Fuel Costs

Obviously the tax per gallon must have been bothering Allegiant, since the Airport Commission voted in August, 2006 (http://www.flyorh.com/user/airport%20commission%20august,%202006.pdf) to change their vote on August 15, 1989 which had recommended to the City Manager to impose a tax on the purchase of fuel which is allowed by Mass General Law 64J Section 13:

The provisions of this chapter relative to the imposition, payment, collection and distribution of an excise tax on the sale or use of aircraft fuel shall apply in a city after acceptance by a majority vote of the city council with the approval of the mayor, in the case of a city with a Plan A, Plan B, or Plan F charter; by a majority vote of the city council, in the case of a city with a Plan C, Plan D or Plan E charter; by a majority vote of the annual town meeting or a special meeting called for the purpose, in the case of a municipality with a town meeting form of government; or by a majority vote of the town council, in the case of a municipality with a town council form of government. The provisions of this chapter shall take effect on the first day of the calendar quarter following thirty days after such acceptance, or on the first day of such later calendar quarter as the city or town may designate

Please note that this was only a recommendation by the Airport Commission but that it is ultimately up to the City Council to vote on this recommendation to rescind the tax. To date this has not been brought up at any City Council meetings.. In other words the tax per gallon is still in effect.

I also had a chance to read through the Allegiant operating agreement with the City of Worcester. The only thing that jumped out at me was Section 5.2 whereby Allegiant represented to purchase 2,600 gallons of fuel per outbound flight. Lets assume there were 20 outbound flights in a month that would equate to 52,000 gallons of fuel. If Allegiant only purchased 40,000 gallons, they would have to still pay a flowage fee (.055) on the shortage. In this case it would be 12,000 times .055 or $660.

Was this a big deal? Was this typical at other airports that Allegiant flies from?? I do not know, but these are the types of things we need to find out.