Hilton Head airport can use new revenue sources

Beaufort County officials should move ahead with plans to charge new fees at the Hilton Head Island Airport and get the airport on sounder financial footing.

The proposal to charge $4.50 per ticket to commercial passengers boarding planes at the island airport should get swift approval. The money would be used for airport improvements. Given the projects listed in the airport's long-term plans, including extending the runway, the surcharge would bring in much-needed revenue.

A $3 ticket surcharge to raise up to $1.5 million helped pay for airport improvements in the 1990s.

The $4.50 fee is expected to bring in $225,000 a year, based on current passenger counts, and would be used to help pay the county's anticipated $900,000 share of extending the runway.

More controversial is a proposal to charge landing fees to private aircraft using the airport. Money collected under the proposal would also be used to pay for future construction, including runway lengthening.

The proposal is to charge a minimum of $10 or up to $1.65 per 1,000 pounds, whichever is greater. Private planes based at the airport that pay for permanent tie-downs or that rent a county hangar would be exempt since they already contribute to airport operations. Transient aircraft account for about 65 percent of general aviation traffic.

The new fee is expected to raise about $100,000 a year.

Commercial aircraft are charged a fee of $1.31 per $1,000 pounds, as well as fire-fighting fees. For fiscal year 2011, that brought in $149,016 and $298,954 respectively, according to county financial reports. That money goes toward paying operating costs.

Private aircraft already contribute to airport operations. If a private pilot rents a car, buys fuel, pays for an overnight tie-down or hangar stay, that money helps cover the county's operating costs.

Paul Werts, executive director of the S.C. Aeronautics Commission, warns that such a fee could be seen as "discriminatory," which could put at risk state and federal grants for airport improvements. If that's true of federal grants, then the idea probably should be dropped. Federal Aviation Administration grants often pay up to 95 percent of qualified projects. The county received $1.4 million in FAA grants this past fiscal year. We could probably find a way to make up the 2.5 percent covered by state grants.

But something needs to be done differently if the county wants the airport to be self-sustaining or at least more self-sustaining. The Hilton Head airport posted a $381,727 operating loss (including $555,056 in depreciation) for the 2011 fiscal year, according to financial reports. It owes about $1.5 million to the county's general fund.

"We are in the black, but we're not in the black because we have liabilities," said Hilton Head resident Will Dopp, a member of the Beaufort County Airports Board. "And (we) are embarking on projects requiring the county to come up with substantial sums. ... A $10 (landing) fee won't drive someone away."

The new fees, if tied to specific airport improvements, won't directly help day-to-day operations, but the improvements could help generate more airport use -- and more income for operations.

The advisory board and ultimately County Council must decide whether they think a landing fee for private aircraft will hurt more than it helps. We think it will help and is worth a try.