CHAPTER 2 AVIATION ACTIVITY FORECASTS

Chapter 2 Aviation Activity Forecasts One of the objectives of the Stockton Metropolitan Airport Master Plan is to establish development policies that will preserve the long-term growth potential of the Airport and encourage compatible growth in the surrounding area that is influenced by airport operations. The development of realistic long-term forecasts that recognize the underlying growth potential of the Airport and surrounding area is a major focus of this master planning effort. Particular attention is applied to national aviation trends combined with the socio-economic conditions of the area at-large. The forecast horizon is 20 years with interim breakdowns that should be considered planning trigger points rather than emphasizing a specific forecast year. This chapter provides discussions of the methodologies and findings used for projecting passenger enplanements at Stockton Metropolitan Airport. The projections of aviation demand are documented in the following sections: Demand Influences Past Forecast Studies Passenger Projections Air Carrier Operations Air Cargo Based Aircraft General Aviation Operations Military Comparison with the Terminal Area Forecast Summary DEMAND INFLUENCES Population, land availability for development, and geographical and topographical features of the San Francisco Bay Area influence local aviation trends. San Francisco Bay Area population and commercial development are clustered around San Francisco Bay, San Pablo Bay, and the lower reaches of the Sacramento River. This results in high population density, roadway congestion, and concentrated commercial use. Aviation infrastructure, availability, and use have naturally followed a similar pattern. This has resulted in saturation which is forcing and will continue to force future population and commercial growth farther inland.

CHAPTER 2 AVIATION ACTIVITY FORECASTS The airline passenger industry is influenced by an increased need to control transport costs by focusing on larger aircraft, capacity constraints at major hub airports, and intense competition. Globally, passenger forecasts are down due to the volatility of fuel prices. In North America, The International Air Transport Association (IATA), predicts that traffic will decline by about five percent and air carrier capacity will fall by close to six percent as airlines park planes and cut routes (EIU/IATA December, 2008). This being said, the same IATA report is predicting that the decline will continue in all developed countries except the United States where the airlines will become profitable once again in late 2009/2010. Stockton can be competitive in the eventual upturn of this market by offering airlines less delay and competition for ramp space which in turn will help the airline s bottom line. San Francisco International Airport, Oakland International Airport, and San Jose International Airport are located in densely developed areas, and San Francisco and Oakland Airports are bordered by San Francisco Bay. Expansion of these facilities would be both difficult and costly. Plans to expand the runway system at San Francisco in particular have been dismissed. The only outcome is to utilize regional planning and increase growth at other airports to satisfy aviation demand. Domestic freight is influenced by a strong trucking industry. International freight is also influenced by the relative strength of the dollar. The Port of Stockton serves ships from all over the world through the Stockton Channel to San Francisco Bay and is considered to be the busiest small port in California. The Port contains almost 8 million square feet of warehousing facilities and docking space for approximately 17 shipping vessels. Accessible via roadway, rail, and airport, the area is primed for freight. Stockton Metropolitan Airport is one of only 17 civilian airports in California having at least one runway 10,000 feet in length or longer. This makes the airport ideally suited for air cargo and commercial operations. Central Valley civil airports having runways longer than 10,000 feet are Mather Airport (11,301 ) and McClellan Airfield (10,600 ) in Sacramento, Castle Airport (11,802 ), and Bakersfield s Meadows Field (10,857 ). Figure 2A lists the California airports with runways over 10,000 feet in length. Business/charter activity is related to growth of national economy, to local business atmosphere, availability of airport services and infrastructure, growth of fractional aircraft ownership, and potentially the advent of small jets with low acquisition and operational costs. This portion of the industry is in a growth mode. Small piston aircraft activity is influenced by high fuel and liability insurance costs, short-term economic fluctuations, and the number of active pilots. Operations per aircraft continue to decline. The need for hangar storage (instead of tiedown storage) has increased. 2-2 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Airport Name (Designation) Runway Length Bakersfield (BFL) 10,857 Castle (MER) 11,802 Long Beach (LGB) 10,000 Los Angeles Int l (LAX) 12,091 Mather Field (MHR) 11,301 McClellan Airfield (MCC) 10,600 Mojave Spaceport (MHV) 12,500 Oakland Int l (OAK) 10,000 Ontario Int l (ONT) 12,198 Palm Springs (PSP) 10,000 San Bernardino Int l (SBD) 10,001 San Francisco Int l (SFO) 11,870 San Jose Int l (SJC) 11,000 So. Cal. Logistics (VCV) 15,050 Stockton Metropolitan (SCK) 10,650 For airports with multiple runways, the longest runway length was identified. Figure 2A California Civil Airports with Runways 10,000 ft. or Longer Stockton Metropolitan Airport Master Plan (March 2009) 2-3

