Despite recent slide, airport is a huge economic generator.
To expand or not to expand? That's the question facing the Minneapolis-St. Paul International Airport as its operators try, as best they can, to peer into the future and weigh the metro region's air-travel demands over the next two decades.
If this were still the go-go 1990s and MSP were still the headquarters hub for Northwest Airlines, a decision to move confidently forward wouldn't be so hard. But times have changed, and so has the airport.
A confluence of factors -- recession, Northwest's bankruptcy, Delta's takeover and the rise of rival markets -- have diminished the airport's status in recent years. Passenger boardings have declined by 12 percent since 2005, and flight operations by 18 percent. Once the nation's 10th-busiest commercial hub, MSP has slipped to 16th, overtaken by Charlotte, Orlando, Miami, Seattle and Newark.
Fortunately, there's a mechanism that allows airport operators to match those new realities to market demand, allowing MSP to grow only if and when it needs to. That process is now underway. Here's how it works:
Federal and state environmental assessments are required any time the Metropolitan Airports Commission (MAC) contemplates major expansion. Those assessments can take four to six years from the start of the study to the completion of construction. That's not enough flexibility to respond to changes in the market.
But by completing the assessments for maximum expansion in advance, including all of the public comment required, the MAC can, in effect, put the completed assessments in its pocket and parcel out the degree of expansion required, whether major, minor or no expansion at all, depending on market conditions.
"You don't have to pull the trigger on a particular project until it's needed, but you have all of the environmental requirements in place," explained Commissioner Rick King. So, if a new carrier -- say, Jet Blue or Lufthansa -- decides it wants to come into the Twin Cities, the airport can have gates and customs facilities ready within a reasonable period of time.
It's worth noting that, despite recent declines, MSP remains one of America's most important airports. Its Delta hub operations are on par with those in Detroit and New York. Altogether, the airport handled 33 million passengers and 437,000 flights in 2011 and provided nonstop air service to 118 domestic and 20 international destinations.
It's hard to imagine another installation that's more vital to the metro economy, or the region's future prosperity. The MAC estimates that the airport generates $10.7 billion annually for the metro economy and contributes $600 million in state and local taxes. If the market demands major expansion, then the airport should be ready to respond.
A growth spurt would be nothing new for MSP, where passenger loads quadrupled between 1980 and 2005. Indeed, experts forecast as much as a 73 percent rise in passengers by 2030, with flight operations increasing by as much as 40 percent.
To accommodate that kind of growth, MSP would need to add 30 gates and 18,000 parking spaces. It would need better roadway connections and signs, larger rental car terminals, bigger taxiways, more space for international arrivals and perhaps an airport hotel.
To accomplish all of that with the greatest efficiency, the airport would need to achieve much greater balance between terminals. Terminal 1 now handles more than 85 percent of the airport's traffic. The plan is to consolidate Delta's hub operations at Terminal 1 (Lindbergh) while shifting United, American and other major carriers to Terminal 2 (Humphrey), where the number of gates would triple. Whether the shift would promote competition and lower ticket prices is unclear, although airport officials believe that it would. They also believe that a greater reliance on transit would improve the airport's efficiency, but that's a matter beyond MAC's control.
If the market dictates those and other improvements, the cost could reach $2 billion to $2.4 billion spread over 20 years, paid for almost entirely by airport revenues.
As for jet noise, that sticky issue was pretty much settled in 1996 when the Legislature decided to expand the airport on its current footprint. Yes, for safety reasons the Federal Aviation Administration now dictates landing patterns that will increase jet traffic over a portion of south Minneapolis near the southeast shore of Lake Harriet by an average of 18 flights on days that planes are landing to the southeast.
But the plan also calls for expanded noise mitigation. That's shallow comfort for many residents. But, in the larger scheme of things, a busier airport would reflect a flourishing, competitive metro economy -- a prospect that Minnesotans should welcome with open arms.
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