WWL>Topics>>9-3-14 2:10pm Angela: on airport improvements

9-3-14 2:10pm Angela: on airport improvements

Sep 3, 2014|

Angela talks with UNO economist Tim Ryan about the economic impact of improvements to Louis Armstrong International Airport.

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Automatically Generated Transcript (may not be 100% accurate)

-- -- want a special thank you to Doug -- tonne of channel four. Sports director for coming on and joining us for our trending always a delight. And hit that fast breaking news that Meachem is not coming back. But according to do our little metal shift here. The new orleans' Louis Armstrong airport has come a long way. And is on its way to going a lot further with the building of the new terminal soon to began. What will it mean to New Orleans and to the area. Is -- going to be money well spent. Here to talk about that and more is doctor Timothy Ryan. Former chancellor of the UN -- who has just completed a study that gives us all kinds of numbers. And I appreciate you joining us very much glad to be years until you did a study ten years ago. In 2004. Yes so again the study just completed. What is comparing the two or no not not. Really did this study that I just completed actually used 2013. As a -- she was just finished in May of this year. Is a broader scope then what I look at ten years ago. When I looked at ten years ago was just the airport as a business entities looked at the people employed at the airport. People employed at the airlines they -- freight companies that taxi drivers and so -- just. Those people. And did that spending that is generated at the airport itself. What I did this year in addition to that was look at. The impact that the air -- -- -- on the tourist industry we know tourism is one in new island strong industries. And the airports facilitates. A number of visitors well over half of that. Visitors who come into new loans on an annual basis use the airport so I expanded the study to look not only at the operational aspects of the airport itself but also to look at the impact of the airport on the tourist industry so who commission and justice. This was commissioned by. Aviation authority by a the airport itself. I think far a couple of reasons one was to look it to where we -- now and perhaps in comparison to 2004. And then also to look at what the economic impact of the new tunnel has been a lot of work done by consultants national. Consulting firms -- battle the new airport from a financial point of view from. And operational point of view from a design point of view all of those things that what they wanted me a look at was -- what do this mean to new ones. Not so we have a new tunnel that will be great for us locals who museum put to traveling great for visitors to a coming here. To have a more efficient modern up to date. Terminal building -- will it mean anything new for the overall economy and that was I think one of the primary objectives of this study. Tell -- the timeline tell me how do you do what you do I always wondered that. The many many studies you've done what you began. Well. That is Thursday talk about the time line now this was done on an annual basis most economic impact studies. Annual. Like annually in calm and and you know so we look at it for a year. And that they each year of this particular study was 2013. The last year that we -- full date on. How many people came in -- -- how many flights. And and and so with that's the first thing when you do any economic impact study of which I've done. How know at least hundreds maybe thousands. But the first thing you it is suspending. That's the basis that drives. The entire study how many dollars get spent in. Our local economy by whatever. The entities to looking at this case -- airport and visitors bought into New Orleans idea point. I am and when you you generate. Those. Estimates for the spending dollars and and you can do that several ways -- airport itself the dollars to -- by -- airport the aviation board. On construction on salaries on. Paying the electric bill and utility bill and consulting and all the things that that they do you can get directly from the airport it's all public information. But you need to look further than that we needed to look for instance at the airlines. They have people. Here in new while one's employees. They spend money now local economy. I'm related to the passengers that come in whether it be dealt their southwestern united whatever it might be. To get that information we did a survey on the of airlines themselves. I'm saying think that air freight companies here companies. That handled great -- -- for instance FedEx. Moves a lot of frightened while ones are the Postal Service all. The all of the Postal Service that's one of the areas we compare this year of back to 2004 that was down because the -- service now it. It was a big. Hubbub about that -- a year or so ago move there basic operation we added that -- and now. Most of that comes to that illusionist try to. Two new violence back. I mean it arrives at the Baton -- the aggregate. They had eight scheduled alone -- -- they get their -- airlines and and they schedule. Most of the -- that comes hand. I just typical commercial freight. Is in the belly of the airplanes itself the passenger -- him -- -- space sports team right now everybody puts their