Houston is huge. We have two commercial airports which maintain steady business all the time. The older, and smaller, Hobby Airport south of downtown is pretty much all Southwest Airlines. It’s the cities domestic travel airport. Way up north is the monstrous George Bush Intercontinental airport which is the cities international gateway. A proposal by Dallas based Southwestto offer international flights from Hobby Airporthas triggered an intense lobbying duel with United Airlines, which still wields considerable local clout as the successor to Houston-based Continental.
If it gets city approval, Southwest says it would spend an estimated $75 million to $100 million to build a new international terminal equipped with full-scale Customs facilities, as well as to improve the aging airport’s domestic terminals. Southwest flights would depart from the new terminal to destinations such as Cancun and the Caribbean. But United has already broken ground on what may become another international terminal, a $700 million investment piled on top of an additional billion it has pumped into Bush Intercontinental Airportsince the late 1990s. United says this town isn’t big enough for both projects.
While the city awaits two consultants’ reports, expected next week, on the pros and cons of Hobby going international, both airlines have dispatched emissaries to City Hall. The outcome of their lobbying battle will determine whether Houston becomes the sixth among the nation’s 10 largest cities to have two full-scale, international airports. Mayor Annise Parkerand the Houston Airport System director, Mario Diaz, have not publicly picked a side. They say only that they’re obligated to listen to Southwest’s pitch. “The airport is not in the position of choosing winners and losers,” Diaz said. “We’re in a position of laying down a level playing field.”
In letters to airport officials in the past week, United has argued that the deal would damage the economy by diluting international traffic at Bush – traffic United depends on to fill overseas flights, many of which originate elsewhere. Those flights create jobs and boost trade by making Houston accessible from spots across the globe, United said in a letter to Parker. Southwest argues that its plan would create jobs and decrease airfares because United – which dominates local flights to Latin America- would face more competition. “More passengers will fly to IAH because fares will be lower and that will stimulate demand at both airports,” said Ron Ricks, executive vice president for Southwest.
United also fears that equipping Hobby with a full-scale Customs and Border Protectionfacility would force the federal government to split Customs officers between Hobby and Bush Intercontinental. Brian Znotins, United’s managing director of international planning, said fewer Customs officers would result in longer lines and longer layovers and eventually would prompt more international air travelers to book flights through another hub. Customs officers are scarce, Znotins said. “To the extent we can get more officers from the federal government – or keep them – they’re much better used at Bush Intercontinental than they are at Hobby,” Znotins said.
Ricks said that argument is the “biggest red herring I’ve heard in my 40-year career.” The federal government has a responsibility to staff airports with an appropriate number of officers, he said. Diaz said the airport system would never let Customs staffing at Intercontinental diminish to the point where passengers would suffer. If Diaz decides the Hobby plan is promising enough to forward to City Council for a vote as early as May 9, he said he “could make a very, very good argument” for sending more Customs officers to Houston. U.S. Customs and Border Patrol declined to comment on whether it would have to reassign officers to a new facility.
Both airlines are threatening to take their business elsewhere if they’re on the losing end of what Parker called a “historic” decision that’s affected by recent shakeups in the airline industry. Southwest has never offered international flights, but last year it bought AirTran Airways, which does. Southwest wants to add Houston to its growing list of launching pads – for various reasons, including location and room for expansion – but it’s not the only city on its list, Ricks said. “Southwest Airlines is going to grow internationally, and this economic benefit will be conferred on some community in one way or another,” Ricks said. In addition to the policy questions, the Hobby debate is thick with politics.
United’s arguments hint at a home-field advantage by virtue of its 2010 merger with Continental, the longtime Houston airline, and the 17,000 Houstonians it employs. But United moved 1,500 corporate jobs from Houston to Chicago as part of the merger. “They moved their headquarters from here to Chicago. I don’t have any great love for that move,” said Councilman Andrew Burks, who supports Southwest’s proposal. United may have bought good will more directly – with cash. It has the leverage of hundreds of millions of dollars on the line.
