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SkyWest Airlines payment agreement may cost City of Cheyenne $400K

Cheyenne Regional Airport is also looking to request federal funds to rehabilitate its air traffic control tower.

Cheyenne Regional Airport (Lisa Hushbeck/Cap City News)

CHEYENNE, Wyo. — The City of Cheyenne may soon be paying $400,000 to continue flight services with SkyWest Airlines at the regional airport.

At Monday night’s council meeting, Cheyenne City Council members considered a payment agreement with Cheyenne Regional Air Service Focus, or CRAFT, for fiscal year 2025. Councilmembers also supported Cheyenne Regional Airport’s federal funding request for maintenance on its air traffic control tower.

City’s payment agreement

The agreement, known as a Minimum Revenue Guarantee — or MRG — is currently set at $2 million. The city’s role is to pay 20%, or up to $400,000, of the MRG and thus solicit flight services from SkyWest.

However, what the city ultimately pays won’t necessarily be as high as predicted. In an MRG, municipalities or counties pay the difference between what a corporation states it needs to make and what it actually makes.

Councilmembers on the city’s Finance Committee will review the payment, after which the City Council will make a decision on the MRG at its July 22 meeting. The city would use money from the 2021 Specific Purpose Option Tax Fund to pay its part of the MRG.

Funding for airport control tower

The city has also lent its support to the Cheyenne Regional Airport for its federal funding request. The airport is proposing to request up to $850,000 over a five-year period from the Federal Aviation Administration to rehabilitate its control tower. According to a supporting document, the airport tower requires sealing for water intrusion, HVAC and electrical improvements, door replacements and other building repairs to improve staff safety.