CHAPTER 2 AVIATION ACTIVITY FORECASTS PAST FORECAST STUDIES The next step after determining the airport s role is to collect and review previous forecasts. A review of existing forecasts can provide important information about previous economic conditions and aviation demand projections. A summary of previously published forecasts follows. FAA Terminal Area Forecast 2007 2025 (TAF) The FAA has established the TAF as a benchmark for comparing other airport forecasts. The TAF provides a specific forecast for future operations, enplanements, and based aircraft at Stockton. The TAF calculates low to moderate growth at Stockton. Categorized as a non-hub airport, the TAF expects air carrier operations to grow 2.4% at Stockton. FAA Forecasts The FAA s Aerospace Forecast provides a 17-year outlook of national aviation demand up to 2025. The FAA Aerospace Forecast predicts 1.4% growth in operations on the national level. The FAA s Long-Range forecast which predicts outwards to 2030 predicts low to moderate growth in operations at the national level. California Aviation System Plan (CASP) The California Aviation System Plan (CASP), a multi-element plan, is prepared by the California Department of Transportation, Division of Aviation (Department) with the goal of developing and preserving a system of airports responsive to the needs of the State. The CASP anticipates aviation activity in the Central Valley will be directly related to population growth in the region, which is expected to grow 48.9 percent between 2003 and 2020. The CASP directly mentions Stockton s need for enhancing the runway weight bearing capacity from the current 40,000 pounds/ single wheel to at least 50,000 pounds/ single wheel to adequately handle air-carrier operations. The plan also lists Stockton Metropolitan as the Central California Region s top priority for improvement and states that enhancements to [Stockton] could improve regional and state system capacity and safety, and perhaps make [Stockton] worthy of reclassification (California DOT 2003). 2003 Economic Impact Study, California Division of Aeronautics The Annual Report was reviewed for information that might support regional growth. The report highlights a potential developing trend towards increased general aviation options for the business traveler over airline service. California Labor Market Info, The Economy (May 2008) Several independent forecasts were generated using historic and forecast socioeconomic data for San Joaquin County. Historical labor data gathered depict little or no relationship with activity or based aircraft at Stockton. California State Department of Finance, Population Estimates for Counties and State, 2001 2008 with 2000 Benchmarks Population data from San Joaquin County in California was also assessed. There is no correlation between historical population data and based aircraft or operations. Previous Airport Master Plan for Stockton Airport (December 1997) The previous airport master plan contained useful historical data. In addition, the forecast methodologies used in that study were evaluated for possible inclusion in this evaluation. The 1997 Master Plan predicts moderate to high growth in based aircraft and operations. 2-4 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 PASSENGER PROJECTIONS This element of the Stockton Metropolitan Airport Master Plan Update provides projections of future aviation demand at the Airport. The following is a summary of the Aviation Activity Forecast included in its entirety in Appendix A. The Aviation Activity Forecast provides detailed information on: the airport s role; local, regional, and national trends; the methodologies used for the enplanement projections; and conclusions. This section presents projections of scheduled commercial passenger enplanements (i.e., passengers boarding) at the Airport. Projections of short, intermediate, and long-term activity at the airport are based on 5-, 10-, and 20-year milestones (2013, 2018, and 2028), using 2007 as the base year of analysis. Airport enplanements are a function of a variety of factors including population; the local economy; the level, quality, and cost of air service; and the availability of alternatives. The Stockton Metropolitan Airport Master Plan Update evaluates enplanements with emphasis on the local and regional factors. These factors are discussed in detail in the Passenger Enplanement Forecasts (Appendix A). Airport Catchment Area An airport s catchment area (i.e., the geographical area it serves) is defined by several factors, including geographical and access considerations and proximity of alternative aviation facilities. More specifically, the airport s catchment area is the geographic area from which an airport can reasonably expect to draw commercial air service passengers. However, airport use by the airport s catchment area population is affected by a variety of factors, including: proximity to a competing airport(s), airfares, the destinations offered, capacity (airline seats), flight frequency, and low-fare carrier presence at nearby airports. Figure 2B shows the catchment area by zip code. Figure 2B: Stockton Metropolitan Airport Catchment Area Stockton Metropolitan Airport Master Plan (March 2009) 2-5

CHAPTER 2 AVIATION ACTIVITY FORECASTS Stockton Metropolitan Airport is situated relatively close to Sacramento International Airport, Oakland International Airport, and San Francisco International Airport. The Stockton catchment area population is estimated at almost 795,000. The passenger forecast assumes that total air service demand has a direct relationship with population; as the area s population increases or decreases, the level of total demand (i.e. true market) for air service in the airport catchment area will fluctuate in a corresponding manner. After applying population growth to the true market estimate, a low-growth, mid-growth, and highgrowth retention rate range was then applied to the projected true market demand to estimate total enplanements at Stockton Metropolitan Airport. In the low-growth scenario, the retention rate remains unchanged throughout the forecast period. This assumes that the current level of air service will see little improvement. The mid-growth retention rate assumes that retention will grow to 20 percent by the end of the forecast period. This assumes that air service will improve over time with the addition of nonstop service to at least one hub airport. The high-growth scenario assumes that retention will improve to 40 percent of the true market. In this scenario, multiple airlines provide service to multiple hubs. Enplanement projections using the three scenarios estimate enplanements ranging from 37,478 to 230,738 by 2028 (Table 2-1). Compounded annual growth rates range (CARG) from 1.2 to 10.3 percent. Table 2-1: Passenger Forecast True MSA Retention rate range Enplanements Year Market Population High Mid Low High Mid Low 2007 445,028 683,869 6.6% 6.6% 6.6% 29,312 29,312 29,312 Projected: 2013 480,502 738,381 11.0% 9.0% 6.6% 52,989 43,468 31,649 2018 511,423 785,897 16.9% 11.8% 6.6% 86,655 60,271 33,685 2028 576,846 886,432 40.0% 20.0% 6.6% 230,738 115,369 37,994 CAGR* (2007-2028) 1.2% 1.2% 9.0% 5.4% 0.0% 10.3% 