AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

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AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Daria Knupp on Aug 29, 2017 10:59 am

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With the filing of official complaints to the FAA, AOPA rolled out the next phase of its ongoing effort to tackle egregious fees charged by certain fixed-base operations around the country. The move comes after months of effort identifying the worst offenders and attempting to work with local airport sponsors receptive to ensuring their communities offer pilots reasonable access to their airfields, often described as the local on and off ramps to the National Airspace System. Read more here.

Have you experienced any egregious FBO pricing practices? 
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Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Randall Langford on Oct 26, 2017 10:48 am

Chris,
 
FBO’s use to compete for fuel sales with great voracity.  They used flashing lights, free steaks, wine, beer, green-stamps, and short skirts to entice customers.  Even 172 drivers.    The cost of fuel was low.  And the cost of delivering fuel to your airplane was low too.
 
When fuel prices spiked, the prudent pilot shopped, cajoled and started to tanker fuel for his own cost advantage.  Pilots are cheaper than anybody and will find a way around high prices.  And the service fees became one way for the FBO to stay in business.
 
Litigation is another driver of FBO cost, and a big one too.  That may be why it cost $250 a week to watch your plane in South Florida.  Imagine if some doper were to steal your plane and crash it into a schoolyard.  Or, what would happen if someone were to snatch all of your radios.  Lawyers, Lawyers, Lawyers.
 
The AOPA is trying to sue its way to lower fuel price and fees.  Lawsuits are a big reason for high prices in the first place.  As I said, maybe some crooked politicians were exposed in Los Angeles, but someone please call me when prices go down at John Wayne or Jackson Hole or Stewart and West Palm. 
 
When you go down this winter, ask to be parked on the ‘no liability’ ramp.
 
Randy
 

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Christopher Kuyoth on Oct 26, 2017 9:51 pm

Randy,

I'm not saying that the services they provide should be free nor am I saying that the charges are not justifiable.  I'm simply stating that I should have the option, at a public use, tax payer funded airport to decline those services if I choose.
If I decline the services of the FBO and am not paying for them, how can they be found liable?  I park on non-monitored, municipal ramps all the time.  I sleep well knowing that the airplane is properly insured.

Chris

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Randall Langford on Oct 31, 2017 11:12 am

Chris,
 
I am saying that no one can sue their way to lower prices. 
 
Randy
 

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Tino Ferrulli on Nov 1, 2017 4:20 pm

My FBO has a sign up in there lobby offering Jet A for $7.67 per gallon, and AV Gas for $9.00 at KSDL in Scottsdale. 
What is everyones thoughts on that pricing?

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Edward Klapka on Nov 5, 2017 8:00 am

Tino Ferrulli:
My FBO has a sign up in there lobby offering Jet A for $7.67 per gallon, and AV Gas for $9.00 at KSDL in Scottsdale. 
What is everyones thoughts on that pricing?

According to my EFB, at KSDL 'm seeing nearly $9 for 100LL Full Serve at Ross, but closer to $7 at Signature.  Further, Self Serve is in the $5 range.  And if you hop to a nearby airport you can save another Buck.

My thoughts:  
1.  You don't normally see Signature as the lower price offeror.
2.  The KSDL providers don't appear to want to pump from the truck.
3.  There is a not unreasonably priced Self Serve pump.
4.  I don't see a problem at KSDL.  Supply and Demand are working.  

Ted

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Michael Hounslow on Nov 6, 2017 7:43 am

Need to stop worrying about the price of the fuel and concentrate on the “fees” when no fuel is used.  If you own a Walmart or Target, it is considered in the public domain...you get to park in their parking lot, go to the public bathroom and use the water fountain.  Don’t have to buy a thing to use these facilities.  If you go to the authors Cadillac dealership, you get to park in the parking lot, use their bathroom and drink from a PUBLIC water fountain.  The dealer can’t refuse you.  The problem is not if Signature or Millionaire or Atlantic wants to sell fuel for $8/gallon.....they can do what they want.  The problem is that all these FBO’s are using ramps built by the citizen taxpayer.  Signature and Atlantic did not pour that 10” thick concrete in front of their buildings, the Palm County citizens and FAA paid for that concrete.  Therefore, charging tax paying citizens to park on that concrete is truly distasteful.  I agree that lawyers need not be involved in the solution BUT there needs to be a walk-around....a way to say “no thank you” to the line boys, fuel prices, rides to the front gate, etc.  Our small aircraft are becoming worthless while the bottom lines of the FBO’s get fatter and fatter.  I don’t care if the FBO wants $8/gal...the problem is when they put a de facto gun to my head and say “Pay this fuel price or give us $50 for nothing”!  I used to know high school bullies that did the same thing with MY lunch.  And again, our PUBLIC airports need to enforce a “walk around” for folks who don’t want to deal with the outrageous FBO fees.  The only reason Signature, Atlantic and Millionaire have the policies they do is because they CAN.  In the meantime, my airplane becomes less valuable, for example, when I have to park at Monroe, NC to do business in Concord, NC because Concord’s prices are completely unreasonable.  It is not fun to fly 2 hours to save a 5.5 hour trip, THEN have to drive an hour because the FBO’s are unreasonable.

