Wright Amendment

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Dallas/Fort Worth International
Airport—
The Wright Amendment
February 23, 2005

The Creation of the Underlying
Agreements

The Creation of the Underlying
Agreements
 April 15, 1968—City of Dallas and City of Fort
Worth entered into contract and agreement to
establish joint airport board to construct new
regional airport.
 November 2, 1968—Cities adopted Bond
Ordinance agreeing to certain covenants including
in Section 9.5(A) which provides that the owner
cities…“shall take such steps as may be necessary,
appropriate and legally permissible… to provide for
orderly, efficient and effective phase out at Love
Field, Red Bird, GSIA and Meacham Field of any
and all Certificated Air Carrier Services and to
transfer such activity to the Regional Airport....”
FEBRUARY 2005

3

The Creation of the Underlying
Agreements
Every airline but one moved to DFW.

FEBRUARY 2005

 Every Airline, except Southwest
Airlines, fulfilled their obligations and
commitments to the public and moved
their operations to DFW International
Airport consistent with the Bond
Covenants
 In contrast, Southwest Airlines sued
and won the limited right to fly
“intrastate” service out of Love Field
because, at the time, it was not a
“Certificated Carrier”
4

The Creation of the Underlying
Agreements
Every airline but one moved to DFW.

 From 1973 to 1978, Southwest
Airlines only operated “intrastate”
flights out of Love Field
 In 1979, Southwest Airlines sought
to fly “interstate” traffic out of Love
Field over the objections of the City
of Dallas, the City of Fort Worth,
DFW International Airport and other
related constituent groups
FEBRUARY 2005

5

The Creation of the Legislative
Compromise

The Creation of the Legislative
Compromise
 In an effort to settle this dispute, a
comprehensive, thoughtful and fair
compromise was ultimately agreed to by
all parties, including Southwest Airlines
 The compromise provided for new and
expanded interstate air service from
Love Field to the four states contiguous
to Texas
 This legislative compromise is now better
known as the “Wright Amendment” or
the “Love Field Amendment”
FEBRUARY 2005

7

The Creation of the Legislative
Compromise
Southwest Airlines lobbied for the Wright
Amendment.
“Enclosed is a copy of language which Southwest Airlines supports
as a compromise on the Love Field interstate service controversy.
This language also has been approved by the DFW Airport authority,
the cities of Dallas and Fort Worth, and related constituent groups.
Majority Leader Jim Wright has been advised of this compromise.
We are pleased that the parties to this long-standing controversy
have been able to reach this compromise, which we believe to be
the only viable one. We urge your support therefor.
If you or any member of your staff has any questions, please do not
hesitate to call Paul Arneson, Forbes Maner, or J.D. Williams of this
firm.”
Letter drafted and delivered to House and Senate conferees
by J.D. Williams, Williams & Jensen P.C. Attorneys at Law on
December 11, 1979.
FEBRUARY 2005

8

The Creation of the Legislative
Compromise
 Conference Report provides—”Section 29
[Wright Amendment] as approved by the
conferees embodies a compromise which
permits limited commercial passenger service
in interstate transportation at Love Field.
Perhaps the most important point about section
29 is that it provides a fair and equitable
settlement for a dispute that has raged in the
Dallas/Fort Worth area for many years. It has
been agreed to by the representatives of
Southwest Airlines, the City of Dallas, the
City of Fort Worth, DFW Airport authority, and
related constituent groups.”
FEBRUARY 2005

9

The Creation of the Legislative
Compromise
Southwest has become a monopolist at Love
Field.

 This compromise has permitted Southwest
Airlines to flourish to the point that
 Southwest Airlines has become the largest
domestic carrier in the United States in
terms of passengers carried
 Southwest Airlines still commands a
monopoly market share of more than 97
percent at Love Field
 No other commercial airport in the United
States is more dominated by a single
carrier
FEBRUARY 2005

10

The Creation of the Legislative
Compromise
Shelby Amendment

FEBRUARY 2005

 In 1997, the Shelby Amendment
expanded the Wright Amendment
 The Shelby Amendment permitted
carriers operating at Dallas Love
Field to serve points in the states of
Kansas, Mississippi and Alabama.
 As of today, Southwest Airlines
provides no service to any points in
these three states from Dallas Love
Field
11

