There is an underdrain system, except for the crosswind runway that was not built and is now several lakes.
Because of the flooding, DEP made them plug the outfalls and pump the storm water after treatment, but they never catch up between rains. The big "SOTA" sand filter is also flooded with muddy water after months of trying to keep it dry and then dumping the excess water over Thanksgiving weekend. As I said before, I expect them to blow out the mud and try to connect the drains near opening day when the ribbon cutting has the News Herald giddy.
Then the pipes will flush to the tune of a few more fines, and we'll see if it works. All bets off if they don't get some grass growing. 3 inches of rain = 300 acre-feet of water, more than these little branches they have ditched out can handle.
Monday, December 28, 2009
Storm Drains
Friday, December 25, 2009
The ECP Code
I recall they were given a short list from FAA of codes that were available, and the airport responded with 3 from the list in no preferred order. FAA then assigned ECP - any correlation is coincidence. They ran out of 3-letter codes with "relevance" to location, and often the relevance is no longer valid, like "PFN" relating to "Panama City - Fannin Field". I was born here and i don't know who Fannin is/was (or Hathaway either). The codes are all over the place - person names (JFK - changed from IDL for Idlewild, a place), (BDL - Bradley - Hartford), city names (BOS, MIA, TLH,TPA), airport names (RSW - used to be SW Florida Regional, now SW Florida International - Ft Myers), (IAH - Houston Intercontinental), and meaningless (4R4 - Fairhope AL), (YUL - Montreal), (ECP - NWFBIA).
There's an interesting web article about arcane airport codes at http://www.skygod.com/asstd/
"I recall they were given a short list from FAA of codes that were available, and the airport responded with 3 from the list in no preferred order. FAA then assigned ECP - any correlation is coincidence. They ran out of 3-letter codes with "relevance" to location, and often the relevance is no longer valid, like "PFN" relating to "Panama City - Fannin Field". I was born here and i don't know who Fannin is/was (or Hathaway either). The codes are all over the place - person names (JFK - changed from IDL for Idlewild, a place), (BDL - Bradley - Hartford), city names (BOS, MIA, TLH,TPA), airport names (RSW - used to be SW Florida Regional, now SW Florida International - Ft Myers), (IAH - Houston Intercontinental), and meaningless (4R4 - Fairhope AL), (YUL - Montreal), (ECP - NWFBIA).There's an interesting web article about arcane airport codes at http://www.skygod.com/asstd/abc.html"
- The News Herald (view on Google Sidewiki)
Wednesday, December 23, 2009
On the Facts
02worth said, "Donhodges, do you have a set of plans, do you really know what the proposed stormwater treatment was?"
02,
Actually, I do know what the design is, and if you took the trouble to read the docs you would know too. I don't jump on here with things I can't back up. What the airport says and what it writes to agencies are often quite different. I use the written stuff or photos that don't lie. As a friend said to me, "Ink leaves tracks, words flow with the breeze." What do the words "state of the art" mean, absent any explanation? What does "Preserve Forever" mean, coming from a team that violated its permits in May 2006, before they were even issued? What is the "West Bay Preservation Area" without a map with actual dimensions on it? What is a corporate promise not given in writing?
Is it any wonder the people on here automatically go negative when any public effort is reported, not just the airport? We have learned the very hard way that what is said is usually either misleading or outright false.
Southwest Airlines is a breath of fresh air in this - you can bet they will have their deal in writing and retain the right to keep the books on it. That may come as a shock to people accustomed to just revising away inconvenient agreements.
"Donhodges, do you have a set of plans, do you really know what the proposed stormwater treatment was?"
- More stormwater fines levied against airport | west, airport, bay - News - The News Herald (view on Google Sidewiki)
Tuesday, December 22, 2009
State of the Art by February??
The "retention ponds" are an emergency measure they never had in their plan, but now that they are necessary, the airport board takes credit as if they planned to use them all along. The plan was to just rim the site with little silt fences and GET AWAY WITH ANY VIOLATIONS. This proved to be "optimistic" in the face of 1,300 acre-feet of rain. The pictures in April rendered that plan "inoperative" as Tricky Dick Nixon would say, so now they maintain ponds, pump when they can, and scratch their heads about how to drain them and go on the designed drains which have about a 50/50 chance of working AFTER THE SITE IS GRASSED. I honestly don't know how they get to May opening with grass, a dry sand filter (this is the vaunted "state of the art" feature, sorta like a swimming pool filter - it is now flooded with turbid water), and a drainage system. They probably don't care - the ribbon-cutting will distract the public and the NH long enough to just puke the mud in one big release, pay the fine and settle down to regular but diminishing fines as the grass grows and the rain falls and the creeks become ditches like they have made of Kelly Branch and Morrell Branch. These guys literally don't know a creek when they see one.
