State won’t have to pay for Delta’s Paris flight
Pennsylvania taxpayers won’t have to subsidize Delta Air Lines’ Pittsburgh-to-Paris flight for underperforming expectations over the past year, but it remains unknown whether the flight lost money or turned a profit in its second year of operation.
“The final numbers aren’t in,” said Ken Zapinski, vice president of the Allegheny Conference on Community Development. “We do know the flight is doing substantially better.”
Delta began the nonstop service in June 2009, with the state and the conference agreeing to pay the airline up to $9 million over two years to offset potential losses.
The route lost more than $5 million in its first year, resulting in the state and conference splitting the maximum $5 million subsidy, Zapinski said. He did not say exactly how much money the route lost.
This year, the state won’t pay anything, based on preliminary findings, state Department of Community and Economic Development spokesman Steven Kratz said in an e-mail.
That means the route lost no more than $2 million, if anything.
The agreement held the Allegheny Conference responsible for the first half of subsidy payments and the state responsible for the second half. For example, the two groups were on the hook to offset losses of up to $4 million this year, of which the conference would potentially cover the first $2 million lost and the state would pick up the remaining $2 million.
If statistics show the route lost money, the conference will pick up the tab with private money from corporate dues and foundation funding it receives, Zapinski said.
“We think it’s been a good investment,” he said.
GlobalPittsburgh President Roger Cranville agreed, calling the flight “critical for the region’s economic well-being.”
Cranville said the flight has helped companies be more productive by shortening overseas commute times, and made the region more attractive to companies considering doing business here. The link is also important to area universities that are active overseas and educate thousands of foreign students.
The flight also generated an undetermined amount of local revenue through increased visitor spending and money generated by added airline fees, jet fuel purchases, cargo deliveries, concessions and other means, said Allegheny County Airport Authority Executive Director Brad Penrod.
The flight will continue through at least Aug. 31. Delta said it is evaluating the route’s summer performance to determine whether to keep it.