LAX Revision: A First Step

The Los Angeles City Council did the right thing last week when it unanimously voted to put on the November ballot a charter amendment that would help modernize the city’s outdated system of airport finance. But even with voter approval, this charter change alone wouldn’t be enough to allow the city to tap into surplus airport funds.

Airport funds are bound by federal and local restrictions that effectively served the city’s airports, notably Los Angeles International, in their infancy by preventing other city departments from raiding airport coffers.

The charter change would allow other, pinched city agencies to use surplus funds generated by this now-successful facility. But before it could take effect the council must vote to untie other knots in LAX finances and Congress must loosen existing restrictions on the use of federal airport funds.

What’s more, the council needs to exert much stronger oversight over airport finances. Relying on new oversight authority that the council acquired with passage of Proposition 5 last year, Councilwoman Ruth Galanter tried last month to order the semi-independent Airport Department to open its books. She failed to get majority support on the council. Absent this budgetary oversight, it may be ineffective to try to change the financial arrangements that, arguably, now work more to the advantage of the airport, its commissioners and the airlines than the city and its residents.

Many have argued, more loudly of late, that outright sale of Los Angeles International is in the city’s best long-term interest. But retaining public ownership while updating LAX’s antiquated financial arrangements seems a wiser course. Private sale, assuming there is a willing buyer, raises concerns about monopoly operation of this one-of-a-kind facility upon which the region depends for so much of its commerce and tourism.

On the other hand, continuation of the financial status quo ensures that the airport has enough money to operate--some say more than enough--but leaves city services that depend on the general fund increasingly strapped.

The city would reap greater long-term financial gains by maintaining public control while restructuring airport revenues. The City Council has now taken the first step. It must continue to act.