Logan Considers Asking Airlines to Pay for Environmental Improvements

World Airline News, April 13, 2001

Massport Would Likely Increase Fees to Cover Emission Reductions

Boston Logan International Airport is attempting to strengthen its environmental management efforts through a US$15 million environmental initiative slated to be funded by the airport's tenants - including airlines operating from the facility.

The Air Quality Initiative (AQI) is the result of discussions between the Massachusetts Port Authority (Massport) and state environmental regulators. "They asked us to work on our program," said Massport Director of Communications Jose Juves.

Massport emphasized the AQI is the first program of its type in the U.S. airport system. But because U.S. airports are highly regulated regarding methods of charging carriers and how they spend money, it could take a significant amount of time to implement the AQI recommendations.

U.S. airport finances are often "stove-piped" according to Bonnie Wilson, vice president of airport facilities and services for the Airports Council International North America (ACI-NA). She told World Airline News that to meet current regulations the money collected for environmental improvements at Logan from airlines would need to be invested into infrastructure and alternative ground service equipment.

Juves said some of the elements of the AQI are aimed at improving ground transportation and making gate areas more efficient. He also indicated Logan was interested in working with school bus companies and rental car agencies to possibly switch to alternative fuels such as compressed natural gas.

Part of the AQI funding would come from increased landing and rental fees for the airlines. But Juves stressed that offsite environmental projects such as working with school bus companies would not be funded with airline money.

However, in a statement issued on April 7 Massport indicated rental car agencies and those school bus companies would be direct beneficiaries of airline contributions. "Funded by the airlines, the AQI will provide millions of dollars to companies and agencies that permanently cut down on emissions around Boston, creating cleaner air. Potential recipients of the incentives include school bus companies and car rental businesses," according to the Massport statement.

Airline Reaction Questionable

The economics of the airline business probably would make carriers hesitant to embrace Massport's new environmental program, according to an industry source. "The profit margins of airlines are so thin they're not going to be happy about increased costs," the source said.

According to Phil Roberts of Hayward, Calif-based Roberts, Roach & Associates those increased costs "go through the system and are passed directly to the customer."

Projects like the AQI proposed by airports result in the "tricky jigsaw puzzle," of airport funding, according to Wilson. "Airports are self-sustaining and not-for-profit. You have to keep the money where it came from. You can't charge US$5-$10 and send it to city hall to build a new stadium," she said.

Wilson told WAN that the AQI had a better possibility of successful implementation if "they take time to apply it carefully to ensure they stay within the parameter of funding laws." (Continued next page.)

Juves said Massport was still in the initial stages of identifying how to implement the initiatives and the AQI was briefly discussed during an April 10 meeting between Massport officials and airline representatives of the Boston Airlines Affairs Committee.

Juves indicated members of the committee had questions concerning charges and how the program would work. "The details of the funding have yet to be worked out," he said.

In addition to Massport's proposed environmental initiative, Wilson said airlines were already participating in voluntary emission efforts and have "worked hard with ACI, the Environmental Protection Agency (EPA) and the Federal Aviation Administration (FAA)," she said.

Airlines could face an increase in charges for environmental programs at other airports if the AQI is a success, according to Wilson. "If they're successful in applying the fee, you'll see other state regulatory agencies asking airports and airlines to do just that."

Summary of the Air Quality Initiative (AQI) at Boston Logan Airport

The program is designed to cap Nitrogen Oxide (NOx) and Volatile Organic Compounds (VOC) emissions at 1999 levels.

The AQI will be paid for through a fee charged to airlines and its tenants. Elements of the initiative include:

Expanding existing programs to reduce pollution form the airport including alternative fuel and clean fuel conversion of rental car buses, hotel courtesy buses, airline ground service equipment, and Massport vehicles; consolidation of rental car facilities and shuttle service; improvements to the heating and cooling plant; and low-emission fuel buses for increased Logan express service.

Create financial incentives to reduce emissions, focusing on mobile sources such as buses and cars, the most significant sources of pollution and the most difficult to regulate.