# August 2, 2011

Funding to Support the Marketing of New Air Service at Lakeland Linder Regional Airport at Lakeland, Florida Sponsor: Lakeland Linder Regional Airport

Eugene B. Conrad III, C.M. Airport Director Congressional Code: FL

- 12
Dun & Bradstreet Number: 020 997912 Tax Identification Number (EIN): 59

- 6000354 

# LAKELAND LINDER REGIONAL AIRPORT Lakeland

, Florida
Proposal Under the Small Community Air Service Development Program Docket DOT

- OST

- 2011

- 0119Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 2

TABLE OF CONTENTS

Introductory Letters of Support 3 Summary Information

– Appendix C 4
Introduction 6
The Lakeland Linder Regional Airport Air S ervice Market 8

Location, Catchment Population and Air Service Airports 8
Current and Historical Service 9 Central Florida Top Domestic Market Average Fares 12
Central Florida Carrier Market Share 13 Air Service Development Efforts 14
Air Service Needs and Deficiencies 16 Identifying the Air Service Deficiencies 16 The need for Improved Central Florida Air Service 18 Alternative Airports 21 Strategic Plan for New Air Service 22

Goals and Objectives 23 Many Steps Have Already been Taken 23 A Modern, Convenient and Low Cost Airport Terminal Facility 23
Low Costs for Airlines 24 Local Support via Public Private Partnership 24 Grant Funding Plan 25 Grant Application Target Audience 26 The Economic Impact of New Grant Supported Service 27 Grant Use Timeline and Measuring Progress toward Goals 28 Grant Application Legal Sponsor 30 Summary 31
Appendix A: Domestic Cities w ithout Nonstop Air Service to Central Florida: Year 2010 3 3 

### Section Page NumberLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

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INTRODUCTORY LETTER OF SUPPORTLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

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SUMMARY INFORMATION

– APPENDIX C

Small Community Air Service Development Program
Docket DOT

- OST

- 2011

- 0119



### A. Applicant Information

Not a Consortium Community now receives EAS subsidy
Interstate Consortium Intrastate Consortium Community previously received a Small Community Grant If previous recipient, date of Grant: ________________________________ Expiration date of G rant:

_______________________


### B. Public/Private Partnership

Public:
1. The Lakeland Linder Regional Airport 2. The City of Lakeland, Florida 3. Polk County 4. Central Florida Development Corporation of Polk County

Private:
1. Polk Vision 2. Lakeland Area Chamber of Commerce 3. Lakeland Economic Development Council 4. Columbia Air Services



### C. Project Proposal

Marketing Upgrade Aircraft New Route
Travel Bank Service Restoration Subsidy Surface Transportation Regional Service Revenue Guarantee Launch New Carrier Start

- Up Cost Offset First Service Study Secure Add itional Service Other (Specify)Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

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D. Existing Landing Aids at Airport

Full ILS Outer/Middle Marker Published Instru ment Approach
Localizer Other:



### E. Project Cost

1. Federal amount requested: $ 35 0 ,000
2. State cash financial contribution: $ 0
Local cash financial contribution:
3a. Airport cash funds: $ 0
3b. Non

- Airport cash funds: $ 70,000
3. Total local cash funds: $ 0
4. TOTAL CASH FUNDING: $ 0
In

- Kind Contribution:

a. Airport In

- Kind contribution: $ 0
b. Other In

- Kind contribution: $ 0
5. TOTAL IN

- KIND CONTRIBUTION: $ 0
6. TOTAL PROJECT COST: $ 420,000



### F. In

- Kind Contributions

For funds in lines 4 a (airport in

- kind contribution) and 4 b (other in

- kind contribution), please describe the source(s) of fund(s) for each.

__________________________________________________________________________________ 

### G. Is Application Subject to Review by State Under Executive Order 12372 Process?

This application was made available to the State on ______. Program is subject to review, but has not been selected by the State. Program is not covered.



### H. Is Applicant Delinquent on any Federal Debt?

NoLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

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INTRODUCTION

The Lakeland Linder Regional Airport is the newest commercial service airport in the Un ited States. The Airport and its community supporters are proud of their hard work and financial
commitment

, which resulted in Lakeland‘s new air service.

The Airport is the lowest cost facility in Central Florida and its location, right between Orlando
and T ampa and along Interstate I

- 4, means it has enormous potential to introduce new and low
fare air service from cities nationwide to Central Florida.

With commercial service now in operation, the Airport wishes to ―take the next step‖ and develop an aggress ive and comprehensive air service marketing program . This program would promote Lakeland as the best, most convenient and lowest cost air service airport in Central Florida, for inbound tourists and for local residents.

While the Orlando and Tampa areas have a significant level of low

- fare air service, some cities and entire regions of the United States still lack any nonstop service to Central Florida and have average fares significantly higher than do cities in their pe er group.

