Wright Amendment

From Wikipedia, the free encyclopedia

The Wright Amendment of 1979 is a federal law governing traffic at Dallas's Love Field airport. It originally limited most nonstop flights to destinations within Texas and neighboring states. The limits were expanded in 1997 and 2005, and a law repealing the amendment was enacted in October 2006. That law eliminates some of the restrictions and leaves others intact until 2014.^[1]

1 Background
2 Passage of the Wright Amendment
3 Alterations and bypass efforts
4 Repeal efforts
- 4.1 Repeal compromise
5 Text of amendment
6 References
7 External links

[edit] Background

In the early 1960s, the Federal Aviation Administration (FAA) determined that Love Field in Dallas and Greater Southwest International Airport in Fort Worth, Texas were unsuitable for expected future air traffic demands, and the FAA refused to provide continued federal funding for the municipal airports. The Civil Aeronautics Board (CAB) then ordered the cities of Dallas and Fort Worth to find a new site for a joint regional airport. The result was Dallas/Fort Worth International Airport (DFW International), which first opened to commercial air traffic in 1974. To make the new airport viable, each city agreed to restrict its own passenger-service airports from commercial passenger service use, and all airlines serving the old airports at that time signed an agreement to relocate.

Southwest Airlines, founded in 1971 and headquartered at Love Field, built its business on selling quick, no-frills trips between Dallas, Houston, and San Antonio. Southwest, which was founded after the agreement between the airlines and cities to relocate to DFW International was reached, was not a party to the agreement, and felt that their business model would be affected by a long drive to the new airport beyond the suburbs. Therefore, prior to the opening of DFW International, Southwest filed suit to remain at Love Field, claiming that no legal basis existed to close the airport to commercial service and that they were not bound by an agreement they did not sign. In 1973, the U.S. Supreme Court ruled that, so long as Love Field remained open as an airport, the City of Dallas could not preclude Southwest from operating from the field. However, the ruling was in the pre-deregulated environment where the CAB did not have control of travel within a state, the type of service Southwest offered at the time.

When DFW International opened in 1974, every airline, except Southwest, moved to the new, larger airport. Southwest, however, remained at the older airport. With the drastic reduction in flights, Love Field decommissioned most of its concourses.

[edit] Passage of the Wright Amendment

After the deregulation of the U.S. airline industry in 1978, Southwest Airlines entered the larger passenger market with plans to start providing interstate service in 1979. This angered the City of Fort Worth, DFW International Airport, and Braniff International Airways which resented expanded air service at the airport within Dallas. To help protect DFW International Airport, Jim Wright, a Fort Worth congressman, sponsored and helped pass an amendment to the International Air Transportation Act of 1979 in Congress which restricted passenger air traffic out of Love Field in the following ways:

Passenger service on regular mid-sized and large aircraft could only be provided from Love Field to locations within Texas and the four neighboring states, (Louisiana, Arkansas, Oklahoma, and New Mexico). At the time, all of Southwest's destinations were included within this zone, hence the law had no immediate effect on Southwest's operations.
Long-haul service to other states was possible, but only on commuter aircraft with no more capacity than 56 passengers.

While the law deterred other major airlines from starting service out of Love Field, Southwest continued to expand as it used multiple short-haul flights to build its Love Field operation. This had the effect of increasing local traffic to non-Wright-Amendment-impacted airports such as Houston/Hobby Airport, the New Orleans Airport, and the El Paso and Albuquerque Airports.

Some people managed to "work the system" and get around the Wright Amendment's restrictions. For example, a person could fly from Dallas to Houston or New Orleans, change planes, and then fly to any city Southwest served — although he or she had to do so on two tickets in each direction, as the Wright Amendment specifically barred airlines from issuing tickets that violate the law's provisions, or from informing customers that they can purchase multiple tickets that would allow this.

[edit] Alterations and bypass efforts

In 1997, a law authored by Sen. Richard Shelby of Alabama modified the Wright Amendment to allow flights to Alabama, Kansas, and Mississippi. Citing a lack of demand, Southwest never offered nonstop flights from Love Field to these states, but passengers became able to fly to Birmingham, Alabama, or Jackson, Mississippi, on connecting tickets.

