Airport requests property tax break to incentivize return of U.S. hub flight
The Regina Airport Authority is asking the city for a five-year property tax exemption to help bring back a direct flight from Regina to a United States hub city.
“We are going to continue to work until we’ve restored U.S. hub service to the Queen City,” RAA president and CEO James Bogusz said at an event highlighting airport renovations Thursday.
Bogusz made a presentation to executive committee on Wednesday asking for the exemption, which could cause the city to lose the approximately $1.5 million dollars in property taxes the Regina International Airport currently pays.
Bogusz told committee if the tax break was granted, that money would go directly to incentivizing an airline to establish a new American flight.
Regina used to have similar flights to the U.S. but changing economic conditions and less parity between the American and Canadian dollars lead to their cancellation, with the final hub flight being pulled in 2016.
The RAA says financial incentives are necessary because of the same conditions that caused the flights to be pulled in the first place.
“If we were in a position today where the dollar was at parity [and] our economy was booming, we have great growth here in Regina, but not enough for an airline to take all the risk themselves,” Bogusz said.
The deal also gives the airport motivation to secure a flight, as if no airline commits to a hub-city flight by the end of 2020, the tax break will end.
Regina mayor Michael Fougere says because the plan is tied to results, he’s supportive of the idea.
“Typically our exemptions are just open ended for many years, we approve them without asking for any deliverable,” Fougere said. “This one we actually tied to performance to have a direct flight to the U.S. so I think it’s great.”
The Regina Hotel Association says a new American flight could get more people travelling to the Queen City.
“That provides our air-travelling guests with options as well as ease to enter and exit the city,” said Tracy Fahlman, president and CEO of the hotel association.
The mayor agrees restoring the hub flights would be a huge boost for Regina in many respects.
“The fact you can’t get to the U.S. directly is frustrating for people who want to visit here, want to invest here, start a business here, people going on holidays, it’s a disincentive,” Fougere said. “It is really foundational for growth of our city to have a direct flight to the U.S. We are an international airport, and we need that flight.”
The tax exemption is on the agenda for Regina’s next city council meeting, set near the end of August.
After council makes a decision, the airport will know how much money it can has to put towards any potential airline incentives.