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July 31, 2014

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Repeal of Washington airport ‘perimeter rule’ could lead to new Las Vegas flights

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Steve Marcus

US Airways could add a flight to McCarran International Airport if Sen. John Ensign’s bill to eliminate a perimeter rule at Dulles International Airport in Washington passes.

Nevada’s congressional delegation is rallying behind legislation boosted by US Airways that could lead to additional flights between Las Vegas and Ronald Reagan Washington National Airport.

Lawmakers were expected to begin meeting on a bill introduced by Sen. John Ensign, R-Nev., that would repeal a 43-year-old law that restricts flights from beyond 1,250 miles of the centrally located Washington airport.

The so-called “perimeter rule” was established in 1967 to spur growth at the new Dulles International Airport in nearby Arlington, Va., an hour’s drive away from most government offices in Washington. Originally, Dulles was envisioned as an airport for long-haul flights with Reagan National handling more domestic flights.

Today, Dulles is far busier with 23 million passengers a year compared with Reagan National’s 17 million. Dulles is served by 54 airlines, Reagan National by 30. Dulles recorded 340,000 takeoffs in 2009 while Reagan National had 272,000 takeoffs. But many government officials prefer flying into Reagan National because it is closer to their offices.

Over the years, lawmakers have permitted 12 flights as exceptions to the perimeter rule, but Ensign’s bill, co-sponsored by Sen. Barbara Boxer, D-Calif., would allow airlines with flights to hub airports within 1,250 miles to convert them to flights to cities anywhere outside the perimeter.

Four representatives, including Nevada Democrat Dina Titus and Republican Dean Heller, introduced a version of the bill in the House.

The proposed legislation is likely to be a priority for lawmakers because it is being tied to a Federal Aviation Administration reauthorization bill.

US Airways executives say that if the legislation is passed they would add at least one daily nonstop flight between McCarran International Airport and Reagan National.

Tempe, Ariz.-based US Airways is the fourth busiest operator at McCarran and in the past two years has dramatically reduced the number of flights it operates in Las Vegas, cutting more than half its capacity. The airline has said the cuts are a business decision to focus more on flights to its hub airports in Phoenix, Philadelphia and Charlotte, N.C.

US Airways CEO Doug Parker said a 1999 study by the Transportation Research Board found that perimeter rules “no longer serve their original purpose and have produced too many adverse side effects, including barriers to competition.” The study also found that such rules “arbitrarily prevent some airlines from extending their networks to these airports; they discourage competition among the airports in the region and among the airlines that use these airports; and they are subject to chronic attempts by special-interest groups to obtain exemptions.”

The Reagan National perimeter rule has the largest negative effect on Western states. The 12 perimeter-rule exceptions allow four daily round trips between Reagan National and Denver, three to Phoenix, two to Seattle and one each to Los Angeles, Salt Lake City and Las Vegas.

US Airways flies the daily nonstop flight between McCarran and Reagan National.

US Airways has the most at stake in the repeal of the perimeter rule because it is the dominant air carrier at Reagan National with about half of the market share. United is the biggest operator at Dulles, while Southwest Airlines is big at Baltimore-Washington International Airport, which is even farther away from central Washington than Dulles.

Parker, in a telephone interview, said Los Angeles, San Francisco, Phoenix and Las Vegas would be priorities for his company if the perimeter rule were lifted.

Under Ensign’s bill, air carriers serving Reagan National would be allowed to convert flights to their hub airports into flights to any destination outside the perimeter with airlines getting a proportional number based on current market share.

Parker thinks that should mean an additional 24 to 30 flights beyond the perimeter for all carriers and based on the airline’s current market share at the airport, it would mean an extra 12 to 15 flights for the airline. With that number of extra flights, Parker said he could guarantee at least one additional Las Vegas flight.

But Ensign’s bill is expected to face opposition from Virginia Sen. Mark Warner, whose constituents include Reagan National Airport neighbors who fear more flights to farther-away destinations would result in larger airplanes that make more noise. Parker said technological advances in aircraft engines shouldn’t make the area any noisier than it already is.

US Airways officials also fear that friends of the airline’s rivals would oppose the repeal of the perimeter legislation to give them a competitive advantage from one of the other Washington airports.

“We’re still getting a lot of pushback from Sen. Warner, but most of the support for the legislation comes from the West,” Parker said. “Under the bill, Los Angeles would get a fair number of flights, and San Francisco, which has zero service to National, would get some.”

Parker said it’s hard to convince neighbors around the airport that the noise level wouldn’t change with larger aircraft, but that noise contours today are less than 50 percent of what they were 15 years ago because of new technology in engine efficiency.

Another fear of Parker’s is that the number of flights authorized in the repeal would be decreased because of compromises. If that happens, Las Vegas could be on the losing end of the compromise because adding flights to Los Angeles, San Francisco and Phoenix hold a higher priority for US Airways than a second flight to Las Vegas.

Two other U.S. airports have been subject to similar artificial barriers. In 2006, Southwest Airlines led the charge to repeal the Wright amendment, which restricted flights to Dallas’ Love Field, Southwest’s headquarters. In 2014, Southwest will be able to offer nonstop flights to Dallas from any destination. Until then, the airline is restricted to offering nonstop flights from a handful of states, including those that border Texas.

A perimeter rule similar to the one restricting flights to Reagan National is in place for operations to New York’s LaGuardia International Airport. That rule bans flights beyond 1,500 miles except on Saturdays and exempts Denver and some Caribbean destinations. As a result, LaGuardia is the nation’s busiest airport without nonstop service to and from Europe.

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