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Ronald Levy on Nov 6, 2017 11:54 am

Michael Hounslow:
Need to stop worrying about the price of the fuel and concentrate on the “fees” when no fuel is used.  If you own a Walmart or Target, it is considered in the public domain...you get to park in their parking lot, go to the public bathroom and use the water fountain.  Don’t have to buy a thing to use these facilities.

I don't think that's quite true.  Many stores like that have signs about "parking for customers only", or "no public restrooms".  It's still all private property and they can (like airports) still make "reasonable" restrictions on access and use (as long as they don't violate the various non-discrimination laws on the basis of race, gender, etc).  Of course, as all RV'ers know (and I'm talking about the ones with beds in them, not the ones with wings), WalMart encourages RV parking in their lots, but that's largely a well-considered marketing decision, not a legal entitelment, and my observations over the years and around the country suggest the RV'ers reciprocate by parking in the outer areas of the lots as a courtesy to other customers and patronize WalMart for supplies (which is why WalMart allows it).

 If you go to the authors Cadillac dealership, you get to park in the parking lot, use their bathroom and drink from a PUBLIC water fountain.  The dealer can’t refuse you.  The problem is not if Signature or Millionaire or Atlantic wants to sell fuel for $8/gallon.....they can do what they want.  The problem is that all these FBO’s are using ramps built by the citizen taxpayer.  Signature and Atlantic did not pour that 10” thick concrete in front of their buildings, the Palm County citizens and FAA paid for that concrete.  Therefore, charging tax paying citizens to park on that concrete is truly distasteful.

OTOH, those FBO's are paying rent to the airport for that space, and they're responsible in many ways for what happens on those ramps and in those buildings.  In that sense, I have no objection to them charging reasonable fees for access and use of their facilities.  The problem arises when $ignature gets a monopoly position and charges fees well above those they charge for the same services/access at similar airports where there is competition.  To me, that's the fundamental issue at the airports where AOPA is pursuing these actions, and I fully support AOPA's efforts in that regard.  But to argue that merely because public money was used to build the airport all pilots have an automatic right of free access to FBO facilities is as abhorrent to me as the actions of those monopoly FBO's in charging outrageous fees.

 I agree that lawyers need not be involved in the solution BUT there needs to be a walk-around....a way to say “no thank you” to the line boys, fuel prices, rides to the front gate, etc.  Our small aircraft are becoming worthless while the bottom lines of the FBO’s get fatter and fatter.  I don’t care if the FBO wants $8/gal...the problem is when they put a de facto gun to my head and say “Pay this fuel price or give us $50 for nothing”!

I think that's where your argument loses its legitimacy -- you're not paying "$50 for nothing", you're paying $50 for the use of the facilities the FBO paid to build/maintain and space they paid to rent.  I don't think it's reasonable to expect free access to FBO facilities, and I think it's a fight that cannot be won as long as we have a capitalist economic system.  As former AOPA President Phil Boyer once pointed out, it's a bad idea to expend AOPA's limited political capital on a fight we cannot win.  However, when a monopoly FBO charges $50 for the same facilities/services that only cost $20 at an airport where there is competition, I believe that is a fight we can win and therefore should be fought with all the resources AOPA has available.

 

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Christopher Kuyoth on Nov 7, 2017 9:23 pm

Ronald,

Well said.  You have obviously taken the time to look at the issue from all sides.

To me, it boils down to 2 things; first, having to pay for services that I do not want, regardless of price.  I really don't want a red carpet laid on the ground, I believe that it sends the wrong message to my kids.  I really don't want someone retrieving my bags from inside the airplane, for the same reason that I load them, to avoid scratched interior panels. I really, really don't want someone moving my airplane, particularly when they insist on using the same tug used to move the Citation X. I've incurred costly damage when turn stops were exceeded.  When I go to the grocery store to buy a pound of ground beef, I shouldn't be forced to buy the buns, lettuce an tomatoes too.  I have asked many Signature-like FBO's for the "no-frills" park-and-go rate and told they have one level of service only.  That would be perfectly acceptable if I had the option to decline that one level of service and park on the other end of the ramp.

