Andrew Edwards and Joe Nelson, Staff Writers
Posted: 04/10/2010 10:09:49 PM PDT

The effort to transform the former Norton Air Force Base into a commercial airport is a gamble of more than $200 million that may well determine if San Bernardino can rediscover prosperity. Success would mean domestic and international flights landing and taking off from San Bernardino International Airport. It would mean travelers spending money at local hotels and restaurants. It would mean a busy airport employing well-paid professionals like air traffic controllers and aircraft mechanics.

It would also result in the initials SBD becoming as well known to Southern California travelers as LAX, L.A./ONT or JWA.

Failure would likely result in continued economic stagnation. The city’s economy never fully recovered from the job losses that accompanied the closure of Norton, and airport supporters say passenger travel would be the best way to reignite the economic engine that once was there.

“This is a game-changer, for this city and this valley,” said Mayor Pat Morris, who is also chairman of the San Bernardino International Airport Authority. “It provides tremendous inducement to businesses to locate, even those that are not aviation related.”

But the hundreds of millions that have been spent on runway, terminal and road improvements in and around the airport are not enough in themselves to guarantee success. No commercial carriers have yet announced plans to do business in San Bernardino, and any airline doing so in the near future would also be taking a gamble at a time when their own industry and the Inland Empire economy are suffering.

“Where are you going to get the new airlines? Airlines already serve Ontario and Los Angeles,” said Jack Keady, a former American Airlines marketing executive who now has a Playa del Rey-based travel and airline consulting company.

“It’s a pretty far-fetched idea that you’re going to get a new airline, and there are no start-up airlines,” he said.

Globally, the airline industry has endured rough times since at least the morning of Sept. 11, 2001, when al-Qaida terrorists showed the world that commercial jets could be used to murder thousands. In the years since, those troubles have been compounded by rising fuel costs and the worst economic downturn since the Great Depression.

The recession hit San Bernardino particularly hard. As Keady noted, an airline making a play for San Bernardino would be betting on drawing customers from a region with high unemployment and foreclosures.

Based on the principle that “money talks,” Keady said San Bernardino International Airport management would need to find a way to guarantee that any airline coming to SBIA would be able to make money.

That’s precisely what local officials are trying to do. In September, the Inland Valley Development Agency board decided to offer incentive packages to induce airlines to set up shop in San Bernardino.

The packages, which can be given to up to four airlines, include $500,000 in advertising and marketing money, SBIA Aviation Director Bill Ingrahm said.

The IVDA would pay airlines’ landing fees for the term of the service agreement, which Ingrahm said is typically five years. The incentives also include revenue guarantees of up to $1 million annually for the airlines’ first two years at SBIA.

Despite the aviation industry’s current problems, Ingrahm said there’s reason to expect SBIA can have a role in the marketplace.

Ingrahm said airports in Los Angeles and Orange counties have no room to expand, leaving the San Bernardino and Ontario airports in position to take on flights. Once the economy rebounds, there should be enough air traffic for both airports, he said.

But Ingrahm admits it won’t happen overnight.

“When you look in a very long-term perspective, you realize San Bernardino’s runway is very important. When I say very long-term, I mean decades,” Ingrahm said.

Thus far, the most significant travel firm willing to try SBIA is Texas-based Million Air. Million Air is what’s called a “fixed-base operator,” or a terminal and fueling service for those who fly aboard private planes.

Million Air’s franchise at San Bernardino can be seen near the north end of the airport from Third Street. The company’s name is painted in big green letters fashioned to resemble the way the word “dollars” is printed on American currency.

From the outside, Million Air’s terminal looks ready for business.

“The first week of May is our plan,” said Terry Cross, Million Air’s vice president of business development and operations.

Even in a weak economy, Million Air is counting on business passengers traveling to the greater Los Angeles region using San Bernardino to avoid heavy traffic in Santa Monica, Burbank and Van Nuys.

Resort amenities at Lake Arrowhead or Big Bear Valley, along with the potential to save time and money, could lure business travelers to SBIA, Cross said.

Construction to redevelop the base has gone very well, he said.

“We’ve been very impressed with their ability to rebuild the perimeter,” Cross said. “You really don’t know it was an old air field here if you don’t know the history.”

End of Norton AFB, beginning of SBIA

Norton Air Force Base officially closed in 1994. The efforts to convert the military base into a civilian airport have been part of a marathon job that is not yet completed, even though key figures in the transformation thought passengers would have been able to climb aboard jumbo jets by now.

It didn’t help matters that the Air Force left Norton’s facilities in less than pristine condition.

