Subsidies for Airline Defended; A year's free rent, $200,000 in airport upgrades promised

Santa Fe's top aviation official is defending a decision to pledge $200,000 in airport upgrades and a year of free rent to a national airline that recently announced new flights to and from the city.

Jim Montman, the aviation division director, said the "preconditions" that were part of the letter of intent between the city and American Eagle, a regional affiliate of American Airlines, aren't outlandish.

"Sometimes in economic development you need to spend some money to get the development," said Montman, who compared the strategy to using tax incentives to lure filmmakers to New Mexico.

The $200,000 will be used to purchase specific ground equipment that will technically belong to the city of Santa Fe in case the airline ultimately decides to leave.

"If we're going to buy capital equipment, we're going to retain ownership of it," Montman said.

In addition, $200,000 represents the maximum amount of money that can be spent. Montman indicated the ultimate expenditure may fall short of that total.

Santa Fe Mayor David Coss also voiced support for the subsidies, which he said have been discussed and developed over a period of several years.

"I think you always need to balance those incentives with the benefit to the community," Coss said.

In the case of increasing the daily air service linking Santa Fe to the rest of the country, he said the benefits far outweighed the costs.

Interestingly, however, a separate deal with another major airline didn't include the same "preconditions."

Delta Airlines, which on Tuesday announced service connecting Santa Fe to Los Angeles and Salt Lake City beginning Dec. 10, may now request similar perks.

"As soon as they read the newspaper, they're probably going to call," Montman said.

And because of federal regulations, the city would likely be obligated to comply.

"We can't play favoritism with one airline versus another," Montman explained.

Though Montman declined to reveal the price tag of one year of free rent at Santa Fe's airport, he said there have already been discussions about various possible sources for the $200,000.

The issue is expected to be taken up at the next meeting of the city's Public Works Committee.

Councilor Carmichael Dominguez, who represents the district closest to the airport, indicated he's adopting a waitand-see attitude about the merit of the incentives.

"I have not really had any reaction by any of my constituents," he said. "I think there may be some concerns later on."

The American Eagle flights, which will include nonstop daily service to Dallas-Fort Worth and weekend flights to Los Angeles, are slated to start in mid-December.

The Santa Fe Municipal Airport was founded in 1941 and is situated on more than 2,000 acres of land on the city's southwest side.