6.7% 1.2% *CAGR = Compound Annual Growth Rate Each year, the FAA prepares Terminal Area Forecasts (TAF) for use in the FAA s decision-making and planning process. The TAF includes all U.S. airports which have at least one of the following: an air traffic control tower; commercial airline service; 60,000 itinerant or 100,000 total annual operations; or at least 10 based aircraft. The current TAF for Stockton Metropolitan Airport is based on 2006 data and forecasts annual activity through the year 2025. To provide a more comprehensive comparison of trends and projection methodologies, the TAF was compared to the low-, mid-, and high-growth scenarios in Figure 2C. 2-6 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Figure 2C: Forecasts Comparisons 250,000 Enplanements 200,000 150,000 100,000 50,000 0 2007 2013 2018 2023 2028 Calendar year TAF Low growth Mid growth High growth Conclusions In evaluating the enplanement forecasts depicted in Table 2-1, the primary factors affecting Stockton s air service and enplanement growth must be considered. The following factors are discussed in summary in this section: the short-term air service opportunities available to Stockton Metropolitan Airport; effect of San Francisco Bay Area capacity constrictions; continued impact of Sacramento International Airport; and the likelihood of low-fare service at Stockton Metropolitan Airport. The full analysis and discussion of each of these factors is included in Appendix A. Volatility of Fuel Prices Fuel prices have an incredible affect on the airline and air cargo industry in recent years and the aviation industry is adjusting to deal with the increased operation costs. Fuel costs have been a major catalyst behind airline mergers, fare increases, staff furloughs, route reductions, and aircraft retirements. With airlines struggling to return to profitability, there has been a dramatic decrease in the rate of expansion which has increase competition amongst non-hub air carrier airports such as Stockton Metropolitan Airport that are searching to increase their passenger and cargo service. Despite the airline industry downturn as a result of fuel costs, there are some positive aspects of the current situation which may prove to be advantageous to the airport in the short term. Rising fuel costs are not solely limited to the airline industry; trucking and shipping are also affected by the increase. This affect trickles down to consumers and increases the price that they pay to ship freight regardless of the mode of transportation they select. Stockton Metropolitan Airport could use the associated costs of transporting goods on the ground to the Bay Area or Sacramento as a method of marketing its local access and lower airport fees. If local producers were to use Stockton Metropolitan Airport and the facilities located on the airport property, they would decrease the distance their goods have to travel, the price they pay for shipping, and would have them to market sooner. High gasoline prices also reduce the financial advantage of driving far distances to access cheaper air service. It will eventually be more economical, in terms of time and money, for travelers in the Stockton Metropolitan Airport catchment area to fly directly from their local airport versus Stockton Metropolitan Airport Master Plan (March 2009) 2-7

CHAPTER 2 AVIATION ACTIVITY FORECASTS commuting elsewhere to access air service. Once again, the airport can advertise not only their large local population base, but also a modern airport with less congestion and lower landing fees than their regional competitors. Short-Term Air Service Opportunities Though the Stockton Metropolitan Airport catchment area generates over 890,000 combined inbound and outbound passengers or 1,220 passengers per day each way, it has been difficult to sustain air service due to the influence of the San Francisco, Oakland, and Sacramento airports. However, as part of the California Regional Air Service Plan (CA-RASP), the San Francisco and Los Angeles markets were identified for possible nonstop service to/from Stockton. In addition, non-california hubs including Denver, Phoenix, and/or Salt Lake City were also individually determined to be potentially viable markets. These service opportunities support the mid- or high-growth enplanement forecasts. The addition of any of the proposed services would increase the retention rate above the 2007 level of 6.5 percent. The route forecasts estimated from 48 passengers per day each way to San Francisco with 30-seat aircraft up to 114 passengers per day each way on regional jet service to Los Angeles. On an annual basis, this equates to an enplanement increase of 17,520 to 41,610 enplanements. Consequence of San Francisco Bay Area Airports The Regional Airport System Plan, updated in 2000, was conducted to address the increasing air traffic demands being placed on the runways at the major San Francisco Bay Area commercial airports and on the airspace around these airports. The Regional Airport System Plan concluded that to meet expected air transportation demand additional runway capacity is needed at San Francisco International Airport and Oakland International Airport. The effect of the capacity constraints at Bay Area airports supports the mid- and high-growth enplanement forecasts at Stockton Metropolitan Airport. In the foreseeable future, it is reasonable to expect that some Bay Area air travelers will use Stockton Metropolitan Airport in lieu of San Francisco or Oakland airports if regularly scheduled commercial air service were available. Impact of Sacramento International Airport The low-fare presence of Southwest Airlines at Sacramento International Airport has a significant impact on the current retention of Stockton catchment area air travelers at Stockton Metropolitan Airport. An estimated 61 percent of Stockton Metropolitan Airport catchment area travelers currently drive to Sacramento International Airport to access air service. For Stockton s retention to improve, travelers currently using Sacramento must fly locally rather than driving to Sacramento to access air service. The continued presence of Southwest at Sacramento International Airport and their anticipated growth does not support retention improvement at Stockton Metropolitan Airport in the near future, yet with possibility of future economic growth in the region Sacramento may have less of an impact. As it stands today, Sacramento s impact on the catchment area supports the low-growth enplanement forecast. 