Nebraska Town Taxes Itself to Attract Air Service, but Goal Is Grounded : Transportation: Sidney has been without a carrier since March, when the only one willing to serve the area pulled out-- subsidy or no subsidy. Problem typifies situation in rural America.

The wind-swept airport on the plains south of this little town is a lot quieter these days.

No longer do the small Beech 1900 turboprops of GP Express Airlines roar off toward Denver or Alliance, Neb., twice daily. As of early March, the 6,000 residents here in the arid hills of western Nebraska were erased from the country’s aviation map when the company determined that its service made no economic sense, even with large subsidies.

Fewer than two people a day, on average, used the service. But those who did say they will miss it.

“I don’t intend to drive that far,” said Vinnie Olinger, 73, who flew 165 miles to Denver several times a year to see family. “People get a little bit older, and they don’t trust themselves in traffic.”

Sidney’s problem is typical of hundreds of small communities that have struggled to retain air service in an era of deregulation when the big airlines pulled out of small markets.

Yearly, Congress debates programs such as the Essential Air Services Program, which has subsidized air service to hundreds of small cities and towns since 1977.

The debate is under way again this year. President Clinton’s fiscal 1995 budget recommended tightening eligibility requirements and cutting the subsidy to $25.6 million, continuing a steady downsizing of the program that at its peak in 1981 cost $86.3 million. The House Appropriations Committee voted to kill the program, but some funding is likely to survive.

Each time, the debate is framed this way: In an era of tight budgets and good highways, can the country afford to subsidize air service for rural America? Is the service really needed?

People in Sidney were so convinced the answer was yes that they were willing to tax themselves to keep their air service alive.

The town was one of 26 communities that lost their Essential Air Service subsidies in a major cutback in fiscal 1989 and 1990. Sidney’s subsidy rose above the cutoff point of $200 per passenger, and the last plane left town on Dec. 31, 1989.

But in 1988 the town had approved a half-cent local sales tax to raise about $300,000 a year for community development. After Sidney agreed to designate up to $42,000 a year from these funds for air service, GP Express agreed to include Sidney on its route from Chadron and Alliance in Nebraska to Denver. Planes began landing again in June, 1990.

City Manager Marlin Ferguson said the public consistently supported the subsidy, and the City Council voted year after year to keep it flowing. “We haven’t had a lot of protest against it,” Ferguson said.

But misfortune overtook Sidney again this year, when GP Express decided to drop Sidney, subsidy or no subsidy.

“It continues to bother me that smaller communities continue to get screwed,” said George Poullos, owner of GP Express. But he said he had to face economic reality. His airline was growing briskly, and he could not afford to use an aircraft as large as the 19-seat Beech 1900 for such a small market.

The decision-makers in Sidney are searching for another small airline that would be willing to take their money.

Why would a small town be willing to pay extra taxes to maintain a service used by only about 45 people a month?

The answer boils down to fear. The town’s economic and political leaders say they are afraid that Sidney will be unable to attract new industry unless it can advertise that it has air service.

Not that businessmen were major users of air service. Several executives acknowledged that they usually drove the 165 miles to Denver’s Stapleton Airport rather than trust the vagaries of a puddle-jumper operation.

“We were probably as guilty as anyone in not using the service,” said Jim Beardsley, catalogue director of Cabela’s, the giant retailer of outdoor-sports gear that dominates Sidney’s economic life. “But we couldn’t live with less than 100% dependability in an airline.”

Those who did use the service did so sparingly. Tim Ryder, plant manager for Prestolite, said his company used GP Express once or twice a week. Elimination of the service “doesn’t affect us at all,” he said.

But Ryder, like the rest of the business community, said he believes the air service is a necessity.

Now that the service is gone, “it probably makes the whole town less attractive for industry,” Ryder said. “If I was an industry and I was looking at a small Nebraska city, that is one obstacle that wasn’t there in the past.”

Sidney, a way station on the original transcontinental railroad, was built by transportation. Today more than 100 freight trains a day rumble through town, and Interstate 80 gives trucks and cars easy access.