CLT may compete for Mid-Atlantic

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N.C. may compete for US Airways

U.S. Airways
Charlotte/Douglas International Airport

David M. Brown and Jim Ritchie
TRIBUNE-REVIEW
Saturday, April 12, 2003

The director of Charlotte-Douglas International Airport said Friday if the location of US Airways' MidAtlantic Airways regional jet base planned for Pittsburgh International Airport is up for grabs, he will make a pitch for it.

My role here is to run the airport for the people in the region, said Jerry Orr, director of the North Carolina airport, home of US Airways' largest hub. In doing that, my job is to provide as much air service and as many jobs as I can. Obviously, if a major airline would want to locate jobs here, that's something we would actively pursue.

US Airways initially pledged to put its MidAtlantic operation at Pittsburgh International, but recently told Allegheny County officials the location of the base would either be Pittsburgh or Charlotte, depending on which airport would come up with $40 million to build a maintenance and training center.

US Airways spokesman David Castelveter yesterday would not discuss Orr's comments.

The focus of our regional jet operation is in Pittsburgh, Castelveter said. We are having discussions with Allegheny County about reducing the cost structure at Pittsburgh International.

Just minutes before emerging from Chapter 11 bankruptcy protection last week, US Airways rejected its $50 million in annual leases and contracts at Pittsburgh International, causing widespread fear about the airline's future here. The carrier employs about 9,000 people at its Pittsburgh hub.

The airline has demanded lower operating costs from the Allegheny County Airport Authority in addition to $155 million in airport improvements — $40 million of which would be to build the regional jet maintenance and training center. US Airways also demanded $235 million in improvements and rent relief from Philadelphia International Airport.

US Airways said it could put the regional jet base in Charlotte if Pittsburgh and Harrisburg don't come up with $40 million to build the maintenance and training center.

I think they're trying to decide where to put it, and I don't think they've decided yet and are looking at all alternatives, Orr said.

Kent George, director of the Allegheny County Airport Authority, would not comment yesterday. He and authority board members met privately yesterday morning with county Chief Executive Jim Roddey to discuss negotiations with US Airways. Roddey also declined to comment this week.

County and airport officials have decided not to challenge US Airways' rejection of its airport leases and contracts. Instead, they intend to negotiate with the airline.

It's likely they'll discuss strategy during a meeting tentatively scheduled for later this month involving Gov. Ed Rendell and local leaders from Pittsburgh and Philadelphia. On Thursday, Roddey formed a five-member advisory panel that will help with the negotiations.

Rendell has pledged financial help from his proposed $2 billion economic development bond issue to keep US Airways in Pittsburgh, but he said he wants US Airways to also make economic contributions and commitments. Among them could be a request that the airline move its headquarters, located outside of Washington, D.C., to Pennsylvania. Both Pittsburgh and Philadelphia are US Airways hubs.

It does not appear Charlotte leaders are preparing a specific financial proposal to win the MidAtlantic base. But economic officials there say they're ready to compete to get such projects.

It's an arms race when it comes to incentives right now, said Tad Boggs, a spokesman for the North Carolina Department of Commerce. Every time you feel that you are taking a step to pull even, the other states are doing something to pull back ahead.

North Carolina has experience in putting together inventive packages for aviation ventures. In 1998, that state sold Federal Express on locating its Mid-Atlantic hub in Greensboro. The deal gave the freight company $115.5 million in tax exemptions and credits over 25 years.