luggage in the overhead -- service funnier. Extra space in the belly of the plane to to put him freight. Which is also important to our economy. So. We also looked at the taxi drivers does a great part of their income. Comes from the -- that date. Take from the airport to media pool a we looked at. The city -- one of the focuses of this study was on. Deceive candidate that's where the airport is located. And as you can imagine whenever you have -- beat entity. Such as an airport. With the new city it is always a controversial. Part of of the city. It can be very positive it can be negative you know we know there's a lot of congestion and traffic and noise associated with the with the airport. Many other hand there's a lot of positive benefits for the -- economy. One of the positive benefits on the economy scanners that airport hotels. -- a large number of hotels. Round. The airport in the CT scanner that serves as. Hotels -- the airport. And sometimes you wanna come to new while it just for days to it's easy to Estes state. At a hotel close to the -- men do which have to do business travelers. Use the airport hotels quite frequently. Sometimes in meetings are schedule you bring people from 45 different cities in going into an airport may go. For -- or so and hotel. Itself with so. We we we've looked at all of those on parts of what is the economic impact at the airport to give us the spending numbers that's that's the first thing. Then once we determine what that what we called direct spending is. It has. -- ripple effect on the economy it it he goes through other. On plots of the economy so for instance let's say I happen to be an employee at the airport so I get my salary from the airport today. Put writes a check. My monthly paycheck now. That's a direct standing now I take that Jack and I go buy groceries -- it. Well that's another level of spending that cars and and so forth and so one and so we use. And what we call multiplier -- to estimate. That ripple effect -- secondary and -- then jobs very very important on to look at how many people. Now hold their livelihood in whole or in part to die any entity in this -- -- reports of again we use those multiplier is to determine how many jobs. Spun off by now. By the end to the idea because you're spending your money at the grocery store somebody. Has a job that aggression absolutely so it goes and let it ripples through the economy absolutely it's like he think of that. I still time and and you throw a rock -- that pond and you see the rebels going out and that's what we're trying to measure and jobs -- important part of that ripple effect. We also look at earnings how much money. And when I'm buying those that are trees it's not only to some might get the job as a result but there. Getting income as a result of my expanding. Again soulful. And we look at revenue for our state and local government. And whenever you spend money that's -- of that truism of any economy is that when whenever you spend money somebody taxes it. I think my computer that the government it might be this state government might be a local government. And and I've actually developed those models myself to determine. The tax implications of those spending. We're gonna take a break this is fascinating and he hasn't even told us the results. So stay with this as we talked to doctor Tim Ryan about a study has done on our airport stay with this will be right back. Bull in a few years we're gonna have a brand new. Terminal at Armstrong international. And which is very exciting and long overdue. It's gonna cost a lot of money and in what is it gonna mean to us and I think that's what we're talking about. Not just with the new terminal but what we have now vs what we even had ten years ago. So how lucky are we to have doctor Tim Ryan what -- for the sour who has just completed -- -- Looking in in the numbers of 2013 but. Again you did 120 of a 200490. Doing this one we're seeing growth. Well. We seeing the potential for growth actually. The comparing. Apples to apples what I did in 2004. And at that point of what I did in 2000 and fourteen. What we find is would just a slight bit down just a teeny bit down. But that's actually good because remember Katrina dealt the airport a serious serious blow. We've lost a lot of flights. Airlines put smaller. Carrier's smaller planes. And it really cost us big time. We've looks like we've made that loss up so would back where we want our pride of country in 2002 we haven't surpassed that yet but. We've headed in the right direction. We've -- fact it was just an announcement. It was in the newspaper. Today that southwest is -- direct flights to San Antonia. The more and more of those kind of flight you get the battery is far for an appointment for our economy so. Think -- poll placed in especially with the new terminal. With poised to see major growth but. What we've done basically over the last nine years since Katrina is make up the losses that we and doing. Not have been compound and by what has been going on in the airline industry. Absolutely absolutely -- of a double hit it did there's no question about it the airline industry is just. Well it's been in turmoil for years. We've seen the latest activity was the merger. Now we're doing it looks like it's going to be like banks you know they'll only be three -- four airlines