Struggling airport gets federal relief

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This article was published 26/07/2021 (1205 days ago), so information in it may no longer be current.

Following months of pleading from top execs about a dire need for assistance, Winnipeg’s airport is receiving crucial funding for its pandemic recovery efforts from the federal government.

The $12.7 million in support, announced at a news conference in the departures lounge Tuesday, comes after a fiscal year bruised and battered by COVID-19 with lots of uncertainty still on the horizon.

Winnipeg Richardson International Airport will receive the money from federal aid packages that were introduced in the stimulus recovery plan last year. Nearly $7 million comes from Transport Canada’s airport infrastructure program, while $5.7 million is from Transport Canada’s airport relief fund.

“This is not the kind of sexy, ribbon-cutting funding for things that you might anticipate,” Barry Rempel, chief executive officer and president of the airports authority, told the Free Press in an interview.

“But, you know, we want it all to go towards the things we had to make immense sacrifices with over the past, really difficult year — things like job creation and asset infrastructure.”

More than half of the money will be designated for updating and making improvements with paved access roads and the taxiway. The remainder will help the airport maintain continued operations and essential air services for residents and workers.

Transport Minister Omar Alghabra, Northern Affairs Minister Dan Vandal and Winnipeg MP Terry Duguid all stressed the importance of how crucial airports such as Winnipeg’s are to the overall Canadian economy.

“As Manitoba’s primary airport, this investment will ensure communities in Manitoba continue to have access to essential goods and health services,” Vandal told reporters Tuesday. “We want to ensure that Manitobans remain connected with loved ones.”

But this federal “investment” didn’t come without anguish. And even now, about half of the $7 million from the infrastructure program will have to be paid back.

Since the federal wage and rent subsidy programs were the only supports provided to the airport in 2020, the company was forced to explore alternative methods for relief. Things were so grim that the airport authority commenced a bondholder consent solicitation process in December and secured short-term financial relief, with a year-end issuing of $100 million of bonds.

Still, much of the airport’s financial woes can be traced back to the incredibly low traffic during COVID-19, given that about 90 per cent of revenue comes from passengers.

It’s a continuous problem though, because close to 80 per cent of costs are fixed items that the authority has had to keep paying (such as utilities, personnel employment and taxes); which resulted in a $73.5-million decrease for the airport’s revenue in 2020 and a net loss of $40.3 million, compared to a net income of $3.5 million in 2019.

Due to the dearth of international travel, many airlines also stopped service at the airport altogether. It included Sunwing, Air Transat, Swoop and United Airlines — some of which Rempel says he’s trying to get back in service, now that restrictions are loosening.

Passenger traffic in Winnipeg has now slowly ticked up to almost 4,000 people a day — much higher than the roughly 100 people per day who would travel through the airport during record pandemic lows last year, but still far behind pre-pandemic levels of over 12,000 passengers this time in July 2019.

“Am I completely optimistic about international travel for Winnipeg and those airlines being back by the peak time of Christmas?” Rempel said. “Not all the way. But I know we’ll get there.”

As of Aug. 9, Winnipeg can accept international flights for non-essential travel from fully vaccinated American visitors. In September, immunized visitors from other countries will also be allowed.

Yet, the U.S. has extended its current border restrictions until at least Aug. 21 for Canadians going to that country, which Rempel said is “completely confusing.”

Alghabra was defensive, however, when answering questions about that from the Free Press. He said there “was complete co-operation” between Canada and the U.S. about their decisions, despite their opposing cross-border travel protocols.

“We’re both deciding based on our current situations,” Alghabra said. “Our vaccination rates are increasing and infection rates are decreasing and so, we felt comfortable with our August date… We cannot necessarily dictate or tell U.S. officials what is best for them, but I can tell you there were and will be no surprises.”

When international travel does commence though, Rempel ruled out separate lines for passengers based on their COVID-19 vaccination status, something Toronto and Vancouver’s airports have tested out.

“We’re following what the science is telling us,” he said.

For now, Rempel says this is a good announcement with the indication of better days to come: “I’m thankful that our voice has been heard and so excited about all our growth ahead.”

temur.durrani@freepress.mb.ca

Twitter: @temurdur