2-8 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Low-Fare Service at Stockton In July 2008, Southwest Airlines served all three San Francisco Bay Area airports as well as Sacramento International Airport. JetBlue Airways, another low-fare carrier, also operates at the three Bay Area airports and Sacramento. The continued presence of these low-fare carriers at Sacramento, Oakland, and San Francisco impacts the current retention of Stockton Metropolitan Airport, but is not necessarily a deterrent to retention improving in the future. As an example, Southwest Airlines currently operates out of four airports in the Los Angeles area, with the furthest distance between any two of them being approximately 51 miles. Jet Blue operates out of three airports in the Los Angeles area that are within 30 miles of one another. Stockton Metropolitan Airport is 83 driving miles away from San Francisco International Airport and 63 driving miles away from Sacramento International Airport. As the area grows in population, low fare carriers may try and capture Stockton residents that do not want to make hour or longer drive. Low fare carrier presence in Los Angeles demonstrates that as population and traffic congestion increase, and economic opportunities improve, travelers will be more likely to avoid prolonged travel time to a hub airport in favor of a less congested local airport. The determining factors for this eventual change in demand will occur when traffic congestion increases and when the City of Stockton can attract enough population and economic growth to sustain regular business travel. Regional Service at Stockton Although the time when the population and economy of Stockton and the surrounding communities can support a main stream carrier may be several years away, there is great potential for a regional carrier to begin operations in the not so distant future. The California Regional Air Service Plan has identified Stockton as a possible market for regional air service within the state and possibly to larger hubs in nearby states. As stated in the Short-Term Air Service Opportunities section in this chapter, the possibility of regional air service supports the mid- or high-growth enplanement forecasts. Forecast Summary The demand influences at Stockton Metropolitan Airport are reflective of high competition. The short-term passenger outlook may experience a decline and the airport s ability to operate at annual levels of 30,000 passengers or more is tenuous with current economic conditions. Growth through the mid-term by mainstream air carriers may occur at Sacramento before Stockton in the near future. It is likely that Stockton Metropolitan Airport will see the development of regional routes to larger hubs such as San Francisco and Los Angeles before it acquires a low fare mainstream carrier. Still, if the market becomes saturated or if the economic conditions were to improve and businesses begin taking advantage of the Stockton Enterprise Zone, air service at Stockton Metropolitan Airport may grow quickly. For example, new service by a mainstream air carrier could result in annual enplanements of 100,000 or more. Projections for that level of activity are conservative, but may to occur within 20 years. Due to the uncertainty of economic conditions, Stockton Metropolitan Airport Master Plan (March 2009) 2-9

CHAPTER 2 AVIATION ACTIVITY FORECASTS this forecast recommends a 20-year projection of 60,000 annual passengers, the approximate number that can be served by the size of aircraft serving the market. AIR CARRIER OPERATIONS Airline Operation Forecasts An aircraft operation is defined as either a landing or takeoff. Forecasting aircraft operations is needed to determine if the existing airfield has sufficient capacity to accommodate future activity levels and for evaluating land use impacts and potential. The previous section developed low-, mid-, and high-growth forecasts for passenger enplanements. These forecasts will be utilized to create forecasts of annual airline operations. The number of aircraft operations for a given number of annual enplanements can be calculated using average seat capacity and load factors. The load factor is the number of seats occupied by paying passengers. Since 2006, Allegiant s average load factors at Stockton Metropolitan Airport have ranged between 69 and 85 percent. The industry typically strives for a load factor of 70% on a given route. Therefore, a load factor of 70% has been used in this analysis. Given the limited historical airline passenger service, there is considerable uncertainty in forecasting aircraft size. Current service by Allegiant utilizes 150-seat MD-80 jet aircraft. This is believed to be at about the upper limit of aircraft size for the Stockton market. Given current airline trends a 90-seat regional jet is probably at the lower end of long-term trends for the Stockton market. Therefore, forecast airline aircraft operations will be calculated for both 90-seat and 150- seat aircraft (See Table 2-2). Table 2-2: Passenger Airline Operations Year Low Mid High 90-pax 150-pax 90-pax 150-pax 90-pax 150-pax 2007 2013 1,005 603 1,380 828 841 1,009 2018 1,069 642 1,913 1,148 1,375 1,651 2028 1,206 724 3,663 2,198 3,663 4,395 Forecast Recommendation As with the enplanement forecast, the mid-growth forecast is recommended for long-range planning. The capacity implications of airline passenger aircraft operations will be assessed later in this report in conjunction with operations by other types of aircraft. 