United has warned that the Hobby project would force the airline to reconsider its future infrastructure investment in Bush Intercontinental, including its decision to put its newer, bigger airplanes there. The first phase of a renovation project at Terminal B that began early this year represents a $97 million investment by United. An additional $589 million could follow, “based on demand and economic conditions,” according to a city document. If the economics don’t work, United could pull the plug and invest its money – and create jobs - elsewhere. United reminded Diaz in a letter last week of United and Continental’s investments in Bush and said the merged company is proceeding with the Terminal B project based on the understanding that the system would “continue to develop IAH as its only international airport.” “Splitting international service between the two Houston airports would severely devalue that investment,” the letter states.
United is pressing its position through a messenger with deep ties to City Hall. It hired Marty Stein, Parker’s former agenda director, last year and assigned her lobbying duties this year. When Stein stepped down, she was hailed as a city hall legend. Parker said she had begged Stein to stay and told her, “There is a level of trust with you.” As soon as Stein’s one-year prohibition on lobbying expired at the end of January, she was dispatched to visit her old colleagues. Southwest representatives are visiting City Hall as well. Just hours after Parker and the United brass celebrated the groundbreaking for the Terminal B project at Bush on Jan. 23, Southwest CEO Gary Kellywas in the mayor’s office continuing his pitch to Parker for international flights out of Hobby.
District council members, meanwhile, are lining up in ways that reflect loyalty to the neighborhoods they represent. Councilman Mike Sullivanstands with United. He said the airline has told him more of its employees live in his district, E, than in any other council district. Councilman James Rodriguez, whose District I includes Hobby, backs Southwest due to prospects for job creation in southeast Houston. Councilman Jerry Davis, whose District B includes Bush Intercontinental, said, “I will not support any proposal that has the potential to adversely affect the businesses that operate at and around Intercontinental Airport.”
Ricks describes Southwest’s proposal as a “no-cost, no-risk” plan, given the airline’s willingness to front the infrastructure costs and the likelihood of thousands of jobs and millions of dollars of economic impact. “We have the financial strength that if the city of Houston wants to pursue this idea, then we can implement the idea without any cost to Houston taxpayers,” said Ricks, the airline’s chief legal and regulatory officer. “We at Southwest would take 100 percent of the risk for launching that service.”
Ricks predicted the feasibility studies will make the economic benefits of the project to the city clear. The small scale of the proposed Hobby operation – up to 25 daily flights from five gates – poses no threat to the international operation at Bush, which offers flights from 35 gates. United is fond of calling Houston “the largest hub for the world’s largest airline.” And United has added the most markets to Bush among its eight hubs since the merger, including Chicago O’Hare, Znotins said.
United does not oppose Southwest starting international service out of Bush, where the airlines can share Customs agents and connection traffic, Znotins said. But for Southwest, flying out of Bush is a nonstarter because its base is at Hobby, an hour’s drive south. Diaz insisted that the city’s decision will be made on an analysis of the pros and cons. “This is a story about competition, not control and favoritism,” Diaz said. “This story is about the rightful role of government working together at the federal and local level to provide the necessary services needed to grow the economy of this country and of this city.” Southwest is good for Houston. So is United. I tend to agree that this is more about competition…let the market decide. Hobby and Bush are two different animals more than an hour from each other. I doubt, seriously, that allowing Southwest to fly to Mexico from Hobby is really going to hurt United.
Indiana is not exactly a bastion for acceptance and understanding and that’s not “hating” on the Hoosier state, it’s simply a matter of fact. I will admit that I was somewhat shocked to learn that the state of my birth was selling license plates for the Indiana Gay Youth Group. How could this have happened in the only state redder than Texas? How could this have happened in a state where Republicans control the statehouse? The legislature narrowly avoided the issue this year but that did not stop 20 conservative state senators from pressuring the Bureau of Motor Vehicles to pull the plates. What a wonderful country we live in…
Friday, the Bureau of Motor Vehicles rescinded the Indiana Youth Group gay-advocacy group’s license plates, saying the nonprofit violated its contract by offering coveted plates with low-digit numbers in exchange for contributions. The move came after 20 state senators sent a letter to the BMV charging that the group had violated its contract. The senators, led by President Pro Tempore David Long, R-Fort Wayne, and Republican caucus leader Jim Merritt, Indianapolis, demanded that the plates be removed from sale.
The BMV agreed. It also reviewed other groups’ policies and rescinded plates from the Greenways Foundation and Indiana 4-H Foundation for the same reason. No more plates will be sold for those groups, though people who already have plates can continue to use them. It was a tough defeat for the Indiana Youth Group, which filed a lawsuit to win the plate after being repeatedly turned down by the state despite meeting all the criteria. Executive Director Mary Byrne disputes the allegations and said she was surprised by the revocation. “Completely,” Byrne said. “It completely ripped my face off.”
