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Allegiant labor woe to reach Manhattan?

Company officials say conflict will not affect scheduled flights to Phoenix

By Corene Brisendine

Manhattan-area travelers may be caught in the middle of an argument.

The question is whether a labor dispute could postpone or disrupt service at Manhattan Regional Airport in early November.

The Transport Workers Union has been running ads and making claims about the contract signed between the City of Manhattan and Allegiant Air.

Thom McDaniel, international vice president for the union, said that in addition to running the ads, they plan to picket all new flights by Allegiant — which begins service between Manhattan and Phoenix on Nov. 7.

Allegiant insists that despite its battle with the union, service here will begin on schedule.

McDaniel said the ads and picketing are a result of the union and Allegiant not being able to come to an agreement on a flight attendant contract, which has been in negotiation for more than two years.

The union has picketed Allegiant flights in Las Vegas this month.

Jessica Wheeler, spokesperson for Allegiant, conceded they have failed to come to an agreement and now have called in the National Mediation Board. A representative from federal board will attempt to negotiate an agreement between the union and airline.

Wheeler said as long as the mediator is not dismissed, there should be no disruption in flights or services.

“We don’t have any reason to believe service will be affected,” she said, “or anything else in the near future.”

She said if either side dismisses the mediator, then service may be interrupted. She said at that point, flight attendants could strike and Allegiant would be forced to bring in replacements.

However, she said Allegiant is “working hard in reaching an agreement.”

The contract between the city and the airline gives incentives to Allegiant to operate two flights weekly from Manhattan to Phoenix over the next two years.

There are two parts to the contract, and the first involves reimbursements for ground handling and customer service – up to $200,000.

The union ad claims that money is “direct payments to the airline.”

VanKuren said that is just not the case – that the payments are given out on a monthly basis, one month after those costs are incurred.

The union also claims the airline is receiving additional incentives through waived fees that will be recouped through parking and passenger facility fees over “the long term.” 

However, VanKuren said the airport does not currently charge for parking.

Also, the fees that are waived would go into the city’s general fund to cover operating costs at the airport.

In discussion with city commissioners, VanKuren has said that once the parking lot is remodeled — after the airport expansion is completed — they will charge parking fees.

Those fees will pay for the remodeled lot, not general operations of the airport.

The city has projected that the airport expansion will be completed in the next two years.

VanKuren said when Allegiant begins operations the first week of November, it will nominally raise the operating costs.

He said the only increase would be to janitorial services because of increased passengers using the airport.

VanKuren said the deal with Allegiant is a typical incentive contract, and they provided similar incentives to American Eagle when it began offering flights from Manhattan in 2010.

American Eagle’s incentives agreement included “$200,000 for various start-up assistance, plus another $500,000 in local revenue guarantee funds.”

McDaniel said the ad campaign was designed to educate the public on Allegiant’s business model.

He claimed Allegiant has pulled out of markets over the last several years, even ones that were profitable, without any notice to the city. However, McDaniel would not offer any specific example of Allegiant abandoning a market where the airline was making money.

According to the contract signed between Manhattan and Allegiant, the airline has the right to pull out of Manhattan for any reason at any time, but must give 60 days’ notice.

Because the $200,000 in incentives would be paid after the fact, Allegiant could not walk away with more than what it had incurred in costs, VanKuren said.

Lindsay Hernquist, spokesperson for Allegiant, said the airline evaluates all of its flights on an ongoing basis.

She said Allegiant’s decision to half service to a city is dependent on several factors. She said among those are ticket sales, seasonality of sales, demand for service, third-party products and ancillary fees.

She said in the case of Manhattan and Phoenix, they are evaluating third party products in Phoenix because that is the flight’s destination.

So, when evaluating profitability of the flights, the airline will look at hotel packages sold to Manhattan area residents in addition to base ticket sales before determining if the flight is a successful venture.

VanKuren said he was not worried about success.

“I feel we have a very strong market,” he said. “People want this service and our flights will be full.”

Hernquist said Allegiant acknowledges the union can utilize its resources as it sees fit, but that the airline would like to talk about issues rather than exchange in attacks.

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