In 2000, a new low-fare carrier called Legend Airlines attempted to bypass the Wright restrictions by reconfiguring several McDonnell Douglas DC-9 jets to hold 56 passengers. These were flown from Love Field to Los Angeles, New York City, Las Vegas, and Washington, D.C. American Airlines tried several times to force Legend to abandon this concept, and Legend eventually folded in 2001.

Many people who supported repealing the Wright Amendment blamed Legend's demise on American Airlines, DFW International Airport, and the city of Fort Worth.

In 2005, Sen. Kit Bond of Missouri attached an amendment to a transportation spending bill to exempt his state from the Wright restrictions. After the bill's passage, Southwest began nonstop flights from Love Field to St. Louis and Kansas City. At the same time, American Airlines returned to Love Field, offering competing flights to the Missouri destinations.

[edit] Repeal efforts

By the 1990's, DFW International Airport's annual air traffic had exceeded the airport's capacity. A 1996 study suggested repealing the Wright Amendment and opening Fort Worth Alliance Airport to passenger service to relieve congestion at DFW. But DFW opposed both proposals, and the end result was the Shelby Amendment which added Kansas, Mississippi, and Alabama to the Wright zone.

Set Love Free campaign logo

In late 2004, Southwest Airlines announced its opposition to the Wright Amendment. Shortly thereafter, the company began trying to garner public support for the repeal of the Wright Amendment by launching a massive public relations campaign. Print media, the Internet, billboards, and TV spots were all used, directing the viewer or reader to visit the Set Love Free website, created by Southwest Airlines. In response, a group opposed to the repeal of the amendment, spearheaded by the DFW Airport Board and American Airlines, launched their own media campaign directing visitors to their Keep DFW Strong site (DFW Airport has even painted advertising on one of its water tanks on the north side of DFW).

Critics of the amendment assert that the restrictions on long-haul travel from Dallas Love Field are anti-competitive. They ask for the "freedom to fly" from Love Field to any destination. They also argue that the restrictions on full use of Love Field artificially inflates fares at the DFW Airport. They believe that eliminating the amendment, and thus allowing any airline to fly long-haul service out of DAL, would allow the so-called "Southwest Effect" to occur, where new, inexpensive capacity will increase traffic at both airports (assuming that the market effect of low fares on flights into and out of Love Field will serve to drive down fares on corresponding routes at DFW); these projections are based upon historic results in other air travel markets in which low-fare carriers, most frequently, Southwest, have initiated service. Wright opponents also argue that DFW's main tenant, American Airlines, can charge high prices out of DFW because, with AA controlling in excess of 80% of air carrier traffic at DFW, there is little competition on most routes, a problem which has recently been attributed to Delta Airlines discontinuing its usage of DFW as a hub.

Supporters of the amendment say that DFW Airport is the economic engine of the metroplex area, and do not wish for a competing airport to either take traffic from DFW or drive the prices down there, although they do concede that American's fares are often higher than from other airports. What's more, DFW Airport recently completed construction of a $2.5-billion people mover system to transport passengers between terminal buildings. DFW Airport is concerned that the financial burdens caused by such things as the people mover project and the recent pull down of Delta Air Lines' hub will hamper airport profitability and sustainability if a direct competitor to DFW is introduced into the Dallas-Fort Worth Metroplex. A primary concern of many in the DFW area is that American is the largest employer in the North Texas area and many people associated with DFW and American Airlines are reluctant to put any jobs at risk, especially when considering the chronic financial difficulties that modern airlines face.

[edit] Repeal compromise

On June 15, 2006, it was announced that American, Southwest, DFW Airport and the cities of Dallas and Fort Worth had all agreed to seek full repeal of the Wright Amendment, with several conditions. Among them: The ban on nonstop flights outside the Wright zone would stay in place until 2014; through-ticketing to domestic and foreign airports (connecting flights to long-haul destinations) would be allowed immediately; Love Field's maximum gate capacity would be lowered from 32 to 20 gates; and Love would handle only domestic flights non-stop.