The Small Community Air Service Development Grant program was designed for precisely this situation. In this Grant application, the Airport and its supporters propose to match $350,000 in grant funding with $70,000 in a local cash match. The tot al of $420,000 in dedicated air service marketing funds will enable the Airport to provide marketing and advertising support for new air
services from cities that do not currently have nonstop and low fare service to Central Florida.

The Airport and its s upporters would use Grant funding in coordination with both the existing air service provider (Direct Air) and other carriers that are currently being recruited . There is a significant opportunity to grow Lakeland Linder air service to a critical mass at w hich it can complement existing service at the two Orlando airports and the two Tampa Bay area airports.

The Orlando

– Tampa corridor in Central Florida contains some of the most popular tourism attractions in the world, including Disney World, SeaWorld , and the incredible beaches of the Gulf of Mexico at Tampa Bay and St. Petersburg.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 7

The region draws millions of domestic and international tourists per year , from Boston and from Binghamton, from Washington D.C. and from Williamsport

, from St. Louis and from Springfield,
and from every big and small city in between . People love to vacation in Central Florida.

Domestic air service to Central Florida is focused at Orlando International and at Tampa International, with somewhat less ser vice and traffic at Orlando Sanford and St. Petersburg. The two Orlando area airports clearly serve that city and region, the two Tampa area airports the Bay area and the gulf beaches.

The Lakeland Linder Regional Airport is located right between Orlando and Tampa and just off
of Interstate I

- 4. It is the only airport in Central Florida that truly serves the entire region. Lakeland Linder is actually closer to Disney World and SeaWorld than is Orlando Sanford. Downtown Tampa is less than a 45 minute drive and the beaches of St. Pete are an hour or less.

Capitalizing on this strategic location, the Lakeland Linder Regional Airport, in partnership with the FAA, the City of Lakeland, and the State of Florida, committed $9. 8 million dollars over the past seve ral years to d evelop Lakeland Linder as a commercial service airport. Years of hard
work culminated on June 2 3 , 2011
, when the first Direct Air scheduled public charter MD80 took
off for Myrtle Beach.

Now Lakeland Linder is in a unique market position. It is the one commercial service airport that truly provides visiting tourists with easy access to all of Central Florida. This efficiency, the ability to market both the Orlando area attractions and the Tampa Bay area attraction s, has significant potential to open up less

- than

- daily air nonstop service from a host of domestic cities that lack such service today and pay high airfares to access Central Florida.

The new service

, launched on June 23
, is just the beginning of devel oping that potential to bring new nonstop air service and lower airfares to Central Florida from many small and medium sized U.S. cities that currently have no such service and pay high airfares to Orlando or Tampa.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 8

THE LAKELAND LINDER REGIONAL AIR PORT A IR SERVICE MARKET Regional Air Service Data

Location
, Catchment Population and Air Service Airports

The Lakeland Linder Regional Airport is located in central Florida, 32 miles from downtown Tampa and 60 miles from downtown Orlando, all easily accessible via Interstate I

- 4 which is only five miles north of the Airport terminal.

Lakeland Linder represents the single most convenient commercial air service airport in all of Central Florida, putting airport users within a one hour or less drive t ime of the entire Orlando and Tampa Bay metro areas. Some 1.9 million central Florida residents live within a 60 minute drive of the Airport and 4.9 million live within a 90 minute drive. The other area airports, OrlandoLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 9

International, Orlando Sanford, Tam pa International and St. Petersburg, all serve one section of the region. None can compare to Lakeland Linder in terms of accessibility to the entire region.

And the resident population totals do not diminish near the airport. The Airport is within minutes
of downtown Lakeland, population 92,796, and Winter Haven, population 32,577. Polk County, in which the Airport is located, has a population of 574,746. The Lakeland

- Winter Haven MSA has a population of 583,403 and that popula tion has grown 20% since 2000.

In terms of proximity to tourism attractions, the Airport is actually closer to Disney World and
SeaWorld than Orlando Sanford . It is barely 30 minutes drive further from the Tampa Bay area than is Tampa International Airpor t. In short it is one airport that effectively gives tourists easy
rental car access to all of the attractions of Central Florida.



### Lakeland Linder Area Current and Historic Air Service

Commercial air service began at Lakeland Linder just recently

, on Jun e 2 3 . For the summer of 2011 Direct Air has scheduled eight weekly departures to four cities.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

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The first few weeks of service have generated strong passenger traffic with the average number of passengers per flight well over 100 (137 seat aircraft), generating load factors in the 70% to 80% range.

Direct Air‘s winter service package will grow from eight weekly departures to twelve (50%) and the carrier is reporting to the Airport strong winter season bookings.

Obviously the lion‘s share of Central Florida
air service is at the Orlando International and Tampa International airports.

