Other Cities Watch as FAA Questions Wichita, Kan. Aid to AirTran

Airports, cities and airlines across the country will be closely watching Wichita's dispute with the FAA over subsidies to AirTran Airways.

The FAA first said that one way to fix the problem may be to make the Airport Authority separate from the city, then later said that may not be enough to solve the problem. Another option is to stop subsidizing AirTran.

Wichita has argued that the Airport Authority and city government are separate, which would allow the city to subsidize any airline it chooses.

It also argued that the subsidy comes from city funds, not airport funds, and that a subsidy is reasonable because fares have dropped 30 percent and passenger traffic has increased 33 percent.

But favoring one route and fares over another does not justify a financial incentive that "favors one carrier over another," the FAA said.

The FAA has scrutinized other subsidy deals.

Last year, the FAA reportedly was looking into whether Wilkes-Barre/Scranton International Airport was in violation when it agreed to subsidize startup costs for Vacation Express to begin service from the Pennsylvania airport to Orlando, Fla., and Myrtle Beach, S.C. The airport reportedly has lobbied the FAA to relax its prohibition on airlines subsidies.

And in 1996, the FAA investigated subsidies the Lehigh-Northampton Airport Authority gave TWA and Midway airlines to lure them to that Pennsylvania airport. The FAA began its review after USAir, United, Delta and Northwest airlines complained.

Ultimately, the agreements ran out and "everybody lost interest in the case," said airport authority executive director George Doughty.

Lehigh-Northhampton has not since offered airlines subsidies, he said. Instead, it has paid for marketing programs.

But the issue of communities offering to subsidize airlines to spur economic development is a larger one, Doughty said.

"The FAA's premise is the airports are essentially there for the airlines," he said. "Our premise is airports are here for the community."

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