Ontario International Airport Adopts New Use and Lease Agreement for Growth

Ontario International Airport Approves New Use and Lease Agreement

Ontario International Airport (ONT), a rapidly growing aviation hub in Southern California, has taken a significant step toward sustainable development and operational efficiency by adopting a new Use and Lease Agreement (ULA). This updated agreement, approved by the Ontario International Airport Authority (OIAA) on July 24, 2025, replaces a decades-old framework and introduces a hybrid financial model designed to foster collaboration with airlines and support long-term infrastructure investments.

ONT’s evolution from a secondary airport under Los Angeles World Airports (LAWA) to an independently managed facility has been marked by steady growth in both passenger and cargo traffic. The new ULA reflects this transformation, offering a more flexible, transparent, and forward-looking approach to airport-airline relations. With immediate implementation, the agreement sets the stage for ONT to continue its upward trajectory amid regional economic expansion and shifting aviation trends.

In this article, we explore the historical context, key components, and broader implications of ONT’s new ULA, while also examining how it aligns with global airport management practices.

Background: ONT’s Journey and the Need for Change

ONT’s Transition to Local Control

Located approximately 35 miles east of downtown Los Angeles, ONT was historically managed by LAWA. However, after years of underperformance and declining passenger numbers, local stakeholders advocated for a shift in governance. In 2016, management of the airport was officially transferred to the Ontario International Airport Authority (OIAA), a move that catalyzed a period of revitalization and growth.

Since the transition, ONT has emerged as a key player in the Southern California aviation market. Passenger traffic increased from 4.2 million in 2016 to over 7 million in 2024, reflecting a 67% rise. This resurgence has been supported by investments in infrastructure, expanded airline services, and a focus on customer experience.

ONT’s strategic location within the Inland Empire, a region with over 18 million residents, has positioned it as a preferred alternative to larger, more congested airports like LAX. The airport’s growing reputation for efficiency and convenience has further underscored the need for a modernized operational framework.

Limitations of the 1999 Agreement

The previous ULA, established in 1999 under LAWA’s oversight, was ill-suited for ONT’s current operational model. It lacked flexibility, imposed outdated financial structures, and did not reflect the airport’s independent status or evolving market dynamics. As ONT expanded its services and infrastructure, the constraints of the old agreement became increasingly apparent.

Airport officials and airline partners recognized the necessity of a new agreement that could accommodate growth, encourage investment, and streamline decision-making processes. This led to a collaborative effort between OIAA leadership, financial experts, and airline stakeholders to draft a more adaptive and mutually beneficial arrangement.

The result is a new ULA that not only modernizes ONT’s financial and operational framework but also aligns with best practices observed at leading international airports.

Strategic Objectives of the New ULA

The updated agreement is designed to achieve several key goals: enhance financial sustainability, improve airline relationships, and support infrastructure development. It introduces a hybrid revenue model, provides mechanisms for airline input on capital projects, and allocates a significant portion of ground transportation revenue to participating carriers.

These provisions aim to create a balanced environment where both the airport and its airline partners can thrive. By aligning incentives and promoting transparency, the ULA lays the foundation for continued growth and innovation.

As ONT prepares for future challenges and opportunities, the new agreement serves as a critical tool for navigating the complexities of modern airport management.

“This agreement reflects years of collaboration and positions ONT to grow responsibly. It’s a win for airlines, passengers, and the communities we serve.” — Alan D. Wapner, OIAA President

Key Features and Impacts of the New Agreement

Hybrid Financial Model and Revenue Allocation

One of the most significant changes introduced by the new ULA is the adoption of a hybrid financial model. This model allows ONT to retain unrestricted funds, which can be allocated to future capital projects without requiring immediate cost recovery from airlines. In Year 1 alone, unrestricted deposits are projected to reach $28 million, with expectations of growing to $45 million over time.

In addition, the agreement stipulates that 75% of ground transportation revenue will be distributed to participating airlines. This revenue-sharing mechanism incentivizes airline engagement and fosters a sense of shared responsibility for the airport’s financial health.

These financial provisions provide ONT with greater flexibility to plan and execute infrastructure projects, respond to market changes, and maintain competitive cost structures for airline partners.

Infrastructure Development and Capital Planning

The ULA includes a provision requiring airline approval for major capital projects exceeding a certain financial threshold, which is adjusted annually for inflation. This ensures that large-scale investments are subject to stakeholder review, promoting accountability and alignment between ONT and its partners.

