Forum… Or Against ‘em

By Count Friedrich von Olsen
Riverside Superior Court Judge Gloria Connor Trask, who is hearing a lawsuit brought against the city of Los Angeles and its airport agency by the city of Ontario which calls for ownership and authority over Ontario International Airport to be returned to the city from which its name derives, declared on Tuesday that the matter before her is a complicated one. If the bench association hands out awards for direct statement of the obvious, Judge Trask should be this year’s recipient…
Let me stab at cutting through the complication. In 1967, when Ontario Airport was a struggling backwater airfield with fewer than 550 passengers passing through its gates daily and a gravel parking lot full of mites and ticks, its city council entered into a pact with Los Angeles to let its much more experienced officials essentially run the airport. Built into the agreement was the proviso that upon reaching certain goals, the airport would be turned over to Los Angeles. It took eighteen years, but by 1985, all of those goals had been met and the Ontario City Council, minus its mayor who was against surrendering the facility, voted to transfer title to the airport to Los Angeles. That transfer was made for no consideration, based upon Los Angeles’s considerable outlays in building the airport into a modern transportation wonder. The airport continued to prosper under Los Angeles’ ownership, just as it had under the previous eighteen years of its guidance. A second, entirely new east-to-west runway was laid down over its obsolete  northeast-to-southwest runway and vast improvements were made to its existing east-to-west runway, including the widening of taxiways and the addition of storm drains. Its tower was modernized.   Two ultra-modern terminals were built at a cost of $270 million, augmented with a world class concourse. Ridership at the airport continued to grow and grow and grow until in 2007, forty years after Ontario had entered into its partnership with Los Angeles, there were over 19,700 passengers moving through its gates daily, which was 36 times the passenger traffic the airport had under Ontario’s management…
Then came the economic downturn of 2007. Air travel in general, not just in Southern California, but in the United States and worldwide, declined.  Los Angeles, which had embarked on its own modernization effort at Los Angeles International Airport in 2006, continued with that effort. Airlines cut back on the number of flights into and out of Ontario Airport. A few airlines ceased operations there altogether. Meanwhile, with the improvements at Los Angeles International Airport and other factors coming into play, passenger traffic into Los Angeles picked up. Ontario officials interpreted that as malignant neglect. With the situation at Ontario Airport continuing to stagnate, they initiated an effort to have Ontario Airport returned to Ontario. And they were not very civil about it, either. The effort was accompanied by what can accurately be described as a campaign of vitriol, one in which Los Angeles was rudely demonized and its airport officials and politicians portrayed as mendacious and duplicitous monsters seemingly intent on destroying the viability of Ontario Airport as a regional hub and driving the economy of the Inland Empire into the ground at the same time. According to these representations, the number of flights into and out of Ontario Airport was not a reflection of the energy, intensity and health of the region’s economy, but the primary generator of economic activity in the area surrounding it. Los Angeles was, in this depiction, a greedy and rapacious landlord with its foot strategically planted across the prostrate inland area’s windpipe…
“Give the airport back!” Ontario officials indignantly demanded, and they encouraged other local officials in San Bernardino County and even across the county line in Riverside County to join them in that chorus. The next move was to insist that Los Angeles neither request nor accept any money in exchange for the return of what rightfully belonged to Ontario. This demand bypassed entirely any consideration of the improvements, conservatively estimated as representing a cost of half of a billion dollars over 47 years without any adjustment for inflation. Ontario officials made a mantra of insisting, at least publicly, that as a public benefit asset the airport had no monetary value, and as such, should simply be deeded back…
Secretly, however, behind the scenes, Ontario officials conveyed to their Los Angeles counterparts that they would be willing to put up $50 million in cash, assume debt service on $75 million in outstanding bonds for past  airport improvements and provide up to $125 million to Los Angeles from future revenue to be generated at the airport over the next dozen years. But Los Angeles officials, who were still smarting over the yet raging public campaign in which they were being excoriated as rapacious cretins, were unimpressed and unmoved. Deftly, they publicly disclosed that Ontario, which was yet maintaining to the rest of the world that the airport had no monetary value, was offering to pay a quarter of a billion dollars to reacquire it…