in reference to: The News Herald (view on Google Sidewiki)State of the Art Problem
The "retention ponds" are an emergency measure they never had in their plan, but now that they are necessary, the airport board takes credit as if they planned to use them all along. The plan was to just rim the site with little silt fences and GET AWAY WITH ANY VIOLATIONS. This proved to be "optimistic" in the face of 1,300 acre-feet of rain. The pictures in April rendered that plan "inoperative" as Tricky Dick Nixon would say, so now they maintain ponds, pump when they can, and scratch their heads about how to drain them and go on the designed drains which have about a 50/50 chance of working AFTER THE SITE IS GRASSED. I honestly don't know how they get to May opening with grass, a dry sand filter (this is the vaunted "state of the art" feature, sorta like a swimming pool filter - it is now flooded with turbid water), and a drainage system. They probably don't care - the ribbon-cutting will distract the public and the NH long enough to just puke the mud in one big release, pay the fine and settle down to regular but diminishing fines as the grass grows and the rain falls and the creeks become ditches like they have made of Kelly Branch and Morrell Branch. These guys literally don't know a creek when they see one.
in reference to: More stormwater fines levied against airport | west, airport, bay - News - The News Herald (view on Google Sidewiki)Thursday, December 17, 2009
More on the Local Identity
I was reminded of John Prine's song "Paradise":
"Daddy won't you take me back to Muhlenburg County, down by the Green River, where paradise lay...
Well, I'm sorry, my son, but you're too late in askin', Mr. Peabody's coal train done hauled it away,"
Probably works for Bay County and Mr Finch's slipform paver too.
"I was reminded of John Prine's song "Paradise":"Daddy won't you take me back to Muhlenburg County, down by the Green River, where paradise lay... Well, I'm sorry, my son, but you're too late in askin', Mr. Peabody's coal train done hauled it away,"Probably works for Bay County and Mr Finch's slipform paver too."
- The News Herald (view on Google Sidewiki)
SW and the Beaches
If any airline can succeed with this, it is Southwest. The subsidy makes no difference to the customer as long as SW is willing to try. They will do OK to Baltimore and Nashville in part because the "beyond" traffic is good, and assuming Delta rolls over for them.
Several airlines have tried Orlando and Houston before and it was always weak (not just those cities but east-west along the Gulf in general - New Orleans and Tampa no better). East-west and intra-Florida will make or break it unless they are so successful north-south that they can re-direct their excess seats there. The obvious new market is extending fly-in Orlando vacations to our beaches - a possibility but Disney and the other Orlando stops will fight to keep the traveler there. (If they can build China, they can build a nice beach.)
With the subsidy SW has the luxury of a "competition lab" at no risk for two years - I suspect the experiment intrigued SW as much as the fundamentals. Customers could care less - they will go where their budget and reasons for travel coincide. SW and St Joe have satisfied the budget piece - now the beaches must deliver a reason to travel. Panama City and eastern Bay County are "all in", having "contributed" 1/3 the cost, about half the passenger base, the community airport, and a natural resource that cannot be replaced or "relocated".
Good luck, beaches, it's your moment.
Thursday, December 10, 2009
The Airport and the Courts
Roger on the courts - I provided two depositions about the financial and enviro risk of this project, and volumes of comments on the EIS. FAA dismissed them by assuring the court that ordinary construction controls would manage the risk. They may even be right, but we didn't get even the minimal controls required by law. This is not my opinion, the authority has signed two consent orders admitting it.
in reference to: Airport again facing DEP fines | west, bay, florida - News - The News Herald (view on Google Sidewiki)Wednesday, December 9, 2009
Who pays?
itismee,
I don't know about the Phoenix fine, but the airport keeps getting extensions and is now shopping for a local environmental org to do an "in kind' project so they can claim its all for the good.
It really doesn't matter who pays the fine (unless Phoenix pays it from previous profits - very unlikely). Every cent comes from FDOT (taxpayers), FAA (taxpayers or passenger fees), or sale of the old airport (previously funded by taxpayers and land contributions). The airport board is not spending its own money, thus has no incentive to manage the project - its just a question of which trough to wallow in.
The only check on them is the courts, and there again they spend tax money while the challenger spends real money - guess who runs out first?
If any of these men had this project to develop with their own money, they would run from it like squirrels.
Monday, December 7, 2009
Revisiting the Promises (You can't go back home)
[QUOTE]Here's what the airport said in the 4/30 NH article. I wonder where those "experts" were last week. A team of almost 20 top construction and engineering officials hammered out the final version of a plan designed to prevent another uncontrolled stormwater runoff, which followed a series of storms last month that dumped as much as 20 inches of rain across the region. Under the watchful eye of Airport Authority Chairman Joe Tannehill, senior project manager Roy Willett vowed to correct any problems and usher in a new spirit of tight coordination between construction teams and transparency with the DEP and public. Here's what we got now. That worked well.
Posted by asterisque[/QUOTE]
A violator always says the expedient thing that will get the current heat off. Nobody remembers the promises, and the "problem" will just be another opportunity to PROMISE BIGGER when it returns. Its the old saw: all publicity is good publicity. Next time they'll promise to restore MORE THAN EVERYTHING at no cost to taxpayers (and don't forget: we got Southwest, so anything is possible).
Saturday, December 5, 2009
December 2009 Flooding
The project is violating its permits using its own historic and current measurements. They brought most of this on themselves by clearing the whole site with essentially no construction runoff controls, and it will haunt them because they are overstating what they can do with storm water quality in the setting. There is "fast", "cheap", and "high quality" - you can only do two of the three.
