SOMERSET — A program to subsidize passenger air service from the Somerset airport has cost taxpayers more than $960,000, but with the subsidy about to end, the carrier plans to pull out after Friday.
Lynn Roy, president of Locair Inc., which most recently offered service to Baltimore and Washington, D.C., said there were periods when flights were full, but interviews and records obtained by the Herald-Leader show there were few passengers on some flights. Only one passenger was on board last month, for instance, along with two pilots, when the company's nine-seat plane slid off the runway while landing at Lake Cumberland Regional Airport.
"On a month-to-month basis, it was never really strong enough," Roy said.
The company sought more money from local governments to continue underwriting passenger service, but the county didn't have the money and the city couldn't foot the subsidy alone, officials said.
With the service gone, the airport won't be using its passenger terminal, funded with a $3 million federal grant, for the time being, airport manager Ron Swartz said.
Aviation consultant Michael Boyd said it's not surprising that the federal grant didn't result in sustained passenger air service from Somerset.
Among other factors, the Lexington airport and its connecting flights are only 90 minutes away, he said.
"That was one of those things that was just a total waste of money," Boyd said of the grant to Somerset.
A 2008 federal study showed that only 30 percent of the communities that got grants similar to Somerset's met all the goals of their proposal to develop or enhance air service.
Some local business leaders disagree that passenger service from Somerset is not feasible, however.
The Somerset-Pulaski County Development Foundation has hired a consultant for $22,000 to study the local market for passenger service.
The foundation would like to recruit a carrier to offer passenger flights, executive director Martin Shearer said.
"It would be good for us to have commuter service," he said.
Local leaders had long dreamed of having passenger service at the Somerset airport, in part as a tool in economic development, and were excited when the U.S. Department of Transportation gave the city a $950,000 grant in 2005 to underwrite the service.
U.S. Rep. Harold "Hal " Rogers, a Somerset Republican who has pushed for development in his district, wrote a letter supporting the city's application.
The grant was through a program designed to build air service in smaller markets.
Other cities in the state, including Lexington, have gotten money through the program. On Thursday, the U.S. Department of Transportation announced Bowling Green will get a $500,000 grant from the program.
Although Somerset won its grant in 2005, it took some time to attract a carrier to provide passenger flights.
A company called Air Azul started flying people from the Somerset airport to Nashville in late 2008 aboard a plane named the City of Somerset.
Locair later took over the service. As the company looked for destinations to build demand, it dropped Nashville, added and dropped Cincinnati, and began flights to Baltimore and Washington, D.C.
Rogers used the service at times when it fit his schedule, said his spokeswoman, Stefani Zimmerman.
The carriers offered low fares — far below retail, in some cases — to try to build the market for passenger service from Somerset. The grant provided a subsidy for the carriers.
The city had to offer some matching money as part of the program. As of Wednesday, the two companies had been paid a total of $962,646, according to city invoice records.
Of that, the city had paid a little more than $81,000, and the rest, more than $881,000, came from the federal grant.
Locair received more than $870,000. The company probably will get one more payment of several thousand dollars, city budget director Jimmy Hogg said.
Many people in the Somerset area are used to going to airports in Lexington, Louisville or Cincinnati.
Roy, president of Locair, said a year and two months wasn't long enough to get people to fly from Somerset, even with heavily discounted fares.
But the flights did not go to popular hubs such as Atlanta that might have attracted more passengers. In addition, Locair did not fly to some destinations daily, creating scheduling issues, some businesspeople said.
"Once people look at it and can't use it, they never go back," said Jack Keeney, executive director of the Somerset-Pulaski County Chamber of Commerce. "It was a tough match."
Shearer said the fact that Locair, which operated as an air-taxi service, had few passengers at times doesn't mean another carrier couldn't succeed.
The foundation hopes to attract a carrier that would operate under other federal rules and offer more regularly scheduled service, Shearer said.
Chuck Coldiron, who owns a Somerset Hyundai dealership and is past president of the chamber of commerce, said he thought travelers would fly from Somerset given reasonable fares and good connections.
"I do think it's a service that the business community will use as long as there's a hub that makes sense," he said.