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DIA at 10: Airport is paying off for region

Article Published: Sunday, February 27, 2005
Denver Post Editorial

DIA has exceeded expectations in its first decade, but its future depends on today's leaders showing the same foresight as their predecessors did.

A decade ago, jokes about Denver's new airport were flying. What does DIA stand for? Doesn't Include Airplanes. What's the password for getting luggage through Denver? Carry-on. But after frustrating delays, Denver International Airport finally opened on Feb. 28, 1995, and the punchlines fell silent.

Airports reflect a community's spirit and ambition. From its elegant terminal to its high-tech airfield, DIA emerged as a proud monument to the visionary people of Colorado. Its full promise is still in the making, but longtime supporters are celebrating how well DIA met its high expectations.

For example, in 1988, Denver identified open fields in Adams County to build a replacement for its aging Stapleton airport. The annexation required the say-so of Adams County voters. Denver Mayor Federico Peña didn't have the political sway to complete the pitch, so Gov. Roy Romer went on an "oatmeal" tour of breakfast spots and said the airport would bring jobs to Adams County.

Fast-forward to 2001, when a consultant crunched numbers for the DIA Business Partnership. The report said DIA and its associated businesses had directly and indirectly created 200,000 jobs in the immediate area, including parts of Denver and Aurora and all of Commerce City and Brighton. Some 120,000 of those jobs are in the latter two cities, both in Adams County.

DIA is paying off for Denver, too. Federal law bars the city from using landing fees and airport-specific revenue on non-airport needs, but general taxes collected from airport businesses flow to the city's treasury. Last year, DIA generated $13.8 million in sales and use taxes, a $2.2 million increase from 2003 levels. DIA also brought in business personal property taxes of $17.6 million in 2003. The airport's occupational tax collections hit $1 million last year. And 60 percent of DIA's $1 million in 2003 real property taxes went to support the Denver Public Schools budget.

Overall, the Metro Denver Economic Development Corp. says DIA's annual economic impact for the state is $17 billion.

One of DIA's great legacies has been how moving the airport east of the city spurred an urban rebirth. Closing Stapleton airport transformed Park Hill from a noise-rattled area into one of Denver's most livable neighborhoods. Demolishing the old airport opened seven square miles for a residential and commercial center, which 30,000 residents and 35,000 workers eventually will call home. Stapleton has become a one-word image for urban revival.

As promised, the highly efficient DIA usually works well even in most winter storms. It's been closed only twice, during a storm in April 2001 and after Sept. 11, when air traffic was halted nationwide. If DIA travelers are cooling their heels waiting for delayed flights, it's most likely because problems at other airports have disrupted schedules. DIA itself has the best on-time record of any major U.S. airport.

However, DIA sometimes has experienced slow-downs because Denver-based crews couldn't get to the airport, one notorious case happening during a storm in October 1997. After landing, out-of-towners sometimes wonder where the city is, and taking a cab can produce sticker shock. Access should improve when rail service to the airport, part of the FasTracks system voters approved last fall, is completed.

Despite dire predictions, DIA has also weathered financial downbursts. Last year its gross revenues and net income reached $570 million and $358 million respectively. Another measure, change in net assets, has improved in the past five years from a negative $68 million to a positive $43 million.

The fiscal turnaround is especially impressive because it came as the airline industry struggled. Of 26 the airlines operating at DIA in 2004, four had filed bankruptcy: United (DIA's largest carrier), US Airways, Vanguard and Air Canada. Air Canada has emerged from bankruptcy, but Vanguard went out of business.

It's a disquietingly familiar problem. The first airline to sign a lease at the new airport was Continental, which, when the airport was planned, was expected to be as large a player as United. Continental later filed (and survived) bankruptcy. DIA steered around that early trouble and must do likewise now. Clearly, DIA would suffer if United can't pull out of its tailspin.

DIA, like most U.S. airports, depends heavily on one airline. United accounts for about 59 percent of DIA's passengers and nearly a third of the airport's connecting traffic. To reduce the risk from a United collapse, DIA's managers are actively wooing other airlines to begin flying to Denver or to expand existing Denver operations.

The worry reaches beyond just United, however. The real storm brewing on DIA's long-distance radar is the shaky viability of the whole airline industry.

DIA's managers have delayed new construction projects, slashed operating costs and left jobs vacant. Two bond rating agencies, Moody's and Standard & Poors, cited DIA's management as one reason they upgraded the airport's credit status last year. Even with United's uncertainty, the bond watchers rate DIA's debt status as "stable."

DIA's future depends on today's leaders showing the same foresight that their predecessors displayed more than a decade ago.

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