Durango-La Plata County Airport aims to create a year-round connection between Durango and Houston, DRO’s No. 3 market for origin and destination market. But doing so may require some front-end investment from the city.
Residents might consider it good news their tax dollars are not being proposed to fund such an investment.
In September, Mike French, city prosperity officer, and Tony Vicari, DRO aviation director, pitched lodgers tax funding for a future possible minimum revenue guarantee agreement with United Airlines.
The primary payers of lodgers taxes are visitors to the city who stay in hotels. The tax rate is 5.25%, according to the city of Durango.
Minimum revenue guarantees are commonly used countrywide – including in towns and cities such as Montrose, Grand Junction, Telluride, Gunnison and Steamboat Springs – to incentivize airlines to expand their service routes, he said.
“It’s a minimum revenue guarantee, so the contracting entity locally working with the airline commits through negotiations to a set level of guaranteed revenue for the airline,” he said.
If an airline’s ticket sales on a route exceed total revenue, then minimum revenue guarantee funds aren’t spent and can be used for other purposes later, he said. If an airline’s ticket sales underperform and do not reach an agreed upon balance, the contracting local entity pays the difference.
Lodgers tax funds and contributions from regional transit authorities and private businesses such as ski resorts are common funding mechanisms for minimum revenue guarantees, Vicari said.
“The long-term objective here is to create long-term, year-round air service into the Houston market without the need for minimum revenue guarantees,” he said.
A $185,000 lodgers tax investment is proposed for the winter 2026-27 season, with another $220,000 to be contributed by major employers in the area, French said.
United Airlines increased its 2026 schedule for nonstop flights between Durango and Houston’s George Bush Intercontinental Airport to span from May 21 to Aug. 27, about five weeks longer than its daily service period last summer, Vicari said last week.
“The strong performance we saw over the Houston route in the summer of 2025 correlated directly to United wanting to expand that season, particularly on the front end, pushing it up to the memorial weekend as a start point,” he said. “Last year, that didn’t start until the very last handful of days of June.”
He said if United Airlines decides to pursue a minimum revenue guarantee with the city to trial a winter service route, the route would likely begin around Christmas 2026 and end around March 2027.
If implemented, he said, the city would have ongoing monthly performance updates with United Airlines to monitor the winter route’s performance, to determine if financial or marketing support would strengthen the route and how to adjust that marketing for long-term implementation.
He said October traffic this year was only 2% to 3% lower than peak traffic in July, which was “remarkable.” Traffic typically peaks sharply during the summertime and declines around the middle of August. But September and October markets are becoming stronger.
cburney@durangoherald.com
