To get all the airlines on board, the state offered some major concessions that included dropping plans to build a fourth runway at the Anchorage airport that would have increased rates and fees to the airport's users.

Officials with the airport system said they promised airlines more say in AIAS programs and projects.

"All the airlines were opposed to the fourth runway," said Kathy Smith, chairperson of the Airlines Airport Affairs Committee and the director of corporate real estate for Alaska Airlines. "This was the sticking point in negotiating a new agreement."

Agreements were last signed in 2002 and were amended in 2007. The airlines negotiated new terms that included the exit of the former AIAS director, dropping the fourth runway project and reducing landing fees for the signatory airlines.

Christine Klein, deputy commissioner of aviation for the state Department of Transportation and Public Facilities and the acting director of AIAS, said the state cut capitol projects, refinanced its debt, and is now offering a "pay for what you use" type system for those who signed the agreement. The state is also offering incentives to attract new carriers.

"Basically we had most of the negotiations done by last August, but we made some changes that required us to post public notices that pushed the final dates out by months," said Klein.

Klein said the airport system is paid for by the air carriers through landing fees, rates, fees and services, so airport system management starting looking at cost savings to reduce and stabilize expenditures on capitol improvement projects.

"We were able to cut projects from $700 million down to $300 million," said Klein. "We tried to look at this from the carriers' point of view when we started seeing the landing weights and fuel flowage dropping last spring."

Last spring, the state got clear signs the world's economic impacts were affecting its revenues: fuel prices rose while the amount flowing declined and cargo tonnage dropped. The eruption of the Mount Redoubt volcano caused cargo planes to divert to the Washington area and dozens of passenger flights were canceled for several days.

The airport refinanced its debt on bonds, saving about $2.5 million, and reduced AIAS revenue balances in reserve, which freed up $20 million in funds for unbilled airport improvement project expenditures. That was used to reduce fees, according to Klein.

The state dropped landing fees 11 cents for those signing the agreement to $1.41 per 1,000 pounds of an aircraft's maximum certified take off weight, Klein said. Rates for non-signatories will be $1.79 per 1,000 pounds, a 3 cent increase.

A key factor to getting the airlines on board was to increase rates to air carriers that use the state's airport system but don't sign the operating agreement.

"Non-signatories will be charged a higher rate for landing fees, and fuel flowage, rents and leases, making it a premium to be a signatory airline with the system," said Klein.

The state did add an incentive for them to sign on, however.

The ASIA - AIAS Passenger Service Incentive Program, announced May 4, offers fee waivers for up to three years for each scheduled weekly round-trip non-stop passenger flight on a carrier between an Alaska international airport and Asian airport for two consecutive years. Waived expenses may not exceed $1 million per 12-month period per participating airline.

This is available to airlines that commit to provide at least 12 continuous months of new or expanded scheduled round-trip non-stop passenger services of at least one flight per week between any AIAS airport and Asian airports.

Great Wall Airline has started charter cargo service from Shanghai, China, to Anchorage with flights on Thursdays and Fridays. On June 11, Yangtze River Airlines, also from Shanghai, landed its first cargo flight to the U.S. at the Anchorage Airport.

Other fee changes include terminal rental rates for signatories beginning July 1 will increase to $68.13 per square foot, up from $61.50 per square foot. Non-signatories will pay $85.16 per square foot, up from $76.88.

Fuel flowage fees for signatory aircraft in the new agreement will be 0.027 cents per gallon and 0.067 cents per gallon for non-signatory aircraft weighing 12,500 pounds or more.

Smith, with the Smith, chairperson of the Airlines Airport Affairs Committee, said the signing airlines were happy with the agreement, and with the state's airport officials.

"We can see that the international airport system is trying, and has made steps to be more competitive," said Smith. "Most people don't know that the airports costs are paid for by the airlines. They are not the cheapest compared to other airports, but they are not the most expensive either."

The state Department of Transportation is taking public comments through June 30 regarding the rates and fee.

Joy Journeay, executive director of the Alaska Air Carriers Association, which represents some of the signatory airlines and others that use the airports, said her organization sent messages to its membership urging them to comment on rate increases.