COLUMBIA: A proposed agreement with United Airlines calls for the city to provide a $600,000 one-year revenue guarantee on flights to and from Denver International Airport. United Airlines on Monday announced new flights to and from Denver and Chicago starting Aug. 1. The revenue guarantee would ensure that the airline makes at least $600,000 on its flights to and from Denver for the first year, according to a memo to the Columbia City Council.
The city and the Chamber of Commerce will try to raise money to cover the guarantee from private donors and community partnerships. It would fall to the city, however, to cover any shortfalls. The revenue guarantee is far less than the $3 million, two-year guarantee the city initially made to American Airlines for flights to and from Chicago and Dallas/Fort Worth in 2012. The city in February 2015 returned 80 percent of the money that investors — including Boone County, Cole County, Jefferson City and MU — contributed to the American Airlines guarantee fund. American required just one payment of $22,562 in March 2013 to compensate for low passenger numbers on two weeks of flights.
Third Ward Councilman Karl Skala said most of the $600,000 for the United guarantee has already been raised. “Public money is not at risk. MU and other private companies have contributed with most of the money,” Skala said, adding that MU experienced a “big boom” of students coming from Chicago when flights there began. He hopes the same will happen with students from Denver.
The city’s agreement with United also includes a waiver of landing and rental fees at Columbia Regional Airport in the amount of $125,000. The city also would provide $250,000 worth of marketing for United’s Denver flights. It’s unclear how the $250,000 for marketing will be spent. “I guess that there will be more money spent on marketing in Denver, since the idea is to put Columbia on the radar,” Skala said. The United agreement will be introduced for first reading at the city council’s regular meeting Monday and is scheduled for a final vote at the council’s March 20 meeting.
