Runner would support airport with tax break

Runner's Assembly Bill 243 would save airlines or air cargo services from paying a statewide 2 cents per gallon jet fuel tax when operating within enterprise zones.

That 2 cents tax is above the sales tax the state charges and goes directly to the state's general fund.

While few airports in the state are within enterprise zones, both Palmdale Airport and Gen. William J. Fox Airfield are, making aircraft companies eligible to receive the tax break if Runner's bill passes.

Another airport within an enterprise zone is Oakland Airport, where even operators across the bay at overcrowded San Francisco International Airport support an increase in air traffic to relieve the burden at SFO.

Oakland's inclusion in the exemption, Runner said, may get Bay Area legislators to support his bill.

"The whole idea is that we need to create incentives to get carriers into new airports," Runner said. "It's just too easy to stay at their existing airports."

He added, "As long as new gates are opening up, like at Burbank or Los Angeles International, (airlines) just stay there and the passengers will be forced to go to where they are."

Runner's bill comes during a fierce political debate over whether to expand LAX.

Los Angeles Mayor Richard Riordan and the Department of Los Angeles World Airports - which owns and operates several airports in the region including LAX and Palmdale - have put forth a plan to expand LAX without adding a runway.

Opponents of that expansion have focused attention on diverting air traffic to outlying, regional airports, such as the one in Palmdale.

A Draft Environmental Impact Statement/Environmental Impact Report outlining LAX expansion plans has gone into circulation for a 180-day public review period. It outlines the findings of a five-year effort to map out LAX expansion in preparation for growth in air traffic demand on the area.

Estimates show up to 157 million air passengers per year traveling in and out of the region by 2020. Currently, 67 million passengers fly in or out of LAX each year.

Those against that expansion plan include Los Angeles County 5th District Supervisor Michael D. Antonovich and L.A. City Councilwoman Ruth Galanter.

Representatives for both officials stated their support for Runner's proposal.

"We think that's great," said Laurie Howard, Antonovich's planning deputy in charge of airport issues. "Anything that encourages airlines to resume service at Plant 42 is good."

Howard said she expects Antonovich to lobby the other supervisors to write a resolution in support of Runner's bill.

Galanter spokeswoman Niki Tenant said the councilwoman will also support the bill.

"I think this is the kind of incentive that we'd be looking at to jump start air service to Palmdale," she said.

"This is a great idea and I hope others follow his lead."

Howard Brooks, executive director of the Antelope Valley Board of Trade, said he will urge local businesses to sign on as supporters of Runner's legislation.

"I think it's a positive thing," he said.

Brooks pointed out that such legislation would not only give incentives to airlines and air cargo services, but to any craft that fly into Palmdale, such as those being serviced by SR Technics America Ltd., a heavy aircraft maintenance firm.

Brooks said Runner will appear before the Palmdale Regional Airport Council today to discuss the proposed legislation.

The meeting begins at noon at the Palmdale Regional Airport office near 25th Street East and Rancho Vista Boulevard (Avenue P).

"I know there's a lot of people talking about wanting to see an airport in Palmdale, but this gives us the ability to put a real economic incentive behind the attraction," Runner said.

Kristin Nelson, a spokeswoman for Southwest Airlines, said that air carrier couldn't comment on the legislation until executives had time to review it.

But, "we think any breaks on fuel or operating costs as it relates to taxes would be great," she said.

Joe Healy, who is on the board of trade's transportation committee, was once president of Flying Tigers Airlines, a major air cargo service that eventually merged with a company new at the time, Federal Express.

Healy stressed the importance of jet fuel costs when figuring an airline's operating expenses, which were a large portion of the costs.

At Flying Tigers, the fuel cost was around 30% of total operating costs, he said.

"Fuel for the airplanes was always a major contributor," he said.

At one point, all common carriers were exempt from state sales taxes until 1991, when the economy took a turn for the worse. The exemptions included air, rail and water carriers.

In 1992, that exemption was reinstated for water carriers. Those carriers still are exempt from paying fuel taxes.

In 1996, former Assemblyman Keith Olberg, R-Victorville, successfully passed a bill that gave railroads limited equipment tax exemptions.

In 1996 and 1998, bills were introduced to eliminate the fuel sales tax for air common carriers but were both killed.