Allegheny County Controller Chelsa Wagner today released her office’s annual audit of street pricing at the Pittsburgh International Airport, which ensures that retail stores are selling goods at the same prices as non-airport locations. In conjunction with the audit findings, which revealed that some prices were inflated at the airport, Wagner recommended changes to the retail sales structure at the airport. Wagner recommends that, per industry best practices, at least a portion of retail amenities should be moved beyond airport gates, or to the “ticketing side,” where all visitors to the airport, not just ticketed passengers, may access the shops and restaurants. Wagner applauded AIRMALL’s recent investment of $10 million to renovate its retail core, but stressed that the Airport should adjust its current structure to capitalize on additional retail revenue opportunity.
“By moving retail to the opposite side of the gates, more people would have the opportunity to shop and dine at the unique businesses within the airport.” Wagner said. “While it makes sense for us to continue to request adjustments from the Transportation Security Administration, progress hasn’t been made to reduce the restricted access for more than a decade so it is time to try another path – one that we can, in fact, control. Increasing revenue at the airport helps pay down debt, decreases landing fees and makes flying more affordable, thereby bringing more people into Allegheny County.”
All but a few stores and restaurants are located in the airside areas of the airport. Since security measures changed after the September 11, 2001 terrorist attacks, only ticketed passengers and airport employees are permitted in the airside areas and, therefore, can use all airport amenities. Non-travelers are generally not permitted past security gates and have few options to shop or dine.
Wagner applauded the Airport Authority’s efforts to increase AIRMALL access to non-ticketed patrons, including hosting an “open house” and efforts to continue to request expanded non-ticketed access with the Transportation Security Administration. Wagner stressed the need to implement immediate improvements that are in the County’s control and urged the Airport to begin these changes as soon as possible.
“Of course, this alone will not restore the Airport to a hub, but it is vital that we in Allegheny County do what is in our power to generate more revenue at the airport. These incremental steps do make a difference and can reap significant benefit in the long run, both in terms of revenue and of the experience for visitors to our airport.”
Controller Wagner suggested that County Council and the Airport Authority Board consider conducting a feasibility study of potential changes to put the AIRMALL outside of the gates. Current industry practices include renovating airports to expand shopping access to non-travelers, bolstering the local economic impact. Research shows that airports built or remodeled after September 11, 2001, when security measures changed, have their amenities outside of the gates so anyone can access the amenities, thereby enhancing retail revenue. Terminal concessions currently generate more than $7 million in revenue for the airport.
Wagner made these recommendations in conjunction with the release of her audit of street pricing at the Airport, which the Controller’s Office conducts annually. When the new airport opened in 1992, the County Commissioners set a policy so that items or services being sold within the airport were to be priced the same as those items or services offered locally, outside of the airport. The Controller’s audit revealed an inflation of price on some items at the airport compared to off-site stores nearby, which is in violation of an enforced policy that ensures that all sales prices charged to Airport patrons do not exceed those of comparable businesses. Some items include headphones, Steelers shorts, beef jerky and a Harley Davidson leather jacket. Wagner noted that AIRMALL has been responsive in prior years and has been cooperative with her office’s findings in the current year, including adjusting those items found to be overpriced to conform to market value pricing. For more information about the audit, and the non-compliant items, view the report here.
Additionally, Wagner’s office is currently performing an audit of how contracts are awarded at the Airport. That audit is expected to be released in early 2015.