The Confessions of Southwest
Airlines

The Confessions of Southwest
Airlines
Southwest has admitted that Wright Amendment
was to be the final resolution to this divisive
issue.
“Southwest officials who want to

FEBRUARY 2005

expand their airline from its major
Dallas and Houston bases, said they
accept the compromise as ‘final
resolution’ in their seven-year fight
over the use of Dallas’ Love Field.”
“’We’re personally pleased that the
idea that this will finally bring
peace to the Dallas-Fort Worth area’
said Kelleher….”
Fort Worth Star-Telegram, December 13, 1979
(emphasis added).

13

The Confessions of Southwest
Airlines
Southwest admitted that it was pleased with the
compromise.

 “Southwest Airlines Chairman Herbert
Kelleher was pleased with the
compromise even though it
restricts his airlines future growth
from Love Field. Kelleher said, ‘it is
in our best interests to put this (the
controversy) aside.’”
Dallas Times Herald, December 12, 1979
(emphasis added).
FEBRUARY 2005

14

The Confessions of Southwest
Airlines
Southwest has actually attempted to use the
Wright Amendment to keep its competitors out
of “The
Field Legislation was intended to settle once
LoveLove
Field.

and for all the ‘dispute that has raged in the Dallas/Fort
Worth area for many years. Now, TI [Texas International]
seeks to reopen that fight and upset the delicate balance which
has brought peace for the first time in over a decade.
Congressional intent to the contrary is clear. Southwest does not
object to TI using Love for intrastate flights (which apparently is
all it wants to do) so long as the law is obeyed and TI’s certificate
properly reflects what It may and may not do. There is simply
no reason for the [Civil Aeronautics] Board to raise again
the spectre of full scale commercial use of Love Field
which has exacerbated this situation for so long, and
which Congress has been to such pains to exorcise.”
Motion of Southwest Airlines Co. for Leave to File an Otherwise Unauthorized
Document in Civil Aeronautics Board’s Review of Texas International Airlines, Inc.
proposed service at Love Field filed August 23, 1980, by Paul Y. Seligson, Attorney for
Southwest Airlines Co. (emphasis added).

FEBRUARY 2005

15

The Confessions of Southwest Airlines
Southwest has even argued that Congress should
rebuff any attempts to change the Wright
Amendment.
“Should Continental now address its

pleas to Congress, where they
properly belong, the legislators would
doubtless be tempted to reply in the
words of Lewis Carroll: ‘I have said it
three times, and that is enough. Be
off, or I’ll kick you downstairs.’”

FEBRUARY 2005

Reply Comments of Southwest Airlines Co. in
Love Field Amendment Proceeding (Docket
43307) filed by Herbert D. Kelleher and Paul Y.
Seligson on August 30, 1985.
16

The Confessions of Southwest
Airlines
Southwest pledged never to seek to overturn
this legislative compromise:

“Operationally, it’s [the Wright
Amendment] extremely difficult, but
I pledged we wouldn’t seek to
overturn it.”
Interview with Mr. Herb Kelleher
concerning the Wright Amendment,
Financial World, March 21, 1989.
FEBRUARY 2005

17

The Confessions of Southwest
Airlines
Southwest Airlines admitted that repeal of the
Wright Amendment is unhealthy.

 “After Crandall’s speech, Southwest
President Herb Kelleher said he does
not support outright repeal of the
Wright amendment because a
rivalry and competition with DFW
would be unhealthy.”
Dallas Times Herald, February 2, 1990
(emphasis added).

FEBRUARY 2005

18

The Confessions of Southwest
Airlines
Southwest Airlines concedes that repeal of the
Wright Amendment will create two competing
hub“Based
upon the foregoing considerations,
airports.
Southwest’s present policy with respect to the
Wright Amendment is as follows:

1. Southwest concedes that repeal of the Wright
Amendment has the potentiality of creating two,
competing hub airports in the Metroplex
through dividing long haul, feed passenger
traffic between two airports.
2. Southwest is amenable to any modification of
the Wright Amendment that benefits its
Customers and is acceptable to all of the
concerned a parties.”
FEBRUARY 2005

Statement of Position of Southwest Airlines, in a fax dated,
September 19, 1991 from Ed Stewart.

