Southwest trying to leave SEA airport
Airline proposes terminal at Boeing Field
By Alwyn Scott
Seattle Times business reporter
Southwest Airlines unveiled a proposal yesterday to build a $130 million terminal and parking garage at Boeing Field in Seattle, touting the plan as "a nice, big, shiny, new, expensive gift" to the county that would boost employment, provide lower fares and even help sell Boeing jets.
The discount airline, which says it wants to shift all its flights from Seattle-Tacoma International Airport, would design and build an eight-gate terminal and seven-level parking garage next to the county-owned Boeing Field's existing terminal, and deed them to the county after 50 years.
"It's Christmas in July for King County, Seattle and Puget Sound," Southwest Senior Vice President Ron Ricks said in a hard-sell news conference at Boeing Field yesterday.
"We're going to buy a lot of new Boeing 737s, and we're going to fly them to a building we built and gave to you," Ricks said.
Skeptics questioned whether any financial windfall for the county would come at the expense of taxpayers, nearby residents, and the financial underpinnings of Sea-Tac airport.
King County Council Chairman Larry Phillips challenged the $1.6 billion in economic benefits predicted by Southwest Airlines and County Executive Ron Sims. "Before we begin to sing the Christmas carols, we ought to have a pretty good idea of how many gifts really are in Santa's bag," he said.
If King County accepts the proposal, Southwest would run 60 flights daily from Boeing Field starting in 2009, up from 38 flights a day at Sea-Tac, gradually increasing to about 85 by 2013.
Rival airlines Alaska and Horizon said yesterday Southwest's shift would prompt them to move as many as a combined 100 flights a day to Boeing Field — nearly one-third of their Sea-Tac flights — even if that meant building their own terminal at Boeing Field.
"We would be prepared to do whatever would be necessary," said Joe Sprague, a vice president at Alaska Air Group, which owns Alaska and Horizon.
"The region has invested billions of dollars" in building Sea-Tac, he said. For the county and city to now spend money on Boeing Field "is incredibly bad public policy."
Southwest currently pays about $11.9 million a year in fees to Sea-Tac, while Alaska and Horizon together contribute about $69 million.
Southwest officials estimated yesterday that, at Boeing Field, they would pay the county $2.5 million per year in landing fees and ground leases. The county would also share in parking revenue.
The Port of Seattle, which operates Sea-Tac, said it would consider cutting airport-expansion plans in response to Southwest's proposal. Sea-Tac is in the midst of a $4.2 billion building program that includes a third runway, a larger central terminal and improvements.
"There's a list of projects we're going to have in front of us as early as Tuesday that could be delayed or omitted," Port Commission President Bob Edwards said.
The Port already has cut projects, restructured its debt and trimmed staff to bring airlines' projected future costs at the airport down to an estimated $14.15 per passenger from $25 projected two years ago. Those costs would take effect in 2009, when the third runway is scheduled to open.
Despite those moves, Southwest said costs at Sea-Tac are threatening its ability to serve Seattle, and without the move, it might have to scale back operations here.
Costs at Sea-Tac are the highest among the 60 airports Southwest serves, Chief Executive Gary Kelly said. Southwest's nationwide average airport cost is between $4 and $5 per passenger, and at Boeing Field the airline thinks it can operate below that average.
Sea-Tac costs amount to more than $10 per passenger, "with the cost destined to go higher," Kelly said.
Southwest said it would conduct a full environmental review, and said its modern, all-Boeing fleet "climbs higher and climbs faster and thus diminishes the noise on the ground."
Southwest often flies from secondary airports. It generally uses existing buildings, but recently built a terminal in Islip, N.Y.
Sims welcomed Southwest's proposal, saying it would bring new jobs to the south end of Seattle while boosting Boeing Field's anemic revenues and building a privately funded terminal that the county eventually would own.
Sims said Southwest has agreed to steer its flights over water instead of residential neighborhoods as much as possible.
"We believe actually that this may result in less noise [rather] than more," he said.
Under the proposal, road improvements would be government's responsibility. Sims and county Transportation Director Harold Taniguchi said they won't know how much it might cost to upgrade nearby roads in Seattle or Tukwila until an environmental-impact study is completed. Sims noted that four-lane Airport Way South in front of the airport is under-used.
He vowed that any road improvements needed to support Southwest's move would come from airport revenues rather than from tax coffers. "There's not going to be property-tax money used to pay for the airport," he said.
The city of Seattle, which owns roads surrounding the airport, said it wouldn't pay for improvements. "If they want to do this proposal, they're going to have to address that concern," said Marty McOmber, a spokesman for Seattle Mayor Greg Nickels.
The plan is running into serious opposition from neighborhood groups, King County Council members and officials in some neighboring cities.
"We have no intention of allowing Southwest to justify their cheap airline fares on the backs of our citizens having to put up with the additional noise," said Tukwila Mayor Steve Mullet.
He questioned whether Southwest would produce enough airport revenue to improve roads, including Boeing Access Road.
"There's probably $100 million [in road upgrade costs] sitting out there somewhere," he said. Five out of 13 County Council members are co-sponsoring an ordinance that would require any airline to pay all capital costs — including those off site — of moving to Boeing Field.
Funding road improvements through increased airport revenues wouldn't comply with the ordinance, said its prime sponsor, Dwight Pelz.
If Southwest moves to Boeing Field, Pelz said, it would gain "an unfair advantage in the marketplace. I don't know why King County government should take sides in the airline industry. That is not our job."
Kurt Triplett, Sims' chief of staff, said Boeing Field could still accommodate Alaska Airlines if the airline wants to build a terminal and parking for an operation the size Southwest is proposing. But the airport couldn't accommodate the 200 takeoffs and landings a day Alaska cited yesterday, he said.
The Federal Aviation Administration said it will await a specific proposal from the county before assessing the added flights.
Boeing spokeswoman Sandy Angers said the company has no opinion on Southwest moving to Boeing Field. But she added, "Southwest is a great 737 customer. ... Anything that's going to help them be profitable, we're all for their success."