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GG 5
Eliminate the State Aircraft Pooling Board


The State Aircraft Pooling Board (SAPB) provides charter service for Texas state government officials and employees for less than its full cost of operation, using an aging fleet of aircraft with high maintenance costs. SAPB also provides maintenance services for about 37 state aircraft, including the 11 it operates. SAPB pilots are underused and fly only about half the hours of comparable charter service pilots. About half of SAPB flights go to destinations already served by commercial airlines. Passengers associated with state universities account for almost 58 percent of the total SAPB passengers, the majority of them from university athletic departments. The state should eliminate the SAPB and contract with a private aircraft charter company for these services.


The State Aircraft Pooling Board (SAPB), with 41.5 full-time equivalent employees, provides charter air service for Texas state government officials, employees and others who travel on state business.

The agency, based in a state facility adjacent to Austin-Bergstrom International Airport, operated 11 aircraft at the end of fiscal 2001. SAPB also provides maintenance, hangar space and other ground services for its own and other state-owned aircraft. Agencies other than SAPB that own aircraft include Texas A&M University (two), the Texas Department of Criminal Justice (two), the Texas Forest Service (one), Parks and Wildlife Department (four), Department of Public Safety (15), The University of Texas System (one) and Texas State Technical College (19).[1]

In fiscal 2001, SAPB performed these functions with appropriations of $2.8 million for agency operations and a biennial amount of $1.4 million for aircraft purchases.[2] Also, in fiscal 2001 the SAPB provided more than 920 trips to state customers.


State law requires SAPB to operate on a cost-recovery basis, recovering direct costs through charges on its users.[3] These charges, however, do not include several important business costs, including capital expenditures for new aircraft, building expenses, and custodial services and other general support. The agency charges hourly rates based on the aircraft and the requesting entity involved (Exhibit 1).

Exhibit 1
SAPB Aircraft Rates
Fiscal 2001 and 2002

Aircraft* Fiscal 2001 Hourly Rate
for State Agencies and Institutions
Fiscal 2002 Hourly Rate
for State Agencies and Institutions***
King Air 200 (5) $700 $850
Cessna 425 (4) $535 $625
Cessna 206** (1) $185 $225
Cessna 182** (1) $185 $225
*Owned as of September 1, 2000.
**Used for aerial photography and other special purposes as well as some passenger travel.
***In Fiscal 2002, the SAPB began charging a slightly higher rate to education-related foundations of $900 per hour for the King Air 200 and $665 per hour for the Cessna 425.
Source: State Aircraft Pooling Board.

In fiscal 2001, SAPB’s fees fell short of recovering its direct costs by about $684,000.[4] This shortfall jumps to about $1.3 million when costs associated with facilities, a new aircraft and services provided by other state agencies are included.

This shortfall resulted largely from increasing maintenance costs on a fleet whose average age was about 19 years at the end of fiscal 2001.[5] For the eight aircraft that SAPB operated since the early or mid-1980s, for example, costs for parts, labor and miscellaneous charges rose from $361,000 in 1997 to $700,000 in 2001.[6] Part of the reason for this rising cost is that four aircraft in SAPB’s passenger fleet are Cessna 425s, a model last built in 1987.[7]

In each of the last two biennia, SAPB received general revenue appropriations of $1.4 million to purchase new aircraft, and has developed a 10-year replacement plan to upgrade its fleet with 10 later-model aircraft by the end of 2011. In fiscal 2002, SAPB tried to secure approval from the Texas Bond Review Board to finance three replacement aircraft. SAPB sought this approval ahead of the planned replacement schedule to take advantage of low interest rates. The Texas Bond Review Board, however, approved only one of the requested purchases.[8] This is because the legislature only appropriated $1.4 million for the 2002-03 biennium for the purchase of one aircraft.

Whether the Legislature funds SAPB’s replacement plan or not, the cost of flight service is likely to become increasingly expensive. If fully funded, the replacement plan could result in two-year aircraft payments of about $5.4 million in general revenue for the 2008-09 biennium.[9] Although maintenance costs would fall with the purchase of new planes, payments of principal and interest on the rejuvenated fleet likely would keep overall costs up. If the Legislature decides not to fund its plan, SAPB can expect spiraling maintenance costs and other complications due to an aging and increasingly unsafe fleet.

