Airport director outlines updated Allegiant operating agreement, projects 40% rate change and incentives

Mark Sprague, the airport director for St. Pete–Clearwater International Airport, told commissioners the airport has outgrown the terms of its decades-old agreement with Allegiant Airlines and presented a modernized operating agreement that consolidates six revenue structures into three.

"Passenger traffic has increased over 67% in the last 5 years," Sprague said, and the new contract moves to a per-turn facility fee intended to align costs with passenger use and provide a predictable revenue stream. Sprague said the agreement includes a two-year airline service incentive program with shared marketing support — $150,000 in year one and $100,000 in year two split 50/50 with Visit St. Pete/Clearwater — and tiered per-turn savings as Allegiant reaches departure thresholds.

Sprague told the board the agreement would start raising rates in fiscal year 2027, with a projected roughly 40% increase in the initial adjustment and an annual incremental increase of about 3% thereafter. He estimated that the first-year revenue bump would be in the range of "approximately $1.2 million" over the current agreement and said the new fee structure is designed to support capital improvement programs "without creating additional county debt."

Commissioners asked for supporting analysis and documentation. Commissioner Nowicki and others pressed for the consultant pro forma and a financial breakdown underlying the 40% figure; Sprague said staff and consulting firm Mead and Hunt developed the pro forma and agreed to provide the materials to the board. The airport director also said the agreement contains no revenue guarantee — revenues are volume-driven — and that the airport built in an 18-month operating contingency in the pro forma in case an airline reduces service.

Sprague and commissioners discussed competitive comparisons. Sprague said PIE's cost-per-enplanement (CPE) would rise from about $2.35 to $3.11 under the proposal but remains comparatively low for a small-hub airport, and that Tampa International's CPE is much higher in part because Tampa carries debt. Commissioners asked whether Allegiant retains exclusivity; Sprague said exclusivity applies to Allegiant's office footprint only and that all gates and ticket counters remain common-use.

The board asked staff to provide the signed contract and pro forma and to bring the item back for formal consideration in September.