LONG ISLAND CENTER FOR SOCIO-ECONOMIC POLICY ECONOMIC DEVELOPMENT POTENTIAL LONG ISLAND MACARTHUR AIRPORT

LONG ISLAND CENTER FOR SOCIO-ECONOMIC POLICY ECONOMIC DEVELOPMENT POTENTIAL OF LONG ISLAND MACARTHUR AIRPORT PREPARED FOR SUFFOLK COUNTY INDUSTRIAL DEVELOPMENT AGENCY PREPARED BY DR. MARTIN R. CANTOR, CPA March 16, 2016 The Long Island Center for Socio-Economic Policy Director, Dr. Martin R. Cantor, CPA 28 Woodmont Road Melville, New York 11747 Tel: (631) 491-1388 Fax: (631) 491-6744 E-Mail: EcoDev1@aol.com WEB SITE: WWW.MARTINCANTOR.COM 1

Economic Development Potential of Long Island MacArthur Airport March 16, 2016 Table of Contents Abstract Page 3 Introduction Page 4 Chapter 1: County Demographic Comparisons: Age and Population Page 5 Chapter 2: County Economic Comparisons: Employed Population Over 16 Years Page 6 Industry Sector Employment Page 8 Regional Family and Household Income Page 9 Chapter 3: Business Activity in Vicinity of Regional Airports Page 10 Chapter 4: Airport Activity, Resources and Economic Impact Page 13 Chapter 5: Summary, Conclusions and Recommendations Page 15 Appendix A: Regional Airport Statistics and Resources Page 23 Long Island MacArthur Airport Page 23 Suffolk County and Islip Town Property Page 27 Westchester County Airport Page 30 Theodore Francis Green Airport (Providence) Page 35 Stewart International Airport Page 39 References Page 44 Bio of Principle Researcher Page 46 2

ABSTRACT This study evaluates and identifies the untapped economic development potential of Long Island s MacArthur Airport by comparing the financial and economic impact generated by Long Island MacArthur airport with three selected regional suburban airports. To mirror conditions at Long Island MacArthur, the criteria used for selecting the three comparison airports was that they be both located near a major airport hub and in close proximity to commuter rail. The airports selected for evaluations were Stewart Airport in Orange County New York; Westchester County Airport in Westchester County New York; and T.F. Green in Providence County Rhode, Island. To provide greater context to these findings, regional economic, demographic, and financial data is analyzed for each of the airport s host counties. The analysis revealed that T.F. Green Airport located in Providence Rhode Island, a county smaller in population than Suffolk County had fewer flights than Long Island MacArthur Airport but had more major air carriers and more passengers per plane than Long Island MacArthur Airport. The evaluation also identified economic development assets in and around Long Island MacArthur Airport that can be brought to higher and more valuable uses in order to attract more businesses and business travelers, both of which would be critical if Long Island MacArthur is to attract additional major air carriers. 3

INTRODUCTION Airports play an important role in the regions they serve. They spur economic development through job creation, facilitate and attract tourism and both establish and encourage business links between their home territory and other geographic areas. With that focus, the purpose of this analysis is to assess and identify the untapped economic development potential of Long Island MacArthur Airport. This will be accomplished by evaluating the financial and economic impact generated by Long Island MacArthur Airport with three similar regional suburban airports. The three regional airports selected for analysis are: *Westchester County Airport in New Windsor, Westchester County (29 Miles from LaGuardia Airport); *Stewart International Airport in West Harrison, Orange County New York (77 miles from Newark International Airport and LaGuardia Airport); and *Theodore Francis Green Airport in Warwick, Providence County Rhode Island (60 miles from Logan Airport in Boston Massachusetts). In comparison, Long Island MacArthur Airport is 52 miles from JFK International Airport and 47 from LaGuardia Airport. The analysis is based upon descriptive, qualitative, and quantitative information derived from regional economic, demographic, and financial data of Orange County New York, Westchester County New York, Providence County Rhode Island and Suffolk County New York, including operating data for each airport. From the comparison of the three regional airports selected, areas of untapped economic development potential at Long Island MacArthur Airport were identified, including use of Suffolk County property located in and around Long Island MacArthur Airport, and recommendations made as to how that potential could be realized. 4

CHAPTER 1: COUNTY DEMOGRAPHIC COMPARISONS The first criteria evaluated are the age and population of the county where each regional airport is located. Table 1 illustrates that while the 2013 Suffolk County population is the largest suburban county of the four included in this analysis, the percent of Suffolk County population age distribution is similar to the other counties. Table 1: Demographic Comparison-2013 Age and Population Orange County, New York Stewart Suffolk County, New York Westchester County, New York Providence County, Rhode Island Airport MacArthur Airport Westchester Cty Airport T F Green Airport Total Total Total Total Total population 373,902 1,495,803 956,283 627,469 AGE Under 5 years 6.9% 5.6% 5.9% 5.9% 5 to 14 years 15.1% 13.4% 13.4% 11.9% 15 to 44 years 39.5% 38.3% 37.8% 42.6% 60 years and over 17.0% 19.5% 20.5% 19.0% 65 years and over 11.4% 14.0% 14.9% 13.6% Median age (years) 36.7 40.1 40.2 37.1 Source: 2009-2013 American Community Survey 5-Year Estimates Table S0101: Age and Sex While the median age in the populations of Suffolk County and Westchester County are nearly identical, it is nearly 10 percent older than the median ages in Orange County and Providence County. The age of a population is of significance to an airport because travel habits of individuals often change with age. While there are some differences between the county median ages, the percent distribution of each age category with-in each county are basically the same. Thus any variations in travel habits between the airports influenced by age can be considered minimal. 5

