This story appeared in YEG Journal today:


For the second straight year, financial problems in the airline industry have prompted the Vancouver International Airport Authority to defer a scheduled increase in the fees it charges to airlines.

Fee increases averaging seven per cent were supposed to take effect on Jan. 1, but they have been delayed until July 1, airport authority chief financial officer Tony Gugliotta confirmed Friday.

A similar fee-hike deferral happened at the Vancouver airport last year, when increases averaging about nine per cent were also delayed for six months.

Financially troubled airlines have asked most major Canadian airports to reconsider proposed increases in landing and other fees this year as airline revenues continue to suffer from a downturn in global travel.

"Airlines and airports are both affected by the slowdown in travel," Gugliotta said. "We're in the position now where our revenues are going down, but our costs are going up."

The number of passengers using Vancouver International Airport fell from 15.5 million in 2001 to about 14.9 million last year. Fewer passengers means lower Airport Improvement Fee revenue and fewer airline flights leads to a falloff in landing and terminal fees paid by airlines.

But Gugliotta noted several costs to the airport authority are still going up this year. The annual rent payable to the federal government is due to increase by $4 million to $68 million while insurance costs are going up by $1 million and security costs are rising by about $3 million.

Gugliotta said the airport authority recovered about 84 per cent of its total costs through fees and charges to airlines last year and its goal is for that figure to rise to 95 per cent by 2006. The shortfall is offset by revenues from "non-aeronautical" sources like parking and retailing.