Tulsa chamber says talks with American Airlines intense
BY WAYNE GREENE World Senior Writer
Saturday, October 13, 2012
10/13/12 at 7:14 AM
Read more about the proposal and the status of Vision 2025 projects.
At least $212 million worth of projects for American Airlines' facilities in Tulsa that are pending in the Nov. 6 Vision2 package are the result of months of talks between local officials and the company, Tulsa Chamber of Commerce President and CEO Mike Neal says.
The aim of those discussions was what would it take to keep the world's largest civilian maintenance facility and Tulsa's largest employer open.
"It absolutely is urgent," Neal said Friday. "It is imperative that we make a move right now while (American Airlines is) attempting to emerge from bankruptcy, to make a formal commitment to this company that we will maintain these facilities."
Opponents of the Vision2 package say they too want the American Airlines jobs to stay in the community, but local voters deserve more proof of the connection between the Vision2 proposal and the airline's plans.
Neal said negotiations between the chamber and the airlines have been intense, starting from the company's November bankruptcy announcement.
"Not a week's - or sometimes a day's - gone by when we haven't had extreme dialogue with various American Airlines leaders about the commitment of Tulsa and about their commitment to retaining and growing this maintenance base and the thousands of jobs that we're fortunate to have," Neal said.
Included in the Vision2 proposal is money to retrofit city-owned hangars at the maintenance base to make them able to accommodate new, larger planes in the airline's fleet and money for facilities to test new, bigger jets coming on line. Other planned Vision2 work includes pavement repairs for aircraft ramps, environmental capacity upgrades for the depot's plating shop and waste-water facility, new tooling and other equipment.
The upgrades are designed to make the Tulsa facility relevant - in fact, irreplaceable - to the airline's future, Neal said.
During conversations with Tulsa officials, American Airlines made it clear that its maintenance costs had to be reduced, he said.
Federal Bureau of Transportation Statistics indicate the company has about twice as many maintenance workers per pilot as competitors Delta and United. The ratio is even more out of proportion with those of smaller regional airlines.
"They made it pretty clear to us from Day 1 that they had to close one of their maintenance bases," Neal said.
In essence, Tulsa's American Airlines facility was competing with the company's maintenance base at Fort Worth's Alliance Airport.
In September, the airline announced plans to close the Fort Worth facility and downsize work in Tulsa, but Neal said American can reverse that decision if Tulsa doesn't come through with its part of the deal.
"I think their decision, at least in my mind, to close the Alliance base is based on the fact that the proposed infrastructure enhancement will be made over the next five years in Tulsa," Neal said. "I think we've made a commitment to them that we're going to do everything we possibly can to make these huge enhancements become a reality."
Losing the maintenance base would be a "devastating blow" to the Tulsa economy, Neal said.
Gary Trennepohl, ONEOK Chair in Finance at Oklahoma State University and former president of the school's Tulsa campus, said the aerospace industry located near Tulsa International Airport is the second-biggest cluster of employment in the city.
"It's a very important part of what we do in the Tulsa market, and a lot of it is driven by American Airlines," Trennepohl said.
The city has about 11,000 jobs directly employed by aviation facilities working at city-owned facilities at the airport, including the airlines maintenance base, he said.
Those 11,000 jobs correspond to about 27,500 people, he said.
Another 6,300 jobs are directly tied to doing business with the aerospace center and another 7,500 jobs in the local economy are dependent on the aerospace impact on the economy, Trennepohl said.
"The whole thing ripples through the economy," Trennepohl said.
Ronda Vuillemont-Smith, a member of the Citizens for a Better Vision steering committee and an unsuccessful candidate for the state Legislature earlier this year, said Tulsa County voters deserve better evidence of the claims of Vision2 backers.
"We've asked for proof that if we don't pass it, that American Airlines is going to leave, because that's what they're saying," Vuillemont-Smith said.
When Vision2 backers are pressed for details on whether Tulsa's American Airlines jobs are dependent on Vision2 passing, they never offer satisfying evidence, she said.
"If you ask anybody who said this and when was it said, you can't get an answer," Vuillemont-Smith said.
"No one from Citizens for a Better Vision wants to see American Airlines leave Tulsa. That's not what we want to see," she said. "But what we want is a better plan, one that's a little bit better thought out, one that has a little better input."
Ulterior motives - specifically, the chamber of commerce's desire to get its hands on an uncapped job-closing fund included in the Vision2 package and which could exceed $172 million - are behind the package, which tries to manipulate voters with the threatened loss of industrial jobs at the airport, she said.
"They throw that up there and they say, 'Well, if you don't do it ... all of these families are going to be destitute and without a job,' and there's nothing that says that this is actually going to happen," Vuillemont-Smith said. "No one from American Airlines has come out and said it. No one at Spirit (AeroSpace) has said it. No one at IC Bus has said it. It's emotional blackmail."
The airline's press spokeswoman did not immediately respond to a Thursday email seeking comment for this story.
Vote date: Nov. 6
Amount: $748.8 million
Tax impact: Extension of 0.6 percent Vision 2025 sales tax from 2017 through 2029
PROPOSITION 1: ECONOMIC DEVELOPMENT
Airport industrial complex buildings and infrastructure: $122 million
Airport industrial complex equipment: $132 million
Closing fund: $52.942 million
Bond costs and interest: $79.938 million
PROPOSITION 2: QUALITY-OF-LIFE IMPROVEMENTS
Tulsa County: $92 million
Tulsa: $157.92 million
Bixby: $11.3 million
Broken Arrow: $44.1 million
Collinsville: $3 million
Glenpool: $5.9 million
Jenks: $9.2 million
Owasso: $14.38 million
Sand Springs: $10.1 million
Skiatook: $1.16 million
Bond costs and interest : $12 million
Original Print Headline: Tulsa chamber says talks with airline intense
Wayne Greene 918-581-8308
An American Airlines jet sits at the American Airlines Maintenance and Engineering Center, which would benefit if Vision2 is approved. MIKE SIMONS/Tulsa World file