» SkyWest will fly to Portland

By Amy Moss Strong
Editor
Thursday, September 04, 2008 | 1 comment(s) Coos County won’t lose commercial air service to Portland.

The county airport district has announced a deal with SkyWest United Express for non-stop service between North Bend and the Portland International Airport.

The service is set to begin Oct. 12 at Southwest Oregon Regional Airport and tickets are on sale.

“We are absolutely thrilled to see this service provided to the North Bend and Coos Bay communities,” said Ron Opitz, executive director of the South Coast Development Council. “This service, along with the new direct SkyWest United Express service to San Francisco, provides essential flight options for residents and business travelers.”

Gary LeTellier, Southwest Oregon Regional Airport’s executive director, and Mike Lehman, chairman of the airport’s governing board, met with SkyWest officials last week to pursue a deal to secure the flights after Horizon Air’s Portland service terminates Oct. 11.

Prior to the meeting, the airport board unanimously approved a tentative agreement that, among other things, would guarantee SkyWest up to $713,136 a year to ensure the airline will at least break even on its Portland flights. If the tentative contract is signed, SkyWest would send the district a monthly report and invoice, which would show passenger revenue for the preceding month. If revenue falls below SkyWest’s break-even level, the district would have to pay SkyWest the difference within 15 days, or the airline could terminate the contract with five days’ written notice to the district, according to the contract. Whose money?

LeTellier declined to say where the funds would come from.

“There’s a plan,” he said. “I’m sure that we’ll be in a position to disclose that very soon,” he said.

Lehman also skirted the issue when he spoke at a Bandon By-The-Sea Rotary Club lunch meeting Friday. He said that $213,000 from “out of state government agencies” has been committed so far. He added added that Congressman Peter DeFazio, D-Ore., was “amazing” and was key to getting the deal accomplished.

“Air service is essential to the coast’s economic viability and I’m very pleased that United Express is going to provide that vital service at North Bend,” said DeFazio in a press release.

Lehman said the airport is seeking commitments from private and public entities, such as Southwestern Oregon Community College, hospitals, Bandon Dunes Golf Resort and Sause Bros. Ocean Towing, but that money will be needed only if SkyWest doesn’t meet its break-even point, which is a 66-percent capacity on all flights. “When all is said and done, I think we won’t have to pay out that money,” Lehman said.

He added that the current Horizon flights to and from Portland have been running at 70-percent capacity. The type of plane SkyWest will use for the route holds 30 people, so 66 percent capacity would be almost 80 passengers per day, or 20 per flight.

“I could sit and tell you how inappropriate it is for local governments to subsidize private businesses, but the upside is we can to it right now for one year, and after that we will need other funding,” Lehman said.

That other funding, he added, could come from federal subsidies, or may not even been needed.

“My request to everyone is to think about using this service,” Lehman told Bandon’s Rotary members.

The tentative contract calls for two round-trip flights between Portland and North Bend per day, using 30-seat Embraer Brasilia EMB-120 or equivalent aircraft. SkyWest would operate the service as United Express, in cooperation with United Airlines.

The contract, if agreed upon, allows renegotiation of the airline’s minimum revenue requirement if fuel costs increase by 25 cents a gallon.

The current price for a gallon of jet fuel is $4.40, the contract says.

The term of the agreement is one year, running through Oct. 12, 2009.

Airport District lawyer Jerry Lesan said the agreement is modeled after a contract the district has with SkyWest for round-trip flights to San Francisco. Airport officials are seeking a speedy agreement to prevent gaps in service when Horizon pulls out.

In a similar revenue guarantee decided upon earlier this year, SkyWest was promised up to $250,000 per year if it didn’t break even on its San Francisco flights.

What you’ll pay

SkyWest just came on board at Southwest Oregon Regional Airport last month. Flights between North Bend and San Francisco began July 7. Tuesday, an Expedia search located a low round-trip fare to San Francisco, using October dates, of $444, including tax.

Friday’s fares to Portland from North Bend after Oct. 11 on United were listed on Expedia at $312 round trip, including tax.

Horizon Air, which has provided the Portland flights at the airport for 27 years, filed its notice of termination on June 27, four days before the grand opening of the new $20 million air terminal.

“SkyWest has received a warm welcome from Coos Bay,” said Mike Thompson, vice president of marketing development for SkyWest Airlines. “We are encouraged by the strong response to our convenient San Francisco service, and we anticipate that the new northbound service to Portland will be met with similar enthusiasm.”

— World staff writer Jo Rafferty contributed to this story.