One of the first initiatives under the new agreement is the upgrade of Runway 26R’s Instrument Landing System (ILS). The project, with a budget of $15.75 million, aims to enhance safety and operational reliability, particularly in adverse weather conditions.

Such projects not only improve airport functionality but also contribute to regional economic development by creating jobs and attracting new businesses to the area.

Operational Flexibility and Airline Engagement

The agreement offers flexible lease terms and clearer guidelines for terminal usage, making it easier for ONT to attract new carriers and retain existing ones. Airlines benefit from predictable cost structures and a more collaborative approach to operations.

Major carriers such such as Southwest Airlines, American Airlines, and Frontier Airlines currently account for the majority of ONT’s passenger traffic. The new ULA supports efforts to expand international routes and enhance service offerings, particularly to destinations in Mexico, Central America, and Asia-Pacific.

By fostering a more cooperative environment, the agreement strengthens ONT’s position as a competitive and attractive option for both domestic and international airlines.

Wider Industry Context and Future Outlook

Global Trends in Use and Lease Agreements

ONT’s new agreement reflects a broader industry shift toward more adaptive and collaborative ULA models. Airports around the world are moving away from rigid, long-term leases in favor of shorter, flexible arrangements that can better respond to market volatility and evolving airline needs.

For example, Amsterdam Schiphol Airport has introduced new fee structures to support sustainability initiatives, while Hong Kong International Airport has implemented advanced technologies to improve operational efficiency. These trends highlight the importance of aligning financial frameworks with strategic objectives.

ONT’s hybrid model and emphasis on airline collaboration position it well within this global context, enabling the airport to remain agile and competitive in a rapidly changing landscape.

Technological Innovation and Smart Airport Initiatives

ONT’s focus on infrastructure modernization aligns with the growing adoption of smart airport technologies. Innovations such as biometric check-in systems, autonomous baggage handling, and AI-driven passenger flow management are becoming standard at leading airports.

By investing in these technologies, ONT can enhance the passenger experience, reduce operational costs, and improve overall efficiency. This is particularly important as the airport continues to expand its services and accommodate increasing traffic volumes.

Future projects may include digital wayfinding systems, enhanced cybersecurity measures, and integrated data platforms for real-time decision-making.

Regional Advantages and Competitive Positioning

ONT’s strategic location and operational model offer several advantages over larger regional airports. Shorter wait times, lower fees, and a customer-friendly environment make it an appealing choice for travelers and airlines alike.

While major hubs like LAX are still recovering from pandemic-related disruptions, ONT has surpassed pre-pandemic passenger levels and continues to grow. This resilience underscores the effectiveness of its management strategy and the potential of the new ULA to sustain momentum.

As the Inland Empire continues to develop as a logistics and business center, ONT is well-positioned to capitalize on emerging opportunities and solidify its role as a regional economic driver.

Conclusion

The adoption of a new Use and Lease Agreement marks a pivotal moment in Ontario International Airport’s evolution. By introducing a hybrid financial model, streamlining capital project approvals, and fostering stronger airline partnerships, the agreement lays the foundation for long-term growth and operational excellence.

As ONT continues to expand its services and infrastructure, the new ULA will play a critical role in ensuring that development is strategic, sustainable, and aligned with industry best practices. With a clear vision and a collaborative approach, ONT is poised to become one of the most innovative and efficient mid-sized airports in the United States.

FAQ

What is the purpose of ONT’s new Use and Lease Agreement?
The new agreement modernizes ONT’s financial and operational framework, promoting flexibility, transparency, and collaboration with airlines.

How does the hybrid financial model work?
It allows ONT to retain unrestricted funds for future capital projects while sharing 75% of ground transportation revenue with airlines.

What are the immediate benefits of the agreement?
The ULA enhances lease flexibility, accelerates capital improvements like the Runway 26R ILS upgrade, and supports airline engagement.

How does ONT compare to other regional airports?
ONT offers shorter lines, lower fees, and has surpassed pre-pandemic passenger levels, making it a competitive alternative to LAX.

Sources:
PR Newswire,
ONT Official Website,
International Airport Review,
ONT Passenger Data,
OIAA Meeting Packet,
Celeste Heinonen Profile,
HSTalks,
Kaplan Kirsch