PROPOSAL UNDER THE SMALL COMMUNITY AIR SERVICE DEVELOPMENT PROGRAM, DOCKET DOT

- OST

- 2010

- 0124

SUBMITTED BY LAFAYETTE AIRPORT COMMISSION, LAFAYETTE, LOUISIANA

LEGAL SPONSOR

– LAFAYETTE AIRPORT COMMISSION

DUNS # 059118182

CONGRESSIONAL DISTRICT # 07

Existin g Air Service Lafayette R egional Airport (LFT) is a large, non

- hub airport that provides air service to major hubs (ATL, DFW, MEM and IAH) for connecting service. Three airlines provide

service

– American Eagle, Delta Connection and Continental Express. Twenty flights are offered each day. 918 seats is the cumulative, maximum number of passengers that can be served on a daily basis. Listed below is a summary of the service offered by each

airline:

American Eagle offers three flights per day to/from Dal las/Fort Worth. Aircraft used are

Embraer ERJ

– 145 jet aircraft with seating capacity for 50 passengers for a total passenger capacity of 150 people per day.

Delta Connection offers three flights per day to Atlant a and three flights per day to

M emphis. Aircraft used are CRJ

– 200 jet aircraft with seating capacity for 50 passengers for a total passenger capacity of 300 people per day.

Continental Express offers fifty percent of the flights to/from LFT with ten flights

to/from Houston. Aircraft used ar e Embraer ERJ

– 145 jet aircraft with seating capacity for 50 passengers and SAAB

– 340 turbo prop aircraft with seating capacity of 34 passengers for a total passenger capacity of 468 people per day.

The top destinations for passengers flying to/from LFT are Dallas, Washington D.C., Las Vegas, Atlanta and Houston. Average round

- trip air fares range from $268 to/from Dallas, $309 to/from Washington, D.C., $351 to/from Las Vegas, $242 to/from Atlanta and $338 to/from Houston.

Lafayette Regional Airport is the major airport for the state’s region that is referred to as the Acadiana region. The parishes within this region include Acadia, Evangeline, Iberia, Lafayette, St. Landry, St. Martin, St. Mary and Vermilion. The airport is located within the city o f Lafayette, which is the major metropolitan area for the region.

Historical Air Service Since collecting enplanement data, LFT had fluctuating enplanement rates, especially during the past twelve years. LFT saw a substantial increase in passenger boardi ng until 1998, when it peaked with 214,000 enplanements. In 2000, American Eagle began to cut its service to/from LFT and entirely left the Lafayette mark et in March 2002 as a result of

911 . The airline returned to the Lafayette market in April 2006 and currently offers threeflights per day to/from Dallas/Fort Worth. Hurricanes Katrina and Rita created abnormal conditions for the majority of the airports in Louisiana. 2006 enplanements rose by 8.5%

from 2005

, and 2007 enplanements increased 9.5% from 2 006. By 2008, air travel

to/from New Orleans stabilized and en planements at LFT declined by five percent

. During 2009 enplananement figures dropped another 1%. It is currently estimated that the LFT loses thirty

- five percent of the regional flying market to New Orleans which amounts to approximately 75,000 passengers annually. Factors such as direct flights and lower air fares indicate that the leakage of air traveler passengers from the Lafayette/Acadiana region to New Orleans will continue if mitigati ng measures are not implemented.

Past Air Service Development Efforts In 2004, LFT received a grant through the Small Community Air Service Development Program for a three year grant period to address the decline of enplanements and provide

methods to inc rease enplanements. Through a partnership with the Louisiana Department of Economic Development, the Lafayette Convention & Visitors Bureau and the Lafayette Economic Development Authority, an aggressive marketing program was developed and implemented. T elevision, radio and outdoor advertisements targeted the core market in Lafayette Parish. A signifi cant portion of respondents (forty

- four percent ) surveyed in an in

- terminal survey remembered the advertising effo rts and a comparable number (forty

- two per cent ) remembered the “Fly Lafayette” slogan used in the ads.

In addition, a thirty six page economic development brochure that prominently featured Lafayette Regional Airport was developed and is currently being used by the Lafayette

Convention & Visitors Bureau, Lafayette Economic Development Authority, Lafayette Parish Consolidated Government and many other private businesses and governmental agencies to attract and provide comprehensive information about the Acadiana region to potential businesses and v isitors.

Research conducted as part of this grant showed that a major barrier for the Lafayette market was a lack of air service to/from Dallas/Fort Worth. The LAC and its partners effectively convinced American Eagle to return to the Lafayette market wi th the airline returning in April 2006. During the next two years, the leakage rate dropped fro m sixty

four percent to forty

- two percent

.

During 2008 the leakage of regional passengers choosing to fly out of New Orleans began to incr ease with the LFT rea lizing a five percent loss of enplanements. A major advertising campaign was launched targeting the business and leisure traveler. Radio, TV and print media was utilized to encourage individuals to “Fly Lafayette”. During 2009 and early 2010, the LAC’s website was redesigned. A major addition to the website was the inclusion of a travel calculator that allows an individual to compare the complete cost to fly to/from Lafayette to comparable costs to fly to/from Baton Rouge or New

Orleans.

