boston 1,861,695 03103 $170,000

03109 $190,000

03104 $208,000

03053 $230,000

Note: Enplanement data as reported by FAA for 2010: http://aspm.faa.gov/main/taf.asp .

Median List values retrieved from http://www.Zillow.com data for Nov 2010.

37

Table 7

General Aviation Airport Median Property List Values

Airport Operations Zip Median List Price

Briscoe Field 70,807 30046 $110,000

30043 $145,000

30019 $180,000

30045 $145,000

La Porte Municipal, TX 79,433 77571 $120,000

77520 $85,000

77523 $189,000

77586 $188,000

Aransas County, TX 79,433 78382 $199,000

78377 $90,000

78393 $85,000

78390 $115,000

Deland Municipal 77,710 32724 $130,000

32174 $198,000

32124 $160,000

32128 $225,000

Homestead, FL 72,084 33030 $130,000

33031 $399,000

33033 $86,000

33035 $51,000

Notes: Total Operations data as reported by FAA for 2010: http://aspm.faa.gov/main/taf.asp .

Median List values retrieved from http://www.Zillow.com data for Nov 2010.

38

A Wilcoxon test of independent samples was conducted to determine if the median property list

values were equivalent for commercial and general aviation airports. This test was conducted at

the 0.05 significance level. The null hypothesis that the median property list values were

equivalent was rejected because the test statistic (-6.64) based on the sample data was more

extreme than the critical value (-1.96) based on probability. Since the null hypothesis was

rejected, the median of the medians for property list values was determined. This test showed

that the median of property list values near commercial airports ($197,500) was greater than the

median of property list values near general aviation airports ($137,500).

39

Chapter V

Discussion

This project sought to answer questions as to the potential economic effects of

commercializing a general aviation airport. The researcher asked, how much revenue could the

proposed airport generate, both directly and indirectly? To what extent would the new airport

affect the number of jobs in the area? And last, would the airport cause an increase or decrease in

area property values?

The results for sub-problem one did support the researcher’s hypothesis that

commercializing Briscoe Field would result in at least $1.5 billion in total economic activity for

the area. The 95% confidence interval was found to be $639.83 < mean < $925.57. Multiplied

by the proposed number of enplanements per year of 2.5 million, the test shows that

commercializing Briscoe Field would generate between $1.6 billion and $2.3 billion in economic

activity.

The results for sub-problem two did not support the researcher’s hypothesis that

commercialization of Briscoe Field would account for at least 20,000 jobs. The 95% confidence

interval showed that the number of jobs generated per passenger enplanement would be between

0.0071434 and 0.0110704. Using the proposed number of enplanements of 2.5 million, the

researcher found that commercializing Briscoe Field would generate between 17,859 jobs and

27,676 jobs.

The results for sub-problem three did not support the researcher’s hypothesis that

commercialization of Briscoe Field would decrease the median property value within the area of

the three closest zip codes. The Wilcoxon test showed that the median property list values near

commercial and general aviation airports was not equal. Furthermore, finding the median of

40

medians showed that the median property value near commercial airports ($197,500) was greater

than that of the median property list value near general aviation airports ($137,500). This

indicates that commercialization would actually enhance property values rather than decrease

them.

41

Chapter VI

Conclusions

As mentioned in the introduction, aviation had a national economic impact of $1.3 trillion

in 2007. The review of literature showed that airports are not just an asset that merely serves as a

transportation hub, but economic engines that are tied directly to the economic output of the

community. This study showed the type of impact that just one small commercial airport can

have on a community through its economic output, the jobs that it can create, and the effect that

it has on local property values.

Based on results from the economic analysis, the first hypothesis was shown to be true.

A commercial airport of the proposed size of operations for Briscoe Field can statistically

produce between $1.6 billion and $2.3 billion in economic activity for the area. The original

problem statement of this study was to determine the possible primary, multiplier, and total

economic output figures; however, due to the way different states publish their own study results,

it was only possible to analyze total economic output. Data used from the various States’

economic impact studies can be found in Appendix A. Compared to the current economic

output of Briscoe Field, which accounted for $85 million in economic activity in 2010 (Georgia

Department of Transportation, 2011), commercialization would represent at least a $1.515

billion, or 1782% increase in economic output. Using the upper end of the confidence interval,

the airport could be responsible for an increase of $2.215 billion or 2606% in economic output

for the area.

