"Louisiana officials have mixed feelings about regional airport proposal"

Sunday, April 1, 2001

Officials have mixed feelings about regional airport proposal
By VICKI FERSTEL and JOAN McKINNEY
The Advocate - Baton Rouge, Louisiana


Officials in Baton Rouge, New Orleans and the parishes in between have mixed
feelings about efforts to build an airport and transportation center in
south Louisiana.

The sentiment among Louisiana's congressional delegation is just as mixed.

Some officials like the idea. Some don't. Some think it will never happen.

"We don't think it's feasible," New Orleans International Airport spokesman
Allan Katz said. "This is one of those deals where no one wants to say the
emperor is naked."

Anthony Marino, aviation director of Baton Rouge Metro Airport, questions
the wisdom of expending any public funds on a competing airport while growth
at the existing Baton Rouge and New Orleans airports is still viable.

"Our argument is that, look, there's just not enough state and federal funds
for us," Marino said.

Baton Rouge Metro has been seeking $3 million from the state since 1997 to
match a $4 million federal grant for additional cargo facilities.

Marino said his airport needs $100,000 from the state to match a $900,000
federal grant to update the Baton Rouge Metro master plan.

Meanwhile, New Orleans International is pushing its controversial $452
million parallel runway project. Reps. David Vitter, R-Metairie, John
Cooksey, R-Monroe and Billy Tauzin, R-Chackbay, have joined to block funds
for work on the runway. The proposal is the subject of a two-year
environmental study.

The runway has attracted bitter opposition from Kenner, the Jefferson Parish
city where the airport is located, and St. Charles Parish officials.

"They keep trying to put 10 pounds of sugar in a five-pound bag, and it just
won't fit," Kenner City Councilman Terry McCarthy said.

Some officials contend that what appears to be suburban support for a new
airport is actually a bid to force New Orleans officials to share control of
New Orleans International Airport.

Kenner and St. Charles officials are backing the Louisiana Airport Authority
project -- support viewed with some skepticism.

"Whether they're really supporting it or they're doing it to look good with
their constituents, I don't know," said Paul Cancienne, the Assumption
Parish representative to the Louisiana Airport Authority.

U.S. Sen. Mary Landrieu, D-La., said in-state competition has kept the state
from landing major economic development projects in the past.

However, Landrieu said she would be cautious about funding the project in
the future if studies show the Baton Rouge and New Orleans airports can
expand.

Asked if a new super airport would hurt the Baton Rouge and New Orleans
facilities Landrieu said, "to be honest, I don't know." The federal and
state planning studies should be designed to answer that question, she said.

U.S. Sen. John Breaux, D-La., said he does not object to publicly financed
studies of the issue, like the current one that weighs pros and cons of the
project.

But Breaux said he would oppose using taxpayer funds to construct and
operate a new airport while the Baton Rouge and New Orleans facilities still
have unused capacity. He said when public funds are used "the decision
should be to invest at existing airports where there's still plenty of
capacity and growth potential."

Upriver, support is gelling for the airport project, which supporters
believe will create much-needed jobs.

St. James Parish President Dale Hymel Jr. has been a member of the Louisiana
Airport Authority since its inception.

He persuaded the parish presidents of Ascension, St. Charles and St. John
parishes to get their parishes to contribute $25,000 each, along with St.
James Parish, as the local share for some of the initial studies for the
project.

Hymel claims to have no preference for any potential site.

"The only thing I'm promoting at this point is for the process to move
forward," he said. "Economic development-wise, we need something in this
area. I think the airport is a golden opportunity to do that."

St. John the Baptist Parish President Nickie Monica said he has made three
trips to Washington, D.C. to support the project.

Asked about its viability, Monica responded, "Ma'am, I wouldn't have spent
$25,000 of taxpayer money if I didn't think it was going to happen."

Private investors going forward with plans for airport

A private investor group that claims it already has secured $1 billion in
funding says it is proceeding on its own with plans to develop a $5 billion
"intermodal" airport in the River Parish area that would include highway,
water and rail access.

The group was assembled by Metairie architect Stan Muller, whose projects
include the design of a swamp exhibit at Audubon Zoo and the design of the
Advanced Technology Center at the University of New Orleans.

Muller said he performed some of the initial studies when former Gov. Edwin
Edwards proposed the huge airport between New Orleans and Baton Rouge as a
campaign promise en route to his 1991 election.

Muller's name crops up occasionally in local headlines. In January, Muller
lost a state Supreme Court appeal on a lawsuit in which he contended he
submitted the best bid to convert part of the World Trade Center building
into a hotel and that the winning bid was illegally chosen in secret.

Late last year Muller was among the most vocal critics of a 2,500-car
parking garage the New Orleans City Council approved for New Orleans
International Airport. Based on a similar garage he designed for an area
hospital, Muller said the city paid too much. Mayor Marc Morial brushed
aside the criticism, saying Muller shouldn't complain since he didn't enter
his own bid.

