Marcellus Shale drilling won't start on Pittsburgh International Airport property for another year, but Allegheny County already is seeing dividends from a multimillion-dollar deal with Consol Energy.
Effective July 1, landing fees paid by airlines that use the facility were reduced by 55 cents per enplaning passenger, from $14.66 to $14.11. That may not sound like a lot, but with 300 passengers on a plane and hundreds of flights per month, the savings add up.
Unfortunately, the new rate is not significant enough to change Pittsburgh International's position relative to other airports; its fees continue to be nearly double the median of $7.22 for origination and destination airports in the country. Still, authority president Bradley D. Penrod said the airlines were pleased with the change, which goes to the county's broad strategy of trying to attract more flights to Pittsburgh International.
A $46.3 million lease bonus payment from Consol is being spread over five years, with $7.1 million of it going to the authority this fiscal year. Of this year's sum, $2.5 million will be used to cut landing fees and the remainder to cover capital improvements and economic development at the airport.
The county expects even more money, in the form of royalties, once drilling starts. Before that day, and thereafter, the county will have to be certain that the activity doesn't interfere with airport operations or disturb the surrounding environment.
Because of Federal Aviation Administration regulations, none of the money generated on airport land can be used to pay unrelated county expenses, but that doesn't mean the benefits will be confined to the airlines and airport property. More business development around the airport and more flights to and from Pittsburgh will be good for the region as a whole.
The reduced landing fees are only the beginning. Properly carried forward, the Consol deal can deliver a bigger financial lift in the future.