The Tale of Two Airports: Chennault and Lake Charles Regional

By Nancy Correro
The Times of SWLA

Randy Robb, Chennault Director

It might be surprising to discover that the two local airports in Lake Charles are not only noncompetitive, but indeed have a friendly working relationship. Chennault International Airport Authority’s Randy Robb and Lake Charles Regional Airport’s Heath Allen say they are not only helping each other in business, but in turn, that helps the economy of Lake Charles.

“Heath and I coordinate a lot of our activities with the FAA [Federal Aviation Administration] and when our fire trucks burned up we were able to borrow a fire truck from the Regional Airport so it’s a real good relationship between our two airports. I’ve been to his board meeting and he’s been to my board meeting and there is a working relationship between the two airports,” said Randy Robb, Executive Director of Chennault International Airport Authority.

Heath Allen, LC Regional Director

Recently, one of Chennault’s tenants, Northrop Grumman, received a substantial contract. The U.S. Air Force awarded Northrop Grumman Corporation a nine-year contract to provide Contractor Logistics Support for its fleet of KC-10 Extender refueling tanker aircraft.

“If something good happens at Chennault, for example, the Northrop Grumman contract, with additional jobs, I’m ecstatic. I’m not worried it didn’t happen at Regional, if it happens at Chennault, it helps us out. It helps the economy and it’s helping our core business which is moving people.

Lake Charles Regional Airport Terminal

Air service hinges on the economy. If the economy is strong, then you’ve got business happening and people are on the move and going places and that is the key for us. So, we are Chennault’s biggest fans,” says Heath Allen, Executive Director of Lake Charles Regional Airport.
Because of the damage from Hurricane Rita, LC Regional just recently finished construction on their $28 million new facility.

“We are in a brand new ground-up passenger terminal—$28 million and all the bells and whistles you would find at a terminal in Houston say just on a smaller scale, of course,” said Allen.

There was Hurricane Rita damage to Chennault Airport as well. In recent news, U.S. Representative Charles W. Boustany, Jr. announced on October 20, 2009 that a grant for $1.05 million from the Department of Homeland Security and FEMA will be used to reimburse the airport authority for costs it incurred from repairs to Hanger D, which houses Aeroframe Services, LLC.

At one time, the civil and military airports were together at Chennault Airport. The Air Force wanted to get rid of the civil side. After they made the requirements for the civil side to move away from the Air Force side, they closed it. It lay fallow for a number of years until 1986.

Chennault International Airpark Main Bldg.

“The properties were given up to the Parish, the city, and the school board. They got some parties together and decided it was more than a drag strip and then they got Boeing to come in here and the state gave about $50 million dollars to build the infrastructure that we now call Chennault.

We sit on a 99 year lease with the Parish, school board, and the city,” said Robb.
Since then, Chennault has bought property around the property. The golf course is still the cities and the school board is still there for the bus facility.

“Chennault is a commercial airport. We are a commercial airport because we bring in maintenance, repair and overhaul airplanes for both the military for Northrop Grumman, and the civilian side with Aeroframe,” said Robb.

They also have Million Air and it is an FBO, Fixed Base Operator. It is high-end and it caters to military and corporate airplanes. They provide all of the fueling services for Northrop Grumman, Aeroframe, and other Chennault transients.

“We are about the fourth busiest airport in Louisiana. We get that kind of volume through there. We do have charters, for instance; we fly the McNeese Football team when they go places just because we have bigger aircrafts,” said Robb.

On June 11, American Eagle started flying back into Lake Charles after a 10 year hiatus.
Continental has been in Lake Charles for quite a long time. In that time, Northwest Airlines was scheduled to come into Lake Charles, but after 9/11 they decided to pull the plug on the project before it ever got started.

“Our primary purpose is to move people. Probably one of the biggest things that affects air travel in Lake Charles is our proximity to Houston. That’s like the 800 pound gorilla in the room. It siphons off probably 25% of our market, easily. With a second air carrier coming in it just opens up more flexibility in terms of destinations,” said Allen.

Competition is good for the consumer. Since Continental was the only carrier in Lake Charles, they charged what they wanted to charge and now they have to pay attention to American.

“It was very big to get that second carrier. You don’t see a whole lot of air service expansion right now domestically. International is what most of the big carriers are focused on right now, but we were fortunate enough to be one of the few cities that got additional service,” Allen said.

Part of the reason Allen said that Lake Charles got the service was the economy here. If you look across the country, there are a lot of places doing a lot worse than Southwest Louisiana.

“The South in general seems to being doing a little bit better than the rest of the country. In fact, where they added most of the service is strictly in the South,” said Allen.

