June 15 - 2006

The day finally arrived for the official announcement of the terms of the agreement. There hadn't been this much buzz throughout North Texas since the Congressional hearings back in November, shortly before Missouri was exempted.

The five negotiating parties -- Dallas, Fort Worth, DFW Airport, American and Southwest Airlines -- held a press conference at the Grand Hyatt Hotel, a key component of DFW's 2.7 billion improvement project, saying they had agreed to ask Congress to repeal the Wright Amendment and to do so in two phases.

Phase One would immediately allow airlines serving Love Field to offer through ticketing to destinations within the 50 United States and the District of Columbia and to market such services.

Phase Two would eliminate all the remaining restrictions on service from Love Field after eight years from the enactment of legislation.

Other provisions would include:

• Limiting all international commercial passenger flights, (both nonstop and connecting) exclusively to DFW Airport. Through ticketing to or from a destination beyond the 50 United States and the District of Columbia would be prohibited from Dallas Love Field.

• Reducing the number of gates available for scheduled passenger air service from the 32 gates envisioned in 2000 to 20 gates -- an overall reduction of 37.5%.

  �

• Defining a gate as one passenger hold room and one passenger loading jet bridge supporting one aircraft parking space, with no hardstand operations permitted.. Airlines were not permitted to subdivide a "gate."

• Leasing 16 gates to Southwest, two to American and two to Continental. AA and Southwest agreed to voluntarily surrender their rights under existing leases to reduce the number of gates necessary to implement the agreement.

  In exchange, the leases on the remaining gates allocated to Southwest and American, would be extended to 2028 and would be on a preferential-use basis with gate sharing provisions.

  Southwest further agreed that the 5 remaining gates in the North Concourse would not be used for passenger service and the facility would be modified as necessary up to and including demolition.

• The City of Dallas negotiating a voluntary noise curfew at Love Field precluding scheduling airline flights between 11 p.m. and 6 a.m.

• The City of Dallas agreeing to significantly redevelop portions of Love Field, including acquisition of the lease on the Lemmon Avenue facility -- up to and including condemnation of the former Legend terminal.

• The City of Dallas agreeing to spend $150 to $200 million (in 2006 dollars) to modernize the main terminal,to be paid for by an increase in landing fees and space rental charges to be collected from Love Field users. This amount was exclusive of the acquisition and demolition of the Lemmon Avenue gates and the development and construction of the DART people mover to Love Field.

• The City of Dallas seeking approval to use PFCs to fund the DART people mover.

• Agreeing that Southwest would voluntarily relinquish control of one Love Field gate, for every gate they used at any other airport in North Texas (including DFW) within an 80-mile radius of Love Field.up to a maximum of eight gates.

• Agreeing that American would voluntarily relinquish control of one Love Field gate, for every gate they used at any other airport in North Texas (excluding DFW) within an 80-mile radius of Love Field.up to a maximum of one and one half gates.

  These voluntary agreements for Southwest and AA to relinquish gates would expire in 2025.

• All Parties understanding that if the U.S. Congress did not enact the legislation by December 31, 2006, then the agreement would be null and void unless all parties agreed to extend it.

The five negotiating parties -- "The Wheeler Dealers" -- presented a untied front at the press conference.

Southwst's Chairman Herb Kelleher said:

"I have been involved in litigation, legislative struggles and cuss fights over Love Field since 1972 -- a period of 34 years, The fact that Southwest Airlines stands here today -- stands here with Fort Worth, D/FW Airport, American Airlines and the city of Dallas indicates, I believe, that there must be hope for world peace."

Southwest executives said through-ticketing would cause fares to fall, even though passengers making long-haul trips would have to go through nearby cities such as Houston or Albuquerque, N.M.

Asked later why he didn't hold out for a better deal, Kelleher responded:

"American has some very, very powerful people on the other side of this issue,"

America spokesman, Dan Gartman was a little more subdued in his enthusiasm, calling the eight-year extension of Love Field limits a compromise. "We wanted 1,000 years," he said.

Others weren't happy at all.

The Dallas Business Journal published a scathing editorial urging Congress to say not only no, but hell no, to the compromise, saying the deal would lock in monopoly conditions for the North Texas aviation industry and forever destroy Dallas Love Field's growth potential.

It claimed the deal would make it much harder for new airlines to enter the market and challenge American or Southwest, because it would permanently destroy the infrastructure that new competitors would need to establish a presence at Love.

Moreover, the plan would give American almost another decade to enjoy most of the protectionist rules it never should have tasted in the first place.

They called the plan "lunacy," saying:

. . . we know free enterprise when we see it, and this isn't free enterprise, it's market fixing -- a willful constriction of aviation capacity in a region that will grow by millions of citizens in the years ahead.

. We're appalled by Dallas Mayor Laura Miller's eagerness to mothball a huge portion of Love Field. Just a few years ago, under different leadership, Dallas welcomed expansion at Love with the construction of a new terminal for ill-fated Legend Airlines. Now there is talk that the city might invoke eminent domain to seize and destroy that terminal, as well as close forever many other gates at Love.

This is nothing short of an economic betrayal of a city by its mayor. Some pundits would have us believe that the Wright compromise will help Miller get re-elected. Impeachment would be more appropriate.

The Fort Worth Star-Telegram reported that

Sen. Kay Bailey Hutchison, R-Texas, planned to introduce a bill that would carry out the compromise and ultimately repeal the Wright Amendment.

The bill would be referred to the Senate Commerce Committee, where it would have to be approved before going to the full Senate for a vote. The committee also could call a public hearing before voting.

If approved, the Senate bill would go to the House. Any member of the House also could draft their own version of the bill, but as of date of the report, no member had committed to do so. Repeal legislation in the House likely would be referred to the Transportation Committee for a vote and possible hearing before going to the full House for approval.

If the Senate and House passed the same bill, it wuld go to the president for his signature and then become law. If the Senate and House pass different versions of the bill, a House-Senate conference committee would be appointed to iron out the differences before it goes to the president.

The repeal proposal also could be attached to other legislation as an amendment and avoid the full process.

The press portrayed it as a truly historic moment -- for it was one of the only times the two cities had ever come to any sort of agreement over the issue without having to turn to the courts. Publicly, there were self-congratulatory smiles and handshakes all around.

While the "celebration" continued the rest of the week and all the next as Southwest celebrated their 35th anniversary on June 18, 2006, privately, some wondered if Southwest's control of 80% of the gates at Love Field was too much of a "gift."

Tune - Everything's Coming Up Roses
Ethel Merman

Flying West
Flying East
Fly the airline that costs you the least
Walk-up fares
Sure to please
Three checked bags
No change fees
On June eighteenth
Let's all stand up and c-h-e-e-e-r!
As our friends at South-west Air-lines
Celebrate thirty-five years!

Flying East!
Flying West!
Fly the airline that LUV's you the best!
Friendly smiles
From your hosts
Frequent flights
Coast to coast
So June eighteenth
We'll all stand up and s-a-a-y -
We wish all the folks at the LUV airline
A Happy Birthday!