Home Business P.A.G.E. Reveals More Details about Skywest Subsidy

P.A.G.E. Reveals More Details about Skywest Subsidy

May 4, 2023

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May 3, 2023

Pocatello for Accountable Government Entities: Keeping Government Accountable

Pocatello for Accountable Government Entities has been digging into the details of the City’s subsidy agreement with SkyWest. The subsidy agreement requires that the City of Pocatello repay SkyWest for any shortfall between SkyWest’s operating costs and their revenue, up to $1,010,000 per year. P.A.G.E.’s research shows that SkyWest’s shortfall for the first quarter of FY 23 “exceeded the maximum quarterly subsidy approved by Council,” as they discussed in a social media post dated April 25. A second records request has yielded more details about the subsidy. In a social media post dated May 1, P.A.G.E. explains the new information:

SKYWEST UPDATE #2:

Turns out we lacked key information regarding SkyWest subsidies. In different circumstances (with strong communication & transparency), it would NOT have taken a second public record request (recently shared with us) to obtain the most up-to-date information.

The first (12/15/22) agreement was limited to 1st quarter 2023 and set a maximum subsidy of $346,459. Council also gave the Mayor authority to sign subsequent “quarterly” agreements, set a maximum annual subsidy of $1,010,000, and waived all rent and landing fees. Subsequent agreements were anticipated, however, the new record contained a few twists.

1. It “appears” with the new agreement that SkyWest will NOT be shorted the $41,877.21 mentioned in our earlier update on 04/25/23. How?

2. The 2nd Quarter 2023 SkyWest agreement (signed by Mayor Blad on March 8, 2023) was NOT actually for the 2nd Quarter of 2023. Instead, it REDEFINES the 2nd Quarter as being for the period 03/01/23 – 05/30/23. How “creative” is that?

3. The new agreement also raises the 1st quarter MAXIMUM set in December 2022 from $346,459 to $400,625.

4. A new addition to the 2023 subsidy agreement (compared to the 2022 version) is the waiver of rent and landing fees. Based on information provided in recent records and the FY23 revenue budget, we estimate this figure will be between $22K – $30K per quarter. When we asked a councilmember for this information, he did not have the figure. That’s not surprising given no one thought it important enough to ask the total cost of the waivers when approved on 12/15/22.

P.A.G.E. also posted a copy of the Transportation Services Agreement between the City of Pocatello and SkyWest Airlines, dated March 8, 2023.