Centerlines - September 2008 - (Page 67) ON MANAGEMENT COURTESY OF JOHN WAYNE AIRPORT/STEPHEN FRANCIS PHOTOGRAPHY ACI-NA’s senior director, Economic Affairs and Research. “Nothing to Hide” Steve Hubbell, properties manager at Southwest Airlines, said the manner in which the airport presents its rates and charges is “effective and one of the better ones.” “It has to do a lot with Loan and her staff and the efforts they make to be as transparent as possible,” said Hubbell, who also serves as the chair of the John Wayne Airport Airline Affairs Committee. John Wayne has “nothing to hide” in its budgeting process, said Leblow. Every year when the business plan is revised, all expenditures—which are eventually charged to the airline tenants— must make sense and meet the goals of the airport. “If not, it will not get approved,” Leblow stated. that “will minimize the impact on the rates and charges of the airlines.” “I think we went above what we have to do with the carriers,” said Leblow. “In the compensatory rate structure, you don’t have to share with the carriers all your expenditures—just the expenditures for their cost center.” In John Wayne’s case, the airport shares the entire operating budget—both aeronautical and non-aeronautical—with the airlines. Among the positive aspects of airport’s rates and charges presentation, Hubbell said, is that the airport always provides the previous year’s actuals—so they have a basis to refer to—as well as the projections for the current year. “Some airports just continue to show us the budget for that year, so it doesn’t really give us an indication of how they’re tracking,” said Hubbell. Hubbell said the airport does a good job of showing the cost per enplanement—clearly laying out the different cost centers—and provides the airlines with an idea of how they’re tracking on an airport-wide basis. John Wayne also breaks down each airline’s costs in terms of facilities: office area, ticket counter, etc. “[It] is really helpful to each airline to get that kind of detail,” he said. “It helps us to understand different areas that may be impacted by changes in the rates and charges, and being able to track from the databases that we have in-house where the cost increases are occurring.” ■ Conservatism An airport has to be able to explain its costs to its tenants, continued Leblow. “Not because it’s nice to have certain items at the terminal. It has to be necessary; it has to make sense; and, it has to comply with our strategic goals.” Leblow said it is the airport’s fiscally conservative financial plan Southwest planes at John Wayne. The manner in which John Wayne presents its rates and charges is “effective and one of the better ones.” — Steve Hubbell, Southwest properties manager. COURTESY OF JOHN WAYNE AIRPORT/STEPHEN FRANCIS PHOTOGRAPHY www.aci-na.org | CENTERLINES 67 http://www.aci-na.org
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