CHAPTER 2: COUNTY ECONOMIC COMPARISON Tables 2, 3, and 4 compare the percent of the Suffolk, Westchester, Orange and Providence County s: Population that is in the workforce. Civilian population 16 years of age and older included in the workforce. Industry sectors where the over 16 population employed are working, and Median and mean household and family incomes in each county. Also presented are the median full-time wages for both males and females in each county s workforce. The results illustrate some interesting economic and industry sector differences. Employment Status of Those 16 Year of Age and Older: Similar for Each County Table 2 illustrates that of the population over 16 years of age Suffolk County has the largest population, the largest labor force, the greatest percent distribution in both the civilian labor force and those employed, and the lowest unemployment rate. Table 2: Economic Characteristics 2013- Employed Population Over 16 Years of Age Subject Orange County, New York Suffolk County, New York Westchester County, New York Providence County, Rhode Island Estimate Percent Estimate Percent Estimate Percent Estimate Percent Population 16 285,563 285,563 1,190,240 1,190,240 757,716 757,716 508,331 508,331 Years and Over Population Over 191,163 66.9% 786,380 66.1% 498,912 65.8% 331,687 65.3% 16 In labor force Civilian labor 186,406 65.3% 785,784 66.0% 498,722 65.8% 331,311 65.2% force Population 170,981 59.9% 727,484 61.1% 456,825 60.3% 294,690 58.0% Employed Population 15,425 5.4% 58,300 4.9% 41,897 5.5% 36,621 7.2% Unemployed Population in 4,757 1.7% 596 0.1% 190 0.0% 376 0.1% Armed Forces Population Not in 94,400 33.1% 403,860 33.9% 258,804 34.2% 176,644 34.7% Labor Force Civilian Labor 186,406 186,406 785,784 785,784 498,722 498,722 331,311 331,311 Force Percent Unemployed (X) 8.3% (X) 7.4% (X) 8.4% (X) 11.1% Source: 2009-2013 American Community Survey 5-Year Estimates Table DP03:Selected Economic Characteristics 6

This, however is a product of Suffolk County s larger population as the percent distribution of the over 16 population in the workforce and in the labor force is nearly the same as in Westchester, Orange, and Providence County. Industry Sector Employment of Those 16 Years of Age and Older: Suffolk County Potential for Growth in Management, Science and Manufacturing Table 3 illustrates that while Suffolk County had the largest civilian employed population 16 years of age and older, there were some similarities and differences in the percent distribution of the industry sector jobs between Suffolk County and Counties of Orange, Westchester, and Providence. Suffolk County had similar percent industry sector employment distribution with Orange, Westchester and Providence Counties in the Service and Sales (retail/wholesale) industry sectors. However, differences were found in the other categories. In the Management, Business and Science industry sectors, Suffolk County s 37.8 percent was ten percent greater than Providence County and within range of Orange County. Suffolk County, although it has a larger population, more people employed and more businesses, had a smaller percentage of jobs (approximately 20 percent) in management, business, and science than the 45.5 percent of Westchester County s jobs held by these categories. In the Manufacturing, Transportation, and Material Moving industry sectors, despite Suffolk County having the most jobs, these sectors represented only 9.6 percent of the Suffolk County industry sector employment. By comparison, Suffolk County was 28 percent lower than the 13.5 percent these sectors represented in Providence County s industry sector employment, and 10 percent less than the 10.9 percent reported in Orange County. This is important because manufacturing is an essential leading indicator of regional economic activity due to its high economic multiplier. The more manufacturing and higher paying jobs created the more secondary service sector jobs created and their resulting economic impact. 7

As will be discussed later in this analysis, the area around MacArthur Airport has additional capacity that can be used to support and generate airfreight and business travelers, both of which are essential assets in attracting additional airlines. Table 3: Population Employed-Industry Sector Employment By Occupation Subject Orange County, New York Suffolk County, New York Westchester County, New York Providence County, Rhode Island Estimate Percent Estimate Percent Estimate Percent Estimate Percent Civilian Employed 170,981 170,981 727,484 727,484 456,825 456,825 294,690 294,690 Population 16 Years of Age and Over Management, Business, 61,089 35.7% 274,762 37.8% 208,011 45.5% 98,991 33.6% Science, and Arts Service occupations 31,370 18.3% 125,053 17.2% 84,149 18.4% 61,962 21.0% Sales and Office 44,314 25.9% 190,382 26.2% 103,365 22.6% 74,012 25.1% Natural Resources, 15,553 9.1% 67,271 9.2% 32,513 7.1% 19,900 6.8% Construction, and Maintenance Manufacturing, Transportation, and Material Moving 18,655 10.9% 70,016 9.6% 28,787 6.3% 39,825 13.5% Source: 2009-2013 American Community Survey 5-Year Estimates Table DP03: Selected Economic Characteristics Regional Family and Household Income Suffolk County Economy Can Support More Flights at Islip MacArthur Airport Table 4 illustrates the differences existing between the Counties of Suffolk, Westchester, Orange and Providence in median and mean family and household incomes, per-capita income, and median earnings of full-time employed males and females. In all the aforementioned income categories, Suffolk County exceeds Providence County, suggesting that Suffolk County residents have the family and household income capacity capable of supporting more flights at Islip MacArthur Airport. Illustrating that there is unfilled flight and passenger capacity at Islip MacArthur Airport is Table 6, which shows that Providence County s TF Greene Airport reports fewer annual flights, more carrier flights, and more passengers; while at Islip MacArthur Airport there are more annual flights, fewer carrier flights, and fewer passengers. 8