E-Texas compared the total cost of SAPB’s flight operations to information collected by SAPB on private charter company rates. In fiscal 2001, SAPB could have covered all of its direct and indirect costs by collecting an average rate of $1,027 per flying hour.[10] SAPB’s information on selected charter companies’ operations indicate an average rate of $1,084 per flying hour for similar aircraft.[11]

The state might be able to further reduce private charter costs by negotiating special rates, as it does for many types of purchases, including commercial airline travel.

E-Texas interviewed an Austin charter company about the possibility of discounts. In fiscal 2002, the company charged a base rate, excluding taxes, of $1,150 per hour for aircraft similar to several used by SAPB. The company said that discounts of 5 percent to 10 percent for flying 50 to 100 hours would be feasible.[12] Many planes offered by private charter companies, moreover, are newer and faster than SAPB’s planes.

Hours aloft

Charter companies face strong incentives to keep their costs down. The Austin-area charter company contacted by e-Texas said that its full-time pilots averaged about 500 to 600 hours of pilot flight time a year, or about twice that of SAPB’s average of 259 hours per full-time pilot captain in fiscal 2001.[13] Although they usually work fewer hours than commercial pilots, SAPB’s average captain’s salary is about $41,000, compared to $37,650 for commercial pilots in the Austin-San Marcos area and $49,560 for Texas commercial pilots in 2000.[14]

SAPB also incurs costs due to its “blue pilot” contract program. Named for their color designation on the agency’s flight assignment board, blue pilots can gain commercial flying hours while earning a nominal $10 per flight as contract copilots for SAPB. If these pilots perform well, SAPB promotes them to “first officers” who are eligible to receive between $10 and $75 per trip. At times, SAPB will assign a first officer to copilot a flight along with an agency captain, when the client agency requests two pilots. The client agency pays SAPB $200 per day for the copilot’s service. The state receives the benefit of a qualified, low-cost copilot not on the state payroll; the client’s need for a second pilot is satisfied; and the first officer receives credit for flight time. In fiscal 2001, SAPB made more than 920 trips. Blue pilots flew on 78 trips for a total of 166 hours; first officers made 365 trips and gained 922 hours of flight experience.[15]

SAPB’s total hours of aircraft usage appear low. Annual flying hours on its primary passenger fleet in fiscal 2001 ranged from a high of 376 hours on one airplane to a low of 187 hours on another, with the average for the group being about 285 hours (Exhibit 2). These figures compare to an average 500 hours annually reported by the Austin charter company and an average 407 hours for turboprop aircraft reported in 1999 by members of the National Business Aviation Association, Inc., an association of about 6,300 business members that own, operate or support aircraft as part of their businesses.[16]

Exhibit 2
Aircraft Usage of Primary Passenger Fleet
State Aircraft Pooling Board
Fiscal 2001

Aircraft Year and Model (Tail Number) Revenue Hours*
1981 King Air 200 (N1TX) 376.0
1982 King Air 200 (N62569) 361.0
1982 King Air 200 (N6308F) 345.8
1983 Cessna 425 (N68865) 298.1
1983 Cessna 425 (N6885S) 292.8
1983 Cessna 425 (N425LD) 254.5
1983 Cessna 425 (N101CA) 246.5
1985 King Air 200 (N7256K) 199.2
1978 King Air 200 (N2061B) 186.9
Total 2,560.8
Average 284.5
* Actual hours flown generating passenger revenues.
Source: State Aircraft Pooling Board.

Aircraft routes

SAPB’s flight service allows state passengers to travel quickly to locations not served by commercial airlines, often eliminating the need for passengers to acquire a rental car or stay overnight before returning home. In fact, SAPB is prohibited from providing air transportation to sites served by commercial carriers unless the number of passengers being flown makes it cost-effective or the timing of commercial flights interferes with passenger obligations.[17]

Even so, in fiscal 2001 about 51 percent of SAPB’s flights served areas passengers reasonably could reach via commercial airline from Austin.[18] Commercial airline routes have increased substantially in Texas since SAPB’s creation in 1979. Southwest Airlines alone flies to 10 Texas cities connecting through Austin, as well as another 48 cities around the country.[19] Other airlines connecting in Austin and serving Texas and other states include United, American, Delta and Continental. These carriers are all on state contract to provide air travel at reduced rates to more than 600 cities in and outside of Texas.[20]

