MYRTLE BEACH — The Horry County Council will vote on a resolution Tuesday that approves entering into a revenue guarantee agreement with WestJet Airlines, the air carrier that will provide service from Toronto to Myrtle Beach starting in May.
According to the agreement, the county is placing in escrow $1 million to guarantee a level of revenue generation. However, no actual expenditures from that fund is expected.
The agreement stipulates that WestJet will receive a minimum 15 percent operating service for the seasonal period, which is May 1 through Oct. 31. Flights will operate each Thursday and Sunday.
Horry County will guarantee that WestJet receives the minimum 15 percent operating margin for flight service during the seasonal period, the agreement states. Once the season ends, the airliner will calculate its profit margin consistent with a reporting process WestJet has historically used in determining route profitability.
The airliner will give County Council an operational report listing route specific traffic statistics, total revenue and funds required to achieve the 15 percent profit margin.
An email from Robert Palmer, spokesman for WestJet, said they don’t comment on commercial agreements when asked how much the airline might expect that 15 percent profit margin to be.
If the profit margin meets or exceeds 15 percent, Horry County won’t owe WestJet any money. If it’s less than 15 percent, the county will pay the difference in an amount not exceeding the $1 million.
WestJet will also provide the county with a montly report listing total revenue, the month’s estimated profit margin and load factors.
The airliner is Canadian-based and serves 85 destinations in North America, Central America and the Caribbean. The additional flights to Myrtle Beach will help the local golf and tourism industries, leaders said, by trimming what is usually a 16-hour-plus drive into a roughly two-hour flight.
Canada is the top international market for Grand Strand tourism, and the area has long celebrated that relationship with the annual Canadian-American Days festival in March.
Contact BRAD DICKERSON at 626-0301 or follow him at Twitter.com/TSN_bdickerson.