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04.06.2009 Airports offers incentives to increase Asia service

For the first time in Alaska the state's international airports are offering an incentive to airlines to increase passenger travel from Asia.

And it wouldn't have happened if the 23 signatory airlines that already land in Alaska didn't sign off on the idea.

Even with more than 5 million passengers coming and going from Ted Stevens Anchorage International Airport, officials say passenger travel from Asia has declined in recent years.

"We have a lot of cargo here, but we have also had in the past quite a bit of Asia traffic and we've seen some decreases over the last two to four years," said Christine Klein, deputy commissioner of Airports and Aviation.

So now the Alaska International Airport System (AIAS) is offering airlines an incentive to bring more frequent passenger travel from Asia to Anchorage and Fairbanks.

"It's a new thing for us here in our International Airport System, but it isn't uncommon at all, it's very common," Klein said.

According the public notice, in exchange for expanding round-trip, non-stop passenger service by at least one flight a week for 12 straight months, an airline would get up to $1 million in discounts on landing fees, gate fees and fuel flowage fees.

"To have an operation here costs a lot more than $1 million, and so this helps offset some of the fees," Klein said. "It doesn't pay for them all, it helps offset, it makes it maybe a little bit more of an incentive to look at Alaska as a place to stop."

According to Klein the rates and fees paid by the 23 airlines that already land in Anchorage and Fairbanks, called the signatory airlines, provide the money for the program and no state funds will be used for the incentive.

"The airlines just wanted to ensure the FAA rules regarding the incentives were followed, and that any incentives would apply only to new and expanded service," said Kathy Smith, chairperson of the AIAS Airline Airport Affairs Committee.

She says the airlines had a lot of questions, but saw the eventual advantage of more passengers coming into the airports.

"As airlines start to serve the airport it brings in revenue -- for the initial period when they are receiving the waived fees there is an additional revenue, but eventually after that period is over the additional revenue helps all the airlines," Smith said.

At least that's the idea -- to help the airlines, airports and communities they serve.

Though incentives are offered across the country, this is a first for the international system here. The application process opens June 10, so airport officials won't know until this summer if airlines think the incentive is worth it.