Table 4 illustrates that Suffolk County had the most families and households, followed by Westchester, Providence, and Orange Counties. At $87,763 Suffolk County also had the highest median household income, followed by Westchester, Orange, and Providence Counties, with Providence County s median household income 56 percent below Suffolk County. However, Westchester County led Suffolk, Orange, and Providence Counties in the remaining income categories Table 4: Economic Characteristics: 2013 Income and Benefits (Adjusted for Inflation) Subject Orange County, New York Suffolk County, New York Westchester County, New York Providence County, Rhode Island Estimate Estimate Estimate Estimate Total Households 125,317 497,347 343,561 237,800 Median Household 70,458 87,763 81,946 49,297 Income (dollars) Mean Household Income (dollars) 88,290 108,316 130,829 66,395 Families 89,873 374,411 237,934 146,971 Median Family 85,100 100,652 105,341 62,348 Income (dollars) Mean Family Income (dollars) 100,210 120,896 157,937 78,936 Per Capita Income (dollars) Nonfamily Households Median Nonfamily Income (dollars) Mean Nonfamily Income (dollars) 30,583 36,945 47,984 26,308 35,444 122,936 105,627 90,829 36,983 45,622 44,050 28,839 52,542 62,999 65,138 42,739 Median Earnings 34,882 40,869 43,006 30,136 (dollars) Median Earnings- 57,505 65,289 70,339 47,180 Male Full-Time Workers (dollars) Median Earnings- Female Full-Time, 44,716 49,516 55,463 40,273 Workers (dollars) Source:American Community Survey2009-2015-Year Estimates Table DP03: Selected Economic Characteristics 9

The Westchester County mean household income, median and mean family income, per capita income, mean nonfamily income, median worker earnings, and median earnings for full-male and female workers exceeded Suffolk, Orange and Providence Counties in these same categories. However the data also indicates that while Westchester County displays some greater levels of wealth than Suffolk County, there is sufficient economic activity in Suffolk County that can support additional flights out of MacArthur Airport. CHAPTER 3: BUSINESS ACTIVITY IN VICINITY OF REGIONAL AIRPORTS Untapped Economic Development Potential for Long Island MacArthur Airport The convenience and location of Long Island MacArthur Airport provides it with an underutilized competitive advantage over JFK and LaGuardia Airports. The untapped economic potential of Long Island MacArthur Airport lies not only with the fact that it can serve Long Islander s wanting ease of access to an airport but that it can also service local businesses requiring air freight service for their manufactured goods and also meet the business travel requirements of their employees. Tourism is also important for attracting air carriers. A tourist destination draws visitors who in turn create a demand for air travel. A coordinated marketing campaign that attracts air travelers to Long Island as a destination for beaches, museums, golf courses, culture, wineries and parks would create a demand for air carrier service to MacArthur Airport. Additionally, building a convention center, something that Long Island lacks, would add to the already $5 billion of economic activity that tourism generates for the Long Island economy and would create a consistent increase in demand for air service to MacArthur Airport. What is most sought after by major carriers, and what is most needed by Long Island MacArthur Airport, is the regular and sustained business traveler. The regular business traveler is essential to airports in their efforts to attract major air carriers because major air carriers calculate the regularity of passengers and ticket prices into their economic evaluation of which airports are profitable enough for them to provide service. As Table 5 illustrates, T.F. Green Airport in Providence, Rhode Island has met that challenge. 10

Table 5 illustrates that, of all the airports evaluated in this analysis, TF Green Airport in Providence, Rhode Island had the most businesses with 1,634, followed by the 1,470 businesses surrounding Long Island MacArthur Airport. Table 5: 2013 Business Census (by Zip Code) (Bold Italic Values Denote Businesses Most Likely to Utilize Air Travel) Industry Code ------ Westchester Airport New Windsor, NY Zip Code 12553 MacArthur Airport Ronkonkoma, NY Zip Code 11779 Stewart Int l. Airport W Harrison, NY Zip 10604 TF Green Airport Warwick, RI- Zip Code 02886 Industry Code Description Total for all Sectors 624 1470 602 1634 22---- Utilities 1 1 2 -- 23---- Construction 58 244 37 94 31---- Manufacturing 29 141 2 64 42---- Wholesale Trade 40 159 28 84 44---- Retail Trade 68 138 19 267 Transportation 48---- and Warehousing 30 72 37 45 51---- Information 10 12 16 33 52---- 53---- 54---- 55---- 56---- 61---- 62---- 71---- 72---- 81---- Finance and Insurance 30 71 79 119 Real Estate and Rental and Leasing 35 44 30 65 Professional, Scientific, and Technical Services 53 163 116 223 Management of Companies and Enterprises 3 5 21 14 Administrative and Support and Waste Management and Remediation Services 35 77 73 71 Educational Services 10 24 12 13 Health Care and Social Assistance 82 72 59 264 Arts, Entertainment, and Recreation 10 18 10 20 Accommodation and Food Services 66 85 20 136 Other Services (except Public Administration) 64 144 38 120 99---- Industries not classified 1 2 11---- Agriculture, Forestry, Fishing and Hunting 1 21---- Mining, Quarrying, and Oil and Gas Extraction 1 Source: U.S. Census Bureau 2013 ZIP Code Business Patterns (ZBP) 11

