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Faced with a significant decrease in its passenger traffic and associated revenues, ADM Aéroports de Montréal, like other Canadian airport authorities, has been compelled to announce an increase in the airport improvement fees (AIF) charged to departing passengers at YUL Montréal-Trudeau Airport. The AIF, used exclusively to fund infrastructure projects essential to maintaining safe operations at YUL, will increase from $30 to $35 effective Feb. 1, 2021.
“While a major budget rationalization exercise has reduced our capital budget to the strict minimum for the coming years, significant amounts have had to and will continue to be made available annually to ensure that our airport site complies with current safety and security regulations and requirements,” said Philippe Rainville, president and CEO of ADM Aéroports de Montréal. “ADM has a duty to ensure that its facilities are upgraded and we will never compromise on this. In the current context, we have no choice but to proceed with this $5 increase, which will partially offset the substantial cash shortfall that will be created by this crisis.”
It should be noted that ADM is a not-for-profit, non-subsidized organization, generating its revenues on a user-pay basis. The data currently available suggest a minimum 71 per cent decrease in passenger traffic at YUL for the current year compared with 2019. For the year 2021, a decrease of at least 50 per cent is anticipated, again based on the same reference year. The increase in AIF is expected to generate additional revenues of $20 million in 2021.
The last AIF increase at YUL was in April 2018 and came after an eight-year freeze on fees.
I always, perhaps naively, assumed that “Airport Improvement” fees were intended for actual “airport improvements” and not as some kind of bail out fund for airports when revenues fall below expectations. Yes, the airports are facing tough times, but so is everyone else. This will be viewed as a very unpopular move by the diminishing flying public and a further disincentive to fly. I would not be at all surprised if airports who chose this course of action face legal challenges from consumer organizations seeking to establish what are “proper” and “improper” uses of Airport Improvement Fees.