Wet Rate vs Dry Rate: How to Price a Shared Aircraft

A wet rate includes fuel; a dry rate doesn't. That's the entire definition, and it takes one sentence. What takes a board meeting is everything downstream of the choice: who buys fuel, who gets reimbursed at what price, what happens when a member tops off at a $7.90 field on a cross-country, and whether the club's rate still covers its costs when avgas moves a dollar.

1. A worked example

Take a 172 that burns 8.5 gallons per hour with fuel at $6.20. The fuel component of an hour is about $53. If the aircraft's dry costs - maintenance accruals, engine and prop reserves, oil, and the share of variable wear - come to $85 per hour, then $85 dry and $138 wet are the same rate wearing different clothes. The equivalence only holds at $6.20 fuel. At $7.20, the wet rate is silently $8.50 an hour underwater, and a club flying 500 hours a year eats $4,250 before the next rate review.

2. When wet wins

• The aircraft fuels at home base almost every flight, from one pump, at one price the club controls or tracks.
• The membership skews toward renters and students who want one number and no receipts.
• The board actually reviews the rate when fuel moves. A wet rate is a standing bet on the fuel price; someone has to watch the bet.

3. When dry plus reimbursement wins

• Cross-country flying is common, so members buy fuel at away fields at unpredictable prices.
• Fuel prices in your area swing more than about 15% year over year - the wet rate would need constant repricing anyway.
• The group wants wear funded precisely: the dry rate carries the reserves, and fuel passes through at actual cost.

The reimbursement mechanics are where dry rates leak. Decide up front: reimburse at actual receipt price or at the home-field rate, require the receipt photo at flight close-out, and post the credit to the member's ledger in the same cycle as the flight charge. A shoebox of receipts settled quarterly is how a treasurer turns a clean pricing model into a part-time job.

4. The mistakes that cost real money

1. Setting a wet rate from last year's fuel price and never revisiting it. Put a fuel-price trigger in the board calendar, not just a date.
2. Reimbursing away-field fuel at away-field prices with no cap. A member who tops off at the most expensive FBO on the coast is spending the club's money. A cap at home-field price plus a margin keeps it fair without an argument.
3. Leaving reserves out of the dry rate. A dry rate that only covers fuel-less operating costs and skips the engine accrual isn't a rate; it's a discount.
4. Tach time billed against a wet rate computed on Hobbs burn, or vice versa. Pick the meter, price against that meter, and write it down.