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Is YVR up for sale?

Selling Vancouver International Airport to a private interest would be a mistake, said its president and CEO, Craig Richmond, who hopes the idea never gets off the ground.
YVR
Turning Vancouver International Airport over to a private interest would be short-sighted, warns the airport authority’s president and CEO, Craig Richmond. File photo

Selling Vancouver International Airport to a private interest would be a mistake, said its president and CEO, Craig Richmond, who hopes the idea never gets off the ground.

Richmond was reacting to a recent Canadian Transportation Act Review, commissioned by the federal government, which includes the suggestion Canada’s major airports be taken out of local control and sold to help finance infrastructure spending across the country.

With an estimated market valuation of somewhere between $4-6 billion, Richmond said he can understand the attraction, but feels it would be a short-sighted move.

“I’m not against more infrastructure in Canada,” Richmond said. “And I also agree that if you sold all the major airports you’d probably get a big cheque. But therein lies the problem, because these airports have already been paid for by all the passengers and airlines coming through here and other airports.

“The government will take their money and go, but the person who buys it has to now make a reasonable rate of return,” he said. “That’s our big objection. It will raise costs and drive down customer service because this new entity (private owner) will be interested on one thing – that is getting the maximum return they can.”

There’s also the issue of losing local control of the airport to outside interests.

“If it is sold off, the decisions will be made in New York, London and Toronto,” Richmond said. “And that’s a big difference.”

He added the realization would also set in quite quickly that a sell-off was short-sighted, if Ottawa goes with that option.

“I think five years after you did it, you’d start to wonder, ‘What did we do?’ And there’s no going back,” he said. “Once you sell for several billion dollars you’re never getting it back and now it’s in the hands of people, who are not bad people, but they have one goal, to maximize the profit out of the airport. That’s the whole point. Why would they buy it otherwise?”

The airport sale was just one of the suggestions in the report titled Pathways: Connecting Canada’s Transportation System to the World that was initiated by the Stephen Harper government and written by former Conservative MP David Emerson, who was also YVR’s first president and CEO.

“David has always thought airports could benefit from private capital,” Richmond said. “And if you read his recommendations, it intimates that the airport authorities would make themselves private. But what’s happened since then is that the government wants to sell them. There’s a difference between those two.”

YVR was transferred from Transport Canada to the private, non-profit airport authority in 1992. Since then, according to the authority’s figures, it has paid the federal government a total of $1.25 billion in lease payments, while investing $3.1 billion back into the airport’s infrastructure.

That financial cycle is one Coun. Bill McNulty said he would need convincing to change.

“It would be like selling the golden goose,” he said, adding YVR is home to about 5,000 jobs and is a significant, local taxpayer.

McNulty also said he was concerned a potential sale would affect Richmond’s representation on the YVR board of directors.

Currently, the city has one member, Howard Jampolsky, who was appointed by the city to the board.

“We have a very good relationship with YVR when it comes to matters like noise management and zoning under the flightpath,” McNulty said. “And whenever we’ve had issues that needed to be discussed, we’ve managed to find common ground.

“I don’t know how that would be affected by bringing in a new private interest to run things.”

Mayor Malcolm Brodie said city staff is in the process of compiling a report on the matter and reserved comment until that has been reviewed

Coun. Carol Day likened the prospect of selling the airport to putting the property public schools are situated on up for sale.

“Once you do that, it’s hard to get back the land you need when more schools are necessary,” she said, adding privatization is not always a beneficial course of action.

Steveston-Richmond East MP Joe Peschisolido told the News from Ottawa Wednesday that the Liberal government is now examining the report and determining how to move forward.

“We are looking at all the consequences,” he said. “As a government, we haven’t made a decision.”

Peschisolido said he first looked at the report back in July and said the overall document did not reflect the current government’s position.

“But as the government, we are doing the responsible, prudent thing and we’re examining his (Emerson’s) proposals.”