The only way to avoid this is to slow down and phase the construction; these guys are still accelerating and we have the spectacle of FDOT granting money to pay FDEP fines. As long as the money comes from the tooth fairy there is no reason to comply, but at least the PR-crazy boosters could stop claiming to "preserve West Bay forever" and blathering about "state of the art". That lasted about two months, and it was only to hoodwink the greens anyway. We are way past that phase.
Monday, November 30, 2009
Truly Green Serial Violator
The PR somehow fails to mention the airport is under two environmental consent orders from the Corps of Engineers and the Florida DEP. These orders and fines were not assessed for being "truly green."
in reference to: Jones Lang LaSalle Launches Web Site Highlighting Commercial Development Opportunities at New Airport — The New PFN (view on Google Sidewiki)Saturday, November 28, 2009
Brian vs. Zelda on 10,000 ft Runway
Brian,
Obviously you and Zelda cannot both be right if taken literally, but Zelda is "more right", because Southwest does operate from both Midway and John Wayne (Orange County CA, 5400 ft) every day without selecting airplanes for it. Because of its altitude, Midway's 6500 ft main runway is functionally the same as PFN's 6300 ft sea level runway. The charts you found are for the extreme condition of "maximum takeoff weight" which is usually "maximum fuel plus as much payload as possible with max fuel". This configuration is of interest only if the mission is maximum range, such as ferrying the airplane to Europe with only a crew. For passenger operations, the controlling configuration is "range with maximum payload (much less than max fuel)" and the 737's can obviously operate from Midway to the West Coast daily from less than 6500 ft. The 737-700 (most of SW fleet) can go to max payload/range from 5200 ft. To get these numbers, you have to read Boeing performance charts for the airplanes (these were online at some point but I'm not sure if still available). AirTran has recently announced 737-700 service to Key West (4800 ft).
This is all academic as to the Beaches airport, but its important to be careful with the facts. I have always said that the new airport should be 10,000 ft if it is to add any significant capability, because the old airport was capable of handling any likely domestic flight. The 757 has even better performance than the 737, going daily from Orange County to New York. The 10,000 ft runway only comes into play for intercontinental flights - it is not necessary for Canada or Mexico. No doubt St. Joe will charter some international 757/767 flights to promote its property and the airport. The long term hope is to attract an international industry that could use the airport for logistics.
The new airport will thus be more capable at the high end, where operations will be few. At the low end, where most of its takeoffs/landings are, it will be less capable because it has no crosswind runway needed over 100 days a year by light airplanes. The nearest alternative will be Marianna or Apalachicola; Panama City will be the largest city in the state with no community airport within 10 miles, having sold PFN for half the cost of grading the swamp at West Bay.
Monday, November 23, 2009
Air Cargo
In Response to Air cargo:
I did some internet research yesterday on air cargo, widely touted as the goal of the 10,000 ft runway. We get back to what has been a major problem in creating economic progress in Bay County, and that is-- it takes an hour to get to the interestate--and that's way too long for many businesses/industries. It's a lasting problem that many believe was created by Dempsey Barron, when the I-10 route was planned, who preferred to give this important access to Marianna, where he had is farm / ranch business.
Posted by asterisque
First Dempsey Barron - I always get a charge out of "Dempsey Barron as Revered Leader". My daddy alleged that he delivered sugar to Dempsey's daddy's still in Bay Harbor - guess who was tending the fire. My own experience was it took him 40 years to 4-lane US 231 in Florida.
AIr Cargo - Today, air cargo is synonomous with Fedex and UPS. I have heard boosters say Fedex has plans to use NWFBIA; I have no idea if this is possible, but after the SW deal who knows anything (see my sig). An interesting exercise might be "clustering" the insourced foreign auto plants to see if there is a logical location for importing their high-value parts. Offhand I would guess Atlanta or perhaps Huntsville if they want a quieter airport.
There was a great enthusiasm for "intermodal cargo" back in the '70's when wide-body air freighters came out. Much academic work was done (including the infamous "Aerotropolis"), but one problem proved insurmountable: the weight of containers strong enough for sea-rail-truck was just not economic for air cargo. So sea-rail, sea-truck, and rail-truck intermodal cargo prospered and air cargo remained a niche for high-value and time-sensitive goods. The only sizeable intermodal market for air service is air-cruiseship, where the "payload" is self-contained. There is another story about the rise of package service vs. postal service, but it will wait for another day.