“The infrastructure was completely shot. The electrical, the gas, the water,” said former flight engineer Stuart Williams, 60, of Highland, who was stationed 17 years at Norton before his 1991 retirement. “Everything out there was being band-aided.”

Airport Authority managers say Norton’s transition from military to civilian life was something that Congress could have handled better.

One of the biggest hang-ups was the government’s requirement that environmental cleanups be completed before any property could be sold, said Donald A. Rogers, the airport’s interim executive director.

This, he said, made it impossible to sell any property for a dozen years after the Air Force relinquished control.

Rogers also criticized the government for giving away Norton land to multiple entities in a patchwork pattern and not exempting the airport from the Endangered Species Act. The Airport Authority had to set aside 1,200 acres for the endangered San Bernardino kangaroo rat, preventing construction of a crucial second runway.

But Norton’s conversion is not only an attempt to transform an Air Force base into a civilian airport. Former base land is also a place where hundreds of thousands of square feet of warehouse space have been built.

The Inland Valley Development Agency, a sister agency to the Airport Authority responsible for overseeing redevelopment of former Norton land, is another major component in the effort to bring jobs back to San Bernardino.

The construction around the airport is what made it possible for the Airport Authority to finance airport improvements, airport managers said. The IVDA gets a share of the property taxes generated by businesses in its territory and is then able to transfer the dollars to the airport to pay for construction work.

The largest example of new construction around Norton is Stater Bros. Markets headquarters. The grocery chain’s 2.3million-square-foot facility opened in 2007 on what was the most blighted part of the former Norton Air Force Base.

The $325 million Stater Bros. headquarters and other facilities housing distribution centers for Kohl’s, Mattel and Pep Boys have contributed to the rising property values and new tax revenues that have gone to airport construction.

In terms of capital investments, San Bernardino International Airport is almost complete. The airport has a new terminal, tens of millions invested into new concrete and a new U.S. Customs and Border Protection facility.

For months, the terminal has looked like an airport that’s ready for action – minus the people. Airport managers boast that its ticketing counters have technology that would allow any airline’s employees to quickly go to work and call up their company’s flight schedule.

Television monitors are queued up to show snapshots of Southern California locales, and there are four jetway gates in place on the terminal’s second level.

Behind the scenes, there’s a state-of-the-art mission room equipped with the latest in communications gear, in case airport managers ever have to contend with a real-live crisis.

Building a full-service commercial airport hasn’t come cheap.

The Airport Authority spent $60 million during the past six years on runway and taxiway work, including $15 million on a single job to pour new concrete 30 inches deep in order to improve a taxiway that SBIA managers say could otherwise not support the weight of modern jets.

The commercial passenger terminal cost $86 million, a fuel farm cost $12 million and $36 million in federal money went for road improvements on Tippecanoe and Central avenues.

There’s also an additional $12 million to be spent on rebuilding an old rail bridge for automobile traffic in order to create a link to the airport from the 10 Freeway via Mountain View Avenue.

Still waiting for flights

Using IVDA revenues for construction means the airport will be able to operate at lower costs than other Southern California airfields, local officials said.

The airport hasn’t had to borrow big money for capital investments and won’t have to pass the costs of debt service on to airlines through its landing fees.

The upshot is that SBIA’s managers are betting on the airline industry’s troubles to attract carriers to San Bernardino.

“In my view, it’s money. Because airlines are dying, every penny matters,” said Donald Rogers, SBIA’s interim executive director.

Still, success or failure remains an open question.

Using complicated assumptions, airport officials estimate they’ll need 15 commercial flights a day to break even.

In 2008, airport officials said they expected passenger service to be offered by the end of that year. Public expressions of optimism continued to be made in 2009, when word from the top held that SBIA would announce a deal with an airline in that year.

But no airline has yet fired up its PR machine and spread word of new flights to and from San Bernardino. Airport officials have consistently said they are near a deal but cannot name names because airlines want the prerogative to make their own announcements.

“Everything is going as good as can be expected. We’re just fighting a tough economy right now,” Assistant Airport Director Michael Burrows said.

One thing that is known is that SBIA officials have been looking beyond the United States to find an airline.

Mayor Morris said he spent time during a November 2008 trade mission to Mexico City talking with Mexican business figures about the possibilities of direct international flights to and from San Bernardino.

“We have lots of movement,” Morris said. “I can’t tell you about it because they are ongoing negotiations.”

Thus far, the most visible airplanes at SBIA are possibly the red-and-silver airtankers that fill up on fire retardant at the U.S. Forest Service base there when nearby mountains or foothills are on fire.

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