The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

and NEIL HARTNELL

Tribune Business Editor

A Bahamian airline operator yesterday urged the Government to clarify its ‘declaration of intent’ with US aviation regulators, welcoming any move that would ensure “we stop paying rent for the use of our house”.

Captain Randy Butler, Sky Bahamas president, told Tribune Business that yesterday’s ‘agreement in principle’ between the Government and Federal Aviation Administration (FAA) needed to be made public so local carriers could understand how it will affect their businesses.

“We’re happy for any movement in the right direction, given the importance of any agreement that allows us to stop paying rent for the use of our house,” he said.

“But we need to know when the agreement is coming into place, and what the agreement means. What does it mean? Where do we go from here?

“We need clarity on how to move forward,” Captain Butler told Tribune Business. “How do we, as businessmen, use that to plan for the future? How do we interpret that in our operations and to manage costs, and whether this is relief to pass on to our passengers?”

The Government’s ‘declaration of intent’ with the FAA formalises the arrangement announced back in January, which was billed as a first step towards the Bahamas taking back control of its air space and establishing a Flight Information Region (FIR), something that will allow this nation to levy and collect fees from airlines flying over this nation rather than the FAA.

Under yesterday’s agreement, the FAA will continue to manage Bahamian airspace, as it has done since 1952, for another 10 years to allow this nation to build the necessary technical, human and infrastructure capacity to develop its own FIR.

The FAA has controlled Bahamian airspace above 6,000 feet since 1952, with all airlines flying over this nation for the past 64 years - including Bahamian-owned airlines - required to pay overflight fees to the US regulator.

Glenys Hanna Martin, minister of transport and aviation, told Tribune Business of yesterday’s agreement: “We signed a declaration of intent between the Bahamas and the United States of America through the auspices of the FAA.

“The declaration has a number of components and one is that the levying of overflight fees for domestic aircraft ceased on January 1, 2017. The declaration of intent indicates that there will be an absolute legal initiative to stop it completely.

“It also indicates that we will enter into a 10-year agreement that will deal with the FAA manning the airspace. The Bahamas government will collect the overflight fees and will agree a management fee for the US, which has the technology and the human resources for that purpose.”

Back in January, Prime Minister Perry Christie hailed as a “landmark accomplishment” the agreement with the FAA to exempt Bahamian aircraft operators from the payment of over flight fees for domestic flights.

He said the deal would save the national flag carrier, Bahamasair, around $1 million over a three-year period. Under international laws, countries require airlines and other aircraft to pay a fee for the right to fly over their airspace. The administration of those rights in the Bahamas has been performed by the FAA since 1952, meaning Bahamasair and other Bahamian-owned carriers have had to pay the US for the privilege of flying over their own country.

   Mrs Hanna Martin told Tribune Business yesterday: “We have also agreed that the US will co-operate with the Bahamas government in its discussions with neighbouring states for the geographical setting of limitations of airspace for the Bahamas.

“They have also agreed to support us as we make application to the International Civil Aviation Organisation for the formal delimitation of our airspace. The other thing in there is a radar sharing of information agreement. That will allow for the mutual sharing of information.”

However, yesterday’s agreement appears to only be an ‘agreement in principle’, and the Bahamas has much work to do to make its contents a reality and take over its own airspace via an FIR.

A 2004 International Civil Aviation Organisation (ICAO) paper on the proposed Bahamian FIR said that apart from this nation taking “full control over its sovereign airspace”, the initiative would create 100 direct jobs and annual government revenues of $30 million.

“The project will create significant directly related employment of about 100 people in high technology areas of the economy, and several times that number in additional support jobs,” the ICAO paper said.

“The new FIR will generate revenues in excess of $30 million annually. The revenue stream will not only finance the capital costs of implementing the total project and pay for the yearly operations and maintenance budget of the Department Civil Aviation, but will also be able to contribute to financing the development of Family Island aerodromes.”

Given the increase in aviation traffic to the Bahamas over the past decade, it is likely this nation could earn more than $30 million by developing its own FIR.