There are a lot of projects that Aeroframe is bidding on, but Robb said he was not at liberty to say which ones, however, it looks like they are going to get a major airline in here. They do airbus series airplanes and nearly every airline has airbus equipment. Fed-Ex is Aeroframe’s major customer.

“Usually, over the holiday period Fed-Ex drops off a little of the MRO, which is maintenance, repair and overhaul activities so they can fly those airplanes to deliver goods over the holiday season. They have other airplanes [they do maintenance on]. They do painting—stripping of aircraft and painting—they’re just a complete airbus MRO,” said Robb.

Million Air is a fixed base operator. They handle the transient airplanes when they come in and out of Chennault.

“What we’ve done is we’ve built them a 15,000 sq. ft corporate hangar so they can park the bigger airplanes there and they have a smaller hangar and the t-hangars. They are expanding pretty rapidly,” said Robb.

Louisiana Mill Works builds doors and door frames and they sell them predominately to builders and lumber yards as opposed to Home Depot.

“As far as the future of Chennault, it’s pretty strong we think. We are getting a lot of interest from outside because of I-10, the railroad, and the port interfaces that are right there. Our whole mission is to create jobs and to set conditions for job creation and that is what we try to do. And, of course, number one we want to help our current tenants and help attract new.

We have over $40 million dollars of direct impact to Lake Charles and about $110 million indirect impact,” said Robb.

LC Regional Airport’s number one outbound market is to Dallas. A lot of people here in Lake Charles have business in Dallas and vice versa.

“Convenience is what Lake Charles Regional is all about. We don’t have the destinations that Houston has and certainly don’t have the number of airlines—I mean you are talking 30 plus airlines in that market. A lot of times they may beat us on fairs because they have Southwest, Frontier, JetBlue, and all the low cost carriers. But, the one place we will always beat them is in convenience—and that is what we hang our hat on,” said Allen.

As the economy improves, LC Regional may see another airline coming in, but right now they’re focusing on getting American Eagle going.

“They’re doing well and they’re making money. We don’t want everything to shift over to American and leave out Continental; we have to support them both,” said Allen.

The next focus will be on Delta. They will try and get something to East Memphis or an Atlanta connection. For a community this size, they have to fly to a large hub airport. The type of aircraft that can serve a regional airport would be Houston, Dallas, Memphis, and Atlanta.

“Northwest was bought by Delta so Delta is the only option going East for us,” said Allen.

Both Airlines are looking to Lake Charles’s future and they think it looks extremely bright. With the port, I-10, and two airports, Robb and Allen think Lake Charles is sitting in a prime location for commerce and growth.

“The port has a real nice piece of property just to the Northeast of us and we want to work with them to develop that property and whoever comes into that property if they want, they have access to the runway. There is a railway running right through that property so it is an optimum piece of property,” said Robb.

“Lake Charles is extremely fortunate to have the access that it has with the port. Most communities would die to have what we have. Look at Mobile, AL, it’s a very similar situation. They have a port, a big industrial airport, Northrop Grumman, airbuses, and then they have got their regional airport.

They play it up and Mobile does quite well because of it. I like what I see with the Chamber and what George Swift is doing. All of the elected officials seem to be on board. The sky is the limit, literally,” said Allen.

Economic Snapshot

By Brett Downer
The Times of SWLA


We’re more likely to have a job than the typical American, thank heavens. We’re more likely to own a home. We have more doctors to choose from — and more hospital beds to climb into — when we’re sick. We have big-dollar economic expansion under way and other prospects peeking in with interest.

We earn thousands of dollars less than the typical American worker, however. We have a tougher time staying in school — whether it’s getting a high school diploma or sticking it out through college. We’re less likely to carry insurance, and when we do, we’re paying more for it.
We’re Southwest Louisiana, and how we stack up with the nation and surrounding regions is outlined in a “Competitive Snapshot” commissioned by the Southwest Louisiana Economic Development Alliance.

The “snapshot” freezes this statistical moment in time for the sake of coordinated economic planning for the future. It was prepared by Market Street Services, an Atlanta-based consulting group which does this work for cities all over the country.

The snapshot tracked data going back four to seven years, sometimes longer, to track Southwest Louisiana trends. In addition, it compared us to three roughly comparable markets — Beaumont, Texas; the Mississippi Gulf Coast; and Mobile, Ala.— and the nation as a whole.

Market Street categorizes the issues by “People, Prosperity, Place.” Its snapshot suggests that Southwest Louisiana grow the workforce, raise wages and educational attainment, diversify the economy, “become an economic garden” for new business, leverage its existing business, expand healthcare access, “improve the environment” and increase civic capacity (more nonprofit groups), among other ideas.

