Friday, June 5, 2009

I want to land a dirigible on the Comcast Building; or Airports and Economic Development

By Ariel

Key to understanding urban growth is the transportation and land use connection. On this blog, Heller and I tend to focus on issues surrounding transit and pedestrian oriented development; the benefit of living near transit or in walkable communities. The size of city blocks, the width of city streets and the availability of transit are all markers of what makes a city livable. However there is a different, older and more fundamental connection between transportation and cities. The earliest cities all grew up around trade routes, rivers, oceans or cross-roads. America’s major metropolises sit atop major transportation hubs, the ports of New York and Los Angeles and the rail road yards of Chicago.

Philadelphia’s street car suburbs of West Philadelphia or Mt. Airy, or the rail lines that stretch through north Philadelphia, are a testament to Philadelphia’s rich transportation and land use heritage. However Philadelphia’s earliest success was related to the nature of its freshwater ports which were a boon to early wooden ships. The City’s early aristocracy grew rich off of the trade from the piers and luminaries such as Stephen Girard built their fortunes by controlling fleets and docks. For a whole slew of reasons (though it starts when those pesky New Yorkers built the Erie Canal) Philadelphia’s port is no longer the pre-eminent port in the U.S; ports such as Los Angeles and New York which can handle much larger container ships see much more cargo passing through their docks. None the less as the Economy League of Greater Philadelphia notes in their recent report Maritime Commerce In Greater Philadelphia the “Delaware River ports employ 4,056 workers who earn $326 million and generate $1.3 billion in economic output.”

However these ports were also important not simply because of the goods they moved, but the people they moved as well. New York, Philadelphia and Los Angeles were the historic ports of call for the Italians, Germans, Chinese, Japanese, Jews (and the list goes on) who built this country. There are many who suggest that Philadelphia’s ability to attract new immigrants (which will account for 66% of America’s population growth over the next 50 years) relies on our airport. They argue that the more countries that first touchdown in a city (such as Philadelphia) the more likely immigrants are to settle in that city.

Airports are not just about moving people, in a New Yorker article (4/18/2005) “Out in the Sort” John McPhee describes the inner workings and impact of UPS’s cargo sorting and shipping hub in Louisville Kentucky. These hubs employee people around the clock, and in the case of UPS also pays for them to go to college; these hubs are economic and workforce development engines. Jon Ostrower of Flightblogger (more on him shortly) suggests that UPS might even be the largest private employer in Kentucy.

So what about the Philadelphia International Airport? UPS does in fact have workers and sorters at a facility at Philadelphia International Airport (PHI) though I doubt it is as large as complex as the UPS or FedEx hubs at Louisville or Memphis or even their satellite hubs in such as those in Indianapolis, Anchorage, Oakland, etc. Moreover some studies suggest that Philadelphia’s airport is threatened by rising sea levels and storm surges. It is also an airport plagued by expansion woes and busy airspace caused by neighboring smaller, regional airports.

To get a better understanding of the airport, and its potential for economic development I spoke with Jon Ostrower of FlightBlogger, an industry expert who blogs about the Airline industry for Flightglobal, “the world’s leading provider of aerospace news and data.”

To talk about the future of airports one has to get a better understanding of the airline industry. I began by asking Ostrower to describe the future of the industry, and what we as consumers can begin to expect. Ostrower noted that “From a passenger point of view, in terms of trends for business prospect, you are not going to pay one price for a ticket, one lower price, and then you will have to pay for everything else, bags, food. There business model has been found not to have worked. Oil is going up, the economy is going the other direction and fares not high enough to justify the flight.” In other words, over the long run, we can expect fewer and fewer flights that are likely to be more and more expensive.

However this gradual loss of passengers does not mean that airports necessarily close, even though nationwide there may be around fifty airports (Toledo, Ohio and Meridian, Mississippi) that have recently lost all commercial service. While there is, as Ostrower puts it “there is a net loss of runway ever year” airports keep running, though they tend to rely more on business and general aviation; that is to say charter flights and recreational flying. Airports make their money off of landing fees, gate fees and food services contracts, and they serve airlines shipping cargo nationwide as well. Which is to say, that there is a significant amount of business going on at airports, and with airlines, that we simply don’t know about or see on a regular basis as we are waiting in line to take off our shoes, belts and key chains. In fact Ostrower notes that if you really want to gauge the health of the Airline industry, or the economy as a whole, one should track the health of the cargo market; cargo numbers dropped long before other indicators of economic collapsed. The complex nature of airports, built off of trade and travel are holistic gauges of an areas health, the desire of people to go there, and their buying power.

While they are important gauges of urban economic health the important thing to look at when it comes to airports, as it always is with all transportation related issues, is access. While Ostrower notes that you can judge the success of an airport by the incentives used to bring airlines in, the cost of fuel, the length of the runway, quality of food or the on time performance, the key really should be the ability to move people and goods through the hub. Which means that in many ways the airport only as good as its connections to people and goods; i.e. an airport is only as good as its multi modal connections to different markets of people and goods.

Ironically, some of the most vociferous opponents of high speed rail are the representatives from districts with small regional airports. As Ostrower puts it “the US market is the largest market in the world for single isle short haul air craft” for flights between Boston and DC. These smaller airports see high speed rail as direct competition for the delivery of people into the hinterlands.

However the questions should be not whether an airport is thriving, but is it connected to other ports and other people? The development of the Philadelphia International Airport depends on its ability to be connected by rail to thriving regions in and around Philadelphia (which is the 8th richest metropolitan region in the world) and to its system of ports around the Delaware river.

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