Future is Now for Prince George

Monday, October 06, 2008 08:45 PM

Prince George, B.C.- For Dan Muscatello, selling the idea of the Prince George Airport as a tech stop or logistics park is a simple proposition.

Landing a cargo flight in Prince George will save shippers and airlines thousands of dollars. P.G. doesn’t charge a landing fee, and while fuel may be more expensive here, that cost is more than offset by the shorter taxi time to fuel, and the lack of landing fees. He says carriers could save as much as half a million dollars a year by landing in Prince George over Anchorage. Muscatello says his company can pretty much take any project it likes, and this one is "very exciting, Ìt offers the aviation community an enormous opportunity."

In a presentation to Prince George City Council this evening, Muscatello outlined all the positives for the YXS.

First, labour costs in China are climbing and it is starting to cost manufacturers more to make products in Asia so companies are now loking to move manufacturing operations out of China to North America. That opens the potential for back haul opportunities.

Short taxi distance means aircraft will burn less fuel and that saves money in a time when fuel costs are volatile.

Port of Prince Rupert offers the shortest distance between Shanghai and North America. The CN intermodal container port is a valued link as it provides a cheaper link to bring product to other areas. Moscatello says he visited the CN intermodal port in Prince George and says he has never seen a warehouse so packed "I don't know how people could walk through it."

For YXS, it's a three phase development;

1. Develop a refuelling stop ( which could see tech stops by the end of the year)

2. Develop a regional cargo flow to create back haul to Asia ( 12 - 18 months)

3. Develop origin and destination cargo development

Moscatello says Purolator is already planning to build a facility at the Airport logistics park, a park which he says will be the "most sophisticated logistics park developed." He also told council that Fedex and UPS have major warehousing in Anchorage, but have indicated they would like to use Prince George as their "back up" should there be a reason( for example weather ) that prevents them from landing in Anchorage.

He says there is a need for a "Free Trade" zone, where products can be brought into the country without having to pay taxes until the item is ready to be consumed". He says it is an incentive to land in Prince George.

He expects serviced lots in the logistics park to be on stream in 2009 and told council he was recently in China and spoke with developers who are interested in spending $100 million dollars in development. "They were asking, when will you be open, will the property be for lease, or for sale?".

He says he read the recent National Post article which quoted an expert from Calgary as saying the project will never "fly". Moscatello says the fellow from Calgary either didn't know what he was talking about, and if he did was misquoted by a writer who didn't want to write anything about this project being able to succeed. "We talked to the writer for more than two hours, and not one thing we talked about was included in the article. The only thing in the article that was accurate was the name of the airport."

"We think the future is now for Prince George."

Moscatello will be on the Meisner program Tuesday morning on 93.1 CFIS and on Opinion 250 through live streaming audio.

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Posted on Monday, October 06, 2008 08:45 PM in News by 250 News

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Comments

Posted by: lunarguy on October 6 2008 10:19 PM

Well this is a great deal for shippers ! Now what about me as a tax payer. 32 million to build the runway, who knows how much to maintain, and we are not going to charge any fees to land here ! What an outrage. This just means this project is a huge waste of money as it is apparent it will never make money, so therefore they aren't even going to try.
I guess that rather high Airport Improvement Fee will be around for years to come to help pay for the repairs that will be needed as the big planes will not be paying for any of this work.

Posted by: NMG on October 6 2008 10:41 PM

I read it to mean that they are actually serious in trying to get flights here, which will hopefully result in spinoff economic development and jobs. Additional development and jobs means additional property taxes, additional people spending money in the community and additional diversification of the local economy.

A significant amount of work will still need to be done and who knows how this will all pan out, but if not having a landing fee helps to get the ball rolling on this project and if it serves as an incentive to attract the flights here, I say go for it.

If this all comes to fruition, I'm confident that I'll benefit more as a taxpayer by having that development take place in PG than without it. To be honest, I think it's a risk PG has to take at this point in our history.

Posted by: szd on October 6 2008 10:41 PM

As a taxpayer I am more worried about the amount of tax dollars spent on Quebec to buy votes. If our tax dollars are to be wasted (a given) why not have our turn at the trough? It's up to us to make the best of it as we may never get the chance to again. Don't look the gift horse in the mouth just figure how to make more with what we get.

Posted by: Sh*tdisturber on October 7 2008 7:04 AM

YXS has some of the highest landing fees in North America for airlines which translates into higher passenger fares and the AIF is slated to increase from $15 to $20 very soon. All to pay for this so that shippers can land free. I'm all for development and really hope this project is a success, however it should succeed on it's own merits.
While airport management has been showing off their new runway, they havn't mentioned that they forgot to change the approach procedures with Transport Canada, resulting in additional problems and costs for the airlines for the next 2 months, during a time when the change in seasons creates additional navigation problems.
I'm not saying the project shouldn't have happened, but it was badly mismanaged.

Posted by: giterdun on October 7 2008 7:49 AM

Google in-- Landrum and Brown.... These guys have a very impressive presence in the world wide logistics business. I for one am glad that they are on our team. Welcome to P.G. Mr. Muscatello. Our future has never looked bigger or better. UP UP AND AWAY!!