less likely only be three or four banks left when all the shake out is over in that reduces the number of flights competition the more. -- issue can't in any market no matter what it is whether the banking are the airline industry is better for consumers. But. When and you get a lot of mergers stayed the eliminate duplicate fly eights and and so on yes they do we have. Had some negative impact. As a result of what's going on in the airline industry but it looks like we've we've -- that. A round and we're hoping even before the new come with built that will we'll see some growth in the employment numbers and an economic impact being. You know that the success the growing success and the return of our great tourism industry and it is seems to be flourishing on many levels. That has to also dictate. But airlines are looking at those numbers of people coming and saying now we can add these flights. App absolutely and that's a positive thing about the change we've seen -- -- news ten years ago twelve years ago. All of the airlines cared about were business travelers. Not. Tourists not conventioneers it could mean I didn't carry those people obviously the idea but. What they wanted -- the business. People who had to make it last minute decision because it was a a problem in the branch office in now Omaha -- hit to get a quick flight out tomorrow to go home cause to I address that problem. Well they would charge that traveling -- five times what you would pay at duke had more time to schedule a trip. And so the airline industry was seeking those business travels and it will putting large numbers of flights in the big business Sanders of the country. In new York and Chicago and Los Angeles and Atlanta and Houston Miami Dallas not new Marlins. And and so we will always. Sort of begging the Caroline's stick to put flight here. To handle -- tourist. Trade. And 22. Handles. Travel of local food needs fly out. Well it looks like. That's equation is changing Libya. They're not. Seeking the business travel is quite as much the differential in fairs so our business travel -- basically figured out how to beat that that system. And and so we're seeing more and more of the alliance like the southwest who interested in those convention bar. On tourist travelers and and that's a very positive thing that this that this city in this airport because I tourist industry. Again we word. Dreadfully concern right after Katrina. We lost what was. The major business for new violence. In the two with three years right after Katrina which was a big convention business we with the number three or number two city in the United States. For big conventions number one city for medical conventions which -- Sort of that. -- the -- cram conventions because of the money it pharmaceutical companies medical device manufactures high wind and nine. The doctors and all the participants. We lost a lot of that. But what happened we've gotten some of it back but not all of what's happened is we've seen much more. What they refer to as discretionary pleasure trap. People who come into violence for a long weekend come to new violence far a festival it seems now we have a festival -- every week. And in many of whom have grown in two major festivals I mean the French Quarter festival. And audit is a little BD. -- I think now it's it's incredibly. Successful so. -- with scenes that part of the tourist business review you merely go well. So I'm thinking about the top of the festival buying now especially for Jazz Fest may be even for French repressed. Airlines have to know that 40000 people were coming in and Reagan had the flights. Absolutely -- what they'll do is. If they don't add additional flights that put on bigger aircraft so they can handle him while. -- -- are passengers it absolutely day day I mean they knew it forever from Michael you know everybody grow we need. Now we've yet jazz fans we've got essence gas we've got French Quarter fast. Vudu is turning into for the young -- -- young crowd is turning into a major. Tourist draw so so new balance is a great. I would have to say I don't think this is this is not hyperbole. I would have to stated while this is probably the best big you -- talent in the United States if not the world we do big events better. -- anybody else it's it's the attitude of our people our people. Argue differently they'd they'd welcome honest -- and -- yeah out of restaurants. Hotels. I know how to accommodate this is just so many different things to do we -- -- -- around these festivals that. It's it's the com. I think one of the it is a major parts of our new tourist industry. Well as I've always said we do it right we do we do it right stay with the second one -- take a break for news but we're gonna come back. And we really are gonna hear the results of doctor Tim Ryan study on our airport -- activists. But we're talking with doctor Tim Ryan who has done a study in his second study on the New Orleans airport. And and what it means to all of -- not just in New Orleans but certainly the city of Kenner and the outlying regions and we're gonna get those results but I'm so -- we have a caller. Martinez. -- -- -- -- -- -- And called -- airport. And -- -- the court so it's. Or. -- OK a RE. DC NN and if you Wikipedia. It's on me through everything. Although the reason why people made that -- Into and so it got. Four