MONTEGO BAY, St James – When the new US$5 (J$260) Airport Improvement Fee (AIF) was announced for passengers leaving the island, as part of the divestment of the Sangster International Airport, domestic travellers thought they had escaped the dragnet.

Not so. Domestic passengers who take flights out of Sangster are subject to a US$5.50 (J$286) fee for what the Airports Authority of Jamaica (AAJ) calls passenger safety and security, which they started paying in February 15.

Additionally, passengers leaving from the Negril, Ken Jones and Boscobel aerodromes pay US$1.52 (J$79.04).

International passengers, who have for years paid the passenger safety and security fee (PSSF), now have to shell out an additional US$0.21, moving it to US$7.81 (J$406.12).

“We have, to some extent, been subsiding domestic operations and what we have done is, in effect, reduce the subsidy on domestic operations by instituting these charges,” explained the AAJ’s senior vice-president of planning and corporate development, Sancia Templer.

The Authority has been running newspaper ads advising the public of the new fee for domestic passengers but its implementation has gone largely unnoticed. In most cases, the fee has been included in ticket prices.

“Ultimately the passenger is going to pay because the airlines incorporate it in their fares,” Templer explained.

Airline clerks were busy, Friday, trying to explain the new fees to domestic passengers leaving from Sangster. Most were unaware of it.

There are likely to be concerns raised about the effect the fee will have on both domestic and international travel.

A visitor to the island, for example, who lands at Sangster then flies to Tinson Pen on business the next day (US$5.50 PSSF), returns to Sangster from Tinson Pen (US$1.52 PSSF) and then leaves the country from Sangster (US$7.81 PSSF) would have to pay a total of US$14.83 in passenger safety and security fees. That’s almost double what would have been payable before the new fee structure took effect.

The airlines now pay over all PSSFs to the AAJ which ostensibly use it to cover the maintenance and operational costs of the facilities where the fees are collected. But as of March 1, when MBJ Airports Ltd takes over operations at Sangster, the AAJ will pay over the fees generated at that airport to the private sector operators.

With an estimated 40,000 passengers travelling between Montego Bay and Tinson Pen per year, MBJ Airports Ltd stands, at the current exchange rate, to raise about J$11.4 million per year in PSSFs from that route alone. MBJ Airports is the operating company for the international consortium that has a 30-year concession to operate Sangster.

The AAJ’s Templer said that the passenger safety and security fee will be used to meet such costs as for janitorial services, maintaining the grounds and other services provided at the airport.

“When the concessionaire takes over, they still have to earn revenues, which they then use to cover the cost of operating the facilities,” she explained. “The primary use of that fund is to maintain and operate the facility. That is not to say that, depending on how they (MBJ Airports Ltd) manage, there might not be some surplus that goes towards the airport development. But this is the main source, really the only revenue, other than commercial revenue, that goes to the airport operator.”

Unlike the airport improvement fee, this one to be paid by domestic travel did not need parliamentary approval, Templer said.

AAJ officials have been at pains to stress that the PSSF is an entirely separate fee from the airport improvement fee. But with both implemented at the same time, travellers link them both to divestment of the Montego Bay airport, which has been criticised by the Opposition Jamaica Labour Party (JLP).

Under a January 15 agreement signed this year between MBJ Airports Ltd and the Jamaican Government, the concessionaire will carry out a US$200-million expansion of the airport, operate the facility for the next three decades after which its control will then revert to the AAJ.

MBJ Airports Ltd gets 100 per cent of the revenue generated, which would normally go to the AAJ; but they also have to assume responsibility for all the operating costs. They will also have to pay the AAJ a fee, based on the number of passengers and cargo that passes through the facility.

At last month’s signing, Government officials used the opportunity to once again rebuff complaints – mainly from the JLP – that MBJ Airports Ltd was getting the better end of the deal, and the country would have been better served if the Government had borrowed the funds and did the upgrading itself.

“Whatever we borrow for this kind of development reduces what we can borrow for other such infrastructural and social programme development,” Prime Minister P J Patterson said at the signing. “…This agreement does not require any Government guarantee, so the capital risk will rest with the investor.”

In addition, Government officials have long stressed that the divestment of Sangster would transfer the costs associated with capital and operating expenses from the taxpayer to the users of the facility.