Secondly, I don't wish to be forced to pay for services/goods that I feel are overpriced.  Free enterprise will work out the rates if no monopoly exists.  Example - If I have a choice to park on the unmonitored municipal ramp and enter/exit through a key-code gate for a nominal fee, the FBO will need to provide their additional services (security monitoring, movement oversight and ingress/egress through their facility) at a rate in which I (or a portion of potential consumers) feel is an acceptable value.  If not, I'll simply take my chances on the public ramp, remembering to bring my own tie downs and ensure that my insurance is paid.

Because I am obviously needy and unreasonable in my expectations, I normally seek out smaller airports that are more accommodating to my desires.  I make it a point to buy their reasonably priced fuel, even if I can find it for less nearby or don't necessarily need it.  Most of the time, I have found that the smaller fields have hangar space to offer in the event that inclement weather should arise.  The large FBO's won't bother with a 206 when they can charge the corporate Beechjet 10x as much.  Again, I'll pay the rate when there is value in it, just like every purchase decision.

The problem is growing. Even smaller, often less convenient airports outside of metropolitan limits are being taken over by corporate-jet focused FBO's.  This has led to a phenomenon where entire geographical regions are being "FBO monopolized".  Try to find an airport within an hour and a half drive of Jupiter, FL that isn't run by Signature or a similar type FBO with a field monopoly.  Yes that area of the country receives a good amount of corporate/personal jet/turboprop traffic that want the red carpet, but folks who don't have nowhere left to go.  I'm betting that there are many areas around our great country that are experiencing the same thing.

 

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Ronald Levy on Nov 7, 2017 10:12 pm

Christopher:

​I think we're in agreement.  I strongly support the AOPA's efforts to deal with egregious pricing by monopoly FBO's.  And I do want to see choices and competition wherever that's possible, although a few decades in this business has taught me that most airports haven't the business volume to support more than one FBO.  That said, in most cases the one FBO at those smaller airports doesn't take advantage of that position, since that will kill the business.  The real problem comes when you look at airports with a lot of business and only one FBO.  In those cases, there are external factors which force folks to fly there and be fleeced since the alternatives are worse.  It's those cases, where airport managment allows monopoly FBO's to squeeze the customers with absurd pricing that we need to focus our efforts, and that seems to be AOPA's goal, which I support completely.

​BTW, it's been my experience at FBO's where there's either small volume or viable competition, when I arrive in my Tiger, I get treated just as well as the big Grumman that arrives behind me.  Seems to me those folks realize that the person flying the 4-seat single on Saturday may be flying a bizjet on Tuesday, and will make choices based on how s/he is treated when flying the little bird.  OTOH, where there is competition to force better treatment and there's enough volume that they don't care whether the pilot of the little plane ever comes back, the sort of treatment we've been discussing becomes common.  Again, that's where AOPA should be, and apparently is, focusing their efforts.

Ron

Re: AOPA FILES OFFICIAL COMPLAINTS OVER FBO FEES

Posted by Ronald Stacey on Nov 14, 2017 10:30 am

The real issue is that the "big biz jet" FBO's have a business model that doesn't include avgas driven piston airplanes. Put differently, they don't want the avgas business. These outfits are structured to uplift thousands of gallons of Jet A into big jets, not 50 gallons into a piston single. The capaacity is finite so the FBO's ration it accordingly with pricing.  This economic reality has been the case at the major airports for decades. When was the last time you took your Cessna 150 into JFK?

 And it's not jsut the FBO's. Part of the economic equation includes the munuicipal Airport Authority looking to maximize the return on the "airport asset" which meas big busy airports charging big fees to the FBO's. The airport asset isn't any different that other real estate; the location drives the demand which drives  the pricing.  Two of the regional airports in my area recently used Federal money to upgrade the load bearing capacity of the runways. That wasn't done to attact more piston aircraft business.

​At my "big biz jet" very busy airport (where I rent a hangar), we have two FOB's. The avgas pirce (FS only) is $7.45 at one and $6.85 at the other as of today. These prices are among the highest in the region.  That exact same fuel is available 11 miles away for $4.00 at a similarly equipped airfied. Gues where I buy gas? And, that is how the free market works. (If you are wondering about the poseted Jet A prices, these are less indicative of market pricies since most Jet A is done on a negotiatied contract basis. Try getting a UVAIR card for avgas.)

 I've been a pilot for 47 years. I'm presently flying about 150 hours a year in a single engine piston. I could see the FBO avgas "squeeze out" coming long ago, surging in recent years with the recovery of the business jet industry. Perhaps we should be less concerned about the availability of avagas and more concerned as to weather or not anyone will sell it to us for a reasonalbe price  where we want to buy it.

​Ron