The Jefferson City Finance Committee has sent to the full City Council a proposed agreement for the city to help guarantee United Airlines' profit in its first year at Columbia Regional Airport. If the airline falls short of $600,000 in revenue in its first year of flights from Columbia Regional Airport to Denver International Airport, Columbia and its community partners - which include Jefferson City and Cole County - would make up the difference.
Columbia city officials said Jefferson City would contribute $100,000 and Cole County $50,000.
The most recent airline revenue guarantee agreed to was in 2012 with American Airlines. That agreement guaranteed the airline approximately $3 million in profits and did not end up costing Jefferson City or Cole County anything out of pocket.
In the previous revenue guarantee, which was substantially larger, Columbia was able to raise almost all of the revenue from the Columbia Chamber of Commerce, large businesses in Columbia, the University of Missouri, Boone County, Jefferson City and Cole County.
These organizations contribute because of how beneficial the airport is for them.
Jefferson City officials noted the city was refunded the full $100,000 they contributed to the American Airlines agreement, with interest.
Columbia officials said United Airlines is asking for a smaller revenue guarantee because the airport has grown in the past few years - noting a few years ago only 4 percent of travelers came from Jefferson City, and that figure is now up to 20 percent.
The officials added United Airlines is interested in Columbia Regional Airport because the city voted to approve a new terminal for the airport, and although the airline could leave at the end of the agreement if ticket sales are low, there is growing confidence the new routes to Colorado will be profitable.
In other news from Thursday's Finance Committee meeting:
The city's 1 percent sales tax has generated $3 million so far in the fiscal year - $86,000 over projections.
The half-cent capital improvement sales tax brought in $507,000 for this reporting period, which is $200,000 over projections; and the parks half-cent sales tax brought in $507,000, which is $135,000 over projections.
The city's general fund has $11,854,000, which is $291,000 over projections; however, two areas that make up the fund were under projections. Fines were down $82,000, but city officials said much of that can be attributed to recently enacted state laws that cap how much can be collected on certain fines and forfeitures, an issue to be addressed in next year's budget. Also below projections was money collected from utilities, particularly from natural gas usage, down $49,000, which was attributed to the mild winter.
In January, the city collected $95,905 in lodging tax, while hotel room occupancy was down slightly from a year ago - 48 percent this year and 51 percent in 2016. So far, since voters approved increasing the lodging tax from 4 cents per dollar to 7 cents in 2011, the city has collected almost $13 million toward its conference center fund.