Businesses in the vicinity of the regional airports evaluated in this study are a potential source of additional business air travelers and resulting revenue streams sought by major airlines and regional airports. These businesses are 25.6 percent of the 624 businesses in the vicinity of Westchester County Airport, 29.7 percent of the 1,470 businesses surrounding MacArthur Airport, 43.9 percent of the 602 businesses in Stewart Airport s Zip Code, and 31.7 percent of the 1,634 businesses in the area surrounding Theodore Francis Green Airport. The business bases in the vicinity of T. F. Green Airport and Long Island MacArthur Airport are similar in size, comprised of similar percentages of business, and have a Foreign Trade Zone, all of which provide a market for business air travelers. However, because of its central location to businesses and business travelers, travelers and major carriers from T. F. Green Airport are greater in number than travelers and major air carriers flying out of Long Island MacArthur Airport. While there may be additional passenger travel, a reasonable expectation is that there is more of a significant and consistent business traveler flying from T. F. Green Airport. The consistency of air travel from T. F. Green generates a reliable and dependable return on the carriers investment. Obtaining that consistency of business travel, supplemented by other passenger travel such as tourism and leisure travel is critical for Long Island MacArthur Airport. Demonstrative demand for airline destinations from Long Island MacArthur is essential to address airline financial requirements if they are to establish a base in a regional airport such as Long Island MacArthur. In addition, creating better connectivity throughout the region could potentially ameliorate some of this challenge. This could include creating new infrastructure as well as better connecting existing infrastructure and regional assets and work centers. These considerations would indicate that there is untapped business travel potential at Long Island MacArthur Airport as nearly 70 percent of the businesses located in proximity to MacArthur are not likely utilizing its services. If businesses with air service needs could be attracted to the area, the number of consistent and sustained business travelers utilizing the MacArthur Airport could be increased. This potential is illustrated in Table 6 which presents a comparison of each airport s resources, permanent carriers, and economic impact. 12

CHAPTER 4: AIRPORT ACTIVITY, RESOURCES AND ECONOMIC IMPACT Table 6 further explores the untapped economic development potential at MacArthur Airport and compares its activity to the other regional airports. Table 6: Comparison of Airport Resources, Activity, and Economic Impact Airport and County where Located Miles to Major Airport Hub Foreign Trade Zone Stewart International, Orange Cty. 77 miles to Newark NJ- LaGuardia NYC Region Yes-Airport, ATT, IBM, Business Pks NY-NJ Port Authority Long Island MacArthur, Suffolk Cty 52 miles to JFK and 47 to LaGuardia Airport NYC Yes-435,000 Sq Ft in 52 acres Town of Islip Westchester County Air. Westchester 29 miles to LaGuardia Airport-NYC No T. F. Green Providence, Cty 60 Miles to Logan,Airport Boston Yes 65 acres Bus Pks. Port+Airport Quasi Govt`- Rhode Island Airport Ownership County of Westchester Airport Size 1,552 Acres 1,311 Acres 702 Acres 1,111 Acres Runways/Helipads 2 / 1 4 / 2 2 2 Runway Length 11,817 ft and 7,006ft/5,034 6,549 and 7,166 and 6,004 3,175/5,186 4,451 6,081 Mass Transit Yes-Metro Yes - LIRR Yes-Metro Yes Rail and Options to Airport North + Short Suffolk North + Bee Bus service Line Bus Bus Line Bus Carriers (a) 4 2 6 7 +2 Seasonal Carrier Flights (a) 3,218 (8.0%) 9,953 (9.3%) 7,449 (5.4%) 33,701(44.7%) Annual Flights (a) 39,983 106,938 137,151 75,475 Passengers (b) 306,000 1,266,000 1,490,000 3,500,000 Passengers/Flight(c) 7.7 11.8 10.9 46.4 Depart on time (d) 82 % 77 % 77 % 85 % Direct Employ (e) 3,636 4,870 4,946 8,187 Direct Income (e) $254,870,100 $168,269,600 $251,026,700 $760,805,200 Secondary Jobs(e) 1,943 1,215 1,382 3,380 Secondary Income $78,751,800 $60,910,100 $83,111,500 $454,365,200 Tot Eco Impact(e) $750,722,800 $577,016,600 $735,879,600 $1,215,170,400 State/Local Tax(e) $60,775,500 $ 54,284,700 $ 72,056,200 $76,606,200 Note: (a) Carrier and annual flights, percent of carrier flights to annual flights-12 Months Ended 12/31/13. (b) Based on emplaned passengers both arriving and departure-12 months ending February 2015. (c) Passengers per flight include air taxi, general, local, iterant and military aviation.t.f. Green is significantly higher because it proportionately runs more commercial flights as opposed to private and charter flights. (d) For period April 2014 - March 2015. (e) New York Airports For year ended 12/31/09. T.F. Green Airport based on 2013/2014 year. Sources: Federal Aviation Administration, New York State Department of Transportation. Rhode Island Airport Commission. (Latest Information Available) 13

The comparison in Table 6 presents the varied airport resources, flight activity, and economic impact of Stewart International Airport, Long Island MacArthur Airport, Westchester County Airport and T.F. Green Airport. T. F. Green Airport has the most direct employment and highest economic impact because it has the most carrier and annual flights, the highest percent of carrier flights to annual flights and the most passengers per flight. The passengers per flight at T. F. Green Airport is significantly higher because it proportionately runs more commercial flights as opposed to private and charter flights. Airport Location Matters: Distance from a Major Airport Hub a Factor As illustrated in Table 6, review of the latest data from the Federal Aviation Administration reveals that excepting for Westchester County Airport, which is 29 miles from LaGuardia Airport; the other three airports are between 47 and 77 miles from a major airline hub. Long Island MacArthur Airport is 52 miles from JFK International Airport and 47 miles from LaGuardia Airport while T.F. Green Airport is 60 miles from Boston s Logan International Airport. Furthermore, T. F. Green Airport not only provides service to Providence County and much of Rhode Island, but its central location also draws passengers from Eastern Connecticut and Massachusetts communities both North and East of the airport. There are few air choices for travelers, thus lessening the competition facing T. F. Green Airport. The result is more major carriers operating from T.F. Green Airport and more destination choices for the traveler flying from T. F. Green Airport. By comparison, unlike T.F. Green Airport, Long Island MacArthur Airport is located in the region with the largest population, but is not located convenient to Long Island s population center. More than half the residents of Long Island live closer to LaGuardia and JFK Airports than MacArthur Airport. The result is greater competition facing Islip MacArthur Airport for the air traveler, making it more difficult to attract major air carriers who locate where the traveling public is. While distance from a major airline hub may impact travelers selecting Stewart International Airport and T.F. Green Airport, the closer the distance to a major airport 14

