The days of the Charlottetown airport going rent-free are numbered as an exemption for the use of federal government owned land ends next year.
Doug Newson, the Charlottetown Airport Authority’s CEO, said how much the airport pays is dependent on its revenues, with no rent charged on the first $5 million.
“Once you get over the $10 million mark, that’s when it really could have a significant impact on the airport authority,” he said.
Newson recently presented the airport authority’s annual report, which included financial projections through to 2019.
The airport authority has a 60-year ground lease with the federal government and had an exemption on rent until 2016.
A percentage of the airport authority’s revenues will start going back to the federal government in rent next year. The authority is projecting $8.1 million in revenues this year and $8.15 million next year.
Newson said based on current revenues, the airport authority would pay about $40,000 a year.
But while that amount might not make a huge impact on the authority’s budget, Newson said the Moncton airport, which is about twice the size of Charlottetown’s, pays about $500,000 a year in rent.
“It’s a good problem to have, I guess, if we double our revenues in the next five to 10 years and we’re paying rent back to the federal government then it’s a success story that we are growing.”
Newson said he would like to see more of those revenues invested into airports.
In Charlottetown’s case, it can’t access federal infrastructure programs because it is on government-owned land.
Newson said there are similar sized airports in the region that can access funding because they aren’t on government land.
“We’d like to see a level playing field,” he said.