For landmarks like this, I have turned "on" the buzzer. Yesterday, there was a letter to the editor in the T & G praising their experience on Allegiant with ORH, I did not print it why?. Maybe I should have, but there is no real debate here that Allegiant and ORH has done a great job with these flights, unlike PanAm..
The real debate right now is what will we do over the next 400 days. As we get closer to the deadline, we will see more letters like today's letter to the editor (which I can not disagree with).. The airport has consistently lost $2,000,000 per year the past 5 years working with MassPort, can you blame anyone criticizing results like these--$10,000,000 is alot of money. We need to start marketing the sale of ORH today, 400 days before the end of the operating agreement with MassPort, not another three extension of the current agreement with MassPort.
Friday, May 26, 2006 Time to end struggle for Worcester’s airport
First, they built a fancy new terminal so we would come to the airport on the hill. Then they improved the runways and instrument landing system so planes could land safely. Next, they posted signs so we could find the hill. Then they got Massport to run the complex and woo airlines to fly to and fro from the hill. Then they proposed, without success, tearing up a big chunk of the city to build an access road to get to the hill. Now, they have proposed a catchy new name for the airport on the hill, hoping that computer screens around the world will herald the shiny airport located just west of Boston. Voila, a full flight to Disney World.
For years, they have spent millions upon millions of our dollars on bricks, asphalt and mortar, high-paid consultants, endless meetings and debate, numerous marketing plans and expensive studies to prove them right. But despite all of their efforts and all that money, airline after airline has come and gone. And the airport continues to languish — a few flights to and from Orlando do not spell success. How much more of our money will we allow our local, state and federal officials to spend on a well-meaning but futile attempt to revive an ailing albatross that simply will never fly? It’s time to tell them that enough is enough.
RICHARD A. HOWARD
Auburn
Same Time Next Year
-
It’s been nearly a year since I wrote about the problems that come from
having 11 bosses who are not on the same page about anything, as well as
suggestion...
4 months ago
19 comments:
If You sell ORH, will the same personnel still be at the "hill".
Get new management and new tenants
That will be up to the company that either outright buys or obtains a long-term lease as to who they retain, or not retain.
Hey, wonder when we will ever get the 20 Year Master Plan..
Pete:
It will never happen.
I've read we can't sell the airport at "fire sale" prices, yet I've also read that there is alot of apathy at the airport.
If I were in a position to purchase an asset, I would watch the business in action to see the behind the scenes of the operation.
This is a public asset and not a private interest.
If we were to outright sell ORH or lease it out long-term, we would need to get a fair price. At the same time, don't forget to calculate the savings of not having to subsidzed the airport each year.
Without the help of MassPort, the airport would have cost the City of Worcester $10,000,000 the past 5 years.
Dave:
Great question.. I tried to answer in a blog. Can I also say thanks to everyone for getting names.
The anonymous thing was getting confusing.
Yes, it was, Bill.
Dave, your question deserves an educated response. If I may, I'll do some research and get back to you. Once I have an answer I'll post it. The question as I understand it is, "How much money does downgrading ORH to GA save the city of Worcester?" I haven't seen a cogent answer here. Bill, am I wrong? Am I repeating efforts to answer this question?
Great comment Dave. I believe the answer to your question is rooted in economics.
The military can afford to keep a base functional not turn a profit but because of strategical and tactical value. It is funded mainly by the government.
ORH is a public domain which relies on the private sector to enhance it's revenue base. A best case scenerio for an airport like ORH is to be at the least self-sustaining. Revenues=Liabilities.
Airports w/ smaller runways (i.e. Fitchburg,Spencer etc.) have a different profit center .
Dan:
You are making alot of sense. If:
1) we save no money turning it in a GA airport
2) extening the agreement (which has not worked the past 5 years) will cost over an estimated 1,000,000 per year
3) closing an airport is an unventured territory
What options are left??? SELL ORH!!
If selling ORH is the best option then:
1) When selling a product we need to realistically assign a value to assets. What does ORH have in terms of buildings, hangars,maintenance facilities, equipment etc.
2) Are there any liabilities like hazardous waste disposal,outdated equipment or facilities that need to be updated or replaced.
3) Lease agreements for presents tenants.
Assess a market price and yo'll be able to target your market.
I agree that the city should not be sitting by the wayside, but we cannot get caught up in the small chance that someone will be willing to buy ORH.
The short-term solution is to ensure that at least one more airline is here within the next year. Plain and simple.
www.WorcesterAirport.blogspot.com
Alec:
We need more airlines, no doubt about it.... If we add one more airline, but keep losing the same amount of money, how can we justify these costs?? We can not.
We need more airlines true, but we need to lower the cost of the airport to the General Fund. An Enterprise Account should break-even or lose a little money each year, not millions.
BIll
I agree Bill. Nobody is questioning the need for additional revenue generating enterprises at the airport be it additional airlines, corproate aviation, etc.
I think what your trying to convey is it's time for the"let's wait and see what happens" attitude has gone on long enough. It's costing to much money, and no one wants to see higher taxes so we can just keep an airport.
Selling makes sense
Massport is in the driver's seat.
They have no incentive to improve or takeover the airport at fair market value.
I also think the time structure for putting up the airport for sale is too short. Not impossible, but I think it would take at least a year to get every to agree to at least "agree" on selling the airport i.e. feasability studies, committees, etc.
Unless there is some patriarch of aviation willing to take on the ORH project , I think in the end Massport will end up taking over.
I often wonder if we really know all the expenses at ORH.
anonymous (9:10AM):
My thoughts exactly.... ORH is the same airport that can not put out an RFP for a restaurant or complete a Master Plan, what are the chances of them putting together a package for prospective buyers over the next 12 months.
Envision this... First, we never put ORH up for sale. Seoond, the current agreement ends in 398 days and MassPort refuses to extend agreement.. Third, the city is looking a 2,000,000 per year to stay open as a commercial airport (cert 139). Fourth, to save money we downgrade to a GA (General Aviation) but now we know it saves virtually nothing. Fifth, we can not close the airport, or in the very least even that will take time.
MassPort can then offer us a low ball price and we will take it to save losing $2,000,000 per year. In the end this may be the best thing to happen at ORH in a long time.
I flew through the IMG report last week, but did it not mention a Master Plan and then go on to mention a marketing plan and the marketing plan is also MIA or supposed to be part of the Master Plan.
We should turn this thing over to a business school like Harvard as a case study.
It would be free and and we might also get them to make a produce a decent website.
Kudos, Jahn! To involve the academic world in a solution to this situation is looking positively toward the future. Who other than the upcoming generation has a vested interest and fresh ideas to help ORH realize her potential.
And a BETTER WEB SITE! YES! We've been needing that for too long.
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