Plan for revenue enhancements at BWI Airport, 2003

Revenue Enhancements at BWI Airport BWI continually looks for opportunities to increase revenue while maintaining its competitive edge as a low-cost airport. Balancing passenger expectations and airline needs while limiting overall expenditures and maintaining reasonable costs to airlines and passengers is key to BWI’s success. Recently implemented, ongoing, and proposed revenue enhancement initiatives for BWI are described below and summarized in the attached table. Recently Implemented Revenue Enhancements • Effective June 1, 2003, the MAA implemented a new Basic Use and Lease Agreement (BULA) with the air carriers operating at BWI Airport. Aimual revenues from this agreement are expected to grow $12.1 million, or 28%, to nearly $51 million in FY 2004. BULA also provides several important operating efficiencies (i.e. relocation and use it or lose it clauses) that will result in more effective management of gates and associated space. • Effective September 1, 2003. the tenant employee parking rate increased 76% over two years in order to fully recover operating and maintenance costs of the employee parking lot and shuttle service. Annual revenue will grow nearly $3 million when fully implemented in FY 2005. The rate increase was coupled with replacement of the shuttle bus contractor to improve reliability and customer service. • The car rental Customer Facility Charge (CFC) increased from $3.00 to $3.25 per transaction day effective September 1, 2003. This increase is expected to raise an additional $1.9 million, or 18.4%, in FY 2004. Total CFC revenue is expected to be $12.4 million this fiscal year. Revenue Enhancements In Progress • The MAA has issued an RFP to solicit a developer for the BWI food, beverage and retail concessions to generate additional revenue, improve customer service and provide better product selection for our passengers. When fully implemented after the opening of Terminal A in FY 2006, annual revenues are projected to be more than $10 million. Proposed Revenue Enhancements • The MAA is exploring the possibility of expanding advertising in the terminal and selling advertising on buses, in the garage and on luggage carts. Additional annual revenue could total more than $2 million within three years. • The MAA is looking at selling sponsorships for official products and naming rights for all or part of the Airport terminal and parking facilities. Over the long term, these sponsorships and naming rights could generate annual revenue of $1 million.