Layoffs landing at Massport as ‘worst-case’ budget scenario plays out, Logan air traffic takes nosedive
Layoffs are landing at Massport — where the average employee salary tops six figures — as the agency seeks to bridge a $400 million budget gap over the next three years as a “worst-case” scenario plays out and air travel continues to take a nosedive amid the coronavirus pandemic.
“It’s never a good thing to come in below your worst-case scenario and that’s where we find ourselves,” Massport board member John Nucci said during a Thursday meeting.
Massport’s annual budget has been decimated by the pandemic, dropping from a budgeted $907 million last year to $547 million this year as air traffic out of Boston’s Logan Airport crashed in March and remains among the lowest in the nation.
In revealing what Nucci called a “sobering” financial picture, Massport’s showed anticipated revenue shortfalls ranging from $126 million in the current fiscal year to $141 million next year and $133 million in fiscal year 2022.
It’s a “troubling” picture spurred by plummeting air travel numbers that Massport CEO Lisa Wieland said have come in below even worst-case expectations since August.
When it comes to a return to air travel, Massachusetts — dominated by Logan Airport’s numbers — consistently ranks in the bottom five airports, Wieland said.
Logan Airport saw 2.9 million fewer travelers this September than it did last year — an 82% drop. Since January, the airport has seen 21.8 million fewer air travelers than 2019 — a 68% dip.
While Massport executives tried to hold onto hope that air travel is slowly “recovering,” Wieland said history shows it will take a minimum of three to five years for things to rebound. That’s about how long it took air travel to return follow 9/11 and the Great Recession, she said.
Up until now, Massport has avoided furloughs, layoffs and pay cuts through a combination of budget cuts and federal aid, but an agency spokeswoman said “even if there’s a CARES 2.0 for airports, that funding would … not be enough to fill our budget gap.”
“I think it’s safe to say we’re not going to find our way out of that without cuts and reductions that are going to be painful,” Nucci said.
An agency spokeswoman said it’s too soon to say when layoffs will start as the budget shortfalls are “just diagnosed.”
“We are in the planning phase,” said spokeswoman Jennifer Mehigan. Massport is also pursuing other avenues to generate revenue, including real estate sales, which have been a lucrative venture for the agency over the past decade, accounting for about 6% of its annual budget.
How deep the cuts will go are still anyone’s guess.
“The crystal ball continues to be quite murky,” Wieland said.
Massport — a quasi-public agency — has seen a modest 7% growth in the number of employees over the past five years — but a 21.4% jump in gross pay, records show. The average employee earned about $101,000 last year, according to the state comptroller’s office.
Massport owns and operates Logan International Airport, the Conley Terminal in South Boston, the Flynn Cruiseport and the Worcester and Hanscom airports.
from Boston Herald https://ift.tt/3j3o8OH
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