Should Northern Michigan's Rural Airports Be Subsidized?

Northern Michigan’s 1st Congressional District is vast, spanning the northern lower and entire upper peninsula. It's also home to more subsidized airports than any other in the country. Federal funding for the airports is proposed to be eliminated under President Donald Trump’s 2018 Budget Blueprint, a move some say could pose a huge economic blow to areas surrounding the airports. But critics of Essential Air Service (EAS) - the program that funds the remote airports - say reconsideration of the funding is long overdue.

As investigative reporter Patrick Sullivan writes in this week's Northern Express - sister publication of The Ticker - EAS critics say the program props up air service in places it doesn’t belong and creates unfair competition for airports like Sawyer International Airport in Marquette, or Cherry Capital Airport in Traverse City, which don’t get subsidies. Created in the 1970s to ensure far-flung communities had access to the nation’s transportation system, EAS was meant to be phased out over a decade - but that never happened, says Tom Rockne, former president of Passageways Travel in Traverse City and an airline industry consultant.

“It’s gone from a ‘We want to get you through this transition’ to, like, it’s in there, and it just continues and continues and continues,” Rockne says. “It’s disturbing to the marketplace, it’s disturbing to the taxpayers, and the requirements are minimal in terms of the effort that the city or the airport has to put forth.” Rockne believes EAS money should come with conditions — that the program should require airports to get together with businesses and pledge a certain amount of use before subsidies are awarded.

Subsidized flights from Manistee to Chicago are a bargain compared to flights from Traverse City. A recent search on Expedia showed that the lowest price for a round-trip flight from Cherry Capital to Chicago’s Midway Airport for the weekend of June 16 was $398. Flights from Manistee to Chicago Midway for that same weekend could be had for as low as $169. Manistee Blacker Airport advertises its EAS-subsidized Manistee-to-Chicago flights in Traverse City, an act Cherry Capital Airport manager Kevin Klein sees as evidence that the EAS program has strayed from its mission.

In 2016, Manistee Blacker Airport got a $514 federal subsidy per passenger ticket.

“It’s supposed to ensure communities have access to the nation’s transportation network,” Klein said. “It’s difficult, in the sense that the public doesn’t necessarily understand that those fares are being subsidized. It’s not a level playing field.”

But Klein believes EAS is important in some places; the Alpena County Regional Airport, for example, is located a long distance from other commercial air and train services. Klein thinks the law should prohibit subsidies for airports that are a certain distance - say, 90 miles - from any airport that, like Traverse City’s Cherry Capital, provides commercial air carrier service. An upside to the elimination of EAS, according to Rockne, would be increased numbers of passengers and flights in Traverse City and Marquette, which ultimately would enable those airports to offer lower fares.

“Without EAS, more natural traffic would flow there,” he says. “And every time Traverse City gets another flight, it gets more low-fare seats too.”

Read more in this week's Northern Express cover story, "The Mile-High Subsidy Club." The Northern Express is available online, or pick up a copy at one of nearly 700 spots in 14 counties across northern Michigan.