Port Authority Chairman Fires Back at United Airlines

NJ Spotlight News | December 17, 2014 | Politics
John Degnan says United Airlines is a monopoly that is keeping airfares out of Newark Airport high.

By Christie Duffy

The Port Authority chairman is firing back after United Airlines which called on the FAA to investigate the Port Authority.

In our interview with Chairman John Degnan yesterday, he called United a monopoly and that is keeping airfares Newark Liberty high.

And he also commented on the higher tolls at the bridges and tunnels. He says the manner in which the Port Authority did it is appalling.

When asked if he agrees with the decision to raise the tolls, Degnan said, “With the benefit of hindsight I agree that the toll increase was necessary. I’m appalled at the manner in which they did it. The Port Authority did not give the public adequate notice. They didn’t have sufficient public hearings. They scheduled the public hearings in places and on the same day to make it difficult for the public to attend.”

When asked what he wants to say to the ton of people running a business that go across the bridges and tunnels every day, Degnan said, “I understand and I can identify with that. It’s not the way I would have liked to run my business. All I can say to them is give us a little time to more aggressively deal with the question and to justify that the toll revenues, the increases yielded are gonna be deployed for a new bus terminal, for a new terminal at LaGuardia, new terminal a at Newark, improved quality at GWB. These cost millions, maybe hundreds of millions of dollars. The toll revenues, as onerous as they are on the drivers that have to pay them everyday and they are onerous for a lot of people, are necessary to enure the safety and security of the tunnels, bridges, and airports, and the ports. We shouldn’t be in the business of making money. We should be in the business of deploying the hard earned assets of our toll payers into legitimate projects to increase and enhance the commuting experience.”

But it’s two illegitimate projects that United Airlines says Newark Airport fees are being diverted. The company filed a complaint alleging the “excessive fees” the airline pays to operate here are instead being spent here, on the Pulaski Skyway project.

United claims the Port Authority has taken more than $2 billion from area airports in the past 10 years and redirected the money into non-airport activities.

The U.S. Securities and Exchange Commission is reportedly investigating the use of Port Authority bond money to pay for the Pulaski overhaul.

Degnan says United agreed to pay the fees set in Newark in a signed contract.

“I was shocked to read the United filing. It was more of a polemic than a legal document. First of all, it’s wrong. Fees at Newark have not increased to the degree that United says they have. But more importantly I’m surprised that United would take this tact. They are an anti-competitive monopolist. They have 70 percent market share in Newark Airport. We believe it’s their most profitable airport operation in the country. They charge very high fees for their passengers. And in addition 60+ flights a day do not take off from Newark Airport because United has control over the slots,” Degnan said. “If they would allow the PA to reassign those slots to other airlines there would be some competition in Newark that would force the PA to do what it ought to do. And that’s charge reasonable rates for its tickets.”

When asked if the Port Authority is using fees from Newark Airport to pay for the Pulaski Skyway project, Degnan said, “Excessive revenues from the airport go into a general fund at the PA. Only a very small amount, if any, is used for the Pulaski Skyway.”

Degnan says he’d be happy to talk about reducing airline fees at Newark. If United Airlines would agree to allow planes to take off from its unused gate slots. Degnan says if United would let more planes take off from Newark Airport, it would reduce fare costs for people like you and me.

Related: Port Authority Chairman Promises Greater Transparency

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