Atlantic City airport might be taken over by the Port Authority of NY-NJ

Control of Atlantic City International Airport could land in the hands of the Port Authority of New York and New Jersey after the agency voted Tuesday to study a potential takeover of the South Jersey operation.

The authority intends to spend as much as $3 million on a feasibility study that will consider the legal, financial, environmental and business impact of assuming control of the airport in Egg Harbor Township — a transfer that has been speculated about for more than a year.

Following a Port Authority board meeting Thursday afternoon in New York City, details regarding how a takeover would be handled were few, and no timeline for the study was divulged. Port Authority board Chairman David Samson said it would be premature to speculate as to whether any forthcoming takeover would come in the form of a sale, a lease or any other arrangement.

However Samson acknowledged that Atlantic City International presents significant potential for growth and could help relieve congestion at the authority’s other airports, particularly Newark Liberty International.

Without increasing aviation capacity, flight delays will worsen and passenger service will deteriorate at the airports under Port Authority control. They include Kennedy, LaGuardia and Teterboro airports. Those airports, combined with Newark, saw 106 million passengers last year. At Atlantic City International’s peak, the airport saw 1.4 million passengers in 2010.

“It could relieve pressure from Newark. It could be an independent generator of income for us — for passenger and cargo,” Samson said. “It’s a potentially very valuable asset.”

Meanwhile, local leaders, including state state Sen. Jim Whelan, D-Atlantic, and Assemblyman John Amodeo, R-Atlantic, were generally unaware of the Port Authority’s intentions to do a study.

“The airport itself is actually in good shape physically. We don’t need them to come here and fix the airport, but we have not been able to attract the airline service that we want, especially not without deep subsidies,” Whelan said. “Unless they’re willing to, frankly, use their leverage to expand service into Atlantic City, it doesn’t make sense.”

Amodeo said he is leery of the $3 million price tag placed on the study, but was open to the possibility of Port Authority involvement.

“If there’s a better way to do business, we should know about it,” he said. “I’d agree with hiring a consultant. I don’t know if I’d agree to $3 million.”

The airport has struggled to retain carriers, and currently one has one primary carrier — Spirit Airlines. AirTran Airways, which ran a twice-daily route to Atlanta for two and a half years– left Atlantic City in January after a $4 million subsidy expired.

The South Jersey Transportation Authority currently operates Atlantic City International, as well as the Atlantic City Expressway. Spokesman Kevin Rehmann declined to comment Thursday afternoon and directed questions to the state Department of Transportation. State DOT Commissioner James Simpson is the chairman of the SJTA’s board of commissioners.

Simpson was supportive of the study and any aviation synergies that could reduce congestion in the crowded North Jersey and New York City region.

“The metropolitan New York airports that the Port Authority operates are tremendously busy, while Atlantic City International has untapped capacity to serve air travelers,” Simpson said. “An important point is that there have been times when Atlantic City International has remained open when bad weather has prompted flight cancellations at the Newark, LaGuardia and Kennedy airports.”

Thursday was not the first time a potential takeover of the airport in Egg Harbor Township has been discussed. In March 2011, state Senate President Stephen Sweeney, D-Salem, Gloucester, Cumberland, told The Press of Atlantic City that a sale or lease of the airport to the Port Authority could be imminent and with it would come major expansion.

The same legislation that created the Atlantic City Tourism District contains provisions for the dividing of proceeds that would result from a potential sale of the airport. Officials have said that without a properly developed airport, tourism to the resort will never meet its full potential.

“Knowing that the Port Authority is willing to examine the potential for a more active development of the airport is good news,” said John Palmieri, executive director of the Casino Reinvestment Development Authority, which oversees the Tourism District. “At this point I know very little but I look forward to hearing more about what’s being discussed.”

The Port Authority is pursing the potential takeover under 2007 legislation that allowed the authority to establish an additional airport outside of its jurisdiction in New York and New Jersey. Later that year, the authority took over operations of Stewart International Airport near Newburgh, N.Y. A New Jersey airport was never selected.

Assemblyman Chris Brown, R-Atlantic, said a takeover could present a tremendous opportunity for the region, provided that the right steps for marketing and development are taken.

“I don’t want Atlantic City International Airport to become a place where Newark Airport dumps its scraps,” Brown said. “A world destination resort like Atlantic City needs a major airport. Atlantic City International has a tremendous amount of potential when properly developed.”

Any deal that would attempt to change control of the airport would be complicated, officials said. The SJTA owns just 2 percent of the space, including the terminal building, which lies within the campus of the William J. Hughes Technical Center. The majority of the land, including runways and taxiways, is owned by the Federal Aviation Administration and leased to the SJTA.

The FAA said it could not comment on any potential action regarding the airport until after official notification from the Port Authority.

(c)2012 The Press of Atlantic City (Pleasantville, N.J.). Distributed by MCT Information Services.