2-10 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 AIR CARGO Stockton Metropolitan Airport has seen robust cargo activity dating back to the 1970 s. However, the volume of cargo has been highly variable (Figure 2D). The peak years began in 2003 when Emery Worldwide, also known as Menlo Worldwide, closed its facilities in San Jose and Sacramento and began operating from Stockton Metropolitan Airport. Emory Worldwide utilized an Airbus A300 for its operation at Stockton. It was in the third year of service by Emory Worldwide (2005) that the highest level of activity occurred with a total of 35.7 million pounds of cargo. UPS bought Emory Worldwide in 2005 and discontinued service from Stockton in 2006. UPS consolidated the Stockton service with operations at its Oakland, Fresno, and Sacramento facilities. With the loss of UPS, cargo volumes have dropped 98 percent over three years. Despite these losses, the airport is poised to attract cargo service through competitive facility charges and government regulation such as the free trade zone around the airport. Stockton Metropolitan Airport is receiving support from San Joaquin County with regards to air cargo. It is the county s intent to attract a cargo operator, and they are working on developing the infrastructure to support cargo operations. By providing freight companies with efficient, modern facilities, the airport predicts an increase in freight operations to 20 flights per day. This will bring a diverse fleet of aircraft to the airport, ranging from the 767 wide-body freighter to smaller aircraft such as the Cessna caravan. Nationally, total cargo volumes have shown continued increases over the last several years. However, this is due to growth in international shipping. Domestic air cargo has declined for the last three years for which complete data is available. In its most recent Aerospace Forecasts (2008-2025), the FAA attributed the decline in domestic to a number of factors including: Shift to other modes of transport, particularly trucks Maturation of the domestic express market Air cargo security regulations by FAA and TSA Increased use of mail substitutes (e.g., e-mail) In the current Aerospace Forecasts, the FAA indicates that factors causing the decline in domestic air cargo volumes have stabilized and cargo volumes will once again begin paralleling national economic growth. Domestic cargo is forecast to grow 2.8 percent in 2008, 4.4 percent in 2009, and 2.9 percent annually through 2025. In comparison, international cargo volumes are forecast by the FAA to increase 2.8 percent in 2008, 6.1 percent in 2009, and increase at an annual rate of 5.1 percent through 2025. Stockton Metropolitan Airport Master Plan (March 2009) 2-11

CHAPTER 2 AVIATION ACTIVITY FORECASTS Figure 2D Airline Cargo Operations: Total Pounds 40,000,000 35,000,000 30,000,000 25,000,000 Pounds 20,000,000 15,000,000 10,000,000 5,000,000 0 Year Cargo-On Cargo-Off Pounds 2-12 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 All-cargo carriers have increased their share of domestic cargo volumes significantly over the last decade. Since 1997 all-cargo airlines have increased their market share from 65.4% to 80.9% in 2007. The FAA attributed this increase to several factors including high passenger load factors leaving limited capacity for belly-haul of cargo on passenger aircraft. There are four primary air cargo facilities located in northern California which include; San Francisco International Airport (SFO), Oakland International Airport (OAK), San Jose International Airport (SJC), and Sacramento Mather Airport (MHR). FAA records for California airports indicate that Oakland international Airport was second only to Los Angeles International Airport (LAX) in terms of total cargo landed weight in 2005. OAK reported 3.59 billion pounds/1.80 million tones of landed weight in 2005 compared to SFO (1.59 billion pounds/0.8 million tons); MHR (.52 billion pounds/0.26 million tons), and SJC (0.49 billion pounds/.24 million tons). Of these airports, only Oakland and Mather are considered cargo hubs. San Francisco and San Jose International Airports are focusing their development efforts on passenger service. There are several factors that indicate that Stockton Metropolitan Airport could again support a high level of cargo operations in the future. These factors include runway length, available apron, foreign trade zone, and one of the largest refrigerated air cargo facilities in the region. The Airmetro Airmetro Business Park boundaries Business Park is classified as an Enterprise Zone and Foreign Trade Zone and currently has 19 tenants. Other supporting factors include projected long-term growth in international air cargo and increased congestion at West Coast cargo hubs. Over the past few years, Stockton Metropolitan Airport has been working with their air cargo consultants to develop an aggressive marketing plan to compete in the air cargo industry. The focus has been on identifying effective market strategies along with keeping track of potential carriers and freight forwarders as the industry evolves. The airport has a plethora of marketable characteristics to attract new tenants. Compared to other airports in the Bay Area, Stockton boasts lower landing fees and facility lease rates. The primary opportunities for robust cargo development are centered on ample space for a logistics center, the perishables market, and the consolidation of trucking volumes to reduce costs. There are, however, several challenges that Stockton faces in becoming established as a significant player in the air cargo market. Currently, there is an absence of a manufacturing base of air cargo products within the City of Stockton. Also, the air cargo industry has established international cargo services at San Francisco and Oakland, and domestic air cargo services at Mather Airport. Stockton Metropolitan Airport Master Plan (March 2009) 2-13

CHAPTER 2 AVIATION ACTIVITY FORECASTS The presence of these established air cargo hubs reduces the potential for Stockton Metropolitan Airport to be utilized as a hub by any of the major domestic all-cargo operators in the near term. In the longer term, there is the potential that constraints at these other airports could make Stockton an attractive site for their operations. Stockton Metropolitan Airport could also be a lower-cost alternative for a foreign-flag cargo airline wishing to establish a hub on the West Coast. This potential exists today and could extend into the indefinite future. Forecast Recommendation The airfield and terminal area facilities at Stockton Metropolitan Airport are capable of supporting wide-body cargo aircraft today; however, the established cargo hubs in the region offer strong competition. Therefore, it is uncertain when a major air cargo operation will again be instituted. The current cargo operations using small aircraft will likely continue at about the present level. These cargo operations are not expected to grow to the point where the cargo airline shifts to a larger aircraft. The reintroduction of large cargo aircraft will likely be a result of a new cargo hub being established. Given that reestablishment of a cargo hub will not come from incremental growth, it is difficult to