Long, though, fired a clear warning shot a week ago. He said lawmakers had found an alternative to legislation to void the group’s contract, specifically citing the contract violation. That came after failed attempts to pass a law that would have eliminated the Indiana Youth Group’s plate while reining in the proliferation of specialty plates. Long on Friday said the youth group had blatantly violated its contract. But senators’ main concern, he said, was what he called the group’s distribution of inappropriate literature about sex education to young children — and Long said they would have shared the same concern for a heterosexual-oriented group. “There is an age-appropriateness for this,” Long said, “and I think anyone who looked at it was kind of stunned by the literature they put out. It was eye-opening.”
As for the two other groups that had their plates eliminated, Long said they should have been following state law. The Indiana Youth Group had sold 669 specialty plates so far this year — its first. The 4-H Foundation sold 1,811 in 2011. The Greenways Foundation sold 725 plates in 2011. Officials from the two foundations did not return messages for comment. Micah Clark of the American Family Association of Indiana said the plates should have been rescinded because of the group’s mission. “The Indiana Youth Group promotes dangerous lifestyles that run counter to state law,” he said. “I think you have to draw the line when you are talking about kids under the age of consent. “I’m happy the plate is not being sold anymore. The plate funds were going to go for setting up homosexual youth groups in schools. . . . It runs against state sexual education (policies), marriage and morality.”
Byrne knows conservative activists criticize the Indiana Youth Group, calling it a recruitment group for gays. “We don’t have to recruit,” Byrne said. “We are helping young people who are isolated and need to know that they are OK. We are trying to eliminate depression, suicide, unhealthy behaviors, by giving these young people a place to go and a person to talk to.” Even with the loss of the plate, she said, the fight has been worth it. “We couldn’t have paid for the marketing that we’ve been getting. I don’t want to ever go through this again to get this kind of marketing, but the more adults that know about IYG, the more young people will be able to know about us.”
Asked what she will do now, Byrne sighed and said: “I don’t know.” The group doesn’t have an attorney, she said, though a couple have offered assistance. “At this point, I think that we’ll probably do anything and everything to keep that plate. That plate means more to us than just having the license plate. It’s a ‘we’ve arrived; we are now OK in Indiana’ plate.” She’s disputing the BMV’s allegations. The contract says the group can assign low-digit specialty plates, though the group can’t charge fees. Byrne says no fees were charged; the plates were given as thank-you gifts.
BMV spokesman Dennis Rosebrough, though, said officials reviewed the Indiana Youth Group’s website and found information specifically detailing how to purchase plates. The BMV, he said, began looking at other groups’ websites and found similar offers from the Greenways Foundation and the 4-H Foundation. Jane Jankowski, press secretary to Gov. Mitch Daniels, said the BMV informed the governor Friday of the decision. “The agency has to enforce the laws and rules that it has.” But on Monday, Daniels had dismissed concerns about whether changes are needed in issuing license plates. “I don’t know,” he said at the time. “And I don’t care.”
Rep. Ed Soliday, R-Valparaiso, breathed life into the issue at the legislature when he tried passing a law reining in the proliferation of specialty license plates. He thinks the state needs a better process to ensure all groups are financially accountable and following state law. Indiana appears to endorse these organizations by issuing license plates, he said, and groups collect $25 for each $40 plate sold. In the end, lawmakers decided to stop the BMV from issuing any new plates this year. They also formed a summer study committee to develop new standards for license plates. It could result in lawmakers making the call on which groups are awarded plates. Soliday said Friday that the Indiana Youth Group became a side issue. “We’re focusing on an agency instead of policy,” he lamented. “To me, it’s a distraction. You have some people getting all animated.” “I was not targeting Indiana Youth Group,” he added. Right…sure he wasn’t!?
For decades, low number license plates were sold at higher prices to contributors to the Republican Party. To get a low number, you ponied up as much as $500.00 as a “contribution” to the G.O.P. so the Republican County Chairman would give you a letter authorizing the BMV to issue your low number license plate. These low numbers remain a status for the elite of Indiana’s governing party. Probably won’t hear much about that though.