In addition to Muller, the investor group includes:

-- Gerald Klugman -- a real estate developer and owner of Fortune 1 Realty
in Huntingdon Valley, Penn., a suburb of Philadelphia.

Klugman, who said his background includes a stint as a public accountant,
has developed shopping centers, apartment buildings, office buildings and
marinas. He has also been involved with the public warehouse and leasing
industry.

"That's where I got a feel for the warehouse distribution business and an
appreciation for what an intermodal facility can offer," he said.

-- Jerry Wolman -- a developer and owner of Jerry Wolman Investments in
Silver Spring, Md.

Through Klugman, Wolman declined requests for an interview.

As previously reported, Wolman is a former majority owner of the
Philadelphia Eagles football team.

His developments include the Spectrum arena in Philadelphia and major
commercial projects in Chicago -- the John Hancock building and the 500 N.
Michigan Ave. office building.

In information provided to state lawmakers, Wolman said he built The Federal
Building on Pennsylvania Avenue in Washington, D.C., as well as more than
30,000 apartments in the District of Columbia.

In May 1999, Wolman spearheaded an investor group that unsuccessfully bid
$800 million for the Washington Redskins football team. The team instead
went to a group headed by Daniel Snyder that also bid $800 million.

Muller and Klugman said Wolman has arranged the majority of the group's
initial $1 billion funding.

"More so at this point, he wants to be involved in an advisory kind of
position," Klugman said. "The rest of us would carry the ball in terms of
really doing the work."

-- Robert M. Brooks -- a Re/Max real estate agent in Santa Rosa, Calif., who
said he has a "varied" background.

Brooks said his experience includes commercial developments, mainly in the
form of some East Coast shopping centers. Currently, he's involved in some
residential developments in California's Sonoma County.

He said he also has experience in venture capital and investment banking.

Brooks said his role in the group is meeting with high-tech companies to see
if they can be coaxed into relocating near the airport project. Brooks said
he hasn't talked to many companies so far, because the deal hasn't come
together yet.

Brooks said an intermodal airport could prove attractive to California's
lucrative high-tech sector, mainly because of that state's energy crisis and
the possibility of tax breaks in Louisiana.

Brooks said he knew Wolman through his work in venture capital and
investment banking dealings, and that he introduced Wolman to Muller.

Muller said the investor group has narrowed its selection to "four or five"
sites, although he would not be more specific.

He said the group is seeking an additional $4 billion in funding from
another wealthy investor he declined to identify.

He said the unidentified investor will tour the prospective sites and decide
by the end of the month whether to provide the funding.

"I would hope we would start in the next few months, and we're ready to
start it," Muller said. "It's in the Airport Authority's corner now. All
they have to do is do what's legal."

Regional airport proposal timeline

1992

January -- Gov. Edwin Edwards proposes an international airport between New
Orleans and Baton Rouge.
June -- Louisiana Legislature creates Louisiana Airport Authority to build a
major international airport. Authority members are from 12 south Louisiana
parishes: Ascension, Jefferson, Orleans, St. Bernard, St. Charles, St.
James, St. John the Baptist, St. Tammany, Assumption, East Baton Rouge,
Livingston and Tangipahoa.

1993

September -- Authority picks San Francisco-based URS (Greiner) team as
consultant. The group bills itself as the second biggest engineering firm in
the country. Authority works with someone out of its Dallas office.

1994

March -- Phase 1 of Louisiana Transportation Center feasibility study
completed. Suggests 25,000 acres for cargo and
passenger airport linked to roads, train lines and ports.

1995-1998

Little activity

1998

May -- Phase 2 of feasibility study outlined. That study is still awaiting
state funding.

2000

February -- Authority members meet with Federal Aviation Administration
officials and Louisiana congressional delegation.
August -- FAA approves $405,000 grant to study pros and cons of the project;
state must come up with $45,000 matching money. That report will discuss the
potential of the airport, expected activity, requirements and financial
feasibility. The state has not paid its share.
November -- Authority votes to proceed with risk analysis, which is
underway.

2001

March -- Gerald Klugman, spokesman for one group of investors, makes pitch
to a joint legislative committee on transportation to use $5 billion in
private funds to build the transportation complex. No site has been
selected.
March -- Authority makes pitch to the same committee for $45,000 match for
the risk assessment study and at least $280,000 to help finance a second
feasibility study.
May -- Risk analysis to be completed.
June -- Tentative date to begin second feasibility study. It is supposed to
take 18 months.

Comparing south Louisiana's airports

A look at Baton Rouge Metropolitan and New Orleans International airports.
Baton Rouge Metropolitan     New Orleans International

Area 1,800 acres             1,600 acres*

Cargo (2000) 461 metric tons 86,312 metric tons

Passengers (2000) 950,000    9.8 million

*Dallas-Fort Worth International airport has 18,000 acres. The proposed
airport would cover 25,000 acres, or about 39 square miles.

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