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Runway Money

Airports around the country are trying out surprising sources of income. Anyone want to buy some hay?

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Whenever staffers at Detroit Metropolitan Wayne County Airport discuss ways to increase income, one person suggests putting Viagra advertisements on the up escalators and ads for sleep aid Ambien on the down.

While most airports are owned by state or local governments, according to the Airports Council International–North America, they still operate like businesses and are required by the federal government to be as self-sustaining as possible. Traditionally, airports have generated most of their money from airlines—in the form of landing fees and fees for the use of terminal facilities—and from non-aeronautical sources such as parking lots, concessions, and advertising. But while the costs to run an airport have risen significantly over the years, airlines, pinched by high fuel prices, have balked at paying increased fees. In the scramble for dollars, some airports, especially smaller and midsize ones more vulnerable to losing airlines because of higher fees, have turned to selling everything from branded products to natural-gas drilling rights.

Some of those efforts are yielding substantial returns, others just a few dollars. According to the Federal Aviation Administration, in fiscal year 2005, U.S. airports had total operating revenues of $13.1 billion. Non-airline revenue represented $6.1 billion, or about 47 percent, of that. By 2007, that figure had inched up: The $6.5 billion airports earned from non-airline sources represented about 48 percent of overall airport revenues of $13.6 billion.

Due to open in spring 2009, Missouri's Branson Airport may be the most entrepreneurial of them all. The 922-acre facility expects to serve between 275,000 and 500,000 passengers a year and will be the first privately financed and operated commercial service airport in the country. The airport will hawk naming rights and sign exclusive agreements with rental-car and ground-transportation companies, says executive director Jeff Bourk. Branson will run its own on-site telephone system, a wastewater treatment facility, and, probably, the bar. "We'll even create a company to reunite passengers with their lost luggage," Bourk says.

These new models may end up benefiting passengers, says Kent Vanden Oever, associate director of the Alexandria, Virginia, consulting firm AirProjects. "The more airports are able to get revenue from non-airline sources, the less they have to press airlines for money," he says. That helps airports keep airlines from looking for other places to land. "And, theoretically at least, every dollar the airlines save lets them keep fares at a reasonable level," he says.

Here's what airports around the country are doing to generate cash.

Selling Souvenirs

Once Iowa's Sioux Gateway Airport stopped being embarrassed by its airport identifier code (SUX), it began profiting from it. In 2007, T-shirts, caps, mugs, luggage tags, and bumper stickers branded with the airport's "Fly SUX" logo generated more than $3,500 for the tiny airport. Internet and in-airport sales of SUX memorabilia should bring in twice that in 2008.

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