The proposed compromise was opposed by jetBlue Airways and other low-fare carriers, who argued that the gate reductions at Love would harm their ability to begin service there,[1] and by area congressmen who opposed provisions of the deal that they believed would restrict competition in passenger service at other airports within an 80-mile radius of DFW and Love, including Collin County Regional Airport in the nearby city of McKinney.[2] The compromise was also opposed by Love Field Terminal Partners who own the old Legend Airlines terminal. They claimed that the announcement of the compromise prevented them from selling the six gate terminal to Pinnacle Airlines who had shown interest in purchasing or leasing the gates and have several law suits to prevent the compromise's implementation.

On July 25, 2006, a leaked memorandum from an employee of the United States Department of Justice Antitrust Division raised concerns about airline competition in North Texas and urged legislators to force a renegotiation of the deal. It also stated that the removal of gates and a cap of 20 gates for the airport would violate federal anti-trust legislation. This capping of gates would affect the other airlines that might be attracted to getting gates there at Dallas Love Field airport.^{[citation needed]}

Sen. Kay Bailey Hutchison responded to the memorandum by stating "They [Justice] are not taking a position at all on the legislation... That memo did not go through the channels. And it probably was one person's view, but it's not the Justice Department's."

Judiciary Committee Chairman James Sensenbrenner also had some complaints about the anti-trust issues that he thought would arise from the proposed legislation.

After extensive negotiations with the House and Senate Judiciary Committees, the compromise bill passed both Houses of Congress on Friday, September 29, just before the 109th Congress adjourned for the November elections. Hutchison led the effort to pass the bill in the Senate while Rep. Kay Granger led a bipartisan Texas House coalition to see the bill through to a successful conclusion in the House. President George W. Bush signed the bill into law on October 13, 2006.^[2] Southwest and American airlines then required approval from the Federal Aviation Administration to begin one-stop flights from Love Field to destinations outside the Wright limits.^[3]

On October 17, 2006, Southwest Airlines announced that it would begin one-stop or connecting service between Love Field and 25 destinations outside the Wright zone on October 19, 2006.^[4] American Airlines made travel between Love Field and locations outside the Wright zone available by October 18, 2006.^[5] ^[6]

[edit] Text of amendment

The original text of the Wright Amendment (from International Air Transportation Competition Act):

(a) Except as provided in subsection (c), notwithstanding any other provision of law, neither the Secretary of Transportation, the Civil Aeronautics Board, nor any other officer or employee of the United States shall issue, reissue, amend, revise, or otherwise modify (either by action or inaction) any certificate or other authority to permit or otherwise authorize any person to provide the transportation of individuals, by air, as a common carrier for compensation or hire between Love Field, Texas, and one or more points outside the State of Texas, except (1) charter air transportation not to exceed ten flights per month, and (2) air transportation provided by commuter airlines operating aircraft with a passenger capacity of 56 passengers or less.

(b) Except as provided in subsections (a) and (c), notwithstanding any other provision of law, or any certificate or other authority heretofore or hereafter issued thereunder, no person shall provide or offer to provide the transportation of individuals, by air, for compensation or hire as a common carrier between Love Field, Texas, and one or more points outside the State of Texas, except that a person providing service to a point outside of Texas from Love Field on November 1, 1979 may continue to provide service to such point.

(c) Subsections (a) and (b) shall not apply with respect to, and it is found consistent with the public convenience and necessity to authorize, transportation of individuals, by air, on a flight between Love Field, Texas, and one or more points within the States of Louisiana, Arkansas, Oklahoma, New Mexico, and Texas by an air carrier, if (1) such air carrier does not offer or provide any through service or ticketing with another air carrier or foreign air carrier, and (2) such air carrier does not offer for sale transportation to or from, and the flight or aircraft does not serve, any point which is outside any such State. Nothing in this subsection shall be construed to give authority not otherwise provided by law to the Secretary of Transportation, the Civil Aeronautics Board, any other officer or employee of the United States, or any other person.

(d) This section shall not take effect if enacted after the enactment of the Aviation Safety and Noise Abatement Act of 1979.