SAPB’s services still may be cheaper than commercial fares if enough passengers travel. SAPB’s Web site posts information to help its agency customers determine this number when flying to selected destinations. SAPB’s analysis includes estimated taxes, parking, employee time saved and passenger facility charges.[21]

E-Texas examined a sample of 171 SAPB single-destination trips, however, and found that 46 percent of them did not carry enough passengers to break even with commercial air fare costs. In all, however, the 171 trips saved agencies about $43,000 because SAPB rates are set below its true cost of operation. Agencies would have paid about $55,000 more than commercial fares if SAPB’s rates were set to recover all state costs.[22]

SAPB passengers

SAPB may provide transportation to state officers and employees on official business, persons in their care, and persons “whose transportation furthers official state business.”[23]

The state’s universities comprise about 58 percent of SAPB’s passengers in fiscal 2001, with the University of Texas (UT) alone accounting for 40 percent of the total (Exhibit 3). The University of Texas System also operates one airplane of its own.

Exhibit 3
State Aircraft Pooling Board Passengers by
Governmental Entity or Function
Fiscal 2001

Source: Texas Comptroller of Public Accounts.

UT uses SAPB aircraft primarily for sports team travel, to assist in recruiting and to travel to activities for the Longhorn Foundation, which supports the UT intercollegiate athletics program.[24] About 73 percent of UT’s riders and 30 percent of SAPB’s total passengers in fiscal 2001 were involved in some way with the university’s athletics program. This percentage should fall in fiscal 2002, since UT’s basketball teams, which constituted about 14 percent of the agency’s total riders in fiscal 2001, have begun using jet charter companies.[25] Texas is generous in using its aircraft for such purposes. Florida, for example, sets its priorities for providing transportation first to the governor, lieutenant governor and other top-ranking elected officials; then for other elected officials and agency heads; and finally for other state employees. In 1995, Florida’s Office of Program Policy Analysis and Government Accountability recommended downsizing the state’s executive aircraft pool from four aircraft to three to cut costs while still accommodating most high-priority travel.[26]

Ground operations

SAPB provides maintenance services for many of the state’s fleet of 55 aircraft, maintaining 37 in fiscal 2001. According to agency records, it provided these services at a price equivalent to 84 percent of private-sector maintenance costs.[27] SAPB’s costs, however, do not include certain overhead expenses, including the cost of facilities, security services and various other items. These other costs are estimated to be about $900,000 annually for all agency operations.[28] Indirect expenses increase the cost of SAPB’s ground operations to a level close to that of the private sector.


SAPB occupied land and facilities at the former Robert Mueller Airport in Austin until 1999, at which time the agency moved to its new facility at the Austin-Bergstrom International Airport.[29] The 1997 Legislature authorized the Texas Building and Procurement Commission (TBPC) to sell the old SAPB property at Robert Mueller Airport, which consisted of about 21 acres of land and improvements. The General Land Office (GLO) is responsible for appraising such properties for the state. In fiscal 1999, GLO determined that the property was underused and recommended its sale after assigning the property a market value of about $4.3 million. TBPC disagreed with the recommendation, favoring its own plan to use the property as a warehouse or centralized print shop.[30] Neither the sale of the property nor its transformation for other state uses has occurred.

In 1999, the state built SAPB’s new facility adjacent to the Austin-Bergstrom International Airport with proceeds from the sale of revenue bonds handled by the Texas Public Finance Authority.


The Federal Aviation Administration (FAA) is the federal agency with the primary responsibility for the safety of civil aviation. Specific flight safety is regulated by the Federal Aviation Regulations (FARs) under various rules. The SAPB operates under Part 91 – the general operating and flight rules, which has less strict requirements than commuter airlines, which operate under Part 135 of the rules. Part 91 is the minimum standard allowed by law for general aviation to operate.

A review of the safety of SAPB operations by a flight safety specialist found that there are additional steps the agency could take to enhance the safety of flights.[31] The review states that the SAPB could enhance safety by using only fully qualified co-pilots, eliminating the blue pilot program, equipping all aircraft so that instrumentation is equal for both the pilot and co-pilot, providing additional training for pilots and co-pilots, using formal cockpit resource management training, creating stricter pilot rest and duty time rules, providing an agency specific Flight Operations Policy Manual, in addition to the approved aircraft manuals/checklists, and operating under Part 135 of the FARs. The addition of these steps would reduce hazards and risks; however, providing these steps would add significant costs.

