Official Statement Airport Commission City and County of San ...

Operating Revenues
General
Under the Lease Agreements, the Airport’s operating budget and non-airline revenue sources are projected
for each new Fiscal Year. Then, using a residual cost methodology, airline landing fees and terminal rental rates are
set such that estimated total Airport revenues each Fiscal Year are equal to estimated total Airport operating costs,
which include debt service and certain capital items as well as general operation and maintenance expenses.
Increases in non-airline revenue sources generally result in decreases in airline landing fees and terminal rental rates.
See “SAN FRANCISCO INTERNATIONAL AIRPORT–Existing Airline Agreements–Lease Agreements.”
Terminal Rental Rates and Landing Fees
For Fiscal Year 2009-10, annual terminal rental rates range from $176.11 per square foot for Category I
space (ticket counters and hold rooms) to $17.61 per square foot for Category V space (unenclosed or covered areas
at ramp level) space, with an average rate per square foot of $100.61. Fiscal Year 2008-09 rates were $167.32 per
square foot for Category I space and $16.73 square foot for Category V space, with an average rate per square foot
of $95.85.
The landing fee rate for Fiscal Year 2008-09 is $3.00 per thousand pounds of landed weight compared to
$3.01 per thousand pounds of landed weight for Fiscal Year 2007-08. Operators without a lease or an operating
permit will pay a supplemental landing fee charge of $0.30 per thousand pounds of landed weight. For Fiscal
Year 2009-10, the minimum landing fee for fixed wing aircraft is $140 compared to $134 for Fiscal Year 2008-09.
Because of the variety of methodologies used by different airports to calculate airline landing fee and
terminal rental rates, such fees and rates are not directly comparable between airports. However, terminal rental
rates and landing fees represent a small proportion of over-all costs to the airlines per enplaned passenger at the
Airport, and are not a primary consideration in the establishment and maintenance of routes and schedules. Instead
of rates, airline payments per passenger (for landing fees and terminal rental rates) is the principal index commonly
used to compare the costs to the airlines for their facilities at different airports. On a GAAP basis, airline payments
per enplaned passenger at the Airport were $14.29 in Fiscal Year 2008-09 compared to $13.20 in Fiscal
Year 2007-08 and compared to $14.26 in Fiscal Year 2006-07. Overall, costs to the airlines are expected to rise in
the near term, primarily due to the construction of capital projects needed to serve the current demand for domestic
terminal space. See “CAPITAL PROJECTS AND PLANNING.” Passenger traffic is expected to reflect low growth rates
based on a slow economic recovery from the global recession. These factors are expected to cause an increase in the
airline payments per passenger during the next few years.
Terminal rental rates and landing fees are adjusted annually on July 1. The Lease Agreements do not
require the airlines, either individually or as a group, to maintain any minimum level of landed weight at the Airport.
A summary of historical and current landing fees for scheduled aircraft with a lease or operating permit and average
terminal rental rates and those for the last five Fiscal Years is set forth below.
HISTORICAL AND CURRENT LANDING FEES AND TERMINAL RENTALS
(Fiscal Years)
Landing Fees (per thousand pounds)
Minimum Landing Fee (fixed wing)
Minimum Landing Fee (rotary)
Average Terminal Rental Rate (per square foot)
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Source: San Francisco Airport Commission.
2005-06
$3.213
109
55
90.16
67
2006-07
$3.336
123
62
94.61
2007-08
$3.010
127
64
91.60
2008-09
$3.000
134
67
95.85
2009-10
$3.150
140
70
100.61