"No evidence of __" is not the same as "Evidence of no ___" -The Black Swan
My other blogs :
http://donhodges.blogspot.com (BayBlogger - My Sidewiki Posts)
http://www.ecoastlife.com (ECoastLife - NW FL Opinion)
http://www.ecoastlife.com/
"In Response to Air cargo:I did some internet research yesterday on air cargo, widely touted as the goal of the 10,000 ft runway. <snip /> We get back to what has been a major problem in creating economic progress in Bay County, and that is-- it takes an hour to get to the interestate--and that's way too long for many businesses/industries. It's a lasting problem that many believe was created by Dempsey Barron, when the I-10 route was planned, who preferred to give this important access to Marianna, where he had is farm / ranch business.Posted by asterisqueFirst Dempsey Barron - I always get a charge out of "Dempsey Barron as Revered Leader". My daddy alleged that he delivered sugar to Dempsey's daddy's still in Bay Harbor - guess who was tending the fire. My own experience was it took him 40 years to 4-lane US 231 in Florida.AIr Cargo - Today, air cargo is synonomous with Fedex and UPS. I have heard boosters say Fedex has plans to use NWFBIA; I have no idea if this is possible, but after the SW deal who knows anything (see my sig). An interesting exercise might be "clustering" the insourced foreign auto plants to see if there is a logical location for importing their high-value parts. Offhand I would guess Atlanta or perhaps Huntsville if they want a quieter airport. There was a great enthusiasm for "intermodal cargo" back in the '70's when wide-body air freighters came out. Much academic work was done (including the infamous "Aerotropolis"), but one problem proved insurmountable: the weight of containers strong enough for sea-rail-truck was just not economic for air cargo. So sea-rail, sea-truck, and rail-truck intermodal cargo prospered and air cargo remained a niche for high-value and time-sensitive goods. The only sizeable intermodal market for air service is air-cruiseship, where the "payload" is self-contained. There is another story about the rise of package service vs. postal service, but it will wait for another day. "No evidence of __" is not the same as "Evidence of no ___" -The Black SwanMy other blogs : http://donhodges.blogspot.com (BayBlogger - My Sidewiki Posts)http://www.ecoastlife.com (ECoastLife - NW FL Opinion)http://www.ecoastlife.com/wordpress/ (BayBlog - NW FL in WordPress)"
- The News Herald (view on Google Sidewiki)
Sunday, November 22, 2009
Environmental Debate
I'm too old to get in this debate, but old enough to report one observation: we had lots of tar balls on our (THE?)Beaches before the tanker ballast pumping ban. This observation goes back to 1948 or so.
Environmentally, things are both better and worse. Raw sewage and fish-cleaning offal flowed into the bay where the downtown marina is now, and industrial waste from the paper mill was staggering - both are much better now. Presently worse are the "non-point-source" effects of population growth, developing the shorelines, wetlands and sand dunes - these are basically irreversible without consensus on how development proceeds. Development aggravates the "Tragedy of the Commons", each one alone can show no (or too little to ban) harm, but the aggregate impact is the "death by a thousand cuts". Our waters are still biologically viable but others, like the St. Johns and Apalachicola rivers, are already threatened. The political response is to propose new categories of waters like "boatable/splashable". Where is the bottom line? - "viewable", "filterable", or even "burnable" like the Cleveland river that launched the clean water movement in 1969?
No upstream flows affect Bay County much - if it becomes foul, we have only ourselves accountable.
Airport Board Game
Panama City is giving up not only its historic financial interest that is being sold for $50 Million (about half the cost of the poor grading work at NWFBIA), it has given up a close-in community airport and it now appears the regional airport will not replace the community airport's crosswind capacity that is needed by light planes over 100 days a year. As a critic (not a luddite opponent), I tried for years to get the board to finance the new airport separately and deliver two airports (the new one 10,000 feet) by seeking another $50 Million or so, or foregoing the crosswind. (Don't tell me an interest that can raise $250 Million can't get $300 Million, the cost escalation exceeds $150 Million and the consulting fees will approach $100 Million.) Much of the cost of the new airport is duplicating the general aviation facilities at PFN, probably better than a break-even offset if the crosswind runway is included. This is the plan Ft. Myers followed; SW Florida Regional had only one runway for 25 years, and still has no crosswind because Page Field is still in Ft. Myers and heavily used. When this is over, Panama City will be the only sizeable city in Florida without a paved and instrumented community airport within 10 miles. Even Okaloosa has two paved general aviation airports, even though Eglin AFB dominates the airspace and hosts the airline terminal.
I'll never understand why the boosters launched this project with a fear mongering campaign that assumed the public was easier to fool than to persuade.
The winners get to write history and the new airport's deal with Southwest is a resounding winner. That does not mean there was never a competitive alternative with the same outcome.
As for the board, it really doesn't matter - the airport is influenced much more by external interests - just like every other political honey pot.
Wednesday, November 18, 2009
Southwest vs Delta
I think SW sees a no-lose opportunity to carve a piece out of Delta.
The easiest way for it to work is if Delta does not respond with serious fare reductions, especially at Northwest FL Regional (VPS). If SW gets half of the present VPS traffic in addition to a large share of PFN's, SW will be well within the revenue guaranteed by JOE, and the TDC subsidy adds some to the momentum.
If Delta is willing to bleed, say, $30 million a year for 2 years (double JOE's subsidy), it will be up to JOE/SW to decide how long all 3 (Delta, JOE, and perhaps SW in the 3rd year) will bleed. Delta did this to AirTran in Tallahassee, but AirTran was losing its own money, is not as big as Southwest, and it was head-to-head to Atlanta. An interesting move for Delta would be to cut back to only feeding the international traffic from Beaches airport, and seek its own subsidy to slash fares at VPS or just slash them anyway. I predict a more selective fare war, with Delta responding just enough to keep its shrinking feeder service breaking even. Either way, travelers will get lower domestic fares.
