~~~ 1. EXECUTIVE SUMMARY -RSW

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1 . ~~~ 1. EXECUTVE SUMMARY -RSW This section presents summary findings of the Economic mpact of Southwest Florida nternational Airport (Airport) for 1999, conducted for the Lee County Port Authority (Authority). 1.1 ARPORT BACKGROUND The Airport cwtently occupies approximately 6,400 acres of land in Lee County, Florida, and is located approximately 15 miles southeast of downtown Fort Myers.! The primary geographical area served by the Airport encompasses the five Florida counties of Charlotte, Collier, Glades, Hendry, and Lee. Exhibit 1 presents the geographical location of these five counties in relation to the State of Florida. As also shown in Exhibit 1, the Airport is relatively isolated from alternative commercial service facilities (i.e., Fort Lauderdale, Miami, Sarasota Bradenton, and Tampa), with minimal diversion of air traffic from its primary service area to these facilities. Specific points concerning Airport activity and its facilities are discussed below: As of August 2000, the Airport has scheduled passenger service provided by seven of the nation's nine "major" airlines, which represent the largest group of airlines in terms of their total annual revenues (more than $1.0 billion). These airlines include American, Continental, Delta, Northwest, Trans World, United, and US Airways? The Airport also has scheduled passenger service by the "national" airlines AirTran, American Trans Air, Spirit, and Sun Country (between $100,000 million and $1.0 billion in total annual revenues); by the regionaj/commuter carriers American Eagle, Cape Air, Comair, and Gulfstream nternational (d/b/a Continental Express); and by the foreign flag carrier Air Canada. All-cargo service at the Airport is provided by Airborne Express, FedEx, and United Parcel Service. As of August 2000, daily nonstop service was provided to 20 cities with a total of 65 daily flights, with four daily nonstop flights to New York, the Airport's top origin-destination (O&D) market. Fourteen (14) of the Airport's top 20 O&D markets are provided nonstop service.with a total of 35 daily flights. n calendar year (CY) 1999, the Airport was ranked 59th among airports nationwide in terms of total passengers with approximately 4.9 million passengers. Delta and US Airways have the highest percentages of enplaned passengers at the Airport, with these carriers accounting for approximately 28 and 17 percent of passenger traffic, respectively, at the Airport in CY The terminal building is a two-story s1ructure with two concourses in the air carrier terminal area. The current terminal building encompasses 350,000 square feet, with 17 passenger loading gates for domestic and international service. 1 n addition to the existing 6,400 acres, the Authority has purchased over 7,000 acres of noncontiguous land to be used to provide environmental mitigation for planned future development, including the Midfield Terminal Complex. 2 Major U.S. airlines currently not serving the Airport include America West and Southwest.

2 Southwest Florida nternational Airport ~~~~ :~ A r~ ~\! Glad: Charlotte (31. i ";\,;;.;::;;;;=?: caloosa'!\a\chee River - '--1.78'r'"./ Lee \\ Ị r Hendry Gulf of Mexico Collier L Legend Prepared By: Ricondo & Associates, nc. Exhibit 1 north exhibit not to scale Airport Service Area ~ Page 2

3 1. EXECUTVE SJMMARY -RSW n order to overcome existing facility constraints and to accommodate future passenger and aircraft activity levels, the Authority is undertaking the Midfield Terminal Complex as part of its long-term Capital mprovement Program. This project includes the construction of a midfield terminal, a south parallel taxiway, roadway and parking improvements, new fueling system, expanded air cargo facilities, and new rental car service facilities. The new terminal building is being designed with two operational levels and a mezzanine level, encompassing approximately 685,000 square feet, including 28 aircraft gates (an increase of 11 gates) along three concourses ECONOMC MPACT The importance of the Airport extends beyond its typically recognized function of moving people and cargo. n addition to the employees and activity directly associated with the Airport, many businesses and employees benefit economically from the Airport and its day-to-day operations. These groups include the employees whose firms base corporate aircraft at the Airport; the commercial and industrial employers whose shipments arrive or depart via the Airport; the area retail establishments; and the hotels, restaurants, and tourism-related activities whose patrons arrive via the Airport. Almost every employment category in the Airport's market area, even those that never directly use the Airport or its many services, receive some economic benefit from the Airport. t is important to note that the Airport's impact is a snapshot in time, therefore; will change as the Airport grows. n general, economic impacts associated with the Airport are classified into two types of impacts: Direct mpacts are consequences of economic activities carried out at the Airport by the various tenants having a direct involvement in aviation (e.g., passenger airlines, airport management, fxed base operators, etc.). Employing labor, purchasing locally produced goods and services, paying taxes, and contracting for capital improvements are examples of activities that generate these direct impacts. Strictly speaking, direct impacts represent economic activities that would not have occurred in the absence of the Airport. nduced mpacts are the multiplier effects of the direct impacts. These effects are the increases in employment and expenditures created by successive rounds of local spending and hiring. Three separate components of economic impact for 1999 were estimated for the Airport: Output for on-aitport tenant benefits is typically assumed to be the sum of annual gross sales, taxes, and average annual capital expenditures. While this defmition works well for profit-oriented tenants, it must be modified for government tenants and air traveler visitor impacts. Government output is equated with the payroll and annual capital improvement costs that occur at the Aitport. For air traveler visitor impacts, output is assumed to equal annual visitor expenditures. Payroll is the annual gross salary paid to all workers. Employment is based on full-time equivalent positions. For example, two part-time workers are assumed to equal one full-time position. t should be noted that output and payroll impacts should not be summed because elements of economic benefit related to payroll are also contained to some extent in the output estimate: As a. Lee County Port Authority Economic mpact Study Southwest Florida nternational Airport Page 3

4 ,... result, each of the three impact categories of output, payroll, and employment stands alone as a measure of the Airport's total economic impact. Table 1 and Exhibit 2 summarizes the total 1999 economic impact for the Airport, which combines the individual impacts associated with Airport tenants, air traveler visitors, and travel agencies. As shown, total output for the Airport is estimated to be approximately $2.0 billion in 1999; total payroll is estimated to be approximately $885.6 million; and total employment is estimated to be approximately 43,940 full-time positions. t is estimated that the Airport's direct economic impacts represented approximately 7.0 percent of its primary service area's total economy in t should be noted that these estimated impacts are just a perspective for 1999 and that, in reality, these impacts will continue to increase as the Airport grows and expands. Table 1 1m act Output Payroll EmplQ~ent 1999 MPACT -TOTAL ARPORT Direct nduced $1,274,730,902 $769,824,212 $561,320,481 $324,276,643 30,146 13,792 Total $2,044,555,114 $885,597,124 43,938 ********** The sections that follow present a detailed description of the economic impact of the Airport in 1999, as well as future impacts associated with the Midfield Tenninal Complex, including the methodology and underlying assumptions used in generating these estimated iinpacts. Lee County Port Authority Economic mpact Study Southwest Florida nternational Airport Page 4

5 r' r! ḷ, hi Exhibit 2 Breakout of RSW Economic mpact Page 5

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