Ontario Airport deal one step closer to the finish line

Inland Empire officials approved a settlement agreement Thursday that would transfer control of LA/Ontario International Airport from Los Angeles to Ontario, moving the deal even closer to finality.

The vote by the Ontario International Airport Authority, a joint agency created by the city of Ontario and San Bernardino County to manage the airport upon its transfer, came one day after the Los Angeles City Council approved the proposal.

The deal still must be formally signed by all parties, then submitted to the Federal Aviation Administration for review.

“We are committed to working closely with FAA officials and Los Angeles World Airports to ensure a smooth transition of airport control in the second half of 2016,” said Ontario City Councilman and OIAA President Alan Wapner. “The OIAA will take all steps to ensure that Southern California has the airport capacity needed to meet the long-term demand for air travel while boosting the Inland Empire’s most important economic and jobs engine.”

Los Angeles and the OIAA reached the tentative deal over the summer that involves Los Angeles giving up the airport to Ontario at a cost of about $250 million. The City Council approved the deal Wednesday on a 13-0 vote.

“This is a very fair and equitable deal for both parties concerned and the current LAWA (Los Angeles World Airports) employees that are working at Ontario,” Council President Herb Wesson said after the vote.

Mayor Eric Garcetti said he has “long supported this transfer of ownership, and I am proud of the collaboration that delivered these results.”

The terms of the settlement agreement call for Ontario to pay Los Angeles about $150 million and assume all of the airport’s debts. Another $40 million in the airport’s unrestricted cash accounts will be transferred to other Los Angeles World Airports accounts.

With about $60 million in debt factored in, the deal is worth about $250 million.

The deal also requires Ontario to protect the jobs of the airport’s existing employees.

Ontario allowed Los Angeles to operate the airport beginning in 1967 and transferred ownership in 1985 on condition that L.A. officials work to attract airlines to the facility.

Ontario filed a lawsuit in June 2013 after negotiations for an ownership transfer hit an impasse. One of the chief stumbling blocks was L.A.’s request for $475 million to relinquish the airfield.

According to LAWA, the city agency that manages LAX, Ontario Airport and general aviation airfields, nearly $500 million has been invested in runway and other terminal upgrades since the late 1990s.

The plaintiffs alleged breach of contract and breach of fiduciary duty against LAWA, which maintained there was no evidence of a failure to faithfully manage the facility.

Ontario accused LAWA — and by extension, the city of Los Angeles — of neglect of the airfield, leaving it at a competitive disadvantage by keeping ramp fees high while lowering them at LAX in order to draw more traffic to the coast.

LAWA officials have denied any effort to reduce business at the Ontario airport in favor of LAX. LAWA officials also insisted that airfares from Ontario are “extremely competitive” and often beat fares available at comparable airports such as Burbank and John Wayne in Orange County.

— City News Service