hub appears to have impacted flights from Long Island MacArthur Airport and Westchester County Airport. Major Carriers Go Where the Passengers Are Another paradox is that while T.F. Green Airport has fewer annual flights it has the most emplaned passengers, more carriers and the largest percent of carrier flights to all annual flights. Westchester County Airport has the second largest emplaned passengers and the lowest percent of carrier flights to annual flights. The result is that T.F. Green Airport has the most passengers per flight and the lowest percentage of non-carrier flights to carrier flights. Non-carrier flights include taxi flights, local general aviation, itinerant general aviation and military. Clearly the ability to attract passengers also attracts the commercial carriers to T.F. Green Airport. CHAPTER 5: SUMMARY, CONCLUSIONS AND RECOMMENDATIONS Summary and Conclusions Suffolk County has the largest population, the largest population 16 years of age and older in the labor force and the largest population employed of the four counties evaluated. However despite these workforce advantages, Suffolk County lagged behind the other counties in jobs in higher paying industry sectors. The employment in Suffolk County s management, business and science sectors was ten percent greater than Providence County and within range of Orange County. Yet Suffolk County had nearly 20 percent fewer jobs in this industry sector than Westchester County. With 9.6 percent of its workforce in the manufacturing, transportation, and material moving industry sectors, Suffolk County was 28 percent lower than the 13.5 percent reported for Providence County and 10 percent less than the 10.9 percent reported in Orange County. Manufacturing is an important leading indicator of regional economic activity because of its high economic multiplier. The more manufacturing and higher paying jobs created the more secondary service sector jobs created. When household and family incomes were compared, Westchester County exceeded Suffolk, Orange, and Providence Counties in mean household income, mean and median family income, per capita income, mean nonfamily income, median worker earnings, and 15

median earnings for full-time male and female workers. Suffolk County exceeded all counties in median household and nonfamily income. As for businesses in the vicinity of each airport that could generate air travel activity, T.F. Green Airport in Providence Rhode Island, with 1,634 businesses had the most businesses followed by the 1,470 businesses surrounding Long Island MacArthur Airport. An analysis of these businesses provided insight into which businesses could avail themselves of additional air travel needs. These included manufacturing; information; finance and insurance; real estate, rental and leasing; professional, scientific and technical services; and management and enterprise administration. These identified businesses constituted 25.6 percent of businesses in the vicinity of Westchester County Airport, 29.7 percent of businesses surrounding MacArthur Airport, 43.9 percent in Stewart Airport s Zip Code, and 31.7 percent of businesses in the area surrounding Theodore Francis Green Airport. These results would indicate that there is untapped business travel potential at Long Island MacArthur Airport. A review of each airports activity, resources, and economic impact illustrates that potential. T.F. Green Airport having 75,475 annual flights, had the most emplaned passengers at 3.5 million, more major carriers at 7, and the largest percent of carrier flights to annual flights with 44.7 percent. Westchester County Airport had the second largest emplaned passengers and the lowest percent of carrier flights to annual flights. Long Island MacArthur Airport had 1.27 million emplaned passengers, the second most flights at 106,938, and the second highest ratio of carrier flights to total annual flights with 9.3 percent. The result is that T.F. Green Airport had the most passengers per flight and the lowest percentage of non-carrier flights to carrier flights. Non-carrier flights include taxi flights, local general aviation, itinerant general aviation and military. Clearly the ability to attract passengers also attracted the major carriers to T. F. Green Airport. Location appears to be a factor in the success of T. F. Green Airport which not only provides service to Providence County and much of Rhode Island, but its central location draws passengers from Eastern Connecticut, and Massachusetts communities both North and East of the airport. Other than Logan International Airport in Boston, there are few air carrier choices for these travelers, thus lessening the competition facing T. F. Green 16

Airport. The result is that more major carriers operate from T.F. Green Airport with more destination choices for air travelers. By comparison, while Suffolk County-based Long Island MacArthur Airport is located in a region with the largest population, it is not centrally located within that population. More than half of Long Island s population lives closer to LaGuardia and JFK Airports than Long Island MacArthur Airport. This factor results in greater competition for the air traveler, making it more difficult for Long Island MacArthur Airport to attract major carriers. While distance from a major airline hub may impact travelers selecting Stewart International Airport and T.F. Green Airport, the closer the distance to a major airport hub appears to have adversely impacted flights from Long Island MacArthur Airport and Westchester County Airport. The business bases in the vicinity of T. F. Green Airport and Long Island MacArthur Airport are similar in size and comprised of similar percentages of business that can be a market for air travel. However, travelers and major carriers from T. F. Green Airport are greater in number than travelers and major carriers flying out of Long Island MacArthur Airport. While there may be additional passenger travel, a reasonable expectation is that there is a significant and consistent business traveler flying from T. F. Green Airport that is lacking at Long Island MacArthur. The consistency of business air travel from T. F. Green Airport generates a reliable and dependable return on investment for the major carriers. By comparison, while Long Island MacArthur Airport has passenger travel, a consistent business traveler, which is critical to Long Island MacArthur Airport in efforts to attract a major carrier, occurs less frequent. For Long Island MacArthur Airport to attract major carriers there must be a demonstrative business traveler demand for airline destinations flying from Long Island MacArthur Airport. This is essential to address airline financial requirements to establish a base in a regional airport such as Long Island MacArthur. 17

