Long Beach puts airport privatization on agenda

The idea has already sparked controversy over whether such an important policy matter should be considered in secret and whether relinquishing control of a valuable city asset to a private company would be in the best interest of the public.

"It's horrendous that this has been scheduled for closed session," said Councilwoman Gerrie Schipske, who plans to call for an open discussion of the matter. "The airport is a sensitive political issue in this city. We need to do this publicly."

Schipske and two other council members contend that no business negotiations are underway -- the state's open-meetings law exempts such discussions -- and closed sessions should not be used to float ideas of critical importance to Long Beach citizens.

Local governments that have tried to privatize airports in the past have found it to be a slow and frustrating process. Since 1997, a Federal Aviation Administration program to privatize airports has had six applications. Five have been terminated or withdrawn because of community opposition, inadequate business plans, a lack of financing or a repurchase by a government entity.

The only application awaiting FAA approval is from Chicago Midway Airport, which now serves about 17 million commercial passengers a year. Its proposed 99-year lease to a consortium of investors could provide Chicago with about $2.5 billion. Supporters say it could be a model for airport privatization.

Long Beach Mayor Bob Foster was unavailable for comment. But Becki Ames, his chief of staff said, "The mayor's position is that there is no harm in having a discussion on this issue. Right now, he has more questions than answers. He also feels that, no doubt about it, there needs to be a full public vetting."

City Manager Pat West said the discussion would involve unsolicited inquiries from financial institutions interested in acquiring airport assets and exploring whether Long Beach should apply to the FAA program. The firms include Citigroup, J.P. Morgan, Goldman Sachs, Merrill Lynch and Morgan Stanley.

West said he called for the closed session because the inquiring companies may need to disclose sensitive financial information. Discussion of trade secrets or financial statements can be held in executive session under the open meetings law, the Ralph M. Brown Act.