Treeces Detail Part of Plan to Privatize Airport
December 6, 2013
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  • Would-be airport operator Dock Treece and his two sons on Wednesday revealed one idea they have for infusing some new lifeblood into the money-losing Toledo Express Airport — an airline maintenance facility, but they continued to refuse to divulge their full-fledged proposals.

    Mr. Treece, 63, president of Treece Investment Advisory Corp. in Sylvania Township, and his sons and partners Dock David Treece, 26, and Ben Treece, 25, met with Blade editors Wednesday.

    The three men have been promoting their idea for privatizing Toledo Express Airport and Toledo Executive Airport in Wood County since March in meetings with port authority and city officials. Recently they created a Web site to start making their proposal public.

    So far, however, they have refused to show a detailed business plan to port and city officials or to The Blade and the public, and no legislation turning over control of the airport to the Treeces has been introduced at Toledo City Council.

    Dock David Treece suggested trying to recruit an airline to establish a maintenance facility at Toledo Express Airport. He said an airline with such a facility at Toledo would probably want to offer passenger service out of Toledo Express.

    “You could steal a lot of routes by convincing one of the airlines to open an MRO facility — maintenance, repair, and overhaul. It’s expensive real estate for Delta to have a maintenance facility up at DTW [Detroit Metropolitan Wayne County Airport]. But if you convince a Delta or Southwest or Frontier to open a maintenance facility that creates jobs at Toledo Express, they’re not going to ferry airplanes back and forth between Toledo and DTW. They’d move a bunch of their routes down here,” Mr. Treece said.

    Toledo Express Airport is owned by the city of Toledo and operated under a lease by the Toledo-Lucas County Port Authority. It ran profitably from 2001 to 2010 but has since been running a deficit, projected at about $300,000 this year, because of a dramatic decline in air freight and passenger business. Port Authority President Paul Toth blamed the high cost of jet fuel for the drop in cargo operations and the lack of community support for passenger service at the Swanton Township airport.

    The Treeces brought to The Blade meeting a spiral-bound book that they said contained a marketability plan for which they paid about $70,000 but refused to hand it over because of their objections to the opinions expressed in The Blade’s editorial page. They said that if The Blade would tone down its editorial opposition to their proposal and support exploring privatization of the city-owned airports that they would give The Blade their entire plan to be reported on.

    “If the editorial page wants to take a stance that alternatives [to the current operations of the airport] are worth exploring, that yes, there are other options, that talks should be had, that attention should be paid, that more could be done with the airport, then we could certainly be more cooperative,” said Dock David Treece.

    They ended up refusing to hand over the study and said they would stick to their plan to release it one document at a time.

    “We’ll later be going live with a marketability study,” Mr. Treece said. He said the marketability study will detail the opportunities that have been missed under the port authority’s stewardship. The Treeces also have a full business plan, a “pro forma,” and information from other consultants they’ve retained, Mr. Treece said.

    The elder Treece again raised the potential that the 180th Fighter Wing of the Air National Guard could leave Toledo Express Airport and that President Obama has the ability to close the base without going through another Base Closure and Realignment Commission. He said the community is not addressing the potential of a base closure.

    “The military is moving to drones. Five years, eight years out, you’re going to see very few pilots flying fighter planes. It’s all going to be drones,” Mr. Treece said. “What are we doing about it?”

    Maj. Gary Bentley, base spokesman, has said that the military has no plans to scale back the use of manned fighters.

    The Blade is not the only entity seeking a more detailed explanation of the Treeces’ ideas.

    Deputy Toledo Mayor Steve Herwat said he and Deputy Mayor Paul Syring met with the Treeces in their office Oct. 10. Mr. Herwat said he and Mr. Syring were permitted to view the Treeces’ report on the airport but were not allowed to keep a copy.

    “No public records were handed over, no notes were taken, and no documents were given to us,” he said.

    Mr. Toth said the port authority has pursued many MRO opportunities when they had a vacant hangar. He said the airport could build a hangar at a cost of about $20 million, but that would be a huge financial risk.

    “We have approached many airlines when we had available hangar space but could never convince them to consider TOL for a maintenance base [MRO],” Mr. Toth said. “It’s not that we haven’t considered this as a potential business opportunity, but there are many factors that play into an airline’s decision to place a maintenance operation. Most of the time, it is the strength of the community as it relates to air service, and in many instances, the availability of existing hangar space. We don’t currently have either of those in Toledo.”

    Russell Mills, an assistant professor of political science specializing in public administration at Bowling Green State University who is working on a study of airport operations around the country, told The Blade on Wednesday that recruiting a maintenance, repair, and overhaul operation to Toledo Express is a good idea but a “long shot” to achieve.

    “As airlines continue to consolidate, there are fewer maintenance facilities to go around. There are more efficiencies to be gained by consolidating these maintenance bases to existing facilities rather than new ones,” Mr. Mills said.

    As a result of a pending merger between American Airlines and US Airways, it is widely believed that the US Airways maintenance hub at the Pittsburgh airport will be closed, resulting in a loss of up to 600 jobs. When that happens, the hub will be available for immediate occupancy, lessening the chances that a maintenance hub would go to Toledo.

    Mr. Mills, a former policy analyst for the Federal Aviation Administration, said privatization of airports is a rare phenomenon in the United State. He said that all money earned at an airport built with FAA grants and loans must be reinvested at the airport.

    “Privatization is difficult in the United States because of the regulatory hurdles and the lack of access to low-interest capital for improvements” [outside of the FAA], Mr. Mills said.

    In a later interview, Dock David Treece said he was aware of the FAA’s regulations regarding privatization, but he said, “There are a number of airports around the country which operate under similar arrangements to those we will be proposing, as well as a number of terminals at large commercial hub airports.”