Recommendations It is not for lack of effort that a regional airport such as Long Island MacArthur struggles in the ever-changing, consolidating, cost-conscious, profit-seeking and competitive airline industry. It is very difficult for Long Island MacArthur Airport to compete when cost and revenue imperatives drive major carrier decisions as where to establish gates and flights. Without guaranteed travelers, major carriers are difficult to attract to Long Island MacArthur Airport. As explained previously, for Long Island MacArthur Airport to attract major carriers there must be a demonstrative business traveler demand for airline destinations flying from Long Island MacArthur Airport. This is essential to address airline financial requirements to establish a base in a regional airport such as Long Island MacArthur. The following recommendations address this need. The recommendations appreciate the success that Long Island MacArthur Airport has had as a true regional airport with a major carrier and local and itinerant general aviation while constantly trying to attract additional major carriers. However, its location away from the traveling population center of Long Island presents a challenge of attracting passenger travel in the magnitude necessary to satisfy the financial and ridership requirements of major carriers, requirements that have been met by T. F. Green Airport in Providence Rhode Island as evidenced by the major carriers flying from there. Two important assets of Long Island MacArthur Airport are its convenience and proximity to businesses in Eastern Nassau County and Suffolk County. This provides Long Island MacArthur with an underutilized competitive advantage over JFK International and LaGuardia Airports. The untapped economic potential of Long Island MacArthur Airport lies not only with the fact that it can serve those Long Islander s wanting ease of access to an airport but that it can also service local businesses requiring air freight service for their manufactured goods while also meeting the business travel requirements of their employees. Regular and sustained business travelers are most sought after by airports in their efforts to attract major air carriers. Long Island MacArthur Airport is no different. T.F. Green Airport succeeds because its location in Rhode Island is central to a population that requires air travel, it is connected to a transportation hub making it 18

convenient to access, it is surrounded by a Foreign Trade Zone that generates consistent business travelers, and its location is far enough away from Boston s Logan Airport resulting in less competition for the air travelers. Long Island MacArthur Airport has several underutilized economic development assets that, when developed to their highest potential, can generate more air travel and economic activity. Long Island MacArthur Airport has more runways and helipads than the other airports reviewed, yet has fewer air carrier flights, fewer businesses and business travelers, an undeveloped transportation hub, and a smaller Foreign Trade Zone than T. F. Green Airport. With this perspective the following economic development recommendations have been identified for Long Island MacArthur Airport Recommendation One: Develop a Coordinated Marketing Campaign to Generate Better Support for Long Island MacArthur Airport Develop a comprehensive and standalone marketing campaign for Long Island MacArthur Airport involving input, participation and cooperation from regional government, corporate and community organizations. Successful regional airports are those supported by the business community, government and the residential community. Long Island MacArthur Airport can only benefit from stronger support from these groups, especially business travelers. Major carriers look for this support when they evaluate using Long Island MacArthur Airport. Part of the success of T. F. Green airport can be attributed to the robust and unwavering support by Rhode Island government, business, and community leaders. That same support for Long Island MacArthur Airport, which is crucial for its success, has waxed and waned amongst Long Island businesses, community and government leaders. For Long Island MacArthur Airport to reach its potential it is absolutely necessary that the talk of support be translated into strong, visible and actual support. This support is a vital part of the essential ingredients all regional airports need to succeed. Long Island s business community must understand the 19

importance of this support and commit to making sure that support doesn t vanish. The success of Long Island MacArthur depends upon it. To generate that support, the coordinated marketing campaign should be funded by multiple entities. New York State can support it by way of the Long Island Regional Economic Development Council and locally, the Long Island Convention and Visitors Bureau can contribute. Recommendation Two: Create a Transportation Hub: Connectivity between Long Island MacArthur Airport, and the Ronkonkoma Long Island Railroad Station. It has been noted that Long Island MacArthur Airport s geographic location presents some challenges, especially as it relates to competition for travelers from JFK International and LaGuardia Airports. A significantly underutilized asset that Long Island MacArthur Airport could make use of to address this challenge is its proximity to the Long Island Rail Road s (LIRR) Ronkonkoma station. Part of T. F. Green s success can be traced to its proximity to a commuter rail station, which was capitalized on by creating an enclosed walkway between it and the airport s terminal. Located just 50 minutes from Manhattan via train, the LIRR s Ronkonkoma station sits at the northwestern edge of Long Island MacArthur s property, separated only by 39 acres of county and town owned surface parking lots. If Long Island MacArthur Airport s terminal were relocated to this location, the airport could offer Long Island and New York City travelers the only one seat airport connection in the entire region, an advantage that would make MacArthur a significantly more attractive option for both business and leisure travelers alike. To accomplish this, Long Island MacArthur Airport, Suffolk County and the Town of Islip should engage the public and the Island s business community in a planning process to determine how the relocation and redevelopment of the entire 39 acre site could best serve all constituencies, especially in light of the soon to be developed Ronkonkoma HUB to the north of the station. Understanding that relocating the terminal is a long-term endeavor, it is recommended more immediate steps be taken to capitalize on the MacArthur s proximity to Ronkonkoma station in the short-term. Establishing a reliable and frequent shuttle 20

