Travelers to Bloomington's Central Illinois Regional Airport [CIRA] may pass through its gates dozens of times without realizing how nearby economic changes — like those over at Normal's Rivian plant — can lead to windfalls at the airport.
In June, Rivian began production of its R2 model. This has led to a climb in production as well as increased hiring. Carl Olson, executive director of CIRA, said an increase in Rivian production directly impacts CIRA's revenue in several ways, including "increased fuel sales, increased landing fees and also just air cargo operations."
Olson said unscheduled air cargo is one of many revenue streams that keeps CIRA running. He said it has "grown exponentially" in the last few years, "and in our case, it's largely driven by cargo flights supporting the Rivian manufacturing plant here in the community."
Olson said Rivian flies in automobile components from other cities in the U.S. and Mexico, "at all times of the day and any day of the week on an unscheduled basis."
Once the cargo is dropped off, it is then "trucked over to the plant and, of course, turned into the Rivian trucks," he said.
Unscheduled air cargo complements the scheduled air cargo service offered by FedEx, which Olson said operates six days a week and helps distribute goods to consumers all across Central Illinois.
The increased cargo traffic also helped CIRA justify a new air cargo road project, which is currently in the design phase.
The airport economy
Olson said the airport operates like a landlord in many ways. Tenants who do business on the property either pay rent or share a portion of their revenue with CIRA. This includes the usual suspects for an airport — coffee shops, gift shops and restaurants — as well as less obvious tenants such as private companies that lease hangars and farmers who lease airport land to grow corn and soybeans.
This revenue model means "more than 70% of our annual operating revenue comes from the business operation of the airport," said Olson.
That minimizes the need for property tax revenue, he said, which makes up the other 30% of the operating budget. These numbers fluctuate a bit from year to year.
Right now, Olson said the airport has $15 million in active construction projects going on. Of the total, $12 million is allocated to the runway rehabilitation project, while the other $3 million is being used to improve their short term parking lot. CIRA hires Central Illinois people to work on these projects, he said.
"All of our contractors are local, and all the local trades that are working here are local people, our community members, our neighbors, our friends," Olson said. "It's nice to be able to reinvest that money not just in the airport, but reinvest it here in the community."
Other boons to the airport recently have been additional services added by Allegiant to Phoenix, and by Delta to Atlanta. These destinations are popular for both business and leisure travel, said Olson.
Despite the strong financial performance of the airport, Olson said it does feel the pinch when it comes to high prices of diesel and gasoline. Olson said the airport's energy costs and utilities have gone up "just like everybody else in the community."
The entire airline industry is also grappling with these increases, he said, especially when it comes to the impact of travelers' personal income.
"Are they are they going to spend that money for a family vacation and fly, or are they going to hold back and wait a little bit? So, we are seeing the impact of it directly," Olson said.
Even still, Olson said, "the airport authority is very pleased that we're having a very good year."