Orlando International has 64% of the region‘s domestic traffic while Tampa International has 32%. These two airports also have 44% and 30%

, respectively

, of the nonstop domestic routes flown from Central Florida. The two large airports combine to have 97% of the region‘s seats. TheLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 11

St. Petersburg and Sanford Airports, on the far western and eastern fringes of the region, have about 2% each of traffic and seat capacity.

Overall Central Florida traffic and capacity (the combination of Orlando International, Tampa International, Orlando Sanford and St. Petersburg) i s down in 2010 compared to previous years.



### Central Florida Combined Domestic Traffic, Capacity and Average Fare

Central Florida traffic and capacity peaked in 2007. Capacity is down 13% since 2007 while traffic is down 10%. Average fare is up 5% since 2007 and 11% since 2003.

Philadelphia is the largest domestic O&D market for the combined Central Florida airports. Twenty five of the top thirty markets are east of the Mississippi River. All of the top thirty have nonstop service to both Orlando MCO and Tampa TPA airports.

77,102 85,092 89,882 89,280 94,242 90,546 82,051 81,532

50,191 56,583 61,702
61,999 64,375 61,937 58,036 57,668

$114

$110 $112 $123 $121 $128

$117 $127

$100 $105 $110 $115 $120 $125 $130

0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000

2003 2004 2005 2006 2007 2008 2009 2010

Seats per Day Each Way Traffic PDEW Avg FareLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 12

Combined Central Florida Top Markets O&D and PDEW: Year 2010

Central Florida Top Domestic Market Average Fares

The average domestic one way net fare paid in 2010 in all domestic markets for the combined four Central Florida airports was $126.78. Passengers in the combined top thirty markets paid $123.38.

What is noteworthy is that both St. Petersburg and Sanford have significantly lower average fares than their respective neighbors TPA and MCO. The St. Petersburg average fare , at $73, is 47% lower than at Tampa International ($137) while the Sanford average fare , at $78, is 39% lower
than at Orlando International ($128)

.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 13

Average Fares in Central Florida’s 30 Largest O&D Markets: Year 2010

Central Florida Carrier Market Share

Southwest Airlines and Delta Air Lines are the dominant carriers in terms of market share in
Central Florida with a combined share of 55.9%

. Low cost carriers Southwest/AirTran, jetBlue, Frontier/Midwest and Allegiant combined to capture 54.7% of total domestic traffic in 2010.

6.1% 0.5%

10.1%

10.8%

17.0%

1.1% 38.9% 4.6% 2.4% 0.2%

8.5% 

### Central Florida Combined Domestic Market Share: 2010

AA
AS
B6 UA/CO DL/NW F9/YX WN/FL

G4

NKLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 14

LAKELAND LINDER REGIONAL AIRPORT AIR SERVICE DEVELOPMENT

Local Air Service Development Efforts

Within the past five years, the City of Lakeland and LAL have been actively involved in efforts to prepare the airport for commercial service and in pursuing n ew service.

Starting in 2007

, LAL began exploring options for commercial service. Since that time the Airport
has spent nearly $ 5 00 ,000 on consulting and on marketing

.

Specific activities have included:

2007

- 2008
Participated in an extensive process attempting to secure service from Skybus Airlines, including making infrastructure improvements.

2009
Hired new airport director Eugene B. Conrad III, C.M. who has significant experience in recruiting commercial service to small communities including being part of the team that opened Branson Airport, which was the first privately developed and operated commercial service airport in the country.

2010
LAL secured funding for and launched a major project to develop the inf rastructure required to support scheduled service

. LAL recruited Sky King corporate headquarters and maintenance operations to the airport with a key motivation being to establish a base from which they could offer
scheduled charter service

.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 15 In the summer of 2010 the airport funded an air service study

.
In the s ummer of 2010 LAL started holding meetings with targeted communities interested in low fare service to the Central Florida region

. LAL spoke with multiple carriers who are interested in providing ser vice to the market

. LAL held meetings with the FAA Administrator, Randy Babbitt

. LAL created marketing materials to promote the airport and to start preparing the community that commercial service is coming

. In the fall of 2010 LAL held meetings with Direct Air regarding market potential. The carrier committed in the spring of 2011 to serve the market starting in June 2011.

2011

LAL attended the Network Conference in Austin, Texas

, in March of 2011 and met with six
low cost or less

- than

- daily airlines.
Marketing of the new Direct Air service began in earnest in early 2011, with expenditures for the year projected to total over $200,000 across many media venues.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 16

AIR SERVICE NEEDS AND DEFICIENCIES

Identifying the Air Service Deficiency

There is significant airline service , in terms of the number of carriers, nonstop routes and nonstop flights, at the Orlando International and Tampa International Airports. Allegiant Air and other less

than

- daily carriers offer modest low fare nonstop service at Orlando Sanford and St. Petersburg.

