Confusion exists as to whether the Hilton Head Island Airport is profitable.
Federal AviationAdministration methodology-based studies peg its annual economic benefit at $80 million. Without it, we would not be hosting the RBC Heritage golf tournament, which contributes another $80 million annually. Our airport provides a public safety function, and our real estate market is enhanced by attracting residents who use private aircraft.
Profitability can be confusing because depreciation makes it appear unprofitable. Depreciation is irrelevant because the FAA funds most improvements. The better measurement is cash flow from operations, which has been positive during the past 10 years by more than $2 million.
Capital improvements over the past 10 years have totaled $13 million. Indebtedness to Beaufort County on these investments peaked at $2 million in 2007; 25 percent has been repaid. The new hangars are being paid off by those renting the hangars. Net worth has increased $6 million over the past 10 years to $16 million. Our airport is valuable and profitable.
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It is a false premise that the county shouldn't loan capital funds to our airport. The debt is modest and is being repaid, which is extraordinary. Other county capital improvements are funded and not repaid. Noting that Hilton Head is the primary beneficiary, it would be appropriate for the town to contribute accommodations tax funding to the airport.
Rest assured that our airport is profitable, is well-managed, has a strong balance sheet, is paying its own way and is an important contributor to our economy.
Beaufort County Council
Hilton Head Island