Allegiant Air, LLC has been operating at the Airport since March 2006. During this time, Allegiant had not leased space in the Terminal Building and operated at the Airport through an agreement with Horizon Air, whereby Horizon used its leased Terminal Building space and employees to provide ground support services for Allegiant flights. Allegiant has terminated its agreement with Horizon regarding ground support services and leased its own space in the Terminal Building. The City Council approved a Scheduled Airline Operating Agreement and Terminal Building Lease with Allegiant at its March 22 meeting. Allegiant has contracted with Worldwide Flight Services, Inc. to provide all ground support services, including ticketing, baggage handling, and passenger loading. To ensure that specific operating requirements will continue to be met, a standard Scheduled Airline Operating Permit between the City of Billings and Worldwide is required. The Operating Permit ensures that this ground support operations company follows certain operating parameters and procedures, including providing proof that the proper insurance coverage is in place. The Permit is automatically renewable for one-year periods, unless there have been no operational activities for three months, or either party chooses to cancel the Permit with 30 days written notice.

The City Council may:

• Approve the Operating Permit,
• Not approve the Operating Permit, or
• Request staff to renegotiate some part of the Operating Permit.

Under the new Operating Permit, Worldwide would not lease any new space in the Terminal Building, but would operate from space currently leased by Allegiant Air, LLC, the airline affiliate contracting its services.  Terminal Building rents and landing fees will be paid by Allegiant under its Scheduled Airline Operating Agreement and Terminal Building Lease.

Staff recommends that Council approve and the Mayor execute the Scheduled Airline Operating Permit with Worldwide Flight Services, Inc.