Mac Holladay, the founder and CEO of Market Street, said the snapshot will help the Alliance’s “Southwest Louisiana on the Move!” economic plan.

Jobs
In baseline terms of jobs, the snapshot found that the employment picture here is just about the best anywhere.

Among the three comparison regions and the nation, Southwest Louisiana had the highest level of employment growth from 2001 to 2008. Also, between the fourth quarters of 2004 and 2008, employment growth here was 5.9 percent — far better than the state (1.2 percent) and nation (2.5 percent).

In fact, from 2000-2008, the unemployment rate actually fell here (4.3 percent to 3.9 percent.) While unemployment has gone up in 2009 — to more than 7 percent — the jobless rate is still lower than that of the state, the comparison regions and the nation.

The area’s working population grew 1 percent. That was far below the growth rate nationally (up 8 percent), but still better than the state as whole, which saw a decline.

If the snapshot’s job stats are relatively encouraging, the pay stats present a challenge.

Real per capita income in 2007 was $31,366. That was far below the nation ($38,615), Mississippi Gulf Coast ($36,133) and state ($35,100). Per capita income “is one of the best measurements of a community’s progress in economic development, because it is a key indicator of economic stability and potential buying power.”

Wages in finance, insurance and information services “lag significantly behind national wages,” the snapshot notes.

Quality of Life
The stats on heathcare and insurance represent a mixed doctor’s bag.
Lake Charles has more doctors per person than the state or nation.
Healthcare costs “as a whole” in the region are higher than the state and nation. However, it’s cheaper here to visit the doctor ($75) and dentist ($55) than the national average ($77 and $70, respectively).

The number of hospital beds per capita (619) is far higher than the rates along the Mississippi Gulf Coast (406) and nationally (420). “Since Lake Charles has significantly more hospital beds per capita than the comparison regions, this presents an opportunity to expand capacity in medical research and training,” the snapshot notes.

Also, insurance costs more ($1,536) than the national average ($1,432). The percentage of people without insurance is 22 percent, higher that the state (21 percent) and nation (17 percent).
Education
Education lags.

Too many don’t finish high school. Too many don’t seek college or technical training. Still others enroll in a four-year college, but drop out. Some lose their jobs and need to learn a new skill set.
That’s where community and technical colleges with two-year degrees can some into play.

“I see Sowela and the other technical colleges in the region playing a key role for training -- and re-training — people for the workforce,” said George Swift, the Alliance’s president and CEO. “There are trades and crafts. Petrochemical, with the process technology program. Heath care. Gaming and tourism. Aviation.”

Entrepreneurship
An entrepreneur might find unexplored fields here.

The snapshot counted just 14,500 self-employed people, though “Beaumont had nearly 22,400, the (Mississippi) Gulf Coast had nearly 26,000 and Mobile had just over 27,800.”
Also, small-business loans, patents and research trail all other areas.
Swift sees opportunities.
Plant employees might realize helpful processes or products — then go get patents or form their own businesses. The “cultural economy” has potential for the musicians, artists, cooks and others who season the only-in-Louisiana gumbo of food, arts and entertainment. Also, “more companies are outsourcing things,” Swift said. “They need support services, consulting and technical services.”

Toward this end, the Southwest Louisiana Entrepreneurial and Economic Development Center is being formed. The Alliance is joining with the city, parish and state to build and operate a business incubator near the McNeese campus. The SEED Center, as McNeese President Bob Hebert named it, will house the Alliance offices, the university’s Small Business Development Center and the tools and resources needed to cultivate new business ventures.

Best Face Forward
The area has its challenges, economic and otherwise, when you’re showcasing the area to suitors.
Swift skipped the statistics when asked to name the first ones that came to mind. Instead, he pointed out the window.

“Litter, and the appearance of the I-10 corridor,” he said. He turned his chair toward his third-floor office window, which affords a view of the half-century-old Calcasieu River Bridge. “You have an I-10 bridge that is not attractive, wide, or safe-looking.”

“It’s not aesthetically pleasing,” he said. “There are no travel plazas that they can easily see...I-210 looks good, but most people take I-10.”

Nevertheless, he said, there’s a good face being put forward when people arrive by other means.
“The new airport is a major improvement for people’s first impression,” he said. The $28 million Lake Charles Regional Airport terminal is a rare welcome legacy of Hurricane Rita. Also, over at Chennault, “Million Air is a great-looking facility for people who arrive that way.” He also cited area casinos and golf courses as powerful imagemakers for the area.

