NMI airports incur $100K-plus deficit

The CNMI’s airports incurred a more than $100,000 budget deficit during the first four months of the fiscal year following the pullout of Japan Airlines from Saipan.

The deficit totaled $101,516, as total airport revenues dropped to over $3.67 million from $4.29 million during the same period in the previous fiscal year.

Higher expenditures in personnel and operations and maintenance also contributed to the deficit.

Commonwealth Ports Authority data show that total airport expenses during the period increased to $3.77 million from the previous fiscal year’s $3.13 million.

The Saipan International Airport only achieved a net income of $300,341—nose-diving by 81 percent from the previous fiscal year’s $1,6 million.

Aircraft landings at the airport went down by 147 from the previous fiscal year’s 5,973, following JAL’s pullout.

The JAL pullout significantly reduced the Saipan airport’s departure totals from 200,147 to 172,110; passenger arrivals also dropped significantly from 197,737 to 167,633.

Those developments impacted aviation and concession revenues, which dropped by 20 and 21 percent, respectively, by ending only at $2.11 million and $794,933 after the four-month period.

Conversely, the Saipan airport’s maintenance and operating expenses during the period jumped by 36 percent from $764,197 to more than $1 million.

Personnel expenses also increased from $1.78 million to $2.04 million, with the retirement of nine employees, including former CPA executive director Carlos Salas.

The CPA said, though, that it is implementing cost-cutting measures to cope with tough economic times. It remains optimistic that the trend will not continue, as Northwest Airlines plans to bring in an additional flight in April.

The CPA also cited efforts for air route development and an “open skies” policy, recently retaining the services of a Washington D.C.-based law firm to undertake the petition before the U.S. Department of Transportation.

The CPA has contracted the services of Hogan & Hartson L.L.P. to represent the authority in petitioning the Transportation Department for expanded air services to the CNMI.

CPA executive director Lee Cabrera said that an “open skies’ policy will enhance air traffic to Saipan.

Under the present situation, Cabrera explained that a foreign aircraft that lands in a U.S. airport has to exit to a foreign port and cannot head directly to that of another U.S. territory or jurisdiction under the current policy. This means, for instance, that a foreign aircraft that lands in the CNMI may not head to Guam or vice-versa.

Cabrera said an open skies policy will solve the problem and enhance air traffic to the CNMI.