forecast when this will occur. By definition, a new cargo hub will mean a daily flight by a wide-body aircraft (e.g., A330-200F, Boeing 767-300F). The ability of Stockton Metropolitan Airport to accommodate such an air cargo aircraft should continue to be preserved through runway maintenance and protection from surrounding incompatible development, in the event that demand requires a new air cargo hub. BASED AIRCRAFT In an airport master plan, forecasts of based aircraft are used to define the number of hangars and (to a much lesser extent) tie-downs that should be provided in the plan. As with other forecast elements, forecasting based aircraft begins with a review of historical records. In common with many airports, the only source for historical based aircraft counts that was identified is those in the FAA s Terminal Area Forecast (TAF). This data was supplemented with a current count obtained from airport management and the fixed base operators. The number of military aircraft was provided by the California Army National Guard. Table 2-3 below presents the current mix of aircraft types. Historical data is presented in several of the tables that follow. Table 2-3: Current Fleet Mix Single-engine piston 127 Multi-engine piston 12 Single-engine turbo prop 8 Multi-engine turbo prop 6 Jet 15 Helicopter 2 Military 16 TOTAL 186 Source: 2008 Mead & Hunt Survey of Airport, National Guard, and FBO Managers. 2-14 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 As can be seen in Figure 2E, the number of aircraft based at Stockton Metropolitan Airport has declined from its 1988 peak of 254 aircraft to its current total of 186 aircraft. Available data indicated that until the last five years most of the decline was due to the loss of multi-engine propeller aircraft. The most recent five year period also saw the loss of 24 single-engine aircraft. However, the last 20 years have also seen the number of based jets grow from zero to 22. Based Aircraft Demand Factors Future demand for based aircraft at Stockton Metropolitan Airport is influenced by a variety of factors. Some of these factors are national or regional in character; others are specific to this airport. The section that follows describes the major factors. Demands Specific to Stockton Airport Changes in the number of based general aviation aircraft at the Airport will be influenced by trends at the national and state levels, but will be more directly affected by the decisions of local individuals and businesses as to where to base their aircraft. Such decisions are influenced by the following local factors: Nearby Airports There are seven public-use airports within 25 nautical miles of Stockton Metropolitan Airport (see Table 1-3). All offer avgas and aircraft maintenance, but only two airports offer services for general aviation pilots comparable to Stockton: Modesto City- County and Tracy Municipal Airports. Jet fuel is offered at only three other airports: Tracy Municipal, Modesto City-County, and Lodi Airports. Airport Role Stockton Metropolitan Airport is a multi-dimensional airport, capable of accommodating the largest cargo and passenger jets to the smallest general aviation aircraft. The airport is responsible for sending the region s produce across the world and opening numerous foreign markets to local farmers. Stockton Metropolitan airport is one of two airports in the region with a precision instrument approach which gives it a distinct advantage in hours of operability. Availability of Services Stockton Metropolitan Airport provides general aviation aircraft operators with a variety of services. These include jet fuel, aircraft power plant and airframe maintenance, flight training, auto rental, and a restaurant. Commander Services, R.J Tutt Aviation, and Creative Aviation offer charter aircraft services. Atlantic Aviation is the local FBO offering fuel, aircraft cleaning and a pilot lounge. Modesto City-County Airport is the nearest airport that provides the same level of services. Among the advantages that Stockton Metropolitan Airport has over Modesto City-County Airport is more developable land to accommodate new or expanded aeronautical services and a runway over 4,000 feet longer then Modesto s longest runway. Demand for Hangar Space Most aircraft owners prefer to store their aircraft in a hangar. This is both more secure and protects the aircraft and its avionics from weather and sun damage. Stockton Metropolitan Airport currently has vacant hangar space for prospective tenants and available land for future apron and hangar development. Stockton Metropolitan Airport Master Plan (March 2009) 2-15

CHAPTER 2 AVIATION ACTIVITY FORECASTS Proximity to nearby Industry and Commerce Stockton Metropolitan Airport has access to two major highways: Interstate Highway 5 and Highway 99. Airmetro Business Park is located on the airport and is a host to a range of business types. The Airport East Business Park is a 550-acre planned development that offers land for manufacturing, research, office space, and air cargo facilities. Forecast Methodology Five different forecasts of based aircraft were considered: the forecast from the 1997 airport master plan and four alternatives developed for this current plan. The four alternative forecast approaches are: Trend by aircraft type Trend by general aviation fleet Terminal area forecast projection County population trend Projection of 1997 Master Plan Forecast Trend by Aircraft Type The FAA s Aerospace Forecast 2008-2025 includes separate growth rates for each major type of aircraft. The growth rate forecasts are: 0.5% growth for single-engine aircraft, 0.9% decrease in multi-engine aircraft, 5.6% increase in turbo-jets: and 3.1% increase for helicopters. These growth rates were applied to the current mix of aircraft types and extended to the year 2028. Based military aircraft were assumed to remain unchanged. The results are presented in Figure 2E. Figure 2E 300 Trend By Aircraft Type 250 Number of Aircraft 200 150 100 50 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Total 203 254 237 237 233 186 194 202 211 220 Single Engine 161 196 160 160 161 135 138 142 145 149 Jet 0 0 6 6 8 15 20 25 31 36 Multi Engine 36 56 28 28 28 18 17 16 16 15 Military 4 0 31 31 28 16 16 16 16 16 Rotorcraft 2 2 12 12 8 2 2 3 3 4 Year 2-16 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Trend by General Aviation Fleet The FAA s Aerospace Forecast also includes a forecast