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Pennsylvania may ask US Airways to move

Pennsylvania Gov. Ed Rendell could push US Airways Group Inc. to base its headquarters in his state in return for lease concessions and state money for its Pittsburgh and Philadelphia hubs.

The airline's other major hub is at Charlotte/Douglas International Airport.

Published reports in Pennsylvania say Rendell has called on US Airways to move its corporate offices from Arlington, Va., if the state helps with $155 million in improvements at Pittsburgh International Airport and $235 million of improvements at Philadelphia International Airport.

Included in the requests apparently is $40 million for a maintenance and training facility for the airline's new regional carrier, MidAtlantic Airways, which is expected to be based in Pittsburgh.

A spokesman for Rendell wasn't immediately available for comment.

David Castelveter, a US Airways spokesman, declines to say whether the airline will consider such a move, in return for lease concessions and financial assistance. He also declines to disclose when airline officials will next meet with Pennsylvanian officials to discuss the lease and improvements.

"All of these issues are issues that will be discussed in private ... with the county executive, as well as Gov. Rendell and his staff," Castelveter says. "We'll negotiate, and when there's something to tell, we'll tell you."

US Airways has rejected its current lease at the Pittsburgh airport as part of its Chapter 11 bankruptcy restructuring. The company is seeking to negotiate a new deal that would reduce its operating costs.

The airline has set a Jan. 4 deadline for reaching an agreement on a new lease. The airline says it will continue to pay its current rates until that date but will reject the lease on Jan. 5 if a new agreement is not in place.

US Airways was based in Wilmington, Del., from 1939 until 1949, Castelveter says.

In 1949, it moved into space inside an airplane hangar at then-Washington National Airport, now called Ronald Reagan Washington National. Forty years later, US Airways moved to its current location in Arlington.

Castelveter says the airline leases its current headquarters, but he declines to disclose the terms or length of the existing lease.



Airport's operator requests to join creditors


With $673 million for 30 years' worth of leases hanging in the balance, the Allegheny County Airport Authority will try to be added to the list of US Airways creditors.

If the authority is considered a creditor, it would at least have some standing in future court proceedings regarding the airline and payments due to contract holders.

On March 30, the last day that US Airways was harbored by bankruptcy protection, it filed papers to cancel leases with vendors associated with Pittsburgh International Airport - unless they can be renegotiated before Jan. 5, 2004.

One of the giants in line for renegotiating is the airport authority, which runs the facility. US Airways, which operates more than three-fourths of the gates at Pittsburgh International, is looking to renegotiate or end its 30-year lease with the authority for terminal space.

By canceling, airport authority officials figure US Airways would back out of payments totaling $673 million for the remainder of the lease, said JoAnn Jenny, airport authority spokeswoman.

The authority has until the end of the month to file its papers in bankruptcy court, Jenny said. Meanwhile, US Airways and the authority will continue negotiating.

Allegheny County will not challenge in bankruptcy court the airline's rejection of the leases.

US Airways spokesman David Castelveter has said the airline will not comment on negotiations regarding the lease.

US Airways wants to renegotiate contracts and leases with 62 companies, including affiliate airlines such as Mesa Air Group and Mesaba Aviation, bankrupt airlines United and Air Canada, the US Air Federal Credit Union (for a terminal sublease) and its garbage hauler, Browning-Ferris Industries of Carnegie.

Among the other companies targeted by US Airways for contract renegotiation are those who provide skycaps, hotel rooms and limo service for crews, warehouse space and consultants.

Sam McWilliams of Rochester, who has worked as a consultant for aerospace planning and space consolidation, said neither she nor her attorney was sure why her company, SMC Consulting, was on the list of vendors that US Airways wants to renegotiate with.

McWilliams has worked with US Airways for three years, helping the company to reduce its building leases at the RIDC Park in Findlay Township and find space for MidAtlantic Airways, the regional subsidiary that US Airways plans to start later this year.

"I'm still working with them," said McWilliams, who said she has a creditor's claim in bankruptcy court but otherwise, has been paid for her work. "I have a meeting on Monday with them."

Moon Area School District might be surprised to find itself on the list. Last week, the district's fiscal director, Alan Bennett, said leases for the old Carnot and McCormick schools, which US Airways uses for staff training, appeared intact until the end of the contract in 2007. The district and the training center leases, however, are on the list to be renegotiated.

Bennett could not be reached for comment. The school district receives more than $450,000 a year from the leases.

The list also includes Mellon Bank, because US Airways operates a ticket office at 2 Mellon Center, and Sharon Community Presbyterian Church in Moon Township, which has a parking lot lease with US Airways.



Embraer hopes for quick decision from US Airways on RJs

Negotiations continue between US Airways and Brazilian manufacturer Embraer for a mega order for ERJs, but a final decision has not been reached, Embraer CEO and President Mauricio Botelho said yesterday, ending speculation that he had come to Washington to make a major announcement.

Botelho was speaking to reporters at a breakfast held by the Aviation Safety Alliance. "It won't take long, I hope," he replied when asked how soon a final decision can be expected. Sources within the industry believe Embraer has the inside track because of its 78-seat 170 that is expected to be certificated and ready for delivery before year end. Botelho said the US Airways order likely will be split between 50- and 70-seat aircraft.

Last week, US Airways President and CEO David Siegel said the company is close to announcing a "very large" order for regional jets and was highly complimentary of the Embraer 170. "The Embraer 70-seater is revolutionary and game-changing for the industry, so if we end up launching that airplane [in the US] it will give us a significant competitive advantage," he said Conceivably, the airline could pick up early delivery positions previously held by launch customer Swiss International.



Great Strides Walk


Philadelphia Mechanic Dan Godwin is asking fellow US Airways employees to support the Great Strides national walk sponsored by the Cystic Fibrosis Foundation on May 17-18. A father of three, Dan's youngest child, 5-year-old Lauren, has the disease, and he has been active in fund raising for the organization.

Cystic fibrosis, a disease of the lungs and digestion process, affects about 30,000 children and young adults in the U.S. today. The Cystic Fibrosis Foundation works to raise money to support the search for a cure. Eighty-eight cents of every dollar goes directly to research.

Dan asks that any employee who would like to participate on a US Airways team in his local walk at Bel Air, Md., or simply to make a donation to the foundation to contact him at 914 Towson Dr., Abingdon, MD 21009. His phone number is 410-515-1979 and his e-mail address is OOOOOOfan@xxxxxxxx Checks should be made payable to the Cystic Fibrosis Foundation. If you'd like more information about the foundation or the Great Strides walk, visit their Web site at www.cff.org.





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