Locals face extra cost for flights to Sydney

People flying out of Rotorua Airport to Sydney will have to pay a $25 departure tax.
Earlier this month Air New Zealand announced it would start flying between Rotorua and Sydney from December. Initially there would be a Saturday to Monday service, extending to Tuesday in February.
Rotorua Regional Airport chief executive George White said the departure tax would cover the cost of aviation security, Ministry of Agriculture and Forestry requirements and Customs in the first year. After that, it would contribute towards paying the cost of developing the airport infrastructure to handle transtasman flights.
Air New Zealand general manager, Tasman Pacific Airline, Glen Sowry, said travellers would have to pay the tax as they left the airport, as opposed to other airports where the departure tax was included as part of the airfare.
Air New Zealand has been offered incentives to set up transtasman flights from Rotorua but the airline said the Rotorua Regional Airport company would not be underwriting any losses it may face - contrary to media reports which inferred any loss made by the airline would be underwritten by the Rotorua community.
Air New Zealand chief executive Rob Fyfe was reported in the Otago Daily Times as saying that Dunedin should follow the example of Rotorua which had made a "financial contribution to the service to help ensure its success".
"If the Dunedin community wanted to have a similar discussion with us about underwriting the cost of any losses Air New Zealand would make operating a year-round service, we would be happy to have that discussion," he was reported as saying.
Mr Sowry told The Daily Post when an airline introduced flights in a new area the likelihood of the airline making a profit "from day one" was extremely rare. He said incentives had been offered in Rotorua, although he would not detail what they were, citing commercial sensitivity.
Incentive packages were common practice when an airline was setting up in a new area, Mr Sowry said.
Asked whether the airport company would be underwriting any losses made by the airline, Mr White said the company had worked with industry to achieve a "financial package" which was sufficiently attractive to secure transtasman flights to Rotorua in the initial start-up phase.
"That package involves a number of different elements, including finishing the airport for transtasman readiness and investment in offshore marketing in order to help ensure the success of transtasman flights."
Mr White said the package was being funded by a number of parties as the financial risk for an airline to set up a new route in this "difficult current economic environment" was significant.
There was also a need to secure flights for Rotorua in order to achieve the economic growth the district needed, Mr White said.
The Rotorua District Council, which owns the airport, will not be writing off any losses made by the airline.
However, council chief executive Peter Guerin has made a commitment to the airport company to help pay an estimated $2 million in start-up costs. That funding is being sought from local tourism and accommodation businesses who are yet to decide whether to make a financial contribution.
If businesses won't contribute, the council plans to borrow the money.