up for the -- that are absolutely beautiful and all. -- Well and that's what we're gonna here because and Martinez I really appreciate that comment. That is what we've committed to. Upgrading ourselves. Doctor Tim Ryan and and hope you -- hold on and listen to. What you found. About the commitment of over half million dollar. The bill before that outline I agree with my thing is it's absolutely critical is making and that was one of the problems that we face hip was we didn't make those constant. But it based -- to make the joke I wanted to go to an airport that was finished. I don't think I've ever been inland when it's finished always put -- that's good that you constantly. Updating in in renovating. -- -- let's talk about the numbers. First of all where we are now with the airport. I talked about the spending. In 2013. The airport including its impact on the tourist industry. I'm in new loans generated five point 26. Billion dollars spending now local economy. And it's hard to get get a feel for that at -- puts the airport as one of the major. Economic generators. In. Does the local economy. Along with. The port of -- warm islands along with the tourist industry the oil and gas industry. So it -- that's a major. Number that that puts the airport up there. As one of -- major economic generates. Jobs. 2013. The airport supported over 53000. Jobs in this community which means that a lot of people. Oh their livelihood are a substantial ponytail livelihood two dollars in the people who come in through the airport. And in terms of income over two billion dollars of income for the local residents was generated. By the airport. And the government's share what's -- government chair of that when you look at both the state I didn't look at federal government. Just state government and local government. I'm almost 500 million dollars a year. And in tax revenue. Generated by the by -- now. Well like to do now is his turn to where we going. I think. As you caller indicated. A lot of people interested in what's going to happen with the new terminal let me talk a little bit about the about the new terminal in what we did to try to estimate. The terminal. Building that we use now for I -- saying -- billing for fifty years. Is out of date for a number of reasons first of all. It's way too big for our needs. Again changes in the airline industry changes in. The way he we can't travel we just don't need as many gates in as many. And as many terminals but. We've got it we've got to maintain that means you've got heated we've got a cool it. We've got to inefficiencies it's very very in fish. The second aspect. The hip with it needs. Old terminal that they're desperately needed. -- replacement. Call were caused mostly by on 9/11. 9/11 changed air travel in dramatic way and it's quite trust -- to go back before. The terrorist attack and 9/11 and think about what it used to be. How we easy it was to fly you'd pull up. Ten minutes before the boy in time and in galactic vehicle it. Park in and boom you're. You're going you know did anymore. Airport terminal the existing terminal building was designed for pre 9/11 were so most of the services to retail shopping. The restaurants the bar is the places where you can spend money. With kind security. So what that meant was that. The passengers. Whether they be locals. Traveling loud or visitors going back home. Wanted to get through security quickly because they saw long lines and didn't know how long the in my own risk miss missing the FA. So they would bypass the the food. That bars. The shopping and they would go right to that it took the time. This out of the rule of thumb for airports around the country is sort of a sixty. I'm forty rules at 60% of the revenue. To support the airport comes from. Not directly from the airlines it comes from ran holes comes from food concession sales. Shopping. Those kinds is things itself. 40% comes from the airline industry with the call landing fees and they grab their baggage facilities they read different points. In new Wallace it was reversed. 40%. About revenue came from. Shopping and food in those kinds of things and 60% came from the airlines which meant everything else being equal the airlines were paying more. To bring a passenger in two new while one's an award to bring that same passenger into -- say well that's not a very competitive. -- situations so what that meant is that the airlines. We're only going passengers -- that they can't. In other words. People who would destined for new while its tourist who wanted to come to New Orleans all our locals who were traveling out. We did him much transfer business in -- -- you change flights like Atlanta. Most of the Atlanta -- transfer business you know use you go from new well to land planet. There ever who have. And we want. And have never gotten very much of that one of the reasons is because if you call me and in one gate and in an airline. You gotta go out through security go back into security in people now we'll still go through security. Two times so. And and then the final thing was it because of all of those factors. It was very expensive. To. For airlines to attempt to bring passengers. On two new line itself. So what what we looked -- was if what. What happens when we build a new terminal. That is going to solve the 9/11 issue that will have our services