Panel Seeks to Pare Airport Shuttle Firms

In a sweeping overhaul of passenger van service that critics predict will lead to higher fares for consumers, airport officials voted Tuesday to essentially boot mom-and-pop shuttle operators from the curbs around Los Angeles International Airport as part of a plan to improve ground transportation at the nation’s third-busiest airport.

If the City Council approves the decision, starting in September passengers catching a ride home from LAX will no longer find nearly 40 firms jockeying outside the terminals for their business.

The Los Angeles Board of Airport Commissioners decided Tuesday to replace that freewheeling competition with a concession system that gives three companies--Phoenix-based SuperShuttle Inc., Prime Time Shuttle, whose parent is based in Santa Clarita, and a Los Angeles consortium called Xpress Shuttle--nearly exclusive rights to pick up passengers at the curb. The board approved four additional long-distance carriers to serve passengers heading to outlying areas.

SuperShuttle and Prime Time already are the airport’s largest shuttle companies, accounting for more than half of the about 600 vans now licensed to do business at LAX. Those firms and Xpress Shuttle each have agreed to pay the airport a minimum of $1 million annually for the rights to operate a quasi-monopoly at LAX.

The action comes at a time when van ridership is declining due in part to cutthroat tactics spawned by intense competition. Airport officials say the new system puts LAX in line with other major airports, which have moved to exclusive shuttle concessions to boost customer service, air quality, traffic flow--and revenue.

Angry mom-and-pops say that the only thing headed up will be fares once their firms are prevented from competing with the big guys for the bulk of the business. After a heated, standing-room-only meeting at LAX, the small fry vowed to take their fight to the City Council and even the courts in a bid to protect their livelihoods.

“They’ll be out of business in 60 days,” said Mary K. Jones, an attorney representing more than a dozen of the small carriers. “It’s unfair to small businesses and it’s unfair to the public who is eventually going to be paying for it.”

Tuesday’s vote caps nearly three years of wrangling over the restructuring of shuttle service at LAX. About the only thing all sides agree on is that the present system isn’t working.

Unlike other major airports, which limit the number of van companies serving their facilities, LAX has effectively welcomed any operator who could get state Public Utilities Commission approval after the deregulation of ground transportation in the early 1980s.

Van shuttles operate much like taxis by offering door-to-door service, but they are significantly cheaper because passengers share the ride. However, consumer complaints about price gouging, unsafe vans and driver misconduct have mushroomed along with the number of competitors.

Now 37 van companies compete for passengers at LAX, up from 20 in 1988. Meanwhile, ridership is waning. Of the 60 million passengers that went through LAX last year, only 1.2 million used a van shuttle. That’s down nearly 5% from 1996.

Airport officials blame bad service born of unfettered competition. They put out a request for bids last year to greatly reduce the number of companies while dictating tough new quality standards.

“‘The problem is that the free marketplace . . . has not served the people who travel into here well,” said Commissioner Patricia Schnegg. “People are frustrated with the level of service.”

In exchange for a $1-million minimum annual payment to LAX, the three firms selected Tuesday will be assigned permanent curb space at each terminal. They will have sole access to the coveted “free call” passengers--the walk-up, non-reservation customers who make up the lion’s share of shuttle riders leaving LAX. They also will be prevented from raising fares more than 10% over the life of the three-year contracts, which carry an option of two one-year extensions.

The long-distance carriers selected Tuesday--Valencia Airport Shuttle, Southern California Coach, Roadrunner Shuttle and Inland Express--will have some designated curb space and access to passengers heading to outlying areas.

Other carriers will still be allowed into the airport, but only to drop off passengers and pick up others holding reservations with their firms. That will effectively shut them out of the lucrative walk-up business that’s the bread-and-butter of many small operators.

“I’m finished,” said Veronica Abadinsky, owner of ABC Shuttle. “This is going to put a lot of us into bankruptcy.”

The decision now moves to the City Council for a final vote. Councilwoman Jackie Goldberg, perhaps the council’s most ardent supporter of the working person, said she approves of the plan as long as no shuttle operator is barred from the airport.

“If the information I have now is accurate, I will support it,” she said.

Companies and corporate officers associated with two of the winning applicants are listed with the city Ethics Commission as having contributed thousands of dollars to municipal campaigns since 1992. Businesses and people affiliated with SuperShuttle gave nearly $22,000 to 13 candidates, including current council members Nate Holden, Mark Ridley-Thomas, Rita Walters and Rudy Svorinich Jr.

Prime Time Shuttle International Inc. gave more than $2,000 to Mayor Richard Riordan’s primary and general election campaigns in 1993.

The winning contracts are contingent upon the management companies of SuperShuttle, Prime Time and Xpress Shuttle obtaining an additional level of state licensing from the PUC. The airport board voted Tuesday to forge ahead with its plan and give the companies a year to obtain the necessary approvals.

That after-the-fact licensing bothers Assistant City Atty. Timothy Hogan, who worries that airport officials would be forced to terminate contracts in midstream if any of the companies failed to secure the necessary approvals.

“It’s a concern,” he said.