Southwest is not really a super-low-fare airline any more, but until fares settle down there will be great bargains, and long-term the fares should be 30% less. Then, it will be Mr. Market who decides if Beaches can provide Southwest volume at those fares.
Monday, November 9, 2009
Californians Comment on Krugman
I am pasting this in from comments because its pretty close to my take and comments are "closed". thanks, Sidewiki.
When was the last time anyone in power questioned the massive outsourcing of US jobs and the heavy toll it is taking on the population? Oh, I remember! Obama, during his campaign, wanted to repeal NAFTA. But once it became apparent that he was going to be the winner he joined GWB and Paulson for massively stimulating Wall street at our expense and leaving us with nothing but prayers for trickle-down crumbs.
The truth is that when it comes to either political party, priorities are quite clear. The leadership of both parties exploits its base to the point of no return at any expense. The difference is that the GOP effectively manipulates right winger public emotions and anger to keep them loyal. Democrats, on the other hand, distract you and then steal your lunch.
"When was the last time anyone in power questioned the massive outsourcing of US jobs and the heavy toll it is taking on the population? Oh, I remember! Obama, during his campaign, wanted to repeal NAFTA. But once it became apparent that he was going to be the winner he joined GWB and Paulson for massively stimulating Wall street at our expense and leaving us with nothing but prayers for trickle-down crumbs.The truth is that when it comes to either political party, priorities are quite clear. The leadership of both parties exploits its base to the point of no return at any expense. The difference is that the GOP effectively manipulates right winger public emotions and anger to keep them loyal. Democrats, on the other hand, distract you and then steal your lunch."
- Paranoia Strikes Deep - Readers' Comments - NYTimes.com (view on Google Sidewiki)
Saturday, November 7, 2009
Crosswing Runway
If they don't build it, they still have to fill the big hole left behind by "site preparation", and the new contractor won't get to game the fill specifications the way Finch did. It's called "painting yourself into a corner".
in reference to: New airport's crosswind runway still planned but likely more expensive | new, airport, planned - News - The News Herald (view on Google Sidewiki)Wednesday, November 4, 2009
In Response to Re: Airport boondoggle:
How in the world do they think a toll road will benefit tourism? Let St. Joe pay for the road.
Posted by brian7
"they think" is an oxymoron - they simply obey. It is against St Joe's religion to pay for anything, thats why I was truly shocked when they ageed to the SW subsidy - I guess the clock just ran out on lobbying the legislature- and TDC's to foot THAT bill. The toll road seems particularly stupid since the traffic will already be thin - more likely it will be "sold" as a self-financing toll road, then reverted to the taxpayers when its "discovered" to be insolvent. In the long run everything works out, but toll roads at panhandle traffic levels just don't make sense in an economic timeframe of, say, 30 years.
and BTW, i don't agree that it's a good idea for Delta to monopolize the market - let it play out. I do hope Delta will compete for its share; there should be some profit zone between monopoly and capitulation. An interesting strategy for Delta would be to abandon NWFPCIA and use the savings and perhaps its own subsidy to go "all in" for this market with lower fares at VPS and perhaps Tallahassee. 3 years should be long enough to show if the NWFPCIA is viable, and we get to use the SW service. A lot of rent comes due in 2012.
"In Response to Re: Airport boondoggle:How in the world do they think a toll road will benefit tourism? Let St. Joe pay for the road. Posted by brian7"they think" is an oxymoron - they simply obey. It is against St Joe's religion to pay for anything, thats why I was truly shocked when they ageed to the SW subsidy - I guess the clock just ran out on lobbying the legislature- and TDC's to foot THAT bill. The toll road seems particularly stupid since the traffic will already be thin - more likely it will be "sold" as a self-financing toll road, then reverted to the taxpayers when its "discovered" to be insolvent. In the long run everything works out, but toll roads at panhandle traffic levels just don't make sense in an economic timeframe of, say, 30 years.and BTW, i don't agree that it's a good idea for Delta to monopolize the market - let it play out. I do hope Delta will compete for its share; there should be some profit zone between monopoly and capitulation. An interesting strategy for Delta would be to abandon NWFPCIA and use the savings and perhaps its own subsidy to go "all in" for this market with lower fares at VPS and perhaps Tallahassee. 3 years should be long enough to show if the NWFPCIA is viable, and we get to use the SW service. A lot of rent comes due in 2012."
- The News Herald (view on Google Sidewiki)
Monday, November 2, 2009
Delta as competition
I'm a famous skeptic, so I'll just wait and see who wants to do the bleeding - Delta or St Joe? Delta bled AirTran out of Tallahassee but at considerable cost and no St Joe backstop. Southwest has no risk other than mis-estimating their worst case and finding themselves really empty, down in the below-40% zone. That is possible in the intra-Florida and west-to-Texas markets, but unlikely northward. Delta's recent domestic traffic is a story of capitulating unless there is an international or corporate discounting tie-in.
One more comment about "Low Cost Airlines" and I'll go to the bench until we see some fare info around January. The difference between "LCC's" and "legacy" airlines is not as great as in the past because of the bankruptcy adjustments. Southwest pilots, for example, are paid 30% more than legacy pilots, and the absolute cost of "low fares" is not bus-fare cheap - SW's "average fare" of $113 is ONE WAY and does not include all fees. The out-of-pocket cost of a round trip is about $250 per person, higher to high-fee places like Denver and New York.