During 2010, airport signage is being addressed with the installation of an LED screen that will be located at the entrance to the airport. The “Fly Lafayette” loyalty club hasbeen reintroduced. Two permanent touch

- screen data collection centers have been

installed at the airport terminal to obtain traveler data. Travelers will be asked to provide information on such things as their reason for traveling, why they chose to fly out/in of Lafayette, and their opinions to improve their experience at the airport. Prize incentives

will be offered to entice travelers to enter their information.

Air Service Needs and Deficiencies In 2008, enplanements at LFT fell by five percent . During this same year, enplan ements in New Orleans grew by five percent . Enplanements for 2009 demonstrated a continued trend with a decline of an additional 1%. Enplanement figures for New Orleans have returned and exceeded rates prior to Hurricane Katrina demonstrating that individuals are again choosing to fly out o f New Orleans

.

Three o f the top five destinations for people flying to/from Lafayette are Dallas, Atlanta and Houston. These destinations are direct flights and passengers typically connect to other flights from these destinations. Destination cities where Lafayette retains 6 5% or less of passengers include Newark, New York, Boston, Chicago and Portland. Three of

these destinations are on the east coast.

Direct flights and low airfares offered by low cost carriers are the primary factors for air traveler leakage to New Orlea ns. Low cost carriers offer direct fl ights and air fares that are forty percent less than the air fares for the top five destinations that air travelers fly to/from Lafayette. An average round trip airfare from Lafayette to Washington, D.C. $309, while l ow cost carriers offer flights from New Orleans to Washington, D.C. for $109.

A major deficiency is a lack of education and understanding of the overall time and cost of air travel. Generally, an air traveler looks at the amount of air travel time that it takes to get from one destination to another. Travel time to another airport that is not within their close geographic location is not taken into consideration. The additional costs, such as the gas and wear and tear costs of a vehicle as well as high er parking fees are not

factored into the overall cost for their travel.

Southwest Airlines offers direct fl ights and air fares that are forty percent less than the air fares for the top five destinations that air travelers fly to/from Lafayette. An aver age round trip air fare from Lafayette to Washington, D.C. $278, while Southwest Airlines offers flights from New Orleans to Washington, D.C. for $109.

A major deficiency is a lack of education and understanding of the overall time and cost

of air travel . Generally, an air traveler looks at the amount of air travel time that it takes to get from one destination to another. Travel time to another airport that is not within their close geographic location is not taken into consideration. The additional c osts, such as the gas and wear and tear costs of a vehicle as well as higher parking fees are not

factored into the overall cost for their travel.Strategic Plan In an effort to stop the leakage to New Orleans, the Lafayette Airport Commission (LAC)

will develop and implement a regional marketing plan to achieve the following goals:

**•** Reduce the leakage of Lafayette travelers flying in/out of New Orleans

**•** Retain and increase flight service to/from Lafayette

**•** Increase the aircraft capacity to/from Lafayette

Airline Communication Program Through a partnership between the Lafayette Airport Commission and the Lafayette Convention and Visitors Commission a “Fly Lafayette” committee will be formed to

convene semi

- annual meetings with members of management of the current three air carriers that serve Lafayette to inform and gain feedback about flight service to/from Lafayette. This committee will report on the current demand for flight services within the region, inc luding upcoming tourism events, economic issues such as new and expanding businesses and industries and the potential need to increase aircraft capacity at LFT. These meetings will also provide information on the regional marketing initiative and request input and suggestions from the air carriers to increase the aircraft capacity at LFT. Another objective of these meetings will be discussions about the possibility of the

current air carriers to offer non

- stop service to other major hubs such as Charlotte, Newark, Washington D.C. and Las Vegas.

Anoth er initiative by this committee will be research and discussions on the possibility of obtaining additional air carriers to fly to/from Lafayette. This effort will begin with an exploratory stage that will also take into consideration the possibility of l osing a current carrier that is already serving LFT if another air carrier came into the market.

Research & Regional Marketing Program In an effort to reach the secondary market of the Acadiana region, an aggressive marketing program will be targeted to three key outlying catchment areas

– New Iberia, Opelousas and Rayne/Crowley. Implementation will begin by conducting focus groups in these areas to gauge passenger leakage to other airports, ascertain impressions of Lafayette Regional Airport, ask what w ould motivate participants to use the airport more often and what competing airports they use and why.

The marketing program will be utilized to educate two different target audiences: the traditional baby boomer/business flyer and the 18

– 49 age flyer . The traditional baby/boomer/business flyer relies on newspaper, television and radio for information.

The 18

– 49 flyer relies on the internet and social networking such as Facebook and Twitter for receipt of information. An aggressive marketing progr am will be implemented that will increase the marketing message to these two different audiences throughout the Acadiana region.

Social Networking As part of the effort to reach new audiences, this project will promote its “Fly Lafayette” message through social media. The LAC website will be improved and constantlyupdated to provide individuals with immediate new information to help educate and provide the best solution to their flying needs. Information will also be shared through an

e

- newsletter, Faceb ook, Twitter and any other social medias that become popular and

available.

