The Martha’s Vineyard Airport Commission unanimously approved the FY23 budget at its Thursday meeting, with an estimated $12 million in total revenue and approximately $10 million in operating expenses.
According to airport finance controller Ed Christofono, FY22 was a landmark year for the airport in terms of how much fuel they sold and how much activity they had.
“Some of the assumptions we made for FY23 were that we wouldn’t be as busy as last year, but that we would be busier than in years past,” Christofono said.
He noted a few significant increases to certain budget items, such as an approximately $160,000 increase in the airfield line, with the majority of that due to the rates and charges agreement between the airport and airlines that increases each year.
Christofono provided some context for the increase in wages, saying that the figures he projects out are based on a fully employed staff. But since he started working at the airport, Christofono said, there hasn’t been a full year where the entire staff has stayed on. “People come and go, and we don’t get every seasonal position filled every time. Right now we are pretty close, though,” Christofono said.
Along with wages, utilities are expected to increase as the cost of fuel rises, and supply costs are on the rise as well. “When I speak with my contractor friends, they say everything is up 300 percent,” Christofono said. He stressed that there are a number of aging buildings and pieces of equipment that may need significant work in FY23, and insurance for employees will also go up.
With a projected operating surplus of around $1.8 million, Christofono said it’s an obvious decrease from the prior fiscal year, which came out around $2.6 million. However, he said he factored in what additional revenue would be if this year’s demand meets the FY22 demand.
If the airport had last year’s demand and activity, it would bring in an additional $750,000 in fuel sales, an additional $100,000 in other types of sales, an extra $50,000 in airfare, and an extra $100,000 from concessions. This would bring the projected budget surplus from $1.8 million up to $2.8 million.
According to commissioner Kristin Zern, industry reports forecast an “insanely busy summer,” with lots of travel to and from the airport. “The other problem is that there are fewer pilots and, as a result, a lot of airlines are cutting back flights up to 25 percent,” Zern said. Airport director Geoff Freeman concurred, and said they are anticipating a strong summer season for travel based on airplane advance bookings and Steamship Authority numbers. “But we aren’t anticipating it will be on the level of last year,” Freeman said. “The airlines are affected locally by the pilot shortage. Cape Air in particular and also JetBlue have announced some flights will be curtailed during the summer season.”
In other business, the airport approved a $100,000 contribution to other post employment benefits. According to finance subcommittee chair Richard Knabel, a resolution that passed last year provisioned that the airport be required to pay into other post employment benefits whatever was taken out of that fund the previous year. In addition, if there are surplus funds, or the commission feels they are financially stable, they agreed to add funds to the annual contribution amount in order to build a cushion for when the airport isn’t as flush with money. “If we put in a little extra money, I think we buy a certain amount of credibility all around,” Knabel said.
Knabel said the finance subcommittee recommends a $100,000 contribution to OPEB for FY22. That recommendation was approved unanimously by the full commission.