"I'm a famous skeptic, so I'll just wait and see who wants to do the bleeding - Delta or St Joe? Delta bled AirTran out of Tallahassee but at considerable cost and no St Joe backstop. Southwest has no risk other than mis-estimating their worst case and finding themselves really empty, down in the below-40% zone. That is possible in the intra-Florida and west-to-Texas markets, but unlikely northward. Delta's recent domestic traffic is a story of capitulating unless there is an international or corporate discounting tie-in.One more comment about "Low Cost Airlines" and I'll go to the bench until we see some fare info around January. The difference between "LCC's" and "legacy" airlines is not as great as in the past because of the bankruptcy adjustments. Southwest pilots, for example, are paid 30% more than legacy pilots, and the absolute cost of "low fares" is not bus-fare cheap - SW's "average fare" of $113 is ONE WAY and does not include all fees. The out-of-pocket cost of a round trip is about $250 per person, higher to high-fee places like Denver and New York."
- The News Herald (view on Google Sidewiki)
The Southwest and St Joe escape clauses
Southwest was playing "hard to get" in this negotiation and had the strong hand, so I assume the $14M and $12M will protect SW down to their lowest forecasts, which should include peeling off 2/3 of Delta's PFN traffic and stimulating some more from surrounding markets. How much more goes to SW depends on Delta's fare response. If Delta does not defend VPS and allows SW to take half of that, SW could break even earlier than 3 years.
The "opt outs" should be set to protect both companies - JOE can opt out if SW just wants to bleed JOE in a hopeless deal, and SW can opt out even if JOE is willing to go deeper in losses than SW expects to grow out of in 3 years.
The wild card in this is not the competiton between markets and airlines, it is the economy that might not support any high volume traffic plan. Southwest is not breaking even nationally on its airline sales and must keep beating the fuel market with hedges until the economy is better. Delta is outright losing money although we have to assume they are profitable in monopoly markets. JOE is also unprofitable and borrowing to finance this deal. If the economy turns strong within 2 years, JOE and SW and the TDC's have helped each other through a rough patch; if not, give-away's cannot entice enough people to travel and buy premium or optional real estate.
The crucial assumption for the players is that transportation cost and insufficient advertising, rather than fundamental economics, is preventing growth and prosperity. There is no obvious "plan B" other than returning to the long term challenges of industry and education in a global and urban-centric economy.
Friday, October 30, 2009
The Sidewiki Post that Caz took down
I have started duplicating most of my comments on "Sidewiki", a Google service that puts them on a sidebar that the page owner can't remove or edit. Only other Sidewiki accounts can see the sidebar, but Google may be big enough to keep it going. It is kind of controversial as page owners obviously won't like it. It is the only way to comment on sites like "The New PFN" that don't enable comments. Get a pseudonymous Gmail account and take a look.
in reference to: The News Herald : Homepage (view on Google Sidewiki)Mentioning Sidewiki costs me a Post
This is getting WAY off topic, but the user guidelines are readily available.
THE WHOLE THING:
http://www.freedom.com/eula.
THE MONEY PARAGRAPH:
Therefore, we reserve the right, but undertake no duty, to review, edit, move, or delete any User Content provided for display or placed on the Service, AT OUR SOLE AND ABSOLUTE DISCRETION (emphasis added by donhodges), without notice to the person who submitted such User Content.
Oh, it also says Freedom has unlimited rights to every word or derivative work. So, in view of these limited rights, I maybe should have an alternative way to comment (mentioning that apparently aroused Mr. ABSOLUTE DISCRETION).
I appreciate the forums and article comments, and I am one of few who makes my name obvious in most posts, here and elsewhere. This is the first time I have ever had a post taken down.
Wednesday, October 28, 2009
Advisory Appointments to Airport Board
I AM NOT A LAWYER (thank God), but it is arguable that the appointments are not valid, if not illegal. The statute controlling the authority does not provide any advisory positions, nor a way for the members to appoint more than one position, nor for the membership to exceed 5 positions. Also, the boundaries of the special district are the same as the boundaries of Bay County, although the district can own property in other counties with their consent (this is necessary to locate ground-based navigation aids for instrument approaches in Washington County).
There is also language that says the authority can do almost anything business-wise to fulfill its public purpose, so it is essentially free to do anything not constrained by a court. For example, the district spent $millions designing its project on land it did not own at a time when its boundaries were confined to the present airport and Lynn Haven Industrial Park. It also pledged land it did not own as 50% share of FDOT grants, after inflating the "projects" to obtain 100% of the actual cost as a 50/50 grant.
The legislature has not exerted any oversight on the authority, and the only recourse for objection is the courts, wherein a plantiff can spend its own money while the authority uses grant money. It also leads to strange consequences like the Florida FDOT granting funds for the authority to pay fines to the Florida FDEP. That means asterisque has very little leverage, but does not mean he is "jumping" anywhere. From his posts I would guess he follows the issue as closely as anybody, and will enjoy flying Southwest too. This is about "process" and public responsibility, not blind obstruction.
