On March 23, REX announced that air services to Grafton would cease from April 6 “unless the federal and state governments are willing to underwrite the [airline’s] losses”, however, Clarence Valley Council (CVC) formalised its support for the airline at the March 24 CDVC meeting.
Councillors unanimously supported a 50 per cent cut in head tax from 1 April to December 31 and authorised the general manager to extend the period by up to sixth months, “should the COVID-19 pandemic not be resolved by then”.
Councillors were responding to a letter from REX that stated granting of the 50 per cent cut “will be critical to the survival of REX”.
“REX has been faithfully serving your community in the last 13 years and we believe we have contributed significantly to the socio-economic well-being of your community,” the letter stated.
“…Should this reduction not be possible, the route may not be commercially viable with the sharp reduction in passenger numbers.”
The cut in head tax “would represent an approximate loss of $40,000 based on the current figures”, the mayor, Jim Simmons wrote in his mayoral minute.
“…this financial year we have received $83,423, or an average of $10,427.88 [per month], up to January 2020”.
REX currently pays a $7 head tax per passenger up to 15,000 and $5 per passenger thereafter.
The mayor pointed out that numbers were likely to drop dramatically as the “pandemic worsens”.
“Unless REX receives assurances from three levels of government … in efforts to assist them through this period, after May we’ll lose the air service,” Cr Richie Williamson said.
“We’ve all got to pull our weight; this isn’t a lot of money – if it can assist us in at least retaining a partial service, it’s a positive.
“While I support your motion now, CVC won’t be getting any landing or head tax anyway, [due to flights being suspended from April 6].”
Councillor Jason Kingsley “acknowledged the commitment REX has shown to servicing regional centres and, in particular, Grafton.
“On numerous occasions they’ve told us they do so at their own expense, so I think we should show some loyalty with what we are doing,” he said.
“Without REX servicing the Clarence Valley we would be stuffed.”
Councillor Peter Ellem said he was “hopeful [that] whatever the federal government puts in place will be enough to get them [REX] through the next six months so they can come back and service airports like Grafton and Lismore and Ballina”.