GREEN EXTREME: CA Operators Rally To Alter Airport Rules

Posted on May 12, 2010 by LCT Staff - Also by this author - About the author

UPDATE MAY 26, 2010: Rene Gamboa, the San Francisco attorney that had been retained by the GCLA, no longer represents the association.

The Greater California Livery Association is trying to moderate a radical mandate promoting green chauffeured vehicles on San Francisco International Airport property as of 2012. The outcome of this challenge could set national precedents for green vehicle policies and operator access to airports nationwide.

SAN FRANCISCO — The GREATER CALIFORNIA LIVERY ASSOCIATION is holding a crucial industry town hall meeting near San Francisco International Airport Tuesday night to gather momentum against a pending measure that would fine operators by 2012 who do not use green vehicles when picking up and dropping off clients at San Francisco International Airport.

The association has been working steadily during the last few weeks to swell turnout at a town hall meeting of California operators Tuesday night from 7 p.m. to 9 p.m. at the HOLIDAY INN SAN FRANCISCO INTERNATIONAL AIRPORT in South San Francisco. Initial estimates show that 150 to 200 operators, association members, and industry employees plan to attend.

Policy problems

At issue is an SFO policy devised in 2000 that takes effect Jan. 1, 2012 that states chauffeured vehicles servicing SFO must be alternative fuel vehicles, preferably ones powered by compressed natural gas (CNG). Access for gasoline combustion-engine chauffeured vehicles would still be allowed, but those operators would have to pay the airport steep fines and penalties.

This would immediately and directly affect about 1,500 chauffeured transportation operators statewide who are legally registered with TCP licenses to service SFO.

For California operators, this policy poses a potential crisis, since the overall costs, technology, and amenities of green luxury vehicles now on the market and available by 2012 have not yet caught up to the affordability and viability of combustion engine luxury vehicles. Moreover, the costs of green vehicles and/or their conversion to green technology are still high enough to be unaffordable for most small to medium-fleet size operators.

For example, a Lincoln Town Car Executive L sedan, the staple of many chauffeured fleets nationwide, now costs about $40,000. A conversion to a CNG engine costs an additional $15,000, making it too costly for typical operators to run by charging reasonable and competitive rates. What’s more, the tank mileage range is well below that of a gasoline Town Car, while California for the foreseeable future still lacks the adequate CNG fueling infrastructure.

In a worst case scenario, if the SFO rules took effect as now stated, many California operators could either lose a lot of business or go out of business because:

1)Paying the airport fines and fees for their gasoline vehicles would become too burdensome;

2)The costs to convert their fleets to all green would be prohibitively expensive.

Both options could cause operators to incur costs that would decimate the profit margins needed to sustain a viable chauffeured transportation business.

Likewise, operators attempting to avoid the fines and use vehicles that meet airport green standards could end up using much smaller vehicles — such as a Toyota Prius, a Toyota Camry Hybrid, a Lexus 250h, or a Ford Fusion Hybrid — that while capable of handling chauffeured clients, cutting carbon emissions, and delivering good gas mileage, are not traditional large luxury vehicles typically sought by chauffeured transportation clients. Standard large luxury vehicles, such as the Town Car, the Cadillac DTS sedan, and SUV models like the Lincoln Navigator and Cadillac Escalade/ESV, can comfortably seat two to four clients, accommodate their luggage, and deliver a premium smooth ride.

Negotiate, but not dictate

GCLA President Alan Shanedling has warned that the current policy could deliver a death blow to luxury chauffeured transportation at SFO and remove it as a viable option for airport transportation. If the policy were to become a precedent or an implementation model, the consequences could spread to California’s other major airports, including Los Angeles International, the fifth largest in the world, and to airports nationwide.

“We have to nip this in the bud,” said Shanedling, during a May 5 GCLA strategy session at a Century City hotel in Los Angeles. “There is no way a client who wants a Mercedes S550 is going to be happy getting into a Toyota Prius.”

Shanedling and other GCLA leaders and lobbyists have made it clear that the GCLA in essence supports use of green vehicles and sustainability initiatives as long as vehicle manufacturers can provide affordable, viable vehicles comparable to current gasoline engine models. “We want to help SFO and work with them voluntarily, but they should never be able to dictate to us what vehicles we can have in our industry,” Shanedling said.

The firestorm over SFO’s green vehicle policy was ignited at a March 10 GCLA meeting in San Francisco when guest speaker Henry Thompson, assistant deputy airport director of operations and security, adamantly told the gathering that California operators would have to comply with the current policy by Jan. 1, 2012 without any modifications or changes. Thompson at that time did not indicate any willingness to be flexible or discuss possible changes to the policy.

Options on the table?

Since then, GCLA and airport officials have exchanged letters, and GCLA lobbyist Gregg Cook of Government Affairs Consulting in Sacramento has appeared before the SFO Airport Commission to explain the situation. A recent letter from John L. Martin, director of SFO, indicated airport officials may be open to negotiations and working with the GCLA to form a palatable compliance plan that considers the unique needs of the chauffeured transportation industry.

In the April 19 letter to the GCLA, Martin wrote that he wants to “work cooperatively” with the association and the industry to devise a plan that meets “the spirit of the policy.” Martin further states that he recognizes that full conversion to low carbon emission fleets is still years away.

SFO’s policy goals are to ensure that vehicles regularly accessing the airport meet stringent clean air and low mileage standards set by the state of California while reducing the airport’s carbon footprint. Shuttles, buses, and taxi-cabs, which comprise most of the ground transportation fleet vehicles servicing SFO, already are well on their way to adapting to CNG. Luxury chauffeured transportation vehicles make up only about 2% of the daily traffic looping through SFO.

Big question

So for the GCLA the bottom line, billon-dollar question of the hour is: Do Martin’s comments indicate a willingness by SFO to consider allowing gasoline chauffeured vehicles on airport property beyond 2012 until viable and affordable green replacement vehicles come to market?

To make sure the GCLA stays on top of the issue and operators fully understand the effects of the airport’s green policies, the association has retained an attorney, Rene Gamboa, a partner at Lewis, Brisbois, Bisgaard, & Smith LLP of San Francisco, in an advisory capacity. Gamboa, who will appear at Tuesday’s town hall meeting, is an expert in sustainable development and environmental law, a government affairs attorney, and an experienced negotiator and litigator.

The GCLA has received initial commitments from some members toward a legal fund to pay the costs of the legal retainer.


— Martin Romjue, LCT Magazine

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