Mayor Parker announced that Southwest Airlines (SWA) will pay for the $100 million Hobby Airport expansion, which is the first step to opening the airport up to commercial international flights. The agreement made by Mayor Parker and SWA says that the city will own the improvements to the airport, but SWA “will have preferential scheduling rights and pay no rent for its use of four of the five new international gates, and will also pay no rent for its use of the customs facility. The fifth additional gate and the customs facility will be available for use by all other airlines at Hobby, but unlike SWA, the other airlines will pay rent.” In addition, SWA must abide by the Hire Houston First policy to make sure that local workers get a chance at the construction jobs. This agreement must be confirmed by City Council, likely to take place on May 30th.
With many groups, such as Greater Houston Partnership supporting the Hobby expansion, there has also been plenty of criticism. The most vocal critique was a so-called independent study that said that the expansion would add 10,000 jobs and bring $1.6 billion to the Houston economy. Many council members said that the study was biased and should be thrown out. United Airlines, the competitor which flies out of Bush Intercontinental, argued that the expansion would actually cost Bush Intercontinental thousands of jobs and lose $295 million in the local economy. Of course, both competing companies have their own agendas that conflict with each other. It seems likely that both studies are exaggerated.
There are so many different theories out there about whether having one central hub for major flights is better than having several options where essentially the city would “compete against itself” as United President and CEO Jeff Smisek says. However, if companies want to compete, should the government really stand in the way of that?
So far council members supporting the expansion are: Helena Brown, Andrew Burks, Stephen Costello, Ed Gonzalez, Al Hoang, Melissa Noriega, Oliver Pennington, and James Rodriguez. I would like to know whether the other members just have not made a decision yet or are actually against the proposal. If they are against it, I am curious as to the reason, as there surely could be more items to consider.
So far it seems like this is a pretty good deal for Houston. It requires a private company to cover the costs of something the city will have for years to come. Ultimately even if Hobby does not see an increase in 20 more flights a day as predicted, there appears to be very little risk for the city, so I hope to see this expansion take off.