7:02 p.m. EST, January 8, 2013
NEWPORT NEWS — Taxpayer assistance to People Express appears to be moving at supersonic speed.
If approved, hundreds of thousands of dollars would help the iconic 1980s airline relaunch by late spring with its world headquarters at the Newport News-Williamsburg International Airport, according to People Express president Michael Morisi.
Florence Kingston, the Newport News economic development director, said at a City Council workshop session Tuesday that the Regional Air Service Enhancement committee — which calls itself RAISE — is slated to meet on Wednesday, with action expected to be taken after a closed session.
Kingston said the committee, while a public body, can deliberate contracts in closed session under a Freedom of Information Act exemption.
From there, a contract would have to be signed by the Newport News Economic Development Authority.
Kingston has said that RAISE — which is a taxpayer-financed group funded by communities on the Peninsula, including Newport News, Hampton, York County and James City County — is being asked by People Express to assist in the purchase of an undisclosed charter airline.
Kingston said the taxpayer financing is not yet being disclosed, but it would be less than $1 million. She said the money would be refundable if People Express failed to start operations.
Morisi said in a brief interview on Tuesday that the money would help People Express purchase the charter airline and its five airplanes by the end of February.
"I hate to give dates, but we should be operating before the summer begins," Morisi said.
Morisi declined to say how much the airline would cost or what types of airplanes are being purchased, noting that it was part of confidential negotiations.
But he said he's appreciative of the potential taxpayer support.
"It's a positive sign to investors if the community is willing to support us," Morisi said.
Councilwoman Pat Woodbury said she would rather that the money given to People Express be a loan.
"If this helps them be successful, then they should have to pay it back, so that we'll have the money for other incentives for other airlines," said Woodbury, who doesn't have a vote on the issue. The RAISE committee is made up of economic development officials from Peninsula communities.
People Express originally announced in February 2012 that it would begin service in summer 2012 to Pittsburgh, Orlando and other cities. Those dates were pushed back after some of the initial financing fell through, Morisi said.
But Morisi said things are back on track, and that starting an airline "from scratch" is typically a two-year process because of complex Federal Aviation Administration regulations.
Ken Spirito, the airport's executive director, said increased service could only help the airport.
"People Express is an opportunity," Spirito said. "It seems to have some good momentum."
Spirito said the airport lost 39 percent of its passengers in 2012 due to Delta scaling back service and the loss of AirTran in March after its merger with Southwest Airlines. That was after more than 10 years averaging 8 percent growth per year, he said.
Meanwhile, an informal group of business and community leaders headed by former Mayor Joe Frank is advocating for People Express and for increased airport service.
"People Express has challenges getting started, but I think they're meeting those challenges," Frank said. "If we can, we can get them jump started."
Colin Campbell, president of the Colonial Williamsburg Foundation and a member of Frank's group, said adding service to the airport is an important goal. He said many tourists to the region would choose air service.
"There's a major economic imperative here," Campbell said. "AirTran service was very successful here. We would very much like to see that returned."
People Express meeting
The Regional Air Service Enhancement committee is scheduled to meet 3:30 p.m. Wednesday at the banquet room at Newport News-Williamsburg International Airport. The committee is expected to discuss whether to give taxpayer assistance to help People Express airline launch at the Newport News airport. The meeting is open to the public, but much of the discussion will be in closed session, according to Florence Kingston, the Newport News economic development director.
