SMA: Increase in landing fees caused airfare increase

Star Marianas Airlines Inc. has recently announced that it will be increasing its ticket prices and according to the airline, the Commonwealth Ports Authority’s recent increase in rates is to blame.

Last Tuesday, SMA sent out an announcement informing members of the CNMI community that effective Oct. 1, they will be implementing new fares for all their flights.

Based on the announcement. starting Oct. 1, Star Marianas will increase its Saipan-Tinian fare from $65 to $85.

For Saipan-Rota, tickets will increase from $130 to $175 for those who opt for assisted booking while online booking will increase from $120 to $165.

As for SMA’s Rota-Guam flights, assisted booking tickets will increase from $140 to $200, while tickets booked online will increase from $140 to $190.

According to a statement from SMA president Shaun Christian, the implemented increase in fare prices is a direct result of CPA’s decision increase its fees and rates come FY 2024.

“This exorbitant increase places an unjust burden on both airlines and passengers, driving up airfare prices and making travel to and within the CNMI significantly more expensive. One of the most concerning aspects of this unilateral decision by the CPA is the absence of cost controls on the organization’s expenditures,” he said.

“It is imperative that the CPA reevaluates its decision and works collaboratively with the airline industry to establish a fair and sustainable pricing structure that benefits all stakeholders. The future of air travel to the CNMI depends on it,” Christian added.

Meanwhile, in a statement from CPA board chair Kimberlyn King-Hinds, she said for SMA to blame CPA for its need to increase fare prices, they must first have to be making their aviation payments to CPA.

However, to date, King-Hinds said SMA still owes CPA $5,238,552.68 in aviation payments.

“CPA rates have remained the same since 2008 until CPA adopted the new rate methodology in October 2021. Throughout this period and while CPA rates remained the same, SMA raised their fares five times and blamed CPA. SMA is a business. They must adjust fares to cover their operational costs. CPA must also generate the revenues it needs to be able to keep the airports open. The fact is, SMA has stopped making aviation payment since 2015. As of July 31, 2023, SMA owes CPA $5,238,552.68 which includes interest. For this fiscal year as of July 31, 2023, SMA has only paid CPA a total of $34,628.11 for lease payments, utility charges, and miscellaneous fees such SIDA Badges and fingerprinting services. For SMA to blame CPA for its increase in fare price, they first must be paying CPA. The fact is, they have not. So how can SMA blame CPA for their increase in fares when they haven’t been paying for their aviation fees?” she said.

According to Saipan Tribune archives, CPA recently adopted a 90% increase in landing fees for both the Saipan airport’s main terminal and the commuter terminals for Saipan, Tinian, and Rota.

In addition, the CPA board also adopted a 79% increase in its current terminal rental rate for both the Saipan International Airport’s main terminal and for the commuter terminals for Saipan, Tinian, and Rota.

With the newly adopted budget, the CPA terminal rental rates for the Saipan International Airport’s main terminal goes up from $19.49 per square foot to $34.92. Meanwhile, the terminal rental rates for all CNMI commuter terminals is now up from $7.79 to $13.97.

As for landing fees, with the 90% increase, CPA will now be charging international airline carriers $15.25 per thousand pounds of certified maximum gross landing weight of the aircraft; they were previously being charged $8.01. As for CNMI commuter terminals, the 90% increase would bring landing fees up from $4.81 to $9.15.