HomeMy WebLinkAbout10/1/2014 - STAFF REPORTS - 2.M. �OQ 7 pLM SA9
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CITY COUNCIL STAFF REPORT
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DATE: October 1, 2014 CONSENTAGENDA
SUBJECT: AIR SERVICE INCENTIVE PROGRAM FUNDING AWARD TO AIR
CANADA.
FROM: David H. Ready, City Manager
BY: AIRPORT
SUMMARY
This action seeks approval for an allocation of Air Service Incentive funding to Air
Canada rouge for new service between Vancouver, Canada and Palm Springs
International Airport.
RECOMMENDATION:
1. Approve Air Service Incentive funding for Air Canada rouge in an amount not to
exceed $50,000.
2. Authorize City Manager to execute all necessary documents.
STAFF ANALYSIS:
To promote the growth of commercial airline service at Palm Springs International
Airport, an Air Service Incentive Program was approved by the City Council in 2010.
The intent of the program was to provide marketing assistance to both new and existing
PSP air carriers that elect to operate new or expanded air service. To date, the City
Council has approved funds to support sixteen new or expanded routes into PSP by ten
different airlines including WestJet, Virgin America, Frontier, United, Allegiant, Alaska,
Delta, Sun Country, and American.
These new and expanded services, funded in part by the Palm Springs Airline Incentive
Program, have been a contributing factor to the Airport's substantial growth in
passengers and visitors to the City of Palm Springs and the Coachella Valley. Calendar
year 2013 exceeded previous years in passenger activity and airline capacity, and 2014
already points to a new capacity year with counts up 9.4% at 1,864,781 total
passengers, compared with the prior twelve month period.
ITEM NO. 1 '
City Council Staff Report
October 1, 2014 - Page 2
Air Service Incentive Program Award Air Canada
Recently Air Canada has announced it will be starting new air service between
Vancouver and Palm Springs on December 18, 2014 and continuing through April 12,
2014 flying the Airbus model 319. Air Canada is Canada's largest domestic and
international airline serving more than 180 destinations on five continents.
Air Canada rouge is Air Canada's new leisure airline, part of the Air Canada Leisure
Group with Air Canada Vacations. Air Canada Vacations and Air Canada rouge offer
competitively priced travel to exciting leisure destinations in Europe: Dublin, Edinburgh,
Manchester, Lisbon, Barcelona, Nice, Rome, Venice, and Athens, multiple destinations
in the Caribbean such as Cuba, Costa Rica, Jamaica and the Dominican Republic and
destinations in Mexico and the U.S. As a wholly-owned subsidiary, Air Canada rouge is
backed by Air Canada's 75-year reputation for safety and reliability and Air Canada
Vacations' 30 plus year history of vacation travel excellence. Since the launch in July
2013 of Air Canada rouge, Air Canada has deployed its leisure carrier to a growing
number of Caribbean, Mexican, European and select sun destinations in the United
States.
The Airport Commission voted to recommend this award at its September meeting.
FISCAL IMPACT:
The expenditure for this promotional support is a maximum not-to-exceed amount of
$50,000 and funds have been budgeted and are available in the Airline Incentive Program
Account No. 415-6002-45521.
Marketing and promotional funds offered through an air service incentive program are an
investment in the future growth of air service to PSP. Increased passenger traffic from
the additional airline service will generate both direct and indirect economic benefits. The
added passenger traffic will result in higher levels of revenues to the Airport through the
Passenger Facility Charges (PFCs), food and gift concessions, car rentals, vehicle
parking fees, aircraft landing fees, fuel flowage fees and other sources.
Thomas Nolan
Executive Director, Airport
David H. Ready
City Manager
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