Domestic cities that have nonstop service (or concentrated Southwest Airlines one stop service) to any of the Central Florida airports tend to have significant traffic and also have low fares with
that service. Domestic cities that do not have nonstop service to Central Florida have significantly less traffic

, and significantly higher average fares paid

, for travel to Central Florida.

This disparity is clear in the 2010 domestic O&D data for the combined Central Florida airports. The combined Central Florida airports generated some 42,097,370 million O&D at an average fare of $126.78 on an average itinerary of 1,097 miles at an average yield of 11.6 cents. On the
surface a well served market.

Bu t a closer examination shows there are two levels of air service to Central Florida

. S ome 125 cities with nonstop or concentrated one

- stop service enjoy an average fare of $126.78 while an
additional 295 cities have an average fare of $185.82. So
, underneath the overall Central Florida domestic traffic data of 42,097,370 million annual O&D and an average fare of $126.78

, is a clear distinction, with some markets enjoying low fares and other markets suffering high ones.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 17

The disparity in Central Flo rida air service is further confirmed by an examination of domestic cities that gained nonstop Allegiant Air service to Central Florida in the period 2003

– 2010.



### Orlando PDEW and Average Fare in 29 Allegiant Cities: 2003

– 2010

These 29 cities ga ined Allegiant Air nonstop service to Orlando over a several

- year period beginning in late 2006. Measured over the period from 200 6 to 2010
, Orlando traffic in these 29 cities grew 76 % while average fare dropped 32 %.



### Tampa PDEW and A verage Fare in 20 Allegiant Cities: 2003

- 2010Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 18

Allegiant added service from twenty domestic cities to St. Petersburg in the 2007

– 2010 period. Comparing 2006 to 2010, traffic grew 111 % while average fare dropped 38 %.

So there are deficiencies in domestic air service in Central Florida. The roster of domestic markets falls into two groups; one with nonstop or concentrated one

- stop service and resulting low fares and another with only connection service and high average fares that di minish traffic demand. While many examples are possible, below are six pairs of nearby cities, with one city in each pair lacking nonstop Central Florida service and the other city having that service.

These six examples, out of many, illustrate that hig h fares and deficient service do exist in some
Central Florida markets. A complete list of domestic markets with no nonstop service to Central Florida is in Appendix A of this document.



### The Need for Improved Central Florida Air Service

Less

- than

- daily air service at Sanford and St. Petersburg has demonstrated the ability to stimulate travel demand for Central Florida. The vast majority of travelers on less

- than

- daily flights to Central Florida airports are leisure visitors and tourists.

Tourism is a major element of the Central Florida economy. It is also a major element in the local economy around the Lakeland Linder Regional Airport. In Polk County alone

, tourism has an estimated annual economic impact of $1.1 billion. Tourism support ed more than 21,000 Polk County jobs in 2009. Visitors paid more than $31 million in sales taxes in Polk County. Lakeland is home to 37 area hotels and motels offering 3089 rooms. Within Polk County, there are 7,100 rooms in approximately 111 hotels and motels. The traditional tourist season runs JanuaryLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 19

through March with an average occupancy rate of 60% and an average daily room rate (―ADR‖) of $77.00. Obviously, this is an average of all Polk County hotels and motels. They have some properties tha t run an average of 84% in peak season. Off peak season would be from April through December, where the occupancy runs about 38% on average with an ADR of $61.00. Again

, however, in Lakeland, there are several properties that run a much higher
occupancy rate and their ADR is $65.00

-- $71.00.

Polk County is unique in that it also offers approximately 7,200 vacation rental homes on the east side of the county near Disney World. These homes account for 52% of the annual bed

- tax collections. Their peak seas on is summer.

With significant hotel and rental home inventory with low daily rates and low occupancy, Polk County has tremendous potential to emerge as a low cost base for tourists wanting to access the attractions in the region, and in doing so driving significant economic benefit to the local
economy

.

Last year, Polk County hosted 227 sporting events generating more than $126 million in economic impact alone. Lakeland is the Spring Training home to The Detroit Tigers and the
annual home to their Clas s A team, The Flying Tigers. Together, they generate about $50 million in economic impact. During 2010 the Detroit Tigers

, at Joker Marchant Stadium in Lakeland

, held a total of 15 Spring Training games with a total attendance of 112,560, averaging 7,504 per game. The largest crowd ever recorded was Saturday, March 27
, when the Tigers played The
N.Y. Yankees.

The Lake Myrtle Sports Complex is home to the Florida Youth Soccer Association

— bringing thousands of young soccer players to the area each year an d the Russ Matt Central Florida Invitational, which brings more than 200 collegiate baseball teams to the area each March.

