Lawmakers warn small cities lose in US Air settlement

Lawmakers say the Justice Department’s settlement allowing American Airlines and US Airways to merge could limit service to smaller cities.

In a letter to Attorney General Eric Holder, the leaders of the House and Senate Transportation committees argue slots at airports in Washington, D.C., and New York that the two airlines gave up in the settlement must increase service to smaller cities.

They ask the DOJ to appoint a “monitoring trustee” to oversee the transfer of the gates “in a manner that supports competition, including service to small communities and rural states and regions.”

The letter is signed by Sens. Jay Rockefeller (D-W.Va.) and John Thune (R-S.D.), and Reps. Bill Shuster (R-Pa.) and Nick Rahall (D-W.Va.), who are the chairmen and ranking members of the transportation committees.

Justice’s settlement requires the newly merged American Airlines to give up gates at several airports, mainly from Washington's Reagan National Airport and New York's LaGuardia Airport. The DOJ argues the settlement would help consumers by allowing low cost carriers like JetBlue and Southwest more gates at the major airports.

The lawmakers argue these carriers usually do not serve smaller cities. Therefore, it calls for all carriers, not just low-cost ones, to be in the running for the new gate spaces. 

“The implicit or explicit preclusion regarding which carriers can bid on the slots and gates to be divested by the newly constituted airline eliminates almost any chance in the short or long-term that overall network service to smaller communities and less populated states and regions will see direct benefits from these historically significant gate and slot divestures,” the lawmakers wrote. 

In a conference call shortly after the settlement announcement earlier this month, Assistant Attorney General Bill Baer said the DOJ was “mindful of concerns that the merger would lead to fewer flights from Washington to small and medium-sized cities.”

He pointed out that the new American Airlines has agreed to maintain its commuter slots at Reagan National that serve smaller airports.