19

The Confessions of Southwest
Airlines
Southwest Airlines has admitted that Love
should not be opened up because it will
“ Q. Does Southwest now support a repeal of the Wright Amendment?
negatively
impact DFW.
A. Southwest has taken a neutral position on that issue. I’m sorry. A repeal of
the Wright Amendment? No, we do not.
Q. And why is that?
A. Well, we think that there is some merit to the position that there is
no city in the United States that has two full-fledged hubs competing
against one another successfully. There are cities that have a main
airport and satellite airports which live well in a complementary
relationship, harmonious relationship; and we to have to agree as a
matter of logic and principle that if you allowed Love Field to come up
as a full-fledged hub in opposition to DFW Airport that indeed air
service to the metroplex would suffer to some extent because basically
a hub-and-spoke system depends for its success upon attracting
passengers from a multitude of spokes that will fill up an airplane going
to another destination. If you divide that type of operation between
two airports, you’re likely to lose service to some of the smaller cities."
Deposition of Mr. Herb Kelleher in Zamutt v. Skinner, U.S. District Court of California, October
8, 1990 (emphasis added).
FEBRUARY 2005

20

The Right/Wright Solution
In virtually every case, where a new airport is
built, the existing airport in the community is
either closed completely or permanently
limited by the local communities to
noncommercial operations.









FEBRUARY 2005








Denver—Stapleton closed
Seattle/Tacoma—King County Boeing Field limited to GA
Minneapolis/St. Paul—St. Paul Downtown airport limited to GA
Kansas City—Charles B. Wheeler Field limited to GA
Detroit—Detroit City Airport limited to GA and limited freighter service
Austin—Robert Mueller Field closed
Cleveland—Lakefront Airport restricted to GA, limited charter, and
military
Washington D.C. Dulles—Reagan Airport limited to defined perimeter
Northwest Arkansas—Drake Field limited to GA
Ft. Myers (Regional Southwest Airport)—Page Field limited to GA
Killeen (Robert Gray Airport)—Killeen Municipal limited to GA
Alexandria, LA—Esler Field limited to GA
Toronto, Montreal, Tokyo, Milan, Paris—upon building of new airports in
these cities, heavy restrictions were placed on close-in city airports.
21

The Existing Opportunity

The Existing Opportunity
Up to $22 Million in Financial Incentives

FEBRUARY 2005

23

The Existing Opportunity
Southwest Could Make the Right Choice Today

FEBRUARY 2005

 DFW International Airport publicly offered a
year’s free rent and additional financial
incentives to any air carrier, including
Southwest Airlines, to lease these newly
vacated gates as part of a precedent-setting
financial incentive package valued in excess
of $22 million
 By accepting this attractive offer and adding
long-haul service to and from DFW,
Southwest Airlines could begin service to any
state in the union almost immediately
 Southwest Airlines has chosen to rebuff
DFW’s offer of free rent
24

The Existing Opportunity
Southwest has considered operating at DFW.

 Admitted that DFW was not an operational
constraint
 Admitted they were concerned about exposing
Love Field and Southwest Airlines to the
growing Low Cost Carrier presence at DFW
 Admitted that it could profitably providing
service to North Texas travelers with long-haul
interstate service at DFW International Airport,
which is a mere eight miles from Love Field,
while retaining its short-haul service at Love
Field
FEBRUARY 2005

25

The Existing Opportunity
Southwest has admitted it can be profitable at
DFW.


“Mr. Kelly agreed that Southwest could be profitable at
DFW, but he said it would face much higher risks
moving operations to the sprawling airport than
expanding existing facilities at Love.”
Dallas Morning News, 11/18/04



“The airline [Southwest] has told D/FW officials that it
can make money there flying against dominant
American Airlines but doesn’t want to run a split
operations where some of its flights would be at Love
Field and others at D/FW”
Dallas Morning News, 11/19/04



“Southwest officials have said that although they could
make money at D/FW, the airport’s congestion doesn’t
fit its business model.”
Fort Worth Star Telegram 12/2/04

FEBRUARY 2005

26

Dallas/Fort Worth International
Airport—Refueling the Economic
Engine
February 23, 2005

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