Ontario officials sputtered and fumed, beside themselves with rage over Los Angeles’ betrayal of  their confidence, seemingly incapable of understanding that their insults to Los Angeles and its officials might have consequences. In that shuffle, an opportunity was lost. Ontario Mayor Leon was a Los Angeles native who, chance would have it, knew, and knew well, Los Angeles Mayor Anthony Villaraigosa. Both had grown up on the mean streets of Los Angeles and survived, each achieving a rough hewn political status with a reputation for the artful dodge, capped by a veneer of eloquence. The two knew each other well enough to be able to take drives together through the cities over which they held sway and all the cities and stretches of freeway in between them. But Ontario was in fighting mode, and Leon was never tasked to negotiate, as perhaps only he could, with the political leader of Los Angeles over the fate of Ontario Airport. That opportunity was squandered. Instead, a stalemate ensued in which Ontario pinned its hopes on the two mayoral candidates to succeed Villaraigosa, Wendy Greuel and Eric Garcetti, coaxing non-enforceable commitments from them to the effect that each would cooperate in returning the airport to Ontario under less than specific terms. But even before the victorious Garcetti was sworn into office, in the waning days of Villagraigosa’s tenure as mayor, Ontario sued Los Angeles in Riverside Superior Court, using the high powered Washington, D.C.-based law firm of Sheppard Mullin Richter & Hampton, destroying whatever prospect it might have had for working with Garcetti…
Recently, during a lull in the litigation, Los Angeles responded to Ontario’s $250 million offer. It would sell the airport, Los Angeles said, for $450 million. That threw Ontario officials into apoplexy…
From my mountain redoubt, I find this squabble both amusing and perplexing. It seems Ontario officials take us, the public, for fools. Is the airport worth nothing in monetary terms, as they claim publicly? If so, then why are they fighting so hard to get it back? And if it is worth nothing, as they are telling us, then why did they offer $250 million for it? It seems there is a bit of disagreement over the monetary value of nothing. Nothing appears to be worth, it seems, somewhere, from what I can tell, between $250 million and $450 million…
Another thing is the city of Ontario’s inflated ego. I shall, no doubt, leave a few deserving places  off of my list here, but when I think of the world’s great cities, London, New York, Tokyo, Paris, Istanbul,  Munich,  Rio De Janero, Cairo, Athens, San Franciso, Hong Kong, Tel Aviv, Brussels, Moscow, Shanghai, Mexico City,  Chicago, Bombay, Montreal, Madrid, Copenhagen, Rome, and yes, Los Angeles leap to mind. Ontario is a nice place and host to one of my favorite Chinese restaurants, but, alas,  absent from the above list…
I believe Ontario brought Los Angeles in to run its airport 47 years ago because it did not have the wherewithal to do so on its own. I do not believe that to have changed. A few years ago city officials there had promoted their fire chief, whose name was Christopher Hughes, to serve as  city manager. Mr. Hughes was, I might note, a very handsome fellow and must have turned quite a few female heads. He rather looked like a movies star, in my estimation on the order of a Clark Gable. He even had the right name for the silver screen. He would have been better off in Hollywood than at Ontario Airport. If one of the planes there caught fire, no doubt, he would have done an admirable job dousing it, and would have looked very good doing so. But I am confident he would have been less fit at running an airport than I am, and that is saying something…
As I will get to below, I do not think Ontario will be wresting from Los Angles control of the airport anytime soon, but if it does, I believe there will be a grave danger that it would soon be in far worse shape than it is today. Ontario, I am told, has the largest budget of all of San Bernardino County’s cities. But even with its large nest egg, it does not have the leverage that Los Angeles possesses, and I would predict that many of the airlines that remain in operation out of Ontario will depart if they do not have Los Angeles to offer them inducements, such as favorable gate positions at Los Angeles International Airport, to stay…
This brings us back to where I started, with Judge Trask. Yes, indeed, she has a complicated set of facts before her. But I will go out on a limb and make a prediction on how she is going to rule with regard to this motion to simply abrogate the 47-year-old agreement confirmed by the city of Ontario’s willing conveyance of the airport to Los Angeles 29 years ago and have Los Angeles just return the airport to Ontario. My prognostication is she will not grant the motion. To do so she will need to turn the custom and precedent of contractual law on its head and overturn an arrangement that both parties have accepted for moving on to nearly half a century. In the end, I believe the court will allow Ontario to take back the airport, but only upon a demonstration that it has the means and the available resources to run it and the cash – meaning at least $450 million or a larger figure adjusted for inflation – to pay Los Angeles what it has invested in it…

The Count’s views do not necessarily reflect those of the Sentinel, its ownership, its publisher or editors.

Leave a Reply