Promotions Throughout the three

- year period, numerous promotions will be offered, especially through the “Fly Lafayette” Club. Prize incentives such as free dinners and free roun d

trip airline tickets will be offered by entering information at one of the airport kiosks or through on

- line promotions. The LCVC will be very involved in this area of the project and will include the airport in their convention information and at regio nal meetings and

conventions.

Media Advertising Advertising in the regional newspapers, television stations and radio stations will target the two different audiences. Ads will be designed to interest the traditional baby boomer/business flyer while othe r ads will be designed to interest the 18

– 49 age flyer. The selection of newspapers, television and radio stations will be determined for each target audience with the days and times of scheduled advertising being a part of the decision making process.

Outdoor Advertising/Signage A minimum of twenty

- eight outdoor billboard will be placed throughout the entire Acadiana region at all times throughout the three year period. Lamar Advertising, which is the major outdoor signage company in the region, will donate the space on no less than six outdoor billboards every month. The airport’s LED sign will be utilized to advertise the latest promotion and the social networking information.

Public/Private Partnership Two area organizations have agreed to partner with the LAC for this project. The Lafayette Visitors & Convention Commission (LCVC) will be a partner and will provide $30,000 in advertising assistance, promotional assistance and serve as an active member

on the Airline Communication Committee. The L CVC promotes all aspects of the Acadiana region including conventions, sporting events, concerts and area festivals. The LCVC also promotes area attractions, hotels and eating establishments. A major function of the LCVC is assisting domestic and interna tional tour operators and travel agencies with group travel needs. Major assistance is also provided for conventions and trade shows, with the majority of these organizations requiring air travel assistance.

Lamar Advertising is the largest outdoor sig nage company in the Acadiana region. This company has prime outdoor billboard spaces throughout the seven

- parish region. Lamar Advertising has agreed to donate space on no less that six billboards every month throughout the three

- year project. Each bill board rental space is valued at $900/month for a total donation of $194,400 over the three year period.The Louisiana Department of Transportation and Development (LADOTD) will provide a 10% cash match for a total of $127,516.50 toward this project.

Prog ram Budget

The total three

- year program is estimated to cost $1,626,600. The LAC is requesting a grant of $360,000 (21% of the total project cost) from the Small Community Air Service Development Program. The Lafayette Airport Commission will provide $91 4,683.50 of funding and the State of Louisiana Department of Transportation & Development will provide a grant in the amount of $127,516.50. The two local partners

– Lafayette Convention & Visitors Convention and Lamar Advertising will provide advertisin g assistance in the amount of $224,400. A detail of the proposed expenditures is list below:

Research $270,200 PR/Marketing $205,400 Social Networking $224,400

Promotions $263,100 Media Advertising $380,700 Outdoor Advertising/Signage $282,800

Total Program Budget $1,626,600

Funding Assurances The LAC will utilize approved accounting procedures to track the project’s expenditures as outlined in the DOT contract. The LAC staff will be responsible for the administration of the gran t and the monitoring of the project’s goals and objectives. The LAC will accept all grant assurances

, that all funds (federal , state and local) intended for this project will not be diverted to other uses, as required in the terms and conditions of the

gr ant offer.

Monitoring of the Program The LAC staff will be responsible for the monitoring of the program’s goals and objectives. Monthly reports will be prepared and provided to the LADOTD and the LAC. The monthly report will reflect the progress of eac h component of the program and whether the objectives are being completed in a timely manner.

Each report will include the monthly enplanement report and an analysis of the enplanement rate. The rate will be monitored to determine if enplanements are i ncreasing and/or leveling off from a negative decline. Upon completion of the focus group study, a complete report and marketing plan based on the results of the study will be prepared and submitted for review. Each component of the marketing plan will b e monitored and reported on a monthly basis.

All efforts and contacts with airlines will be reported on a monthly basis to evaluate the success of retaining and increasing flight service to/from Lafayette. Monthly reports on

data collected from the air port opinion kiosks will provide information on the opinions and needs that have been identified by passengers. Monthly results of the “FlyLafayette” will be reported as well as the number of “hits” that were received on the airport’s website, Facebook p age, Twitter and e

- newsletter. Photo documentation will be reported on the installation of the airport signage and area billboards.

Four quarterly reports will be prepared each year to help determine the overall success of the program and whether the pro gram is being accomplished on a timely basis. An in

depth annual report will be prepared and submitted as a further evaluation tool. Upon completion of the three year program, a final report will be prepared and submitted.

Continuation of the Program Up on Completion of the Grant Period Through increased revenue from additional enplanements, the LAC will be able to maintain an aggressive marketing program that will provide funding for continued market

research and programs that will focus on meeting the n eeds of air travelers, change s in the airline industry as well as changing conditions within the Lafayette market and the state that may impact air travel service to/from Lafayette.

Legal Sponsor The Lafayette Airport Commission, a public governmental e ntity of the Lafayette

Consolidated Government will be the legal sponsor for this program. The LAC has the legal authority to assume the responsibility to ensure that all funding under federal, state and local laws will be carried out for all aspects of t his grant program.