Departing Villaraigosa Seeks Renewed Dialogue With Ontario Over Airport

(June 21)  Los Angeles Mayor Antonio Villaraigosa earlier this month sent a letter to Ontario Mayor Paul Leon offering to reopen negotiations over the transfer of ownership and management of Ontario Airport from Los Angeles to Ontario.
The letter, dated June 6, came three days after Ontario filed a lawsuit against Los Angeles claiming the larger city has been purposefully mismanaging the facility. The lawsuit seeks the return of the airport to Ontario’s possession.
In the letter, Villaraigosa stated, “I stand ready to resume negotiations between our cities upon withdrawal of the city of Ontario’s lawsuit against the city of Los Angeles.”
Villaraigosa’s term as mayor will end in less than a month. He held out hope that the airport ownership and management differences separating the two cities could be ironed out expeditiously and perhaps before he leaves office. He said he had a “continuing interest to work with you and your colleagues to facilitate transfer of the LA/Ontario International Airport (ONT) to the city of Ontario (or its designee, such as the Ontario International Airport Authority). I have always believed, and continue to believe, that if we work together in good faith, we can achieve such a transfer.
“I continue to support regionalization of air traffic, with the long-term growth of ONT as a viable alternative to Los Angeles International Airport (LAX),” Villaraigosa continued. “While these are difficult times for medium and small airports across the nation, I agree that focused marketing of ONT can and should help grow ONT over the long-term.”
Villaraaigosa said he and Los Angles were taken aback by the lawsuit.
“With all of the above in mind, I was quite perplexed that the city of Ontario would file a claim and subsequent lawsuit,” Villaragoisa said. “Given the urgency you and other stakeholders have expressed, it would be more productive to continue our negotiations with the shared goal of identifying a mutually acceptable way to accomplish the transition. Both sides should sit down again and hammer out a mutually agreeable arrangement.”
Ontario maintained that Villaraigosa’s letter had not been received until June 12.
While noting that he partially appreciated the gesture, Ontario Mayor Paul Leon in a letter in response to Villaraigosa said his city was not prepared to abandon its litigious  stance. Leon noted that Villaraigosa will leave office on July 1, and said there is “very little time for the parties to bridge a considerable gap in their respective settlement positions within a very narrow window of time.  Nevertheless, as always Ontario is deeply interested in any settlement discussion that is in good faith and meaningful. However, a legitimate settlement meeting cannot be subject to an unreasonable condition precedent.”
Leon then rejected Villaragoisa’s call for Ontario to drop the lawsuit. “That is not a reasonable demand,” Leon wrote. “Ontario filed the lawsuit after all other avenues of relief were exhausted.  Having been forced to file the case, it is not going to withdraw it as a prerequisite to a settlement meeting, especially given that the current Los Angeles mayoral administration will be transitioned out of existence in a little more than two weeks. With your administration’s professed desire to seek a negotiated resolution before you leave office, it should withdraw the demand that the lawsuit be dismissed prior to any such discussions.”
In 1967, when Ontario Airport had a gravel parking lot and was servicing fewer than 200,000 passengers per year, Ontario and Los Angeles entered into a joint powers agreement to allow Los Angeles to use its clout with airlines to increase flights into and out of Ontario. Under Los Angeles’ guidance, the airport grew, more airlines began flying out of the facility and improvements were made to its runways and terminals. In 1985, after all of the conditions set down in the 1967 joint powers agreement had been met, Ontario deeded the airport to Los Angeles for no consideration.
In 2007, the airport achieved its high mark in terms of passenger traffic, when 7.2 million passenger enplaned there. But since that time, passenger traffic through Ontario Airport has diminished to 4.2 million per year and Ontario officials maintain that Los Angeles World Airports, the corporate entity that Los Angeles utilizes to run LAX, Van Nuys Airport and Ontario Airport, has stifled Ontario International in a deliberate effort to benefit Los Angeles International, where improvements have been made and passenger traffic has continued to rise for the past seven years. In its now-three-year-long campaign to have Los Angeles deed the airport back to Ontario, Ontario officials have publicly insisted that LA should relinquish the airport for no consideration because the airport is considered a public benefit property which has no sale value. Privately, however, Ontario has offered Los Angeles $246 million for the airport. Simultaneously, Los Angeles has sought potential private and public buyers for the aerodrome at reported prices ranging from $225 million to $650 million. Last year Los Angeles revealed the existence of Ontario’s $246 million offer, embarrassing Ontario officials with an exposé of the discrepancy between their public and private statements. Last year, Ontario, with the county of San Bernardino, formed the Ontario International Airport Authority, an entity intended to take over ownership and operation of the airport once Los Angeles relinquishes it.
Los Angeles officials attribute the decline in passenger traffic through Ontario to the recession that has persisted since 2008 as well as widespread changes in the airline industry in which air carriers have reduced flights to outlying airports or non-centralized hubs. They say the airlines have proven resistant to LAWA’s earnest efforts to lure the airlines back to Ontario.  The terms of the 1967 agreement remain in place and Los Angeles maintains it has consistently lived up to that agreement.
In January, Los Angeles offered to sell the airport to Ontario for $475 million. In April, Ontario rejected that offer.
In his letter to Villaraigosa, Leon emphasized that Ontario believed Los Angeles was overpricing the facility, saying that “Ontario would be very interested in siting down with the current administration to discuss a potential resolution” but only if the Los Angeles “administration is willing to consider terms materially less dramatic to Ontario than its prior demand of a $475 million payment for the return of ONT.”

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