Ontario Files Suit Against Los Angeles For Return Of Ontario Airport

Jjune 7) As has been anticipated for the last two months, the city of Ontario this week filed suit against the city of Los Angeles as part of an effort to regain ownership of Ontario Airport, alleging Los Angeles has in recent years failed to live up to all of the provisions of the joint operating agreement for the aerodrome, exacerbated by the larger city’s alleged deliberate mismanagement of the critical Inland Empire economic asset due to a political and regional conflict of interest.
The lawsuit calls for the return of the airport, which has seen a 40 percent decline in passenger traffic over the last five-and-a-half years, to the city of Ontario. The suit also seeks the abrogation of the 1967 agreement that transferred management of the airfield to Los Angeles as well as a reversal of the 1985 transfer of title on the airport property and its facilities from Ontario to Los Angeles.
Represented by the Washington, D.C.-based law  firm of Sheppard Mullen Richter and Hampton, Ontario lodged the suit in Riverside County Superior Court, naming the city of Los Angeles, the Los Angeles Board of Airport Commissioners and Los Angeles World Airports (LAWA), the entity which operates Los Angeles International Airport (LAX), Ontario Airport, which is known by its Federal Aviation Administration acronym ONT,  and Van Nuys Airport for the city of Los Angeles, as defendants.
According to Roy Goldberg, a partner at the law firm of Sheppard Mullin Richter & Hampton “Los Angeles World Airports Chief Executive Officer Gina Marie Lindsey decided to abandon the regionalization objective that previously had united the interests of the two cities to their mutual benefit. Los Angeles is focused on growth and development at Los Angeles International Airport, not Ontario Airport, and the result has been an accelerating decline in Ontario Airport’s fortune.”
Claiming that LAWA’s management of Ontario International has neglected marketing while imposing on airlines still operating there exorbitant enplaning and servicing fees that have resulted in the number of passengers flying into and out of Ontario dropping from 7.2 million in 2007 to 4.2 million last year, Ontario asserts the airport has reached “a crisis point.”
“We were disappointed that Los Angeles rejected our administrative claim without addressing the specific and detailed grounds for relief in the claim,” said Ontario City Councilman Alan  Wapner, who also serves as president of the Ontario International Airport Authority. “The rejection leaves us with no choice but to exercise our fiduciary duties by filing a lawsuit as we press our campaign for control of the Inland Empire’s No.1 economic engine. Anyone following Southern California airport conditions over the past five years can only conclude that as long as Ontario International Airport’s fate lies within Los Angeles’ control, the airport’s condition will continue to deteriorate to the detriment of the entire region,” Wapner said.
Los Angeles’ continuing ownership and operation of Ontario Airport represents a conflict of interest, such that LAWA has promoted an agenda to favor Los Angeles International Airport, and has thus proven unwilling to ensure that air traffic is evenly distributed to the regional airports it controls, Ontario maintains. This violates the joint operating agreement’s mandate that Ontario’s interests be served, according to the suit.
“Ontario Airport’s survival is now in jeopardy because Los Angeles has for too long caused ONT’s costs to skyrocket compared with other secondary airports in Southern California and nationwide, has focused on developing LAX’s capacity as an international airport, and has refused to market ONT as a convenient alternative to LAX,” Ontario councilman Jim Bowman, also a member of the Ontario International Airport Authority, said.
“The current administration at LAWA decided to focus its financial and other resources on renovating and promoting LAX, especially to retain and attract more international service, while allowing passenger levels at ONT to dip dangerously low,” Bowman said. “The result is LAWA has breached its contractual and fiduciary duties by failing to promote and expand air service at ONT.”
Furthermore, Ontario represents in the suit’s pleadings, Los Angeles did not live up to a commitment made by Los Angeles Mayor Antonio Villaraigosa to provide Ontario Airport with up to $7.3 million per year realized by LAWA’s 2008 closing of the Palmdale Regional Airport.
At the time Ontario and Los Angeles entered into the joint powers agreement to allow Los Angeles to use its clout with airlines to increase flights into and out of Ontario International in 1967, the airfield had a gravel parking lot and was servicing fewer than 200,000 passengers per year. 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.
Since the airport achieved its 7.2 million passenger high mark six years ago, Ontario officials maintain that LAWA 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 and 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 and continues to live up to that agreement.
In January, Los Angeles offered to sell the airport to Ontario for $474 million. In April, Ontario rejected that offer.
Maria Tesoro, the spokeswoman for Los Angeles World Airports, on Wednesday told the Sentinel, “We haven’t reviewed the lawsuit, and would not be able to discuss its contents.  However, it has been our hope that instead of a divisive relationship, we would have a partnership with the city of Ontario, to the benefit of all.  A new advertising campaign, ‘Together, the sky’s the limit. Fly ONT!,’ will soon be encouraging people to keep spreading the great news about the Inland Empire’s economic engine and what ONT is best known for – Southern California’s most convenient airport.”
In a seeming contradiction to Ontario’s assertions in the lawsuit, last night Los Angeles Mayor Antonio Villaraigosa met Chinese President Xi Jinping at Ontario International Airport after the latter flew into Ontario for his scheduled summit with President  Barack Obama today and tomorrow relating to cybersecurity.

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