for the general aviation fleet as a whole. This forecast applies the FAA Aerospace Forecast 2008-2025 growth rate of 1.4% for the general aviation fleet to the current number of based aircraft. After subtracting the 16 based military aircraft, the airport s fleet was projected into 2028 using the 1.4% growth rate provided in Table 27 of the FAA Forecast. The results are presented in Figure 2F. 300 Figure 2F Trend By General Aviation Fleet 250 Number of Aircraft 200 150 100 50 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Total 203 254 237 237 233 186 198 211 225 240 Civilian AC 199 254 206 206 205 170 182 195 209 224 Military 4 0 31 31 28 16 16 16 16 16 Year Terminal Area Forecast Projection The FAA s current Terminal Area Forecast (TAF) of based aircraft is only projected to 2025. To create this alternative the forecast rate of growth from 2020 to 2025 for Stockton was used to project the TAF forecast to 2028. The result is shown in Figure 2G. 300 Figure 2G Terminal Area Forecast Projection 276 Number of Aircraft 250 200 150 100 228 212 50 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Year Stockton Metropolitan Airport Master Plan (March 2009) 2-17

CHAPTER 2 AVIATION ACTIVITY FORECASTS County Population Trend The next alternative forecast methodology utilized San Joaquin County s forecast population growth rate to project the number of based aircraft. California s Department of Finance s forecast of population growth for San Joaquin County was applied to the current based aircraft count and projected to 2028. The Department of Finance forecast 3.9% growth through 2010, 2.6% growth between 2010 and 2020, 2.2% through 2030. The result in presented in Figure 2H. Projection of 1997 Master Plan Forecast The 1997 Master Plan only projected based aircraft to 2015. In this alternative the rate of growth from 2010-2015 was used to expand this forecast to 2028. The result is depicted in Figure 2G. Figure 2H also provides a composite of the five forecasts of based aircraft which allows one to compare the results. Figure 2H Composite Forecasts of Total Based Aircraft with Historical Data 450 400 Number of Based Aircraft 350 300 250 200 150 100 50 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Historical Based Aircraft 203 254 237 237 233 186 1997 Master Plan 217 241 270 302 336 375 419 County Population Trend 186 218 248 280 313 Terminal Area Forecast 212 224 241 258 276 Trend by Aircraft Type 186 194 202 211 220 Trend by GA Fleet 186 198 211 225 240 Year Based Aircraft Demand Conclusions This Airport Master Plan concludes that there is potential for an increase in Stockton Metropolitan Airport s based aircraft. Stockton Metropolitan Airport offers the full range of facilities and services and can accommodate all general aviation aircraft types. Anticipated growth in businesses adjacent to Stockton Metropolitan Airport also supports a forecast of moderate growth. Due to the inherent uncertainty of forecasting, a high and a low forecast are proposed. The low forecast chosen is the Trend by Aircraft Type, as detailed in Figure 2D and shown in orange in Figure 2H. This forecast predicts 220 based aircraft at Stockton Metropolitan Airport by 2028. The high forecast chosen is the Terminal Area Forecast Projection, as detailed in Figure 2F and shown in yellow in Figure 2H. This forecast anticipates 276 based aircraft at Stockton in 2028. 2-18 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Based Aircraft Fleet Mix The Trend by Aircraft Type forecast presented forecasts of broad aircraft types. The categories of aircraft types were taken from the FAA s Terminal Area Forecast. Unfortunately, the FAA does not distinguish between piston-powered and turboprop single-engine and multi-engine aircraft. Therefore, the results of the Trend by Aircraft Type forecast need to be further refined. The recent inventory distinguished between piston and turboprop aircraft. Using this current fleet mix as a starting point, the Trend by Aircraft Type (the low forecast) results were refined. Using the refined fleet mix, a fleet mix was developed for the high based aircraft forecast (the Terminal Area Forecast Projection, described above). The results are shown in Table 2-4 below. Table 2-4: 2028 Based Aircraft Fleet Mix Forecast Aircraft Type Single- Engine Trend by Aircraft Type Forecast 149 Refined Trend by Aircraft Type TAF Projection Refined Aircraft Types 126 150 Single-Engine Piston 23 32 Single-Engine Turboprop Multi-Engine 15 4 5 Multi-Engine Piston 11 18 Multi-Engine Turboprop Jet 36 36 51 Jet Rotary 4 4 4 Rotary Military 16 16 16 Military TOTAL 220 220 276 TOTAL GENERAL AVIATION OPERATIONS Each landing or takeoff is counted as one aircraft operation. Local operations are those that remain in the vicinity of the airport. Usually these are training operations. Itinerant operations are those that depart the airport area or arrive from outside the airport s immediately vicinity. Operations are forecast as part of this master plan process as a means of assessing whether the airport s two runways will have sufficient capacity throughout the 20-year planning period. Roughly parallel to the reduction in the number of based aircraft, the number of aircraft operations at Stockton Metropolitan Airport has declined over the last 15 years. Tower Operations Report July 1, 2007 June 30, 2008 Air Carrier 707 General Aviation Demand Factors The number of general aviation aircraft operations at an airport is influenced both by national and regional conditions and by various circumstances specific to the individual airport. These factors are similar, if not the same as those factors for based aircraft, and detailed above. Other major Air Taxi 894 General Itinerant 50,712 Aviation Local 16,657 Military Itinerant 1,336 Local 586 Total Operations 70,892 influences impacting Stockton Airport s general aviation operation forecast include: Stockton Metropolitan Airport Master Plan (March 2009) 2-19