What’s most attractive to outside prospects, Swift said, is an emerging fresh image of the state.
“There’s a new overall attitude and acceptance of the region by new companies and new people,” he said.

The Alliance helps that idea along through advertising and marketing that touts the petrochemical industry, gaming, health care and school achievement. “We can tell a good story,” Swift said. “We get past the perception of Louisiana. Ethics laws and marketing ... move away from the perception of political corruption and the things we don’t do anymore.”

Prospects
To get potential new businesses interested, “we have a database of available buildings and sites and demographics on the area. We contact developers and site consultants. We field RFPs (requests for proposals) usually through the state,” Swift said.

“Say someone wants a hundred acres, with rail (service), and along the interstate. We can be the link between government — on a local, parish or state level — and whatever a potential client might want. We’re kind of the liaison between these entities.”

“We’re also marketing the area in publications and online,” he said.

“We’re behind the scenes, working. We try to identify opportunities.”

And even with the wait-and-see national economic prospects, “people are looking here,” Swift insisted.

“Yes, people are still looking, and that’s a good sign. But they want to see that there’s an upswing in the national economy. There are about eight good prospects right now” — he declined to name them — “so we feel really good about the region.”

He added: “I don’t want to make light of a single person who has lost their job. But I talk to civic clubs all the time, and I tell them I can’t think of another place where I would rather be than Southwest Louisiana.”

FACTBOX:
It's All Part of a Plan
The “competitive snapshot” done by Atlanta consulting group Market Street Services is part of a four-part effort this year by the Southwest Louisiana Economic Development Alliance.

The first step was an analysis of the Beauregard Regional Airport and industrial park effort. The acreage at the site has some rail service, but needs water and sewer lines.

“It has tremendous potential long-term,” Alliance CEO George Swift said of efforts to get the facility designated as a Louisiana Megasite. “And maybe short-term.”

The second step was the competitive snapshot. It was funded by the Alliance, L’auberge du Lac Casino Resort and Louisiana Economic Development.

Next will be a Target Business Review to find targets and opportunities for economic diversification. For example, existing businesses in the petrochemical or agriculture sectors might spark related prospects for new businesses. That review will take place in mid-October.

The final phase will be an Implementation Action Plan with a timeline and benchmarks. “They will look at our five-year plan, Southwest Louisiana on the Move, to see what needs to be re-prioritized,” Swift said.

The Alliance’s plan began a year and a half ago — before the 2008 hurricane season and the national downtown — so changes are expected. Workforce development and new business recruiting, for example, have been high priorities, and will remain so. However, an emerging factor is business retention — developing opportunities from the businesses already here.
The Alliance will have a game plan “by the end of the year,” Swift said.

Northrop Grumman Waits For Contract Announcement, Names Teammates

By Nancy Correro
Editor, The Times of SWLA





Northrop Grumman waits in anticipation to see if they will receive the defense contract to maintain KC 10 aircraft.

"We're especially pleased with the best-in-breed team we've assembled to offer the most innovative, technically superior and low-cost solution to our Air Force customer," said Jim Cameron, corporate vice president and president of Northrop Grumman Technical Services.

"Together, our team excels in program integration, leveraging the best of our industry partner core competencies while ensuring proactive management and unity of effort to provide comprehensive, responsive and focused support throughout program execution. Such capabilities only mean one thing for our customer—superior service delivered anytime, anywhere."

Northrop Grumman Technical Services is a logistics support, sustainment and technical services powerhouse for the corporation. The sector's Life Cycle Optimization and Engineering (LCOE) group provides a full spectrum of contractor logistics support including logistics management, depot maintenance, sustaining engineering support and global field management.

They announced their teammates for this project and they include: TIMCO Aviation Services Inc., AAR, Chromalloy Gas Turbine LLC, and MTU Maintenance.

TIMCO has extensive experience in maintaining, repairing and modifying DC-10-type aircraft.
AAR is one of the world's leading aviation support companies and provides the Northrop Grumman KC/KDC-10 program team its supply chain management solution.

Chromalloy and MTU Maintenance will provide the engine maintenance and related value-added management solutions for the Northrop Grumman team.

"This exceptional Northrop Grumman team will bring the requisite proven capabilities and qualifications to execute the full spectrum of world-class support the Air Force requires for the KC/KDC-10 program: logistics management, depot maintenance, sustaining engineering support and global field deployment," said Dave Werkheiser, vice president and general manager of the company's LCOE group.

The Northrop Grumman team will leverage its more than 4,300 active suppliers from all 50 states in support of the KC/KDC-10 Program.

The team submitted its proposal to the Air Force May 8, 2009. The contract award is expected before the end of June with contract phase-in set to begin July 1, 2009.