Although regulations may only require a single pilot, to ensure maximum safety, two equally qualified pilots can help prevent accidents. Flight accidents have occurred from pilot incapacitation. There have been allegations of accidents or incidents which have occurred from heart attack, stroke, carbon monoxide, falling asleep, intoxication, illness or oxygen starvation. If incapacitation occurred in a single-piloted aircraft, the results could be disastrous. The safety review of the SAPB stated, “It is foolhardy to fly state officials in aircraft without two equally qualified, if not rated, pilots aboard.”[32]


A. State law should be amended to abolish the State Aircraft Pooling Board (SAPB) by the end of fiscal 2004, including its flight operations and ground and maintenance services for other agency aircraft.

The Legislature should transfer other regulatory or support activities set out in SAPB’s statute, such as the approval of new aircraft, to the Texas Building and Procurement Commission (TBPC). Agencies either would perform their own maintenance on aircraft they own or would contract for the service.State law should require the formation of a transition team to oversee the orderly phase-out of agency operations. The transition team would consist of personnel from SAPB, TBPC and the Texas Public Finance Authority (TPFA). All members of the team would assist SAPB in ending its operations. The team would oversee the phase-out so that all SAPB staff, except those serving on the transition team, would be eliminated by March 2004. The transition team would be eliminated at the end of fiscal 2004.SAPB’s equipment and aircraft would be sold in fiscal 2005. The state would pay off the balance on debt previously incurred to acquire one aircraft and two aircraft refuelers, as soon as those assets are sold and funds become available. TBPC would be responsible for these sales. State law should direct TBPC, in consultation with TPFA, to sell the Austin-Bergstrom facility in 2005 and use the proceeds to pay debt service on the related bond series. The sale would be contingent on an assessment of market value from GLO. The Legislature also should direct TBPC to sell SAPB’s former facility at Robert Mueller by the end of fiscal 2005 after obtaining an updated assessment of market value from GLO.

B. TBPC should outsource flights to a private charter company.

TBPC should accomplish this task within the first six months of fiscal 2004. With SAPB’s assistance, TBPC should estimate the flying demand of elected officials and state agencies and procure discounts for volume travel or other benefits that could be gained from a contract with a private charter contractor.

Fiscal Impact

This recommendation would phase out SAPB’s operations by the end of fiscal 2004 and would require the sale of SAPB’s facilities, equipment and other items by the end of 2005.

Based on fiscal 2003 appropriations, the phase-out would eliminate 41.5 full-time equivalent positions. In addition, SAPB no longer would receive annual appropriations of about $3.1 million from its user agencies for ongoing agency operations, nor would staff receive benefits estimated to be about $400,000 in fiscal 2003. The phase-out would eliminate SAPB’s capital budget. The agency received $1.4 million in general revenue in each of the last two biennia to purchase replacement aircraft.

Although SAPB’s ongoing appropriation would be eliminated, this recommendation conservatively assumes that SAPB’s previous clients would transfer all their business to the private sector at about the same cost.

Staff dedicated to fleet operations would be phased out in two equal groups, the first terminating at the end of November 2003 and the second terminating at the end of February 2004. Other staff related to maintenance and operations would be eliminated by the end of February 2004. The recommendation also would provide for six SAPB staff members to continue as a transition team through fiscal 2004.

E-Texas estimates that sales of SAPB’s assets, including facilities, would result in a net revenue gain to general revenue of about $18.2 million in fiscal 2005. This amount would accrue from sales of about $21.8 million, minus $3.6 million in expenses.

Revenue gains of $21.8 million would come from the following sales: $7.5 million from aircraft; $94,000 from aviation fueling trucks; $462,000 from miscellaneous equipment, inventory, and office items; $4.3 million from SAPB’s old location at the former Robert Mueller airport; and $9.5 million from SAPB’s current facility adjacent to Austin-Bergstrom International Airport.

In addition, gains of about $781,000 in fiscal 2004 and $1,760,600 in following fiscal years would result from savings in salaries and associated benefits for SAPB staff. These savings would accrue to General Revenue and other state funds. The division of savings between these funds cannot be determined easily.