our retail shopping all of that outside at security so the first thing you come in. He go to ticket gate if you asked to most the time has now automated you put your critical on a computer and and then you go through security then. There you have the goodies and you write you eat eat drink and if there's any place there's any place in the country. Where people would want to spend time meeting in drinking you'd think he'd be New Orleans. And and so if we give them the opportunity to do. And is that is that is a very important think it is correcting the inefficiencies. It's reversing. Our ability to make some more money. And it's going to be pretty we're gonna have taken the break we'll be right back. Our special guest doctor Tim Ryan who has completed -- recent report on. The impact of our airports and now we're talking about the impact. Of the new terminal of the airport which is. Would begin pretty soon and hopefully will be done in three years and will be done correctly and we were talking about the efficiencies needed. It is. From an economic point of view what the -- will mean -- it will be much. Nicer for travel and much nicer experience but from an economic point you basically two things. It will attract more are transfer flights. And we hope some of those transfer of flights might be international flights from the Latin America. South and Central Command America. And may be ultimately. York. You know there's some discussion right now about. About British Airways putting and I have been terrific. I'm so we should get more transfer business. Based on what other airports have similar size have done. And then the second thing when we bring those costs down we will attract more low cost carriers. -- is who who compete with the -- you guys they're not united did not -- and -- southwest but there. They compete with those big airlines. And they're very. A low price -- tourists and four flyers which is good. But. They're also very competitive they keep prices down but they bring in -- number trap so. We looked at what other airports doing concluded that the new terminal. From a purely economic point of view. Will -- will increase that spending number that I talked about before oval five billion by one point one billion dollars. Produce an additional 111000. Jobs. Another way to vote in the building up and and noticed is just -- -- ongoing operation once built. And it will. And will be about 111000. Jobs it would be permanent part of my -- part of our economy now many of those jobs will be in the tourist industry. You know as we get low cost airlines to bring in more visitors we get more visitors coming into the city what tourists more dollars. What jobs and and and so forth and so on so. I -- from an economic point of view. The terminal. Will be a positive addition to our economy from a financial point of view -- will be good for the airport cheaper. To run an opera from the airlines point of view it will be. -- financial victory because it's gonna lower there. I'm cost the employment and bring in. Asked if -- will make the airport in general more competitive. With other airports and that's where we need to -- the one thing we have some I must ask question we -- met the appointment too -- -- ask questions -- when's the last time you and holding pattern over new -- And any other than maybe fog of bad weather the answers -- would have one thing we have a lot of the major airports that you think about Miami. Atlanta Denver Dallas Houston don't have as we have plenty of air space. And so -- crime with a new facility in new terminal. Two. See increased operations at the airport which will be good for our economy to the tune of over a billion dollars. And you know I heard I've heard people say not many but a couple say you know what we need to get a possible suspects we need to get new light and they are absolutely correct we do. They're not perhaps looking at this in the much bigger picture of what it will do for our economy. Absolutely it it it it it -- in new dollars into our economy but. The money to build that the airport is not money we can use to fix potholes and if this is being paid their capital. Budget. The construction budget of the new apple is gonna be paid by the airline industry. They're the ones who going to what they do is they basically borrow money be -- in the market they borrow money in the airlines. Then agreed to pay off those bonds over time. And so it does not that we can take those dollars and put him into -- streets -- put him into solving some of the election it answers the question it's going to be money well spent. I think it's gonna definitely be money well. Stay with -- everyone will be right back. Want to thank doctor Tim Ryan so much for coming and telling us about the study and really enlightening us about. What is going on at the airport. -- think they do is a pleasure for me to it to be here and to be with you and the input is important airport has taken a lot of barbs over the years but it looks like we've got an administration -- at the airport. The Conde aviation director with got a boy it really knows the right thing to do in is doing it we should have done this fifteen years ago. Build a new terminal. We doing we doing it right. That's the bottom line thank you again doctor Tim Ryan. We'll be back with our -- show with the FBI director stay with us.