The Lakeland Center, a four

- building multipurpose entertainment complex in Lakeland is home to many diverse performing arts program s, including the Lakeland Broadway and Entertainment Series, t he Imperial Symphony Orchestra, t he Lakeland Concert Band, and various contemporary performances by professional artists. The venue also features 100,000 square feetLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 20

of state

- of

- the art exhibit space for meetings and conventions and an arena that is the ideal location for many state, regional and national championships. In February and March alone, more than 100,000 fans from around the State of Florida enjoy the Florida High School Athletic
As sociation State Wrestling and Boys and Girls State Basketball Championships. These numbers account for more than $6 million in direct economic impact each year.

Lakeland is home to Explorations V Children‘s Museum, Florida Air Museum, Sun  ̳n Fun Fly

- In, the largest single

- site collection of Frank Lloyd Wright Architecture, the Florida Dance Theatre, t he Harrison School for the Arts, the Imperial Symphony Orchestra, T he Lakeland Community Theatre, Polk Museum of Art, and last but certainly not least, one o f only three surviving atmospheric
theatres left in the state

— t he Polk Theatre. The Historic Polk Theatre opened in 1928 as a vaudeville and movie house and is now in the National Register of Historic Places, along with many other historic locations in downtown Lakeland, including the Lake Mirror Promenade and
The Terrace Hotel.

Each year, Lakeland provides access to a number of top tourist destinations and attractions. Bok Tower Gardens, Fantasy of Flight, Disney World and Busch Gardens are all within an hour‘s drive of Lakeland. LAL is within an hour‘s drive of eight Spring Training Major League teams. The Annual Sun  ̳n Fun Fly

- In brings in approximately 160,000 international, national, regional and
statewide visitors to Lakeland and the entire Polk County area each Spring for a week long aviation convention. Mayfaire

- by

- the

- Lake, in Lakeland, has grown into a regional juried art show that showcases more than 200 artists‘ displays along the shores of Lake Morton each Mother‘s Day weekend. It brings in about 35,000 annual visitors. Florida Southern College offers, in addition to the largest single

- site collection of Frank Lloyd Wright Architecture with the ―Child of the Sun‖ Collection, the Annual Festival of Fine Arts program featuring such internat ional artists as The Moscow Festival Ballet! The Lakeland Annual Pig Festival each January brings 30,000 visitors to sample more than 300 BBQ teams ‘ finest food. In April, downtown Lakeland introduces the Florida Outdoor Sculpture Celebration and in Octo ber, more than 25,000 visitors enjoy 500
show vehicles in the Lake Mirror Classic Auto Festival.

In the f all of 2011, LEGOLAND is scheduled to open in Polk County. The attraction represents a $150 million dollar investment for the first three years, wi th another $150 million dollar investment scheduled for the next three years. The second offering will include a resort hotel andLakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 21

conference center, a water park, and a Sea Life Aquarium. LEGOLAND has been recognized by Amusement Today as the Country‘s b est theme park for children for the 6th consecutive
year.

New nonstop less

- than

- daily air service at Lakeland Linder will clearly bring more tourists to Central Florida. These new tourists will improve the struggling economy of the region. Polk County
has been one of the hardest hit by the recession. In May of 2011 t he national unemployment figure was 9. 2 % and the Florida unemployment rate was 1 0.6 %. The Polk County rate was also 10.6% . In a recent Florida Trend Article regarding poverty rates in the subu rbs, Lakeland had the
fifth highest suburban poverty rate in the nation in 2008. According to a Brookings Institute study, 75,000 people in Lakeland‘s surrounding suburbs

— or 15.8% of the population

— live below the poverty level of $21,834 for a family of four. Within Lakeland‘s city limits, meanwhile, 12,182 people, or 13.3% of the population, live in poverty.

In short, the community is in need of the economic benefit that would come from new less

- than

daily air service at Lakeland Linder. The community and City have shown their confidence in the potential for the service by investing a significant amount of resources in the improvements noted above and in supporting this grant application.



### Alternative Airports

Residents of the area around the Lakeland Linder Regional Airport, in nearby Lakeland, Winter Haven and throughout Polk County, do have access to alternative air service at Tampa International, Orlando International, St. Petersburg and Orlando Sanford.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 22

A STRATEGIC PLAN FOR EXPANDED LAKELAND AIR SERVICE
S TRATEGIC PLAN FOR NEW AIR SERVICE
The strategic plan for Lakeland Linder Regional Airport commercial air service began in 2007 with a local commitment by the Airport, the City of Lakeland and interested citizens to creating commercial air service at the Lakeland Linder facility. Concurrent with the large scale infrastructure efforts needed to bring the newest commercial service facility in the country online
were efforts to recruit air carriers to serve it.

All of those effo rts have been rewarded as the first Direct Air scheduled service (public charter) took off from the airport on June 2 3 , 2011. While a baseline of scheduled service is in place to four cities, the Airport and its supporters see great potential for Lakeland Linder, with its optimum Central Florida location, to recruit and support much more air service in the next few years.

