I traveled to the state Capitol last week on behalf of the Regional Economic Area Partnership to respond to a performance audit of the Kansas Affordable Airfares Program conducted by the Kansas Legislative Division of Post Audit. My message to the Post Audit Committee was as follows:
Kansas state lawmakers established the program in 2006 and provided for state financial participation in a regional partnership initiated by the city of Wichita and Sedgwick County in 2001. This state-local partnership focuses on addressing the program's statutory objectives of providing "more air flight options, more competition for air travel and affordable airfares for Kansas" by attracting low-fare air carriers to Wichita Mid-Continent Airport. The program has succeeded in meeting these requirements.
Since 2000, overall fares are down 24 percent and passenger volume is up 23 percent. The recruitment of three low-fare air carriers has led to additional competition in 194 one-stop destinations in the United States.
REAP estimates that the investment of less than $50 million through this state-local partnership has saved business and other travelers flying in and out of Mid-Continent Airport more than $500 million in the aggregate over this period. These airfare savings benefit Kansans from three-fourths of our state and allow for more dollars to remain in the pocketbooks of our citizens and businesses.
By all measures, including state auditors, the program has met its statutory objectives and provided a positive return on investment.
REAP will continue to focus on the statutory objectives of the program and be supportive of its mission. REAP has not independently assessed the economic impact of the program, but believes the work done by the staff of the Legislative Division of Post Audit confirms a positive economic impact that returns money to the state. The legislative staff concluded that the program creates 3,178 annual jobs on average and returns $2.32 in state tax dollars for every $1 invested in the program.
In 2006, state lawmakers assigned REAP responsibility for administering the program, including the task of providing annual financial and performance reports. Each year, REAP has provided these reports to the Department of Commerce and the legislative body, and has carried out its responsibilities with a commitment to transparency and financial integrity. In my testimony, I indicated REAP's willingness to work with state officials, both legislative and executive, in accurately documenting exactly what is being accomplished through this state-local partnership.
REAP believes the Kansas Affordable Airfares Program contributes substantially to the entire Kansas economy, as the audit findings support. REAP remains committed to administering the program with a focus on meeting statutory objectives and providing the most accurate and transparent reporting.