Airports For Sale?
Mayor Requests Proposals
For New Operators

By JUSTINA WILLIAMS

After more than forty years of governance over Queens’ LaGuardia and John F. Kennedy Airports, the New York and New Jersey Port Authority will be ousted if Mayor Rudy Giuliani has his way and the right private proposal is sent to New York City.

Though the Port Authority has leased both LaGuardia (above) and John F. Kennedy airports for the majority of their existence, both may be privatized after the Port Authority’s lease expires in 2015.

The Port Authority’s current lease on the two airports doesn’t expire until 2015, but at the end of last week Giuliani and the New York City Economic Development Corporation issued a Request For Proposals (RFP) from private companies describing how they would manage the airports. The proposals are not due until January 14, 2000 but by October 18 – just four days after the RFP went out – the city already had nine international and national companies expressing interest.

The Mayor has called for change in the face of what he says is mismanagement and funds inappropriately allocated from the Queens airports to New Jersey by the quasi-governmental Port Authority. He also maintains that the Port Authority is responsible for a recent study labeling the two airports as among the worst in the nation.

"[New York airports] are among the busiest airports in the world, and they should be among the best. Instead they’ve suffered from decades of neglect. We’re losing passengers, we’re losing business and we’re losing prestige because of Port Authority’s management," said the mayor.

The Mayor also quoted a nationwide study of the country’s 36 airports which ranked JFK 35th, La Guardia 31st.

"Further, for years the Port Authority has been diverting to its New Jersey operations millions of dollars in revenue generated by JFK and La Guardia. In 1998 alone approximately $150 million went to subsidize the New Jersey PATH train instead of funding improvements for our airports," he concluded.

"As a result of the Mayor’s announcement today the Port Authority should see the writing on the wall and negotiate an early termination of its lease," added John Dyson, chairman of the Mayor’s Council of economic advisers.

In response to the Mayor’s request, the Port Authority issued a short statement delineating two current ongoing projects, which provide over 10 billion dollars in investments for upgrades to the two airports. The Port Authority has also said that they are prepared to renegotiate the lease to provide more rental income to New York.

JFK Stats

John F. Kennedy airport, located in southeast Queens on Jamaica Bay, was opened on the former site of a marshy golf course back in 1947, and from its inception the Port Authority held the airport’s city lease. Planned for 1,000 acres the airport has since quadrupled in size, and currently encompasses over 4,930 acres. It employs over 37,000 people and contributes 20.4 billion in economic activity to the area, generating around 207, 700 jobs. As of June 1997 the Port Authority’s capital investment was approximatly 2.4 billion.

LaGuardia Stats

La Guardia airport, located in Northwest Queens bordering on Flushing and Bowery Bay, was opened in 1939 on the former site of the gala amusement park. In 1947, the airport was leased to the Port Authority. Currently ranging over 680 acres, the airport employs around 9,000 people directly, and contributes 5.7 million in economic activity to the area, generating 63,000 jobs. As of June 1997 capital investment was around 791 million.

The Quasi-History

The quasi-governmental ag-ency called the Port Authority was the outgrowth of New Jersey and New York sibling-like squabbles over services and usage, which date back over a century. In 1834, two police officers punctuated their argument by engaging in an informal duel while standing in the entity of contention — the Hudson River.

The contending states eventually turned to England for a model of management. England possessed the first public authority in the world. In 1921 the two American states created the Port of New York Authority (later to be re-named Port of New York and New Jersey). It was the first inter-state agency in the United States, and was created under a clause of the constitution which permits compacts between states.

It oversees a region of roughly 1,400 square feet centered around the Statue of Liberty, and as a public authority is funded independently by funds from projects it oversees rather than tax moneys. It is meant to function as an incubator for the region’s economy and is the primary governing agency over a host of other entities, among them the PATH train and Port Authority bus terminal.

Port Authority funds are pooled as a common source, used to back bonds, and merited out accordingly to various projects, rather than having funding from an individual project remaining solely within that project. The mayor ’s office is angered that the PATH train has been operating as a deficit, and feels it is unfairly draining that resource pool. PATH fare has remained $1 since 1986.

The Voice Of The People

According to a poll conducted by the Quinnipiac Institute, Guiliani’s view is held by the minority of New Yorkers. Seventy-six percent said that bridge and tunnel tolls should remain the same, and 69 percent felt the PATH fare should remain $1. Additionally, John F. Kennedy airport has traditionally utilized the lions share of Port Authority funds, and is currently in the midst of a 9 billion upgrade. New terminals and roads are being built across the airport, and construction has begun on a high speed rail link. Also, La Guardia will be benefiting from a 1 billion dollar makeover, with additional hundreds of millions of dollars in improvements.

Additionally the Quinnipiac survey also said that while 38 percent of New Jersey voters felt the PA favored New York, 25 percent of New Yorkers voters felt it favored New Jersey, and that a similar amount, 43 percent of New Jersey, 40 percent of New York, felt the bi-state agency treats both fairly.

Currently several airports both nationally and internationally have independent operators including Indianapolis airport, England’s Heathrow, and Gatwick, and New York state is making plans to privatize upstate Stewart and Buffalo airports.

While Governor Pataki has encouraged the Port Authority to cooperate, a spokesperson added that "it’ll be down the road before we know that this proposal makes the best sense for the people of New York, and we look forward to getting a complete and fair assessment of the proposal."

Meanwhile, many local residents are ambivalent. President of the United Civic Association, Rose Marie Poveromo, long a vocal opponent of airplane noise and pollution, felt any positive changes would be negligible, as her requests — for airplane technical changes, are under the authority of the FAA, as is plane path routing.

While noting that "the mayor has been rightfully unhappy" with the airports, Dr. Steven Dobrow of Woodside was also speculative, and wondered at the rush as 2015 is "not something just around the corner." Adding "there’s a lot of questions here — I hope the city council will look into it," he mused, "The main reason is because the mayor likes to run things and "privatization" is a good election buzzword."