For the Airport and its supporters

, the guiding strategic principals in this effort are :

 Develop a convenient, easy to use and low cost airport terminal facility for airlines and
their customers.
 Develop a facility cost

- of

- operation model that permits self

- sustaining operation without burdening airlines with significant per passenger costs.
 Promote the new commercial air service, as it develops , so that local residents know there is new air service in the Lakeland/Polk County area.
 Recruit LTD carriers aggressively, listen to their needs and concerns and respond as possible.
 Build a significant marketing and advertising fund for use in partnership with LTD carriers to support their market entry and address their number one concern

-- how to market
new LTD air service to Lakeland Linder as a superior alternative to the traditional use of nearby Orlando or Tampa area airports.

All of the above strategic principals are in place except for the development of a significant marketing and advertising fund for use in partnership with LTD carriers to address their concern about adequate marketing of Lakeland Linder as a superior alternative to the more traditional nearby airports.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 23

Fundamental Goals and Objectives of the Air Service Development Plan

The Airport and its community supporters have three primary goals in air service development and those goals apply to this SCASD grant application :

 Recruit scheduled air service, and the resulting economic impact, to Lakeland Linder.
 Identify domestic markets that lack nonstop and low fare Central Florida service.
 With robust marketing and promotional efforts

, ensure that new service at Lakeland is
successful.



### Many Steps Have Already Been Taken

The Airport is proud of all the hard work and financial commitment that combined to bring Lakeland Linder to life as a commercial air service airport.



### A Modern, Convenient and Low Cost Airport Terminal Facility

A total of $9.3 million dollars was needed to prepare Lakeland Linder for commercial air service.

The State of Florida invested over $4.0 million dollars in the project, the City of Lakeland over $1.8 million and the FAA over $3.4 mi llion. The result is a n easy to use (for customers and airlines) facility capable of handling hundreds of thousands of passengers on an annual basis.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 24

Low Cost

s for Airlines

One essential ingredient in low cost air service is low cost airport operations for airlines. Lakeland Linder has developed a comprehensive program to ensure that air carriers are afforded the lowest costs possible at the Airport.

The Airport is able to c over a significant portion of its operating costs from non

- airline airport activities. Thus the Airport does not charge any landing fees, terminal rent or fuel storage fees and has no PFC charge.

The Airport has airline ground handling equipment for groun d handling services in order to
minimize carrier costs. In

- to

- plane fuel charges are only $75 per turn.

The Airport intends to develop, as traffic grows, a revenue sharing partnership with its airlines, sharing Airport terminal and passenger related concession revenues in a way that will further lower airline airport cost.

Long term
, the Airport believes that its airline terminal services and infrastructure will be self

sustaining at a very low cost to airlines of about $2 per enplanement.



### Local Support v ia a Public / Private Partnership

The Airport‘s government and private sector partners in air service development include :
The City of Lakeland, Florida (public member)

– The City committed over $2.2 million dollars ($1.8 for infrastructure and $400,000 for studies, recruiting and marketing) since 2007 to the effort to make the Airport ready for commercial air service. The City also provides Crash/Fire/Rescue (ARFF) services and police services for the Airport at no charge.

Polk County ( p ublic member)

– The County actively supports Lakeland Linder development a s part of its overall economic development efforts.

Central Florida Development Co uncil of Polk County ( p ublic member)

– The CFDC is itself a public/private partnership of government and private entities working together to further economic development in Polk County. It has committee $100,000 in 2011 to assist in air service implementation.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 25

Polk Vision ( p rivate member)

– P olk Vision is an association dedicated to establishing and meeting long term goals for economic and social infrastructure development in Polk County.

Lakeland Area Chamber of Commerce (private member)

– The Lakeland Area Chamber of
Commerce is a not

- for

- profit organization representing the interests of its 1,700 business members and facilitating economic growth in the area.

Lakeland Economic Development Council (private member)

– The LE DC is a private non

- profit
association with 175 member co mpanies. The ECDC‘s primary job is to expand economic and job opportunities for area residents and recruit new businesses to the area.

Columbia Air Services (private member)

– Columbia Air Services is a network of full service FBOs. The Lakeland operation provides full FBO services for both general aviation and airline operations at Lakeland Linder.

To complement and guide the public / private partnership the Airport has the Lakeland Linder Airport Advisory Board. The board meets six times a year and holds special sessions if required. Board members represent a cross

- section of the local business community and the airport business group.

Lakeland Linder Airport Advisory Board

Tom Dunn

– Corporate Aviation Rep

– Columbia Air Services

– Director of Fuel Operat ions Robert Knight

- Citizen

- at

- Large

– Knight Industrial Equipment Inc.

– Owner/President
Ken Willaford

- Airport Tenant

– Aeromech, Inc.

- Owner
John Burton

– Citizen

- at

- Large

– Sun  ̳n Fun Fly

- In

- President
Jeff Kincart

– Citizen

- at

- Large

– American C ompliance Technologies, Inc.

