40 Airlines Sue to Cancel Landing Fee Hike at LAX : Litigation: Air carriers say U.S. laws bar airports from levying charges beyond those needed to run facilities. Suit could thwart mayor’s plan to use revenue to boost police force.
Forty airlines filed a lawsuit Friday in federal court seeking to block the city’s tripling of landing fees at Los Angeles International Airport--a move that could thwart Mayor Richard Riordan’s plan to fatten the airport’s treasury and siphon off funds to pay for more police.
The airlines’ lawsuit, filed in U.S. District Court in Los Angeles, claims that the steep increase violates federal laws and international aviation agreements that prohibit airport operators from charging fees beyond those needed to operate their facilities.
The new fees--increased from 51 cents to $1.56 per 1,000 pounds of weight--took effect July 1 after being approved by the City Council. That means the operator of a Boeing 747 that previously paid about $300 to land at the airport will now pay more than $900.
“Airlines cannot simply look away while the city jeopardizes the future of LAX and chips away at the law which protects the public’s investment in the nation’s aviation system,” said Jim Landry, president of the Air Transport Assn., the trade group that represents major air carriers.
But Riordan defended the higher fees and lashed out at the lawsuit as a “disingenuous” attempt by the airlines to preserve a sweetheart deal at LAX.
“It is common for mismanaged and inefficient industries like the airlines to get addicted to steep public subsidies,” Riordan said in a prepared statement. “Unfortunately for them, we do not believe this is an appropriate use of scarce public resources.”
Late Friday, the city’s Airport Commission called a special session to decide how to react to the lawsuit.
Riordan and other city officials said the new rates bring LAX’s charges closer to those levied at other large airports and end 40-year agreements that had kept charges in Los Angeles artificially low. New York’s John F. Kennedy Airport charges $2.65 per 1,000 pounds and Chicago’s O’Hare International Airport $1.89, said Jack Driscoll, director of the city’s Department of Airports.
He said the airlines have exaggerated the importance of the landing fees, which he said represent less than 3% of their operating expenses.
“I think the issue is really control of the airport,” Driscoll said. “Before, they were essentially in charge and they dictated terms of the airport’s operation. I don’t think they want to give up that control.”
The lawsuit may be just the opening shot in an extended battle between the city and the airlines.
Los Angeles officials led by Councilwoman Ruth Galanter suggested more than a year ago that the airport be used as a cash cow to support other city programs--particularly police service. That cry was enthusiastically joined by candidate and now Mayor Riordan--who has pledged to use expanded revenues from the airport to hire 3,000 new officers for the Police Department.
Riordan initially said he hoped to lease the airport as a money-making venture, but now says he may be willing to let the city continue running it.
In either case, he said, the increase in landing fees is needed so the city can benefit from its ownership of the airport.
The city is seeking federal legislation to clear away laws that prevent it from spending money from airport landing fees, parking lots and concessions outside of LAX.
“Up until now the people of Los Angeles have been unable to reap the benefits of their own investment,” said Galanter, who represents the airport area. “We have given the investment back to the airlines and that is a situation they want to perpetuate.”
But the airlines have argued that the restrictions were put in place to make sure that airports were properly maintained and not “bogged down in city financial maneuvering,” Landry said.
Landry also protested that the higher fees would lead to higher ticket prices, decreases in revenue for their troubled industry and a loss of jobs as business suffers.
To pressure the city to drop its bid to use airport money, Rep. Bob Carr (D-Mich.) has introduced legislation that would withhold federal transportation funding from cities that divert airport monies to their general funds.
Airlines officials said they are concerned that Los Angeles’ use of airport revenue to prop up the city treasury will become a precedent for other cash-strapped municipalities.