City Gears Up to Fight Airlines Over LAX : Litigation: Airport panel retains two law firms. Companies sued to halt a steep increase in landing fees at Los Angeles International Airport.

By KENNETH REICH

Aug. 2, 1993 12 AM PT

TIMES STAFF WRITER

Saying that it comes down to who runs Los Angeles International Airport--the airlines or the city--airport commissioners Sunday committed $250,000 to fight a lawsuit filed Friday by 40 airlines against an increase in airport landing fees.

“We will prevail,” said Ted Stein, acting chairman of the Airport Commission.

“Litigation is expensive, but the city’s overriding interest in controlling its own airport is more important than anything else,” Stein said.

The quarter-million dollars will be spent to hire two law firms to take on the domestic and international airlines that oppose the steep rise in landing fees, from an annual $28 million to $70 million.

The increase went into effect July 1, but the first payments are not due until Aug. 10, and the airlines may seek a court injunction against having to pay them. Under the new fees, it would cost an airline about $900 to land a Boeing 747 at the airport, hundreds of dollars more than now.

On Sunday