Salem’s plans for commercial air travel in coming year hinge on federal grant

A plane on the tarmac at the Salem Municipal Airport on Thursday, May 5, 2022 (Rachel Alexander/Salem Reporter)

Salem could see commercial flights return to its airport within a year – if the city is successful in its third effort to get a federal grant to help market the service and guarantee carrier revenue.

Initial flights would likely be to the top destinations currently for Salem travelers who fly: Los Angeles, Las Vegas, Phoenix and San Francisco, according to a city grant application to the U.S. Department of Transportation submitted in April.

DOCUMENT: City of Salem air travel grant application

Brent DeHart, owner of Salem Aviation Fueling, said he expects a budget airline to set up shop at the Salem Municipal Airport this year, with a second low-cost carrier to follow soon after.

DeHart is a leader in a contingent of local business owners and residents called Fly Salem that have been seeking to restore passenger service to Salem since 2017.

They had initially pursued a major commercial airline, like Alaska or Delta, but changed goals because of pandemic shifts in the air travel market. Now, they’re looking at carriers like Allegiant, Frontier or startup budget airlines like Breeze or Avelo.

“They’re all in a marketplace that needs low operating costs,” DeHart said last week during a Q&A with Jacob Espinoza of the Salem Chamber.

Salem, he said, can deliver far lower overhead than Portland International Airport.

Brent DeHart, left, leader of Fly Salem, discusses the future of commercial air service with Jacob Espinoza of the Salem Chamber of Commerce on Thursday, May 5, 2022 (Rachel Alexander/Salem Reporter)

The airport is owned by the city, but it covers the cost of its operations through rentals and fees, and doesn’t take money from the city’s general fund.

About 45,000 flights take off and land at the airport each year, according to the proposed 2022-23 city budget, with flights conducted for private travel, military, agriculture, scientific and surveying purposes.

Salem City Manager Kristen Retherford in April applied to the U.S. Department of Transportation for a $850,000 grant from the Small Community Air Service Development Program.

In 2019, the greater Salem area generated about 1.2 million air trips per year, or 1,586 passengers per day, according to the application. Most fly out of Portland.

To be successful, air service out of Salem would need to capture just 6% of that demand, the application says.

The bulk of the money, $800,000, would be put in a pool to help guarantee minimum revenue for a carrier for the first two years of operations. It serves as a hedge in case Salemites don’t buy enough tickets to make operations pencil out.

The city would also waive two years of landing and airport fees to attract a carrier, the application said, though such a waiver would require approval by the Salem City Council.

The federal money would be added to a pool of $350,000 contributed by local businesses. Carriers could seek money from that pool if their flights are less full than expected. DeHart has personally put in $25,000, he said.

“Frankly, I expect to get all my money back,” DeHart said. “That’s how much I believe in it.”

The remaining $50,000 of the federal grant would be used for marketing new flights.

Salem last had commercial air service from Delta, which began flights in 2007 and exited the airport a year and a half later. DeHart said that was a uniquely bad period for airlines, which saw fuel prices skyrocket as the Great Recession hit and Americans cut back significantly on travel and other expenses.

In contrast, he said now Americans are eager to travel. While airlines are struggling with pilot shortages and high fuel prices, he said many budget carriers are looking to expand services as major airlines have cut back.

“It’s larger than any other market you could open up,” he said of Salem.

Salem applied unsuccessfully for a similar grant in 2019 and 2021. DeHart said he’s more optimistic this time because the city has letters of support from two airlines, something lacking in previous rounds. He declined to name the airlines or say which have expressed interest until deals are finalized.

The city could learn whether it’s funded in June, city spokeswoman Courtney Knox Busch said, though the federal timeline may change.

Contact reporter Rachel Alexander: [email protected] or 503-575-1241.

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