Salem Receives Federal Grant To Attract Commercial Air Services – Salem Reporter | Gmx Pharm

The third time is the charm for Salem’s airport.

The city received a federal grant Wednesday to help lure commercial airlines back to Salem Municipal Airport after the U.S. Department of Transportation rejected two previous offers for the money.

John Paskell, the airport manager, said the most recent application contained two letters of support from interested airlines, which he said made the difference in the selection.

“We thought we had the best chance here,” he said.

The $850,000 grant will be used for minimum revenue guarantees, a pot of money airlines could apply for if they don’t meet revenue targets in the first few years of operation. Some of the money would also be used to market flights.

US Senators Ron Wyden and Jeff Merkley, both Democrats, announced the funding on Thursday. Wyden had submitted a letter in support of the scholarship.

“Regional air services through small airports like this one in the Oregon capital are critical to our state’s economy,” Wyden said in a statement. “I am pleased that these dollars will go toward expanding Salem’s regional air service to provide a more accessible option for travel to and from the Mid-Willamette Valley. Investing in smaller airports like Salem Airport lays the foundation to continue to support our state’s economic growth and tourism.”

“Commercial Air will support and grow the economy of the Mid-Willamette Valley, increase tourism, reduce traffic and congestion along the I-5 corridor, and create less dependency on Portland International Airport,” Salem Mayor Chuck Bennett said in an explanation.

Avelo Airlines, a low-cost airline based in Houston, Texas, was one of the airlines supporting the grant. Paskell said they have expressed interest in offering two weekly passenger flights to either Burbank, California – in the Los Angeles area – or Las Vegas, and then increasing offering flights to both destinations.

The news was celebrated by Salem’s business community, which has been working for years to restore commercial air travel to the city.

“Commercial aviation is the jet fuel needed to create a diversified and vibrant regional economy – providing smart and strategic economic development solutions around affordable and accessible travel, talent recruitment and investment, carbon reduction footprint and more,” said Angie Onyewuchi, CEO of Travel Salem, in a statement. “This important grant funding brings us closer to launching our first flights and providing a direct link between Oregon’s spectacular wine country and the world.”

Tom Hoffert, CEO of the Salem-area Chamber of Commerce, said the impact of restoring air travel to Salem would extend beyond the city because the airport would be the closest travel option for anyone living south of Wilsonville or north of Corvallis.

“Opportunities for economic development in the city are things we cannot miss,” he said.

But the funds won’t help the city make upgrades at its terminal, which the Transportation Security Administration says are necessary to resume commercial flights, or pay for the increased airport staff needed to keep those operations running.

“It’s another piece of the bigger puzzle. It certainly makes Salem more attractive to airlines looking to serve Salem,” Paskell said of the grant.

Paskell submitted a report to city councilors last week detailing the costs expected to return air service to Salem. That includes between $3.9 million and $12 million for terminal renovations, depending on the size of the aircraft being served.

Other ongoing costs include doubling the number of airport employees and additional police and fire services needed at the airport.

City councilors generally supported the return of air service but said the city had no extra money available to subsidize airport operations or pay for renovations.

Unlike his peers, Councilor Tom Andersen questioned the business case for the effort and expressed skepticism that the effort would reduce carbon emissions. Advocates have said reducing the number of people driving into Portland for flights will take cars off the road and reduce pollution.

In addition to Avelo, Aha!, another low-cost carrier, has also expressed an interest in serving Salem with two weekly flights to Reno. Paskell said the second airline to sign in support of the federal grant asked that its letter be kept confidential. Her letter was not included in the application package, which was publicly posted on the Department of Transportation’s website. Paskell said the high interest means the airport urgently needs to find sources of funding.

“Possibly three airlines sometime next year, which is why we’re trying to budge and see what that means for our terminal,” he said.

City council still has to vote on whether to accept the grant. Paskell said he expects to present it to the city council at its Aug. 22 meeting, once he has had an opportunity to review the details and understand any commitments the city must make to receive the money.

He said he’s now working to submit cost estimates for necessary renovations and services, and is working with the city’s Treasury Department to identify possible grants, bonds or other funding sources that could help bridge the gap.

“Other than a wealthy benefactor walking in and just dumping cash in the front yard, we’re not sure how to get there,” he said.

Other entities that have supported the return of air service, including Travel Salem and the Chamber, are also looking at potential sources of funding. Hoffert said he was approached as to whether the local business community might be willing to contribute money for the necessary airport upgrades, although it’s too early to say whether the city council would support such an effort, or members of the Fly Salem group be interested.

Paskell said that despite the funding challenges ahead, it’s exciting to be selected.

“These are good problems,” he said.

This story has been updated to include comments from Tom Hoffert, Sen. Ron Wyden and Mayor Chuck Bennett.

Previous Reporting

Salem City Councilors want commercial air service back, but who is paying remains unclear

Salem’s plans for commercial air travel in the coming year depend on federal grants

With interest from low-cost airlines, there is growing optimism about commercial service at Salem Airport

Contact reporter Rachel Alexander: [email protected] or 503-575-1241.

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