– Civil Engineer
Joel Adams

– General Aviation

– Highland Homes

- President
Scott Franklin

– LEDC Rep resentative

– Lanier Upshaw, Inc.

– President and CEO
Gow Fields

– City Commission Representative

- Mayor Justin Troller

– City Commission Representative

- Commissioner



### Grant Funding Plan

The Airport is requesting $350,000 in Department funding. Local non

- airport partners of the airport will contribute $70,000 (a 20% match) for a total Grant funding level of $420,000. The Airport believes a Grant timeframe of two years will be adequate for executing an effective marketing
pro gram in support of new Lakeland air service.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 26

The local non

- airport cash funding of $70,000 will be generated by several local organizations. The Economic Development Councils have committed $55,000 and the City and the local
Chamber and associated businesses will contribute the remaining $15,000.

The City, County, the local Chamber and Economic Development groups have already contributed over $2 .2 million to the multi

- year effort to make the Airport ready for commercial service. The Airport is 100% comfortable that each o f these parties will make good on its modest
contributions to the non

- airport matching funds indicated for this Grant application.

The Airport has over $ 2 00,000 already committed for 2012 for the purpose of air service recruiting and existing air service marketing and promotion. We have not listed this as in

- kind contributions to this application since it is funding the Airport will spend regardless of Grant application award.

This document has already detailed the low Airport cost structure provided to incumbent and new entrant airlines. This is not a fee waiver scenario and, without knowing the operational plan of a specific new service, it is not possible to put any accurate in

- kind valuation (for Grant purposes) on the Airport‘s program for ensuring air service providers have the lowest possible airport costs.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 27

Grant Application Target Audience

Grant funding will be used to promote new air service at the Lakeland Linder Regional Airport. There are four commercial air service airports, of varying size, in the central Florida region around the Orlando and Tampa metro areas.

Lakeland Linder has now become the fifth and is the most centrally located and convenient for tourists wishing to visit the region. It is also the most convenient for residents of Lakeland, Winter Haven and Polk County for outbound travel. However, its existence and convenience are not widely known outside of the immediate Lakeland area.

Thus the target audience for Grant supported marketing and advertising will be both inbound tourists and local residents. The inbound tourist promotional efforts will be focused in the catchment areas of airports in the northern tier, Midwest or mid

- Atlantic area s that gain Lakeland air service. This will be the primary focus of Grant supported m arketing and advertising
efforts.

Depending on what new air service is recruited in 2012

, the Airport may expend, with Department approval, some Grant funding for marketing of new air service to local residents. Just as an example of this, should Lakeland Linder gain nonstop service to Portland, Maine, the Central Florida region generates significant origin traffic to Maine in the summer months as Floridians vacation in Maine, thus some local marketing of that service in spring may be a wise
use of some Gr ant funding.



### The Economic Impact of New Grant Supported Air Service

Visit Florida is the official tourism marketing corporation for the State of Florida. According to their
Research Center in 2010 there were 71.2 million domestic tourists visitors to Fl orida. The average visitor stay was 4.7 nights. This means a total of 33 4 ,640,000 million visitor nights were generated in that year. The Center also estimates that domestic visitors generated $53.3 billion dollars in Florida spending during their visits. This equates to about $160 per day per visitor.

One of the primary goals of the Airport and its partners in developing commercial air service is to
increase tourism visits to the Lakeland area.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 28

The economic impact of one Grant supported new route flown by a less

- than

- daily carrier is significant. The Airport believes that one new route, flown twice weekly year

- round with a 150 seat aircraft at an 80% load factor will conservatively generate near 8,400 new visitors to the Lakeland region. Those new visitors, using average stay and spend patterns according to Visit Florida, will contribute over $3.1 million in tourist spending.

The economic payback from all the effort and spending the Airport and its partners have done to make the airport capable of commercial service is then clear. Also clear is the enormous economic benefit and payback that will occur from the successful use of Grant funding to support additional new air service at Lakeland Linder.



### Grant Use Timeline and Measuring Progress toward Goals and Objectives

The Airport envisions that Grant funding would be available beginning in fourth quarter of 2011. The Airport envisions that new Grant supported air service could then begin , at the earliest, in spring of 2012. Since the lead times for Airlines to make new route decisions can be lengthy, the Airport requests that Grant funding be available for a two year period from the time of Grant
award.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 29

The monitoring and measuring of Grant progress r equires close coordination with the carrier or carriers that are operating the Lakeland routes that are being supported by Grant funding.

The Airport will establish with the airline a baseline of overall revenue targets for each new route. The key is over all revenue, which is a combination of carried load factor and average fare and ancillary revenue. Once revenue targets are established the ongoing monitoring of booking curve activity, actual traffic and actual average fare and ancillary revenue can begin . As airlines have the ability to determine, via zip code, the origin of bookings, it will be possible to see where Grant supporting marketing is having an effect and where it may be ineffective.

