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CPA expects significant decline in FY 2021 airport revenue

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THE airport revenue for fiscal year 2021 is projected to be half of the income in the previous fiscal year based on the new budget proposal of the financial affairs committee of the Commonwealth Ports Authority.

The aviation and non-aviation revenues of the Francisco C. Ada/Saipan International Airport in FY 2018 and FY 2019 were $17.2 million and $13.5 million, respectively. In FY 2020, they went down to $7.6 million.

During a meeting on Thursday, the financial affairs committee said total revenues decreased by 22% from FY 2018 to FY 2019 due to Super Typhoon Yutu and are now forecast to decrease by 43% from FY  2019 to FY 2020 due to the Covid-19 pandemic.

The CPA budget spreadsheet indicates that the projected revenue of the airport is  $7.8 million, about half of the revenue collected in FY 2018 and FY 2019.

Because the total operating and personnel expenses of the airport are $14.2 million, CPA is anticipating a $6.4 million deficit.

CPA comptroller Skye Hofschneider, in her FY 2021 budget narrative, said projected revenues “are budgeted conservatively” with a 2% projected total revenue increase compared to FY 2020.

She added that the aviation revenues for FY21 “are budgeted with the assumption that airlines will gradually increase operations throughout the fiscal year and China routes will remain suspended.”

She said the personnel budget for FY 2021 does not include any salary increases. Contractual expenses are forecast to increase due in part to new contracts to update the pavement condition index and pavement classification numbers of all three airports, preventive maintenance for the incinerator and generators, and environmental consulting.

Additionally, as insurance premium expenses are still unknown for FY 2021, “we are conservatively budgeting an estimated 10% increase,” Hofschneider said.

 

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