YVR increasing airport improvement fee by 25%
The Vancouver International Airport is seen from CTV News Vancouver's Chopper 9. (Pete Cline)
Ian Holliday, CTV News Vancouver
Published Thursday, September 12, 2019 2:07PM PDT
Last Updated Thursday, September 12, 2019 4:36PM PDT
Vancouver International Airport announced Thursday that it would increase its "Airport Improvement Fee" from $20 to $25, beginning on Jan. 1, 2020.
The fee is charged to all passengers travelling to destinations outside of British Columbia and the Yukon. The fee for passengers flying to within B.C. and the Yukon will remain at $5.
Airport president and CEO Craig Richmond announced the change in an address to the Greater Vancouver Board of Trade Thursday morning. In his speech, he described the increase as "absolutely necessary for the long-term financial health of the airport."
"If we took away the AIF, YVR wouldn't be able to keep up," Richmond said. "Our infrastructure would wear down, the passenger experience would decline, people would choose other airports for connections and we would not be able to deliver on our public mandate to provide economic and social benefits to our communities."
In a release, the airport said its improvement fee will still be "one of the lowest among the eight major Canadian airports." Only Ottawa International Airport will have a lower AIF, at $23.
First introduced in 1993, the fee accounts for 31 per cent of the airport's revenue. The rest of its revenue is divided into two categories: money from aeronautical sources (25 per cent) and non-aeronautical sources (44 per cent).
Funds collected through the fee must be used for capital infrastructure projects, such as terminal and runway improvements.
Last year, YVR announced a $9.1 billion 20-year improvement plan, which includes an indoor "forest" of Douglas fir trees, as well as extended runways and a sustainable parkade, which will include geo-thermal heating and spots for electric vehicles.
According to Thursday's announcement, the airport has collected $2.2 billion through its improvement fee since 1993, and has spent $3.7 billion on capital projects over that period of time.
In his remarks to the board of trade, Richmond said the airport recognizes that the fee increase "might not be a popular decision with the public," but believes it is essential.
When CTV News Vancouver asked about the improvement fee last year, Richmond said there were no plans to lower it in the near future. He did acknowledge, however, that the fees charged to airlines that travel through the airport had been decreased by 15 per cent a few years ago.
"What we charge the airlines is flat and has been reduced and is amongst the lowest airline charges in North America," Richmond said at the time.
On Thursday, Richmond also provided early results from the airport's latest economic impact study, which showed that YVR is responsible for $20.2 billion in total economic output. The airport supports more than 126,000 jobs across the province, Richmond said.
As many as 26 million passengers are expected to pass through YVR in 2019, making it the second-busiest airport in Canada.
That said, the fee is only charged to outbound passengers, so the actual number who pay it is significantly lower than 26 million. Likewise, as mentioned, travellers bound for destinations in B.C. and Yukon pay only $5, which further reduces the total amount the airport collects through improvement fees.
In 2018, YVR collected $172.1 million in airport improvement fees, according to a spokesperson.