All route performance data will be measured against predete rmined goals for bookings and
actual carried traffic and revenue.

The Airport, thru its Advisory Board, will monitor progress on each new route that receives Grant marketing and promotional funding.

In terms of new routes being self

- sustaining, t he Airport recognizes that domestic air service is a very competitive business and subject to many outside factors that can dramatically impact air
service economics.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 30

We believe that, working with our airline partners, we will pick successful new air service routes from Lakeland Linder. The potential for Lakeland Linder to have successful new air service that complements that which exists at the Orlando and Tampa area airports is great. There will be a learning curve to determining which types of markets, lon g haul, short haul, small city, large city etc, will work best.

Thus the Airport recognizes that one or more new Lakeland routes may not be financially successful for the airline. If and when that happens, depending on the depth of the financial
losses an d the carrier‘s willingness to continue the service, the Airport will make the best and most financially sound decision regarding the continuation of Grant funded marketing efforts on
that route.



### Grant Application Legal Sponsor

The legal sponsor of this application is the Lakeland Linder Regional Airport. The Airport Director is Eugene B. Conrad III, C.M.

The contact information for the Legal Sponsor is :

Lakeland Linder Regional Airport

3900 Don Emerson Drive, Suite 210

Lakeland, FL 33811

Contact: Eugene B. Conrad III, C.M.; Airport Director
(863) 834

- 3298Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 31

SUMMARY

Lakeland Linder Regional Airport is the newest commercial service Airport in the nation. The Airport is perfectly located to provide convenient and low cost airport gateway, for both airlines and customers, to the entire Central Florida region.

The Airport and its local partners have worked diligently since 2007 to establish commercial air service at Lakeland. The Airport and community spent over $2.2 million of its own money (primarily infrastructure expenditures so far) and gained $4 million from the State of Florida and $3.4 million from the FAA to do what was necessary to make Lakeland Linder airline

- ready.

The goal of all this hard work is to bring air service to the Airport, air service that will provide a critical economic boost to an area hard hit by the recession. That specific goal was achieved with the first Direct Air scheduled service flight on June 2 3 , 2011. Today four cities have service to
Lakeland Linder.

But the Airport and its partners did not commit all this time and local, state and FAA funding to have air service to four cities. The potential for Lakeland Linder to be the best airport for tourist access to Central Florida is clear. The potential for l ocal Lakeland and Polk County residents to have a convenient, low cost and hassle free neighborhood airport is clear.

While some 125 domestic cities enjoy low fare nonstop service to one or more of the four Central Florida airports, this report has clearl y identified 295 ―other airports ‖ , large and small, that do not have nonstop service to Central Florida. While the average fare paid between Central Florida and these 125 cities was $122.92 in 2010, it was $185.82 between Central Florida and the 295
―other airports‖. This glaring gap suggests Lakeland Linder can serve a valuable role as a single airport gateway (at low costs and with high convenience) for some of these 295 airports to receive their first nonstop service to Central Florida.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 32

Growing the Lake land Linder air service from its current humble beginnings requires a significant expenditure of marketing and advertising funds. This brand new commercial service airport must compete with the powerful identity of four surrounding airports. While Lakeland Linder has better regional access and lower costs, it is not known to the general public outside of the immediate
Lakeland area.

Educating the traveling public about this new airport and all that it offers takes marketing money. Thus the purpose of this Grant application.

The Lakeland Linder Regional Airport respectfully requests the Department‘s careful consideration of this Grant application. Lakeland Linder is the newest commercial service airport in the nation. The Airport and its partners have worke d very hard to make that reality and are committed to its long term success. The significant capital investments of the Florida Department of Transportation and the FAA clearly show both organizations are also committed to Lakeland‘s long term success.

This document has clearly outlined that there are numerous situations of lack of service and high air fares involving hundreds of domestic cities and Central Florida. Lakeland Linder is the one airport gateway for innovative less

- than

- daily carriers to step in and address this service deficiency and fill that air service need.

The modest Grant funding request herein will permit Lakeland Linder to foster additional new air service. This new air service will bring new tourists to Lakeland and Polk County and all of Central Florida. The economic gain from such service is measured in millions of dollars per new route, a significant return on investment from the $350,000 Grand funding request.

This G rant application is precise in its focus and modest in its funding need. The innovation and entrepreneurial spirit that the Airport and its partners have shown to create commercial air service deserves the recognition a Grant award would entail. This is the type of Grant appl ication that the Small Community Air Service Development Program was designed to support.

The Airport and its partners thank the Department for its consideration of this application.Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 33

APPENDIX A: DOMESTIC CITIES WITHOUT NONSTOP SERVICE TO CENTRAL FLORIDA: YEAR 2010Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 34Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 35Lakeland Linder Regional Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

## 36 TERNATE AIRPORTS