According to County Administrator Chuck Huckelberry's April 28, 2017 memo, this deal was "coordinated by the Tucson Metro Chamber of Commerce and Mr. Bill Assenmacher as a member of the Tucson Airport Authority Board of Directors." The "deal" basically provided for a pledge of $3 million to American Airlines which would serve as a revenue guarantee to induce American Airlines to begin direct air service between Tucson and New York City.
Touting the economic benefits of this deal, Huckelberry claimed that by increasing air service between New York City and Tucson the results would be obvious. We would have increased tourism from New York, which would then increase the number of hotel beds occupied. From tourists sleeping in these beds, we would realize increased restaurant revenues, as well as other tourism related revenues. The rationale stated by Huckelberry is that any risk associated would be offset with the revenue guarantee.
That didn't happen. Just like the $15 million World View space balloon deal, the taxpayers got stuck footing the bill for this failed economic venture.
FACTS: WHY THE BAIL OUT WAS REQUIRED
FACT #1: County Administrator Huckelberry stated in his April 18, 2017 memo that he "earmarked $100,000 in this year's Contingency Reserve to be used for this purpose, if necessary." [note: reference is to FY 2016-2017]
FACT #2: The Air Service Agreement is made and entered into by and between American Airlines, a Delaware corporation, (American) and Tucson Metro Chamber (Guarantor).
FACT #3: American Airlines reported they were below their target utilization. This meant they would have to start drawing money from the revenue guarantee to recoup losses.
QUESTION TO MR. HUCKELBERRY: Why would you earmark $100,000 of taxpayer monies to offset any risk associated with the revenue guarantee if the Air Service Agreement was between American Airlines and Tucson Metro Chamber?
Maybe the Agreement had a funding leak ... similar to another $15 million World View deal the taxpayers funded.
Sun Corridor, Inc., Pima County's transformative economic development machine, reported the success of the American Airlines deal in their Economic Development News.
At the Pima County Board of Supervisors' July 11, 2017 meeting, the Supervisors approved in a 4:1 vote a $650,000 annual contract for Sun Corridor. Supervisor Miller opposed this contract as a $100,000 bail out does not demonstrate a positive economic impact for county taxpayers.
UPDATE: AMERICAN AIRLINES $100,000 BAIL OUT
THE MYSTERY OF THE MISSING DOCUMENTS
DIRECT TO YOU FROM THE BOARD ROOM ...
WATCH THE AMERICAN AIRLINES $100,000 BAILOUT
ECONOMIC IMPACT ... BALLOONS IN THE SKY?
Tucson, AZ -- On April 18, 2017, Pima County Board of Supervisors Bronson, Elias, Christy, and Valadez voted to "APPROVE" release of $100,000 from the Pima County Contingency Funds for the American Airlines New York City Air Service Revenue Guarantee.
Make no mistake ... this was an effort designed to use taxpayer hard-earned money to bail out the Tucson Metro Chamber from a May 2016 contractual agreement made with American Airlines (see, References below to read the Air Service Agreement).
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August 10, 2017 -- Listen to Supervisor Ally Miller on the James T Harris Show, "It's Miller Time" discuss recently discovered documents which shed light on the mysterious American Airlines $100,000 bail out. These documents, which are dated almost two years before the April 2017 bail out vote, were never provided to Supervisor Miller's office until AFTER the bail out was approved. Supervisor Miller voted "NO" on this deal and for good reason. Check it out!