service between the station and terminal would help boost airport business while plans for, and construction of, a new terminal play out. The ease of access created by such a service should be included as a selling point in the marketing campaign contemplated in recommendation #1 of this study. While creating connectivity to the LIRR station would help attract travelers from New York City and elsewhere, it would not, in and of itself, increase usage from the businesses that already exist on Long Island. In addition to the businesses surrounding MacArthur Airport, Brookhaven National Laboratory, Cold Spring Harbor Laboratory, Stony Brook University, the Hauppauge Industrial Park and Route 110 Corridor are all major employment centers in proximity to MacArthur Airport that represent potential consistent businesses air travelers. Existing plans to modernize mass transportation options along Suffolk s major employment corridors and between major employers (MacArthur Airport included) should increase connectivity among these resources sufficiently to boost local business utilization of MacArthur s services as well Recommendation Three: Attract Business and Business Travelers to Long Island MacArthur Airport and Expand Islip Town Foreign Trade Zone T. F. Green Airport is, in part, successful because the businesses that surround it are those that utilize its services, both in terms of shipping product and for business travel itself. The analysis of businesses surrounding Long Island MacArthur shows that the same is not true here. To remedy this, it is recommended that a reexamination of zoning and other incentives, including Islip s Foreign Trade Zone be conducted to see if it s possible to attract more businesses to the area that would become mainstay consumers of the airport s services. In addition, while waiting for Long Island MacArthur Airport s terminal to be relocated as described in Recommendation #2, the opportunity would exist to redevelop the existing surface parking lots surrounding the terminal. When and if the terminal is relocated, the vacated terminal space would be added to the redevelopment plans. To ensure these assets were developed to their highest and best uses, it is recommended proper planning take place that incorporates input from the County, 21

Town of Islip, residents, and the business community. It would stand to reason that creating a business park comprised of businesses that would generate usage for MacArthur Airport would make sense. Increased air travelers are essential in attracting major air carriers to Long Island MacArthur Airport. Summation The goal of this study is not to increase the capacity of the airport but to maximize the assets currently in place. Long Island MacArthur is an economic development asset that just can t be underutilized or wasted. If implemented, the preceding recommendations would go a long way toward addressing the airport s current challenges. Furthermore, it would get Long Island MacArthur airport on the path to become a major economic engine for Suffolk County and Long Island. 22

APPENDIX A: REGIONAL AIRPORT STATISTICS AND RESOURCES The information in Table 6 and the resulting analysis has been developed from the following detailed information for the airports in this analysis; Long Island MacArthur Airport, Westchester Airport, T. F. Green Airport (Thomas Francis Green), and Steward International Airport. Long Island MacArthur Airport Vitals: Airport Code: ISP 52 Miles to JFK Airport Surrounding County: Suffolk County. Suffolk County Population (2014): 1,502,968 Foreign Trade Zone #52 The Foreign Trade Zone has 435,000 square feet of prime warehouse and office space located on fiftytwo acres of land. There is direct access from the Foreign Trade Zone into Long Island MacArthur Airport. The complex is situated along the well known Veterans Highway business corridor; an area abundant with restaurants, fine hotels, and world class recreational opportunities. The Welcome Center is located at 1 Trade Zone Drive, Ronkonkoma, New York. Additional acreage is available for development. Ownership and Access: Publicly owned, Open to public Owner: Town of Islip 655 main st Islip, NY 11751 631-467-3300 Manager: Robert Schaefer Attendance Schedule: Open all months, days and hours Address and Location: 100 Arrival Avenue, Ronkonkoma, NY 11779 www.macarthurairport.com (631) 467-3300 FAA Region / ADO Code: AEA NYC Airport Latitude: 40-47-42.9000N ESTIMATED Airport Longitude: 073-06-00.8000W Airport Elevation: 98.7 SURVEYED Size: Acreage: 1,311 Non-Commercial Landing Fee: NO Runways: Macarthur has four runways and two helipads. The runways are: 6/24 (length of 7,006 and width of 150 ); 10/28 (length of 5,034 and a 23

width of 150 ); 15L/33R (length of 3,175 and a width of 75 ) and 15R/33L (length of 5,186 and a width of 150 ). Public Transit Access: - The Long Island Railroad (LIRR) has one of its main hubs the Ronkonkoma Station--located just one mile to the north of MacArthur Airport. It offers hourly service to and from New York City. - Suffolk Bus Route S57 Carriers: Parking: Based Aircraft & Operations: Southwest, U.S. Airways Express Short, Long, handicapped and residential parking available Based Aircraft: Single Engine (SE): 135 Multi Engine (ME): 16 Jet (J): 51 TOTAL FIXED WING: (SE + ME + J) 202 Helicopters: 23 Gliders: 0 Military: 8 Ultra-Light: 0 Operations for 12 months ending: 12/31/2013 Air Carrier: 9,953 Air Taxi: 8,853 General Aviation Local: 44,924 General Aviation Itinerant: 41,547 Military: 1,661 TOTAL OPERATIONS: 106,938 Airport Performance: Summary Data (U.S. Flights Only) Passengers* 2014** 2015** %Chg Rank*** Arrival 669k 636k -4.93% 102 Departure 666k 630k -5.35% 103 Scheduled Flights Departures 7,257 6,427-11.44% 156 Freight/Mail (lb.) (Scheduled and Non-Scheduled) Total 1,685k 1,649k -2.10% 218 Carriers Scheduled 7 6-14.29% Scheduled enplaned revenue passengers. ** 12 months ending February of each year. *** Among 823 U.S. airports, 12 months ending February 2015 Carrier Shares for March 2014 - February 2015 Carrier Passengers Share Southwest 1,164 91.94% 24