Expenses of $3.6 million against these gains would result from payout of $2.3 million for remaining principal on one airplane and two aviation-fueling vehicles, and $1.3 million for a 6 percent service charge on sales of aircraft, facilities, equipment and inventory to pay for administrative and overhead costs associated with the sales.

TBPC would be primarily responsible for selling SAPB’s assets in 2005. Out of gross sales of $21.8 million, about $8.7 million would supplant general revenue appropriations in TBPC’s method of finance. Another $9.5 million that would result from sale of the Bergstrom facility would reduce TBPC’s general revenue appropriation for lease expenses paid to TPFA. The remaining $3.6 million would be appropriated to TBPC to pay off principal and sales transaction costs. With the exception of the Bergstrom facility, if sales bring in more than the revenues anticipated here, those amounts also should be appropriated to TBPC for its use. Any funds remaining in SAPB’s accounts after termination of the agency should be transferred to general revenue.

The state built the Bergstrom site from funds derived from a 1997 TPFA bond issue. The Legislature should require that revenues from the property’s sale, estimated at $9.5 million, be deposited to TPFA’s State Lease Fund Account and used to pay debt service on the bonds, as permitted under federal regulations. TBPC should be required to transfer general revenue funds from any of its programs to the State Lease Fund Account in an amount sufficient to make up for any shortfall from the estimated $9.5 million.

The state would lose rent of $12,000 a month after TBPC sells the Mueller facility, which presently is leased to Sleeping Shark Productions, a film-related business. In fiscal 2005, general revenue would lose $72,000 for a half-year’s rent. Losses in each later year would increase to $144,000.

The cost of outsourcing flights to the private sector would depend upon future events and cannot be estimated. No appropriation reduction is shown for the loss of FTEs because the recommendation assumes agencies will spend the funds to purchase flight and maintenance services from the private sector.

Fiscal Year Gain to General Revenue Deductions from General Revenue Gains Related to Sales Rental Loss to General Revenue Net Change in General Revenue Change in FTEs
2004 $781,000 $0 $0 $781,000 -20.0
2005 $23,581,000 ($3,602,000) ($72,000) $19,907,000 -41.5
2006 $1,761,000 $0 ($144,000) $1,617,000 -41.5
2007 $1,761,000 $0 ($144,000) $1,617,000 -41.5
2008 $1,761,000 $0 ($144,000) $1,617,000 -41.5


[1]State Aircraft Pooling Board, “State Operated Aircraft,” Austin, Texas. (Single-page list.)

[2]Tex. H.B.1, 76th Leg., R. S. (1999).

[3]Tex. Gov’t Code §2205.040.

[4]Texas Comptroller of Public Accounts, “Aircraft Cost Analysis,” Austin, Texas, July 2002. (Spreadsheet analysis by Comptroller staff.)

[5 ]State Aircraft Pooling Board, “APB Ten-Year Aircraft Replacement Plan,” Austin, Texas. (Single-page cost analysis.)

[6 ]Texas Comptroller of Public Accounts, “Summary of Maintenance Costs from 1997 through 2001,” Austin, Texas, July 2002. (Spreadsheet analysis by Comptroller staff.)

[7 ]E-mail from Jerry Daniels, executive director, State Aircraft Pooling Board, July 2, 2002.

[8 ]Interview with Jerry Daniels, executive director, State Aircraft Pooling Board, Austin, Texas, July 1, 2002.

[9 ]State Aircraft Pooling Board, “APB Ten-Year Aircraft Replacement Plan,” Austin, Texas. (Single-page cost analysis.)

[10 ]Texas Comptroller of Public Accounts, “Aircraft Cost Analysis,” Austin, Texas, July 2002. (Spreadsheet analysis by Comptroller staff.)

[11 ]State Aircraft Pooling Board, “Charter Rate Comparisons, SAPB vs. Private Sector,” Austin, Texas, August 31, 2001. (SAPB handout.)

[12 ]Interview with Jerry Garrett, president, Capitol Wings Airline Inc., Austin, Texas, March 19, 2002.

[13 ]Interview with Jerry Garrett; and Texas Comptroller of Public Accounts, “Full-time Pilot Salaries and Flight Hours in Fiscal 2001,” Austin, Texas. (Spreadsheet analysis by Comptroller staff.)