"I AM NOT A LAWYER (thank God), but it is arguable that the appointments are not valid, if not illegal. The statute controlling the authority does not provide any advisory positions, nor a way for the members to appoint more than one position, nor for the membership to exceed 5 positions. Also, the boundaries of the special district are the same as the boundaries of Bay County, although the district can own property in other counties with their consent (this is necessary to locate ground-based navigation aids for instrument approaches in Washington County).There is also language that says the authority can do almost anything business-wise to fulfill its public purpose, so it is essentially free to do anything not constrained by a court. For example, the district spent $millions designing its project on land it did not own at a time when its boundaries were confined to the present airport and Lynn Haven Industrial Park. It also pledged land it did not own as 50% share of FDOT grants, after inflating the "projects" to obtain 100% of the actual cost as a 50/50 grant.The legislature has not exerted any oversight on the authority, and the only recourse for objection is the courts, wherein a plantiff can spend its own money while the authority uses grant money. It also leads to strange consequences like the Florida FDOT granting funds for the authority to pay fines to the Florida FDEP. That means asterisque has very little leverage, but does not mean he is "jumping" anywhere. From his posts I would guess he follows the issue as closely as anybody, and will enjoy flying Southwest too. This is about "process" and public responsibility, not blind obstruction."
- Moving on to the next doomed project - CAZ - The News Herald (view on Google Sidewiki)
Tuesday, October 27, 2009
Rep. Boyd's Top Contributors
1 Pfizer Inc $12,563
2 American Assn of Orthopaedic Surgeons $10,000
2 AmeriPAC: The Fund for a Greater America $10,000
2 Blue Dog PAC $10,000
2 Florida Citrus Mutual $10,000
2 United Parcel Service $10,000
7 Koch Industries $9,000
8 Altria Group $8,500
8 National Restaurant Assn $8,500
10 Cauthen, Forbes & Williams $8,000
11 American College of Surgeons Prof Assn $7,500
11 Comcast Corp $7,500
11 PricewaterhouseCoopers $7,500
14 American Trucking Assns $7,000
14 Indep Insurance Agents & Brokers/America $7,000
14 Wal-Mart Stores $7,000
17 Aircraft Owners & Pilots Assn $6,000
17 Blue Cross/Blue Shield $6,000
17 National Assn of Broadcasters $6,000
20 Van Scoyoc Assoc $5,752
Sunday, October 25, 2009
The Southwest Viewpoint
Bill Owen is Southwest Route Planning Exec, and he said on the company blog (responding to several comments disappointed that Pensacola was not selected, and the relative weakness of the PFN market):
Good Thursday afternoon, everyone!
Thanks for all of the good wishes and support. And to those of you out there that are expressing disappointment that our new city announcement was not Pensacola, guys, please understand this was never a competition between the two. This was not an "either/or" decision. We know enough to understand that the two are distinct, different markets, and we remain interested in Pensacola. However, the combination of a new airport and the alliance with St. Joe led us to believe that it was time in May of 2010 to "do" Panama City.
Hope that explanation eases the disappointment! Keep those comments coming, and thanks!
Bill
Bill Owen — Thu, 10/22/2009 - 15:25
Taking the airline viewpoint a little further, here's another way to look at it: SW had a profit of $178 M, a margin of 1.6% on $11 Billion revenue in 2008 INCLUDING $329 Million gained on fuel hedging. So, to earn $14 Million that St Joe sends in a wire transfer quarterly, SW would have to sell $875 Million in tickets over their system and continue to gain significantly on hedges.
This way they get the $14M on $20 to $30M in sales during a couple of difficult years overall. Not a bad deal. Delta used to sell an aging airplane or a delivery slot to stay profitable in a bad quarter (the good old days when Delta owned a lot of airplanes). The $8 or $10 M gain was like selling $500 Million more tickets at 2% margin, and for many years extended a run of profitable quarters.
Delta
I don't think Delta will quit (among the reasons, Delta has contracts to sell tickets to the military at bulk fares) but they will cut back to the minimum service that supports international and military travel. The Memphis hub may not survive the Delta-Northwest merger once the labor issues are settled, but that decision would affect all Memphis service, not just PFN. Delta (and particularly "Delta Connection") have justly earned a bad reputation here, so 2 or 3 years in the wilderness is in order. When the market becomes rational again we'll see how they compete. Southwest has a subsidized laboratory to test the extent of the "Southwest Effect".
in reference to: The News Herald (view on Google Sidewiki)Friday, October 23, 2009
I'm Conflicted but In for Now
Too many sites (politicians, government, corporate propaganda) don't allow comments and are taking positions that demand discussion. I see the vast potential for abuse but I also see an opportunity to participate without an invitation.
If it becomes an embarrassment I'll have to reconsider, but for now I'm in.
Thursday, October 22, 2009
More on the St Joe Deal
JOE is guaranteeing up to $14M the first year and $12M the second year. At average fare of $114, each percentage point below break even costs $450,000 per year, so in order for JOE to be out $14M, LF would have to be 31 points below break-even. Break-even is around 70%, so actual LF would be about 40% or 54 passengers per 136 seat plane.
