Airport commission approves restaurant extension

The Fort Smith Regional Airport Commission approved a four-month extension to the Runway Cafe through next April at Tuesday night’s (Dec. 20) meeting.

The operators of the Runway Cafe had expressed interest in allowing the lease to expire on Jan. 1, 2012, but were coaxed into the extension when Airport officials could not find any interested parties in taking over following lapse of the agreement.

Under the four-month extension, the Runway Cafe will continue to serve travelers, Airport Executive Director John Parker said, but they will do so with a $1,500 per month stipend from Fort Smith Regional to help cover expenses.

Parker noted the restaurant’s revenues are directly tied to enplanement numbers, which can fluctuate with little rhyme or reason making an exact revenue projection for the four-month period impossible to predict. For the first 11 months of 2011, enplanements at the airport total 78,994, down compared to the 79,121 in the 2010 period.

Should the restaurant lessees earn below $10,000 for a one-month period, they would keep all gross revenues. Earning more than the $10,000 would mean the airport claims 7.5% of gross.

Airport officials will entertain a number of ideas for how to replace the Runway Cafe at the end of April, Parker said. Finding an interested party to take over the lease is one option, he noted, though it could be difficult considering the Airport’s location in conjunction with other restaurants that share close proximity to the terminal building.

Increased vending could be another option. The commission will hold a study session on Jan. 17, one week before the regularly scheduled meeting on Jan. 24, to discuss ideas.

AUDIT, REGIONAL JETS
In other news, with the airport closing the books on the 2011 fiscal year, the BKD accounting firm was approved at the fee of $33,000, to undertake auditing of the year’s financials. In 2009, the price was $31,000, and rose to $32,000 in 2010.

Parker endorsed BKD based on “the job they’ve done in the past” and the fact that the agreed upon fee is well within the $40,000 line item in 2012’s budget. He also noted the “complex nature” of airport financials and auditing guidelines per the Federal Aviation Administration (FAA) produced constant changes in needed personnel for the accounting firm.

Parker also updated the commission on one result of the recent bankruptcy of American Airlines’ parent company AMR.

“Of our four daily departures and arrivals, half are handled by ATR propeller driven aircrafts. Those planes will be replaced by (regional) jets, so American will now run a four-jet fleet,” Parker said.

With 11 months completed, total operating revenues are at 93.5% of the budgeted amount, against 94.4% for the same period in 2010. Overall revenues are 82.3% compared to 80.9% from last year.

On the expenses side, operating departments are at 81.7%, slightly over 2010’s 80.3%. Overall expenses are 75% against 69.1% from last year.