The Fort McMurray International Airport is receiving $15 million from the municipality to help them rebound from the COVID-19 pandemic.
Wood Buffalo council met virtually on Tuesday where they unanimously approved providing the Airport Authority a sustaining grant which will come directly from the emerging reserves fund.
A lack of revenue from air travel and from businesses which operate at the terminal has forced the FMAA to dip into their own reserve fund.
RJ Steenstra, CEO of the Airport Authority, says they currently have around $11 million in the reserve, however, they’re on pace to drop down to zero by 2023.
“It puts us into a very unsustainable position and we would have to look at some fairly significant, drastic action that would be able to continue the airport going forward.”
According to the FMAA, they saw a 50 per cent drop in traffic from 2015 to 2019 when compared to its busiest year of 2014. Air traffic dropped an additional 61 per cent in 2020.
This drop has resulted in a roughly 66 per cent decrease in revenue for the airport.
The pandemic has also had a big impact on the local businesses who operate in the terminal.
Stu Wigle, the Managing Partner at both Earls locations, noted the Airport Authority changed the way they pay rent to help them stay afloat.
Instead of a monthly fee, they changed payment to a certain percentage of revenue they get at the airport location.
“If it wasn’t for the help from the Airport Authority we would actually be down as a business, we would have had to close up our doors. We just don’t have enough in reserve and capital to continue going.”
Wigle, along with Fort McMurray Wood Buffalo Economic Development & Tourism and the Fort McMurray Chamber of Commerce, argued the funds would give the airport a head start in its rebound from COVID.
Steenstra noted these funds will help them over the next three years. This does not account for another spike in the pandemic.
Along with the $15 million from the municipality, the FMAA has recently been approved for $1.6 million from the federal government. They’ve also applied for an additional $1.3 million from the government of Canada.
They’re also in talks to only pay interest rates on their debt, which currently sits at $173 million, over the next three years. This would also free up extra funds to help with the recovery.
“This problem does not go away even if its not supported… I see this, once again, as an investment in one of the showcases of this region,” added Mayor Don Scott.
If things continue to trend upwards, the Airport Authority expects to be back to a sense of normalcy by 2024.