Since SW had all the leverage in this deal, 40% must be about the low end of their forecast for the market. If SW adjusts the break-even calculation for below-average fares, JOE could owe more/sooner. At $99 fare, break-even LF would go up to 80% and JOE's guarantee would max out at 50% LF or 68 passengers per plane. There will be such a sudden increase in seats that its hard to foresee the fares; it would take extremely low fares to fill the planes and below about $79 SW can't break-even with full planes.
Delta will probably cut back to a few flights to feed the international hubs, and these flights will have fares with low increments above the hub-to-intl-destination fare, but high domestic-destination fares to assure the planes can accommodate the intl demand. This is an extreme version of Delta's present fare policy that prices PFN-ATL very high to assure seats for all "beyond-ATL" traffic. Such a response by Delta will leave SW free to experiment with maximizing revenues under almost unlimited supply conditions, seeking a fare level that would be profitable after the JOE "put" is gone.
Wednesday, October 21, 2009
Text of the JOE/Southwest 8-K
St. Joe owns hundreds of thousands of acres in the service area of the new airport, including approximately 71,000 acres of land surrounding the new airport. St. Joe believes that the introduction of low-cost air service to the region will make the region more accessible to a broader market and significantly enhance the value of these lands, as well as other St. Joe properties in Northwest Florida.
Given the current state of the U.S. economy and the airline industry, new airline service must be positioned as an economic development initiative with broad regional support. St. Joe has been working alongside a number of regional organizations in its effort to secure the financial commitments to support the new air service.
St. Joe has agreed, to the extent that Southwest operates at a loss, to make quarterly cash payments to Southwest to cover shortfalls in the results of Southwest's operations at the new airport during the first three years of service. For purposes of the break even calculation, the agreement establishes fixed amounts for Southwest's non-fuel expenses and the minimum revenues that will be attributable to the air service. It also provides that Southwest's profits from the air service during the term of the agreement will be shared with St. Joe up to the maximum amount of St. Joe's prior break even payments.
The term of the agreement extends for a period of three years after the commencement of Southwest's air service at the new airport. The agreement may be terminated by St. Joe if the payments to Southwest exceed $14 million in the first year of air service, or $12 million in the second year of air service. St. Joe may also terminate the agreement if Southwest has not commenced air service to the new airport within 90 days of its opening. Southwest may terminate the agreement if its actual annual revenues attributable to the air service at the new airport are less than certain minimum annual amounts established in the agreement.
Southwest's obligation to commence air service to the new airport is conditioned upon: (1) the certification of the new airport by the Federal Aviation Administration and the Transportation Security Administration on or before April 15, 2010; (2) receipt by the local Airport Authority of a certificate of occupancy for the new airport on or before April 15, 2010; (3) the execution of satisfactory agreements between Southwest and the Airport Authority authorizing Southwest to use and lease space at the new airport and to receive any cost mitigation measures that may be available from the Airport Authority; (4) the execution of an agreement between Southwest, the Bay County Tourist Development Council, the Panama City Beach Convention and Visitors Bureau and the Beaches of South Walton Tourist Development Council, no later than 30 days from the date of the agreement, regarding the coordination of marketing resources and efforts for the air service; (5) the execution of an agreement between Southwest and Coastal Vision 3000, no later than 60 days from the date of the agreement, regarding the establishment of a program through which Southwest would receive available room nights free of charge at various rental properties in Northwest Florida for use in the marketing efforts for the air service; and (6) the execution of any other agreement that Southwest deems necessary or appropriate prior to the commencement of the air service.
Southwest has agreed that it will not commence air service to any airport within 80 statute miles of the new airport during the term of the agreement. In the event Southwest starts service to any airport that is more than 80 statute miles but within 120 statute miles from the new airport during the term, Southwest and St. Joe will either negotiate a modification to the terms of the agreement to accommodate the impact of such service or the minimum revenues used in the annual break even calculations under the agreement will automatically be increased by 10%. In such event, Southwest has agreed that the air service to the new airport in Bay County would not be diminished.
Additional information may be found in St. Joe's press release dated October 21, 2009, a copy of which is filed as exhibit 99.1 hereto and is incorporated by reference herein.
St Joe Guarantees SW Break Even
Gary Kelly just said it'll be its 69th city. So there you go. Close blog readers knew ahead of time, so that's your reward if you're reading us closely. May is the start for eight daily flights spread among four cities to be named later.
"I kind of feel like Oprah," Gary says, as he tells the news to an internet connection to the folks there in Florida.
"We have been overwhelmed by the amount of energy that Panhandle residents have put on Southwest Airlines to start service to that area," he said.
I've got to believe there's a very large incentive package coming to Southwest for this brand-new airport. Press release cites local tourism groups as part of the incentives.
There's a twist: They're doing a "strategic partnership" with the St. Joe Co. where the St. Joe Co. ensures that Southwest will break even on the service for the first three years. Very interesting. The risk was too high, Kelly said, since there's no history there. St. Joe Co. - a huge real estate entity in Florida -- will make up any differences to keep the service there. So they're basically buying the service, to some degree. Interesting.
The agreement gives St. Joe an out after 2 years if things are bad: Southwest can exit too under certain circumstances. "It's an innovative approach," Kelly said.
in reference to: The News Herald (view on Google Sidewiki)