Jan 21, 2025
During the Tallahassee annual city retreat discussion about the airport, Mayor John Dailey proposed using minimum revenue guarantees to incentivize air carriers to establish service in Tallahassee. “I am also formally asking that we formally engage with the state to bring back a contract as part of that minimum revenue guarantee. And how can the state participate, allowing the state workers to be able to fly through our airport to and from and participate in that minimum revenue guarantee,” he said. Dailey’s proposal would create a partnership between the city and state that would help with financial incentives. Minimum revenue guarantees ensure an airline receives at least a minimum amount of revenue. Other cities -who have issues with market forces impacting consumer options – are employing this approach. For example, the mayor of Pensacola recently signed off on an incentive program for air carriers. Adopted on Marh 15, 2024, the Air Carrier Incentive Program “is intended to encourage new non-stop air service,promote competition and improve or enhance existing air service at Pensacola International Airport (“PNS”). The Program offers a range of support to assist an airline expanding its service at PNS.” Tallahassee has a history with minimum revenue guarantees. In 2001, the city agreed to subsidize AirTran for up to three years, providing approximately $1.5 million per year in revenue guarantees and $600,000 in marketing services. After the subsidies ended, AirTran – which no longer exists – ended service in Tallahassee.
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