Posted by: lostfaith on October 7 2008 9:55 AM

We all need to be very aware of one thing when it comes to most of these big dollar developments.
They are not for the benefit of the average citizens in this country.

They are for the benefit of the rich.

Posted by: giterdun on October 7 2008 10:23 AM

lostfaith...Is it not a benifit to have a vibrant economy with good jobs? Why shouldn't the people who put their money on the line make a profit? Profit is not a bad word. It drives and serves us all in some way. The only thing that stops YOU from becoming rich is your hard work and desire. You create your own destiny. If your happy to be on the outside looking in, then so be it.

Posted by: Palopu on October 7 2008 10:24 AM

Dont hold your breath on this one. There needs to be some clarification;

(1) Although there will be no landing fees for the Aircraft that might land here, there will be money included in the cost of fuel that will be paid to the Airport in lieu of a landing fee. So in effect there is a landing fee.

(2) The original idea was to capture some of the Wide Body Cargo Jets that presently land in Anchorage, however the cost of fuel is significantly cheaper in Anchorage than in Prince George so any savings from landing fees may be lost to increased costs of fuel.,

(3) If you are going to transfer freight from one carrier to another the obvious question is where will this carrier come from, where is the freight going to go to. Its highly unlikely that these flights will be co-ordinated to the extent that they will arrive and depart at the same time, and therefore you would have to hold freight in Prince George for the transfer which means a delay to the cargo, which no shipper will accept if he is paying high cargo rates.

(4) There are no domicles in Prince George for Pilots so that means that they would have to fly from say New York, to Prince George to Bejing and back to New York with a short layover in Bejing. Pilots in Anchorage actually live in that City and fly from Anchorage to East Asia and back to Anchorage which gives them time off etc. This situation would not exist in Prince George.

There are many other reasons why this bone headed idea will not work. Far to many to go into on this site, suffice to say that time will tell.

Posted by: Eagleone on October 7 2008 10:48 AM

$32 million for the runway infrastructure I can see, but the city paying $48 million for what could end up being a $100 million dollar road to the logistics park will sink this city in debt. I like this airport logistics park proposal, but I think the logistics park is in the wrong and most expensive to the tax payer location.

By continuing down that road we are committing to the sunk cost without first exploring the alternatives. We should be looking at how the provincial and federal governments would be sharing more of the costs. As well we should be looking at how an industrial park could better fit in with PG's future industrial land developments elsewhere... to cut down on the number of $48 million dollar stretches of highway we have to fund.

Posted by: gamblor on October 7 2008 11:17 AM

You people are missing the point - the city is building a runway and a road to a logistics park. Thats it. While you are correct runways and roads dont pay for themselves, it is the role of government to build infrastructure that WILL pay for itself because it fosters INDUSTRY. (They really need to start teaching this stuff in school.) Who pay for the industrial park? INDUSTRY Who will pay for the runway? INDUSTRY - the same people who pay for EVERYTHING and make EVERYTHING and sell EVERYTHING and provide EVERYTHING.

So PG doesnt have domiciles or enough cargo holding or transfer facilities - guess what that is? Its called oppurtunity. The government isnt going to build all that, nor should they - that is the role of INDUSTRY. A government that steps outside of building infrastructure and starts building and micromanaging business is called a communist state. The runway simply brings potential for business in PG, if INDUSTRY (not keyboard surfing Joe 6pack) decides the opportunities are worthwhile, they move in and provide nice things like jobs and pay taxes. Honestly, what are you people smoking?

Posted by: giterdun on October 7 2008 11:28 AM

Well said gamblor!!!

Posted by: lunarguy on October 7 2008 4:25 PM

Oh there is no problem trying to attract industry but like many we question the logic in spending so much to attract so little, that apparently will not help pay for the enhancements. You land at any airport with a cargo plane and they charge you to land, but not in PG. That would be great if we were a rich city, but we are not !

Posted by: I support the working class on October 7 2008 4:40 PM

Lets take a look at property developers!

Property development is paid for by the property developer not the city tax payer.

If you either own or buy property to subdivide and develop and want to sell these lots as residential, commercial etc the property developer incurs all costs. These costs are then offloaded onto the sale of the property that is purchased by the consumer (buyer).

As a property developer you would be responsible for the paving and all works required by city by-laws to be in place.

If it is the City of Princes George's intentions to develop the logistics park and road then sell off the lands owned by the City (tax payers), then the sales of these lands would pay for all works done to create this development. The city would then continue charging taxes to the owners that buy these parcels.

Now if these lands are owned by private investors, then they should be responsible for paying for all development costs and not the tax payer..

Posted by: Palopu on October 7 2008 5:20 PM

It must be a coincidence that the Highway connector from Highway 16 to 97 just happens to pass in front of the property that is to be developed into an Industrial Park . This connector is going to cost taxpayers $46 Million dollars.

Considering that we already have a connector from Highway 16 to 97 via the old Cariboo Highway that could be upgraded at considerably less cost than the proposed venture, one wonders why we wouldnt use this highway. Business from the Industrial Park could still access the park through or around Gunn Road, and Johnson Road. It seems unnecessary to build a second connector.

Posted by: Palopu on October 7 2008 5:20 PM