Politics

ST. PAUL (AP) ― Frustrated by unanswered questions about the proposed Northwest-Delta combination, Minnesota lawmakers took steps Tuesday to enforce agreements requiring Northwest to maintain its headquarters, hub and a certain level of jobs in the state -- or pay up.

The House Commerce and Labor Committee approved two bills that would force Northwest to forfeit roughly $200 million in airport rent reductions and speed up repayment of a $245 million loan if the Eagan headquarters and jobs are lost. Both bills passed on voice votes without audible dissent.

"To be blunt, I don't trust Northwest Airlines nor do I trust Delta to do the right thing," said Rep. Michael Paymar, DFL-St. Paul, who co-sponsored one of the bills.

He added: "Let's make sure that we aren't taken advantage of anymore."

Northwest Airlines Corp. and Atlanta-based Delta Air Lines Inc. announced plans earlier this month to become one airline.

Seventeen years ago, the Legislature helped Northwest avoid bankruptcy with an almost $800 million aid package, including the loan the company is still repaying. That agreement was renegotiated last year to add airport lease concessions worth $10 million to $18 million a year through 2020.

The head of the Metropolitan Airports Commission -- Northwest's landlord -- said he is prepared to enforce the agreements. But Jeffrey Hamiel also said the commission could use flexibility as it learns more about the combination.

Hamiel said the bills, if enacted, would give the commission "very little opportunity as far as flexibility to look at other options that may in fact be more beneficial for Minnesota."

But panel chairman Joe Atkins, who sponsored the second bill, said he's not satisfied that the commission will put enough weight behind enforcing the state's agreement with Northwest. Atkins' bill would potentially allow the commission to go after Northwest for collateral damages for what he said may be "the single most detrimental economic event in Minnesota's history."

Northwest has said the legal remedy for pulling the headquarters out of Minnesota is repayment of the bonds and the loss of the airport concessions. It has said it believes Delta would negotiate to promise a certain number of jobs and flights in Minnesota after the two airlines combine.

Both bills must clear at least two more panels before coming to the House floor for a vote.

Anxiety over the acquisition was palpable in the basement hearing room, where uniformed baggage handlers, ticket agents and flight attendants watched the proceedings. Some were jittery about losing their jobs. The airlines have said there won't be any involuntary furloughs of front-line workers.

Rene Foss said she became a flight attendant 23 years ago because her father wanted her to get a job with good wages and benefits, and over the years it became her career. Now, Foss said she's worried.

She asked lawmakers to hold Northwest executives accountable for their promises, so they can't gut the airline "and then have a good laugh about it five years from now at a cocktail party when they walk away with generous, multimillion-dollar bonuses."

Delta has said it won't close hubs or furlough front-line workers because of the combination, although about 1,000 administrative jobs will be cut in Atlanta and Eagan.

Some fear more jobs could be lost down the line.

"The core intent of consolidation is less -- it's less service, less jobs, less choice. Otherwise, why consolidate?" said Steven Gordon, president of the International Association of Machinists union that represents Northwest ground workers.

Atkins, DFL-Inver Grove Heights, also threatened to subpoena Delta executives to testify after complaining that they ignored his invitations. It wasn't immediately clear whether two-thirds of the panel members would vote to issue subpoenas.

 

 

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