The second hypothesis proposed that commercialization of Briscoe Field would account

for at least 20,000 jobs in the area. While this study failed to support this hypothesis, showing

that commercialization would generate between 17,859 jobs and 27,676 jobs, the results are not

insignificant. The results show that this is a significant increase over the amount of jobs that

42

Briscoe Field currently generates. According to the GDOT study (2011), Briscoe Field generates

730 jobs in the area. It should also be noted that one of the airports included in the study

generated significantly fewer jobs than the other airports. Manchester-Boston Regional Airport

generated 0.0021 jobs per emplaned passenger. The mean for this sample was found to be

0.0091 jobs per passenger with a standard deviation of 0.0034. This shows that the airport at

Manchester-Boston is more than two standard deviations from the mean, thus including jobs data

for this airport in a sample of this size may have skewed the results.

The final hypothesis proposed for study was that brining commercial service to Briscoe

Field would decrease property values in the area. The results of this study failed to support this

hypothesis. There is a significant discrepancy in the median value between property near

commercial and general aviation airports. The median value for properties near commercial

airports was $60,000 higher than the median value near general aviation airports. The results of

this study are opposite to the studies mentioned in the review of literature. It is the researcher’s

opinion that the reason for this difference can be attributed to the fact that airports used for the

previous studies were larger, hub-style airports. The difference in the amount of traffic at a large

hub airport, and smaller airports similar to the one proposed at Briscoe Field may account for the

discrepancy of this study with previous studies. It should also be noted that previous studies use

an equation to determine the percentage of decrease in value in relation to the noise level and

frequency near an airport. The fact that aircraft with jet engines have become quieter as

technology has advanced may also account for a portion of the difference in the study results, a

point which was also highlighted in McMillen’s (2004) study.

Finally, previous studies compare property values near airports to similar properties that

are not near an airport to show the approximate decrease in value that the airport causes to homes

43

in the immediate area. This study focused on comparing property values between two different

types of airports, as opposed to areas with no airports. This may also account for the difference

in findings of this study compared to previous studies.

44

Chapter VII

Recommendations

The recommendations contained in this portion of the project are strictly the opinion of

the author based on the data contained throughout the first six chapters of this report.

The economic studies presented, as well as the results of this project show just how

beneficial a commercial airport can be to the local economy. The large increase in both the

economic output and the increase in jobs would be extremely beneficial to any local government

looking to boost the economy in the area. Subsequent studies in economic output and jobs areas

should expand the sample to include the entire population of airports in the country that are

similar to the size and scope of what is proposed for Briscoe Field.

Another area that should be further examined is the performance of smaller airports that

operate in close proximity to a large hub. While a few of these types of airports were included in

this study (Dallas-Love Field and Bob Hope-Burbank), the researcher did not focus solely on this

type of environment. A focused study on this type of commercial setup should be performed in

order to gain insight as to how these types of airports are affected by their much larger

competitors.

As for property values, this study showed that the property values near small commercial

airports are higher than those near general aviation airports. Future studies should explore

possible reasons for this outcome by increasing the sample sizes in both categories for

comparison. As noted in the review of literature, the residential property value is not the only

concern near airports. Future studies should also take into consideration commercial and

industrial property values near similar types of airports. Property value is based on an extremely

large number of variables, and thus more expansive studies into this topic should be pursued.

45

Based on the literature reviewed, and the outcome of this study, it is the researcher’s

opinion that Briscoe Field should be commercialized. The potential economic gains as a result

of commercialization are too great to be ignored, and it would be a disservice to the citizens not

to take advantage of the opportunity.

46

References

Air Transport Association of America. (2011). Economic impact. Retrieved from:

http://www.airlines.org/Economics/AviationEconomy/Pages/EconomicImpact.aspx

Alward, A. (2009, June 29). What is IMPLAN? Retrieved from:

http://implan.com/V4/index.php?option=com_content&view=article&id=282:what-is-

implan&catid=152:implan-appliance-&Itemid=2

Bell, R. (1997, January 9). Airport diminution in value. Retrieved from

http://www.eltoroairport.org/issues/rbell.html

Bennett, D. L. (2010). Airport privatization after midway. The Air and Space Lawyer, 23(1), 1-

1,23-27.

Bureau of Economic Analysis. (1997, March). Regional multipliers. Washington, D.C.:

Department of Commerce.

Dugan, I. J. (2010, Aug 23). Facing budget gaps, cities sell parking, airports, zoo. Wall Street

Journal, pp. A.1-A.1. Retrieved from

http://ezproxy.libproxy.db.erau.edu/login?url=http://search.proquest.com/docview/74639

8301?accountid=27203

Federal Aviation Administration. (2009). The economic impact of civil aviation on the U.S.

economy. Washington, D.C.: Department of Transportation.

Field, D. (2008). Slow progress. Airline Business, 24(12), 45-45-46. Retrieved from

http://ezproxy.libproxy.db.erau.edu/login?url=http://search.proquest.com/docview/20412

6062?accountid=27203

Fly Gwinnett Forward. (2011). Frequently asked questions. Retrieved from

http://www.flygwinnettforward.com/frequently-asked-questions

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Georgia Department of Transportation. (2011). 2011 Georgia statewide airport economic

impact study. Atlanta, GA: Georgia Department of Transportation.

Humphreys, I., Francis, G., & Fry, J. (2001). Lessons from airport privatization,

commercialization, and regulation in the United Kingdom. Transportation Research

Record 1744, pp. 9-18. Paper No. 01-3239.

Infanger, J. & McAlliser, B. (2008, August). Economically challenged. Airport Business, pp.

18-21.

Jones, D. (2004). Relative earnings of deaf and hard-of-hearing individuals, Journal of Deaf

Studies and Deaf Education, 9 (4), 459.

Kasarda, J. (2009, April). Airport Cities. Urban Land. 56-60.

McMillen, D. (2004). Airport expansions and property values: the case of Chicago O’Hare

Airport. Journal of Urban Economics. 55, 627-640.

MyFoxAtlanta. (2010, August, 31). Newsmaker: Briscoe field expansion. Retrieved from

http://www.myfoxatlanta.com/dpp/news/newsmaker-briscoe-field-expansion-083110

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Massachusetts Institute of Technology.

Poole, R. (2006). Should Milwaukee’s airport be privatized? Wisconsin Interest. Fall 2006. 15-

23.

48

Appendix

A Table of Economic Studies

49

Appendix A

Table of Economic Studies

50

Table of Economic Studies

Note: Dollars reported in the year the study was completed as noted in the first column.

State/Year Airport Enplanements Direct Impact Indirect Impacts Multiplier Impacts Total Econ Impact Total Jobs

TX / 2004 Austin-Bergstrom International 3,841,773 $1,200,000,000 Not Reported $1,000,000,000 $2,200,000,000 38,920

Dallas Love Field 2,954,800 1,000,000,000 Not Reported 900,000,000 1,900,000,000 32,745

El Paso International 1,685,723 495,200,000 Not Reported 406,900,000 902,100,000 17,613

Houston William P Hobby 4,151,974 1,400,000,000 Not Reported 1,100,000,000 2,500,000,000 44,839

San Antonio International 3,712,992 1,800,000,000 Not Reported 1,600,000,000 3,400,000,000 51,588

FL / 2008 Southwest Florida International 3,770,681 487,670,800 $1,589,959,400 1,685,301,800 3,762,932,000 41,588

Jacksonville International 2,965,973 457,573,000 749,736,000 974,390,000 2,181,699,000 23,040

Palm Beach International 3,232,009 558,888,100 1,375,642,500 1,560,958,000 3,495,488,600 37,504

VA / 2010 Norfolk International 1,664,735 Not Reported Not Reported Not Reported 1,064,117,000 10,170

Richmond International 1,660,876 Not Reported Not Reported Not Reported 1,071,389,000 10,820

NC / 2004 Raleigh-Durham International 4,701,950 1,103,311,100 1,197,644,900 453,899,100 2,754,855,100 18,327

NH / 2008 Manchester-Boston Regional 1,861,695 242,400,000 240,900,000 375,200,000 1,236,100,000 3,820

AZ / 2009 Tucson International 1,808,043 Not Reported Not Reported Not Reported 941,000,000 17,000

CA / 2006 Bob Hope - Burbank 2,837,872 628,100,000 1,124,100,000 2,136,900,000 3,889,100,000 36,226