Piedmont 69.02 5.45% Wisconsin 22.19 1.75% Allegiant 6.72 0.53% Peninsula 3.71 0.29% Other 0.36 0.03% Based on enplaned passengers(000) both arriving and departing. ISP On-Time Performance Summary (Major U.S. Carriers Only) Domestic Flights, 2010-2015 % On Time 2010 2011 2012 2013 2014 2015* Rank** Departure 81% 85% 84% 78% 74% 77% N/A Arrival 76% 80% 79% 71% 68% 70% N/A Avg Delay (min.) Departure 46.59 64.14 64.04 46.56 61.33 59.67 N/A Arrival 46.59 61.38 59.96 51.89 59.85 58.00 N/A % Cancelled Total 2.24% 1.96% 1.13% 1.40% 2.08% 0.22% N/A Number of Flights Total 7952 7499 5936 4985 4959 3589 N/A Number of Reporting Carriers Total 1 1 1 1 1 1 * April 2014 - March 2015. ** Ranked only for major U.S. airports, April 2014 - March 2015. Financials: In 2010, the NYS Department of Transportation conducted a study to evaluate aviation s contribution to New York state s economy. Four components of economic impact were measured for the calendar year 2009 25

In 2009, the airport s economic impact was measured through surveys that revealed 4,870 full- and parttime jobs and nearly $399.1 million in direct expenditures are a result of on-airport businesses, including airport management. Visitor spending is added to this impact to derive the total economic activity at the airport. Including indirect expenditures, the total impact for Long Island MacArthur Airport was $577 million, supporting 6,085 jobs. By way of definition for DOT 2010 airport study, direct impacts are associated with providers and users of services at the airport. They are immediate consequences of airport economic activity. The value of direct impacts is the sum of all payroll, capital expenditures, operating and maintenance costs, taxes and fees 26

incurred by providers and users of services at the airport. Direct impacts include the employment and expenditures related to on-airport contracted employees such as construction workers or contracted air traffic control employees. Direct impacts also include off-site economic activities that are attributable to the airport. The value of these impacts is the sum of the fees and charges paid, time and cost savings, expenses related to food, lodging, ground transportation and similar outlays. Indirect impacts are those impacts resulting from the recirculation of direct impacts within the economy. Recirculation of direct impacts within an economy is frequently referred to as the multiplier effect. For example, as an airport employee spends his or her salary for housing, food or services, that spending circulates through the economy and leads to increases in associated spending, payroll, and employment throughout the local community and region. Regions that are more economically self-sufficient have higher re-spending "multipliers" than do regions that are more dependent on regional imports, since less of the money is siphoned out of the community for goods and services. Sources: U.S. Census 2014 Population Estimates FAA info: http://www.gcr1.com/5010web/airport.cfm?site=isp&cfid=12930874&cftoken=52363798 http://www.macarthurairport.com/ http://www.transtats.bts.gov/airports.asp?pn=1&airport=isp&airport_name=islip,%20ny:%20long%20is land%20macarthur&carrier=facts https://www.dot.ny.gov/divisions/operating/opdm/aviation/repository/nysdot%20ei%20brochure%201 50_1.pdf Airport Website: www.macarthurairport.com http://www.suffolkcountyny.gov/business/importandexportassistance.aspx + http://www.ftz52.com/about PROPERTY SURROUNDING LONG ISLAND MACARTHUR AIRPORT The following illustrations present properties owned by Suffolk County and the Town of Islip that can be redeveloped and brought up to a higher and better economic development use. They are the 39 acres owned by Suffolk County and the Town of Islip compost facility. Approximately 30 acres is used for 3,200 parking spaces of which the Town of Islip is responsible for maintenance. If the 30 acres are not used as a parking lot the land reverts back to Suffolk County (a reverter clause exists). These parcels also include another approximately 9 acres of property owned by Suffolk County. This will add to the significant economic development activity that is planned for the north side of the Long Island Rail Road tracks around the LIRR's Ronkonkoma train station, near Long Island MacArthur Airport. The Town of Brookhaven has approved what will eventually be a $538 million investment in the Ronkonkoma Hub. When fully developed, the hub is expected to have 27

approximately 1,450 apartments and 545,000 square feet of retail and office space on approximately 50 acres. Because of their transit-oriented location with the Long Island Railroad and the proximity to the Ronkonkoma Hub, the adaptive reuse of the Suffolk County property should be evaluated so they can benefit Long Island MacArthur Airport by creating a transit hub. This transit hub would integrate well with relocation of the Long Island MacArthur Airport terminal similar to the transit oriented transportation hub benefiting T. F. Green Airport passengers. MTA property in Ronkonoma Ronkonkoma Rail Yard Addition Land where rail yard is expanding. MTA Property at Ronkonkoma PR Land transferred from SC to MTA for yard expansion Key: Red Ronkonkoma Hub Project Area Light Blue Land owned by Suffolk County. Town of Islip is responsible for maintenance. If they chose not to use it as a parking lot, the land gets reverted back to County (a reverter clause exists). Roughly 30 acres; approx. 3200 parking spaces. Light Purple Suffolk County owned land. Roughly 9 acres. Blue Registers as Null for ownership in Suffolk County Tax Records. Being used by LIRR for Mid Suffolk Yard for train yard expansion. The project will build 11 more tracks South of the Existing Rail yard in the Town of Islip, North of Railroad Ave. Green Compost facility owned and operated by Town of Islip 28