[14 ]U.S. Department of Labor, Bureau of Labor Statistics, “2000 State Occupational Employment and Wage Estimates—Texas,” March 11, 2002, (Last visited October 7, 2002); U.S. Department of Labor, Bureau of Labor Statistics, “2000 Metropolitan Area Occupational Employment and Wage Estimates—Austin-San Marcos, Tx, MSA,” March 11, 2002, (last visited October 7, 2002); and Texas Comptroller of Public Accounts, “Full-time Pilot Salaries and Flight Hours in Fiscal 2001,” Austin, Texas. (Spreadsheet analysis by Comptroller staff.)

[15 ]Texas Comptroller of Public Accounts, “Trips and Flight Hours of Contract Co-pilots in Fiscal 2001,” Austin, Texas. (Spreadsheet analysis by Comptroller staff.)

[16 ]Texas Comptroller of Public Accounts, “Revenue and Non-revenue Hours in Fiscal 2001,” Austin, Texas, July 2002 (spreadsheet analysis by Comptroller staff); and National Business Aviation Association, Inc., 2001 NBAA Aviation Factbook (Washington, D.C., March 24, 2002), (last visited October 9, 2002); and interview with Jerry Garrett, president, Capitol Wings Airline Inc., Austin, Texas, March 19, 2002.

[17 ]Tex. Gov’t Code §2205.036(c).

[18 ]Texas Comptroller of Public Accounts, “Analysis of SAPB Flight Routes in Fiscal 2001,” Austin, Texas, March 2002. (Spreadsheet analysis by Comptroller staff.)

[19 ]Southwest Airlines, “Cities Served by Southwest,” July 22, 2002, (Last visited October 7, 2002.)

[20 ]Texas Building and Procurement Commission, “State of Texas Contract Airline Fares,” March 5, 2002, (last visited October 7, 2002); and interview with Gerry Pavelka, director of the State Travel Management Program, Texas Building and Procurement Commission, Austin, Texas, March 11, 2002.

[21 ]State Aircraft Pooling Board, “Aircraft and Rates,” July 21, 2002, (Last visited October 7, 2002.)

[22 ]Texas Comptroller of Public Accounts, “Trip Breakeven Analysis,” Austin, Texas, July 22, 2002. (Spreadsheet analysis by Comptroller staff.)

[23 ]Tex. Gov’t Code §2205.036(a).

[24 ]State Aircraft Pooling Board, Annual Aircraft Flight Report for the Year Ended August 31, 2001 (Austin, Texas, November 20, 2001), example entries for flight numbers 13031, 13490, and 12928.

[25 ]Texas Comptroller of Public Accounts, “UT Athletic-related Ridership,” Austin, Texas, July 22, 2002 (Spreadsheet analysis by Comptroller staff); and interview with Jerry Daniels, executive director, State Aircraft Pooling Board, Austin, Texas, July 22, 2002.

[26 ]Florida Office of Program Policy Analysis and Government Accountability, Review of the State Executive Aircraft Pool (Tallahassee, Florida, September 14, 1995), p. 1.

[27 ]State Aircraft Pooling Board, “Measures for FY 2001,” Austin, Texas. (One-page worksheet.)

[28 ]Texas Comptroller of Public Accounts, “Statewide Indirect Cost Fiscal 2001,” Austin, Texas, August 27, 2002. (Spreadsheet analysis by Comptroller staff.)

[29 ]Sunset Advisory Commission, State Aircraft Pooling Board Staff Report (Austin, Texas 2000), p. 22.

[30 ]General Services Commission, Real Property Evaluation Reports (Austin, Texas, 2000), pp. 16-17.

[31] “State Aircraft Pooling Board, A Report on Safety” from Captain M. P. Papadakis J.D., former military/retired commercial airline pilot, mechanical engineer, attorney and author of Aircraft Accident Reconstruction and Litigation, Albuquerque, New Mexico, December 17, 2002. p. 4.

[32] “State Aircraft Pooling Board, A Report on Safety” from Captain M. P. Papadakis J.D., former military/retired commercial airline pilot, mechanical engineer, attorney and author of Aircraft Accident Reconstruction and Litigation, Albuquerque, New Mexico, December 17, 2002. p. 6.