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The Honolulu Advertiser
Posted on: Wednesday, March 12, 2003

Airport subsidy proposal opposed

By Ledyard King
Gannett News Service

WASHINGTON — Sen. Dan Inouye is hoping the Bush administration will exempt Hawai'i from a proposal that would force 125 rural communities to either start paying for federally subsidized air service or face losing it altogether.

At a Capitol Hill hearing yesterday, the Hawai'i Democrat said he would like to negotiate with the administration on a solution that would spare at least two of the three sites receiving subsidies — Kalaupapa on Moloka'i and Hana on Maui — from having to pay to keep the service. He did not mention the third: Waimea on the Big Island.

As part of his 2004 budget plan, the president proposes cutting the federal air-service subsidies from $113 million to $50 million and making communities pick up at least 10 percent of the cost.

The federal program pays airlines to fly into small airports they normally would bypass because of few passengers and high costs. Essential air service began in 1978 to make sure money-losing flights would continue to isolated towns after air service was deregulated.

Last year, Pacific Wings received about $594,500 in federal money to fly to Waimea, $746,500 to fly to Hana and $386,500 to fly to Kalaupapa. Inouye said the money Kalaupapa would be required to provide — at least $38,650 — is a lot to ask of a community where the most notable industries are the Kalaupapa National Historic Park and a hospital serving victims of leprosy.

"There's no economic development there. This is a community made up of patients, doctors and federal workers," he told administration officials at the hearing. "There's no one solution for every single case. I'd like to work out something because ... any matching fund would be just impossible to meet."

Inouye said Hana's situation is a unique case as well. Although it is only 30 miles from the airport in Kahului on Maui, Hana's airport is accessible only by a narrow, winding road that crosses 32 single-lane bridges, a trip that discourages most motorists.

"It's so treacherous that very few cars ever make it," the senator said.

Congress still must weigh in on the proposal. If yesterday's hearing before a Senate aviation subcommittee was any indication, the administration's proposal might never leave the runway.

"You cannot cut off air service," Sen. Jay Rockefeller, D-W.Va., said at a hearing. "That's like cutting off blood supply to hospitals."

Under the proposal, all communities receiving aid would be ranked based on their distance from a larger airport and their willingness to match a portion of the subsidy. Communities more than 210 miles from a medium-sized or large hub airport would be asked to cover 10 percent of the cost, while those closer would have to contribute 25 percent. Those that provide nothing would likely be the first to lose their subsidies, although officials have said they'll consider individual circumstances.

"They have a hard time just maintaining the facilities of the airport, let alone trying to (contribute) 10 percent of whatever the cost is to serve that area," said Montana Republican Sen. Conrad Burns, whose state includes seven communities receiving subsidies.

Administration officials say the subsidized air service is underused and inefficiently managed. Congressional auditors agree the Essential Air Service program is "broken," pointing out that passenger traffic has dropped since 1995 while federal subsidies have tripled.

In 2000, the median number of passengers on each subsidized flight was three, according to the General Accounting Office.

Assistant Transportation Secretary Read Van de Water said the administration proposal would improve the program because communities that contribute would have a vested interest to make the program work. She also said the recommendations allow communities greater flexibility to use the subsidies for buses and taxis that could take local residents to larger airports.

"I don't see it as an option — take a bus," retorted Sen. Olympia Snowe, R-Maine, whose state has two communities that get the federal aid. "We're dealing with a world where transportation is everything."