CHAPTER 2 AVIATION ACTIVITY FORECASTS Facilities and Services Available Existing general aviation facilities at Stockton Airport are satisfactory for the Airport s current level of activity. The airports fixed based operator (Atlantic Aviation) provides fuel service, pilot lounge and aircraft maintenance. Several businesses located on airport offer aircraft repair, rental and sales. Creative Flights offers flight training and aircraft rentals. Other services provided include an on-airport cafe (Top Flight Cafe & Catering Company), and aeronautical advertising. Extent of Transient Aircraft Use Increased business, corporate, and industrial development at Stockton Airport and in its environs is expected to generate increased aircraft operations. Larger general aviation aircraft, primarily business jets, will generate much of this increased activity. The infrastructure for future growth in air cargo is adequate to handle substantial growth in transient aircraft operations. Number and Type of Based Aircraft The shift toward proportionately more complex single-engine and business jets, and light sport aircraft at Stockton Airport will tend to push operations counts upward more rapidly than the rate of based aircraft growth. Typically, complex aircraft are used more frequently and thus generate more operations per aircraft. However, single-engine piston aircraft will continue to dominate the Stockton fleet mix. Any changes in the status of the flights schools could affect based aircraft and operations counts. Forecast Methodology A common means of forecasting general aviation operations is to assume that there is a constant ratio between the number of based aircraft and the number of operations. As long as the role of the airport remains largely unchanged, this methodology should produce a reasonable forecast. This method has been used in this master plan. The operations per based aircraft ratios for local and itinerant operations were calculated using current counts by the air traffic control tower and the recent inventory of based aircraft. High and low forecasts for operations were created by applying the ratios to the high and low based aircraft forecasts presented previously. Figure 2I shows the low operations forecast for general aviation operations at Stockton Metropolitan Airport. This forecast was derived by multiplying the Trend by Aircraft Type forecast of based aircraft by the ratios calculated above. This forecast anticipates 60,000 itinerant and 20,000 local operations in 2028, an increase of 13,000 general aviation operations from 2008. 2-20 Stockton Metropolitan Airport Master Plan (March 2009)

AVIATION ACTIVTY FORECASTS CHAPTER 2 Figure 2I Projected GA Operations Per Trend By By Aircraft Type 120,000 Number of Operations 100,000 80,000 60,000 40,000 20,000 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Total 99,602 94,183 110,903 81,253 63,328 67369 70269 73311 76420 79601 Itinerant 56,623 45,911 37,187 31,401 49,267 50712 52895 55185 57525 59919 Local 42,979 48,272 73,716 49,852 14,061 16657 17374 18126 18895 19681 Year Figure 2J uses the same method as described above. This high forecast of operations is produced by multiplying the Terminal Area Forecast Projection forecast of based aircraft by the ratios calculated above. This forecast results in a higher number of operations in 2028: 21,000 local and 66,000 itinerant operations. Figure 2J Projected GA Operations Per TAF Projections 120,000 Number of Operations 100,000 80,000 60,000 40,000 20,000 0 1983 1988 1993 1998 2003 2008 2013 2018 2023 2028 Total 99,602 94,183 110,903 81,253 63,328 67369 71182 76585 81987 87745 Itinerant 56,623 45,911 37,187 31,401 49,267 50712 53582 57649 61716 66050 Local 42,979 48,272 73,716 49,852 14,061 16657 17600 18936 20271 21695 Year Stockton Metropolitan Airport Master Plan (March 2009) 2-21

CHAPTER 2 AVIATION ACTIVITY FORECASTS Annual Operations Demand Conclusions Continued growth in annual general aviation aircraft operations at Stockton Metropolitan Airport is anticipated. This increase will principally be the result of growth in flight training and business and corporate aviation activities. The difference in the high and low projections for operations is only about 10,000 operations in 2028. In a broader sense, the growth in operations will result from continued growth in population and economic development in the area, the attractiveness of Stockton s facilities, and the availability of hangar space and developable land at the airport. MILITARY Current data shows ten military aircraft stationed at Stockton Airport in early 2009. Before 2009, the Airport 5010 forms and TAF reports indicate there were 28 military aircraft based at Stockton. Data provided by the California Army National Guard in August, 2008 allows us to accurately document the current military fleet. The Guard houses 12 CH-47 Chinooks and 4 Bell OH-58 Kiowas. Both are rotorcraft and are deployed throughout the world when needed. At the time this Master Plan was being written, overseas conflicts in Iraq and Afghanistan displaced the Chinooks and Kiowas. Communication with the commander of the Stockton Army Aviation Support Facility in September of 2008 indicated that there were 16 military aircraft at Stockton Metropolitan Airport. With both conflicts ongoing, the amount of aircraft returning to base at Stockton is expected to remain the same. Anticipating the amount of based military aircraft and their associated operations is not related to FAA projections for other based aircraft. Normally the FAA projects a flat rate for future military operations, no loss or gain. This is the case at Stockton, also. Other factors determining potential military aircraft are possible future conflicts and the amount of defense spending by the government. A zero rate of growth is used in the based aircraft and operation forecasts presented here. All future scenarios show eleven military aircraft. COMPARISON WITH THE TERMINAL AREA FORECAST As a part of the master plan process, the Federal Aviation Administration (FAA) must approve the activity forecasts. Generally the FAA wishes master plan forecasts to be within 5% of the 5-year Terminal Area forecast (TAF), and within 10% of the 10-year TAF forecast. Although the TAF provides forecasts of many activity components, the principal components are: passenger enplanements, total operations and total based aircraft. As can be seen in Table 2-5 below, the master plan forecasts for both total operations and total based aircraft are below those in the TAF. As explained earlier in this chapter, due to high levels of uncertainty, short- and mid-term forecasts of passenger enplanements have not been made. Rather, as a long-term tool for ensuring future land use compatibility, this plan recommends using 60,000 annual passenger enplanements as the assumed level of future activity. 2-22 Stockton Metropolitan Airport Master Plan (March 2009)