The GNWT held a public meeting at the legislature Wednesday night concerning Bill 7: An Act to Amend the Revolving Funds Act, which would introduce a new revolving fund for the Yellowknife Airport.
The fund would authorize $36 million for ongoing business, operations and maintenance of the city’s airport.
Currently, revenue from the airport goes directly into the GNWT’s consolidated revenue fund, while the department of transportation pays for operation expenditures that are approved during the budget process.
Because of that, the territory’s transportation minister says the airport often has to compete against schools and hospitals for funding.
“This model does not allow for sufficient financial resources to support effective long-term infrastructure investment, economic development and businesses at the airport,” said Wally Schumann.
“It is also a serious drain of the NWT’s financial resources.”
According to Schumann, a revolving fund would eliminate the need for subsidies from the GNWT, currently amounting to over $4 million annually.
Transportation officials argue it would also allow the airport to become financially self-sufficient, allowing them to invest in more parking and retail space and improve the building for travelers.
But it’s the travelers who’ll be paying for it.
A proposed airport improvement fee that would contribute to the fund would charge $20 for passengers traveling outside of the NWT through Yellowknife, and $10 for within the territory.
While it may not sound like a huge fee, NWT Tourism believes it will cost the tourism industry half a million dollars annually.
Effect on the tourism industry
Members of NWT Tourism spoke at Wednesday’s meeting. They represent roughly 200 businesses either directly or indirectly involved in the territory’s tourism industry.
NWT Tourism chairman Don Morin said their members oppose the proposed fees.
He says aurora tourism competes with places like Alaska, Iceland and Scandinavia for business. Travelers can go to any of those places to see the aurora, and if they can save money by going elsewhere, he says they’ll do it.
“You get a large amount of our tourists coming in that have lower-end budgets,” Morin said. “They look at the price and if they can see aurora in Iceland, that’s where they’re going to go if they can go there for $30 cheaper.”
Morin says he doesn’t have exact data on how much increased fees would hurt tourism, but says one detriment to the industry here already is the high cost of travel.
Cathie Bolstad, executive director of NWT Tourism, says any increase in cost is bad for business.
“For those who work in the tourism industry, we know that any increase in cost is going to have a negative impact on tourism travelers choosing a destination in comparison to other destinations,” she said.
“The visitor we’re trying to entice looks at what does our destination have to offer in terms of products and experiences, and what’s the price they’re going to pay to get here for that experience.”
Despite its opposition towards increased fees at the Yellowknife Airport, NWT Tourism says it supports the vision for a better airport and experience for tourists.
However, Morin says he doesn’t believe the government has done proper research into what effect it could have on the economy.
“I’ve never seen those numbers,” he said. “I’ve never seen any information from that as of today.”
MLAs voted unanimously Wednesday to move Bill 7 as ready for consideration in the legislature.