Saturday, May 25, 2013 | 11:20 a.m.
Hi, (not you?) | Member Center | Sign Out
Updated: 8:32 a.m. Tuesday, Aug. 24, 2010 | Posted: 7:25 p.m. Monday, Aug. 23, 2010
The Atlanta Journal-Constitution
The Atlanta airport wants to sharply raise fees on many businesses that operate there, saying the revenue boost is needed to help secure construction financing for the new international terminal.
The airport plans to restructure and hike fees for regional shuttles, hotel shuttles, limos, off-airport parking lots and others -- in some cases boosting the annual cost to a business by 400 percent or more. The move comes as the airport prepares to try to sell bonds to finish the $1.4 billion terminal project, and officials say it is part of a broader effort to bring in more money and assure investors the debt will be repaid.
Businesses are balking at the size of the increases, saying the economy makes it hard to pass costs onto travelers.
“We’re not out of this economic ditch yet,” hotel industry lobbyist Ron Fennel said at a City Council work session last week where the proposals were discussed. The council’s transportation committee could consider the matter at its Sept. 1 meeting, after which it would go to the full council. The airport, which hopes to begin selling bonds this fall, wants the increases to take effect 30 days after council approval.
Bill Henderson, general manager of the Westin Atlanta Airport hotel, said he pays the airport $3,600 a year to operate shuttles now. He’s worried he could pay as much as $80,000 under the proposed new fee structure, and said he plans to partner with another hotel to halve the bill.
Operators of shuttles and limos now pay an annual fee based on the number of shuttles operated. Under the airport plan they would be assessed per trip -- generally $1.25 for hotel and regional shuttles, $1 for limos and $5 for charter buses. Revenue from such fees would go from less than $1 million a year now to $2.5 million to $2.7 million after the changes, the airport estimates.
Annual shuttle fees have averaged out to about 25 cents to 65 cents per trip, according to the airport. Under a $1.25 fee per trip, hotel shuttles would pay as much as five times more than in the past, according to airport estimates.
For off-airport parking operators, who also operate shuttles, the airport wants to switch from annual fees to collecting 8 percent of the businesses’ gross revenue.
The airport has already raised some fees as it grapples with a downturn in passenger volume, rising costs and the financing issues surrounding the terminal expansion, which was launched prior to the recession. Airport officials say it is still justified by long-term growth.
Total operating revenue in fiscal 2009, which ended June 30, was $389.5 million, up .9 percent from the year before. The airport has said it will lose $17 million in revenue from changes in recently renegotiated airline leases, though it may gain in other areas.
The airport last year boosted fees for taxis to $1.50 from 50 cents per trip, and parking rates went up in July.
The airport sold bonds to help pay for work so far on the terminal, but the financial market downturn in late 2008 has made additional sales more difficult. It now plans a three-part, $1.6 billion bond issue including more than $500 million for the international terminal.
The airport -- whose leadership is currently in flux, pending appointment of a new general manager -- wants to have a 1.5 debt service coverage ratio before it goes to the market with bonds. The figure represents the amount of cash available to pay off debt. The proposed increases would get it to about 1.41, and airport officials are talking to the city about finding other sources of revenue.
Airport officials say fees for many ground transportation operators haven’t changed in years. Interim general manager Robert Kennedy said the fee increases are also justified to help cover operating costs, and he sees the per-trip fees as a way to help limit road congestion in years to come.
“It’s time that our ground transportation fees catch up with the rest of what we’re doing at the airport,” he told council members at the work session.
Tony Paalz, chief executive of Atlanta-based Park ‘N Fly, said other airports around the country where his company operates are watching the Hartsfield-Jackson proposal, which could lead to rate changes elsewhere.Thomas Dortch, a lobbyist for off-airport lots, said a large fee increase could put some small parking companies out of business.
Airport hoteliers say the proposed per-trip fee is a problem because they can’t directly pass the fee increases on to customers, since shuttles are complimentary. Holiday Inn Atlanta general manager Adreene Allen also noted the shuttles operate regularly and don’t always carry passengers. Yet under the new plan every trip would be assessed.
City Council member Keisha Lance Bottoms suggested airport hotels consider charging for shuttle services.
“Expectations for complimentary services are out the window,” Bottoms said. “Things that were once free aren’t free anymore and this may be one of those things.”
Airport businesses have asked for the fees to be phased in, but airport management says that won’t take effect quickly enough to aid in bond sales this fall.
“We have an immediate need to show what our revenue is,” Kennedy said. “In order to finish the international terminal we have to get to the bond market soon.”
© 2013 Cox Media Group. By using this website,
you accept the terms of our Visitor Agreement and Privacy Policy, and understand your options regarding Ad Choices
.
Already have an account? Sign In
{* #registrationForm *} {* traditionalRegistration_displayName *} {* traditionalRegistration_emailAddress *} {* traditionalRegistration_password *} {* traditionalRegistration_passwordConfirm *}Already have an account? Sign In
{* #registrationFormBlank *} {* registration_firstName *} {* registration_lastName *} {* traditionalRegistration_displayName *} {* traditionalRegistration_emailAddressBlank *} {* registration_birthday *} {* registration_gender *} {* registration_postalZip *} {* traditionalRegistration_passwordBlank *} {* traditionalRegistration_passwordConfirmBlank *} {* agreeToTerms *}We have sent you a confirmation email. Please check your email and click on the link to activate your account.
We look forward to seeing you frequently. Visit us and sign in to update your profile, receive the latest news and keep up to date with mobile alerts.
Don't worry, it happens. We'll send you a link to create a new password.
{* #forgotPasswordForm *} {* forgotPassword_emailAddress *}We have sent you an email with a link to change your password.
We've sent an email with instructions to create a new password. Your existing password has not been changed.
To sign in you must verify your email address. Fill out the form below and we'll send you an email to verify.
{* #resendVerificationForm *} {* resendVerification_emailAddress *}Check your email for a link to verify your email address.

You're Almost Done!
Select a display name and password
{* #socialRegistrationForm *} {* socialRegistration_displayName *} {* socialRegistration_emailAddress *} {* traditionalRegistration_password *} {* traditionalRegistration_passwordConfirm *}Tell us about yourself
{* registration_firstName *} {* registration_lastName *} {* registration_postalZip *} {* registration_birthday *} {* registration_gender *} {* agreeToTerms *}