Centerlines - January 2008 - (Page 37)

ON MANAGEMENT Using the Survey “The new ACI-NA Airport Performance Benchmarking Survey significantly increases the amount of comparative airport information for airports of all sizes,” explained Liying Gu, ACI-NA’s director of economic affairs and research. “It provides a clearer definition for aeronautical and non-aeronautical financial information and key performance indicators. It also reduces duplicative administrative efforts for airports to respond to different surveys.” According to Poinsatte, DFW started benchmarking just in the last year, and he said he takes a very high-level approach to the process. “There are two ways to look at it: Either you can do it very high level or you go down to the very micro level, and in between, it becomes very hard,” he said. The key measurement for DFW is cost per enplaned passenger, which is the only measure Poinsatte said he benchmarks. “And the reason I stay right there is because it’s the highest level, most important,” he added. “But what we do in the benchmark survey is try to differentiate the different aspects of cost per enplanement. And we’ll break it down and look at the expenses per enplanement, the revenues per enplanement, the debt per enplanement. And then you have to go a little deeper, and in the survey we try to get to that.” For example, he said, “How many of your terminals does the airport maintain versus the airlines maintain? Here at DFW, we maintain three out of five. At Atlanta, they don’t maintain any; consequently, their cost per enplanement is very low.” Additionally, at DFW, benchmarking is also tied into the airport’s longrange plans. “We want to see relative movement in cost per enplanement,” said Poinsatte. “Today, out of the top 25 airports, we’re probably right in the middle, No. 12, based on our current measures. We’re going to try to move that down into the seven or eight range to be a more cost-effective airport.” He added that this goal is based on a three- to five-year timeline. “If you look at our relative performance to the industry, DFW’s cost per enplanement has gone from (about) $2.50 to the $7.50 range, which is not the direction you’d like to go,” he said. “But we just built our capital development plan and borrowed $2.8 billion to build a new terminal and Skylink, so we knew our cost structure was going to go up.” Which is why, he said, it’s important to look at the numbers over a long period of time as airports manage their capital programs. Poinsatte added that this year, the cost per enplanement is estimated to be back down under $7. “We’re going to try to keep it in that $6 to $7 range and let the other airports gradually increase over time,” he said. KEY DEFINITIONS IN THE ACI-NA PERFORMANCE BENCHMARKING SURVEY Landing Fee Rate for Signatory/Major Airlines Landing fees defined/designated in an airport’s airline operating agreement for major carriers signing the agreement. Passenger Airline Cost Per Enplanement The amount that passenger airlines pay airports for landing fees, aircraft parking, and use of terminals (terminal leases, HVAC, international fees, etc). This excludes hanger rentals and any amounts paid by cargo airlines to the airport. Landing fees. Fees charged to aircraft owners and operators for the use of runways, taxiways, landing strips, runway protection zones, and clearways. Terminal/international arrival area rentals or other charges. Revenue earned from aeronautical use of the terminal facilities and ground space for the purpose of moving passengers and their baggage. Apron charges. Revenue earned from the parking of aircraft on airport property. Air cargo, GA, military fees. Fees charged to cargo, GA, and military aircraft owners and operators for the use of runways, taxiways, landing strips, runway protection zones, clearways, terminals/hangars and aprons/tiedowns. Baggage make-up system costs. All of the baggage handling operating costs (personnel, materials and supplies, utilities, etc.) of the airport associated with their self-operation/maintenance of the baggage make-up system. Airport Operating Cost Per Enplanement Total airport operating expenses. Personnel compensation and benefits; communication and utilities; supplies and materials; repairs and maintenance; contractual services, insurance, claims and settlements; and any other miscellaneous operating expenses. Parking facility expenses. Personnel and other operating expenses such as pre-paid kiosks, O&M, revenue control systems, etc. Operating expenses for air cargo, GA, military. Operating expenses related to air cargo, GA and military facilities. Non-aeronautical Operating Revenue Per Enplanement All revenues associated with the running and operation of the airport that are not derived from the aeronautical use of the airport. Annual Debt Service and Net Debt Service Per Enplanement Annual debt service and net debt service payments that would be used as part of the rate setting mechanism for a residual airport, or for helping to determine the capital component of the revenue base for a compensatory airport. www.aci-na.org | CENTERLINES 37 http://www.aci-na.org

Table of Contents Feed for the Digital Edition of Centerlines - January 2008

Contents President’s Message Canadian Airports Associates’ Corner Policy Center Regulatory Front On the Hill and On the Stump One on One: Dave Barger Revenue: The Concessions Awards Environment: O’Hare Expansion Passenger Focus: Houston Friendly Safety and Security: After Comair, What Next? Air Service Recruiting: Charleston’s Acquisition of AirTran On Management: Performance Benchmarking at DFW Now Underway Grand Opening Conference Previews and Reviews New Members Index of Advertisers/Advertiser.com Box Scores

Centerlines - January 2008

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