Modesto faces head winds in landing passenger flights

Travelers should not expect commercial flights to return to the Modesto Airport anytime soon.

Airport Manager Mark Germanowski said service might resume in a year or two. But he said the city continues to work on landing the flights, preferably daily service between Modesto and Los Angeles, though service with Phoenix could be an option.

Modesto faces the same head winds buffeting other regional airports trying to keep or land commercial flights: a pilot shortage and the big airliners focusing their business on major airports. But Germanowski expects those trends to turn around, and Brent Bowen, dean of the college of aviation at Embry-Riddle Aeronautical University in Prescott, Ariz., agrees.

Modesto has been working on the Los Angeles flights for about two years. Bringing in an airline has become more critical since SkyWest Airlines stopped its daily flights between Modesto and San Francisco in June 2014, citing “poor performance in the market.” This is the first time since the 1980s that Modesto has not had commercial passenger service, according to Bee archives.

Officials have said their focus is on Los Angeles because it is more reliable than San Francisco, and Southern California is the top destination for travelers flying from Modesto. The city had been talking with SkyWest regarding Los Angeles flights, but those discussions have ended.

City Manager Jim Holgersson said American Airlines has expressed interest in serving Modesto, and the city is talking with the carrier. The airline’s media relations office would not confirm that in an email: “American continually evaluates its network to ensure we are maximizing our fleet and profitability while matching customer demand.”

Modesto also has made progress on funding a revenue guarantee for the flights. Airlines are reluctant to start flights without such a guarantee, which makes them whole for financial losses sustained in the first two years as the flights get established.

The guarantees typically are $1 million over two years. Modesto officials have said the city cannot afford that, but it appears the city has found a way to fund about half of the guarantee. Holgersson has talked with Stanislaus County CEO Stan Risen about the county setting aside the property taxes it collects on the aircraft at the airport for part of the guarantee.

Risen said the county’s preliminary budget for the current fiscal year sets aside the $241,000 in aircraft taxes for the guarantee and said he would support setting aside a second year of taxes, but no more than that. He said the taxes are discretionary revenue for the county, but its practice has been to use them to reimburse the city for one-time capital projects at the airport.

Germanoswki said the city is looking at other ways to fund the rest of the guarantee, including considering asking travelers to put money into an account that they would use to buy airline tickets.

Bowen, the Embry-Riddle dean, said he was impressed with how Modesto has funded part of the guarantee and that it appears to have a good relationship with the county. He said airlines look at how well local governments get along as part of their decision to enter a market.

But Bowen said the key for Modesto will be funding the revenue guarantee. He said the city could re-establish commercial flights within two years once it has the guarantee in place.

Modesto had tried to land the Los Angeles flights with a pledge drive. It worked with Sixel Consulting more than a year ago on a drive to show an airline the demand for the flights. The drive raised about $1.5 million. The nonbinding pledges were from travelers who said they would spend the amount they pledged on tickets.

Modesto no longer is working with Sixel. The city paid the consulting firm a $15,000 fee, plus $15,518 for expenses, according to records provided by the city. Sixel could have received about $120,000 annually had it landed the flights. Bowen said pledge drives are commonly used and show the potential demand for air service but are not considered significant enough for an airline to start service in a community.

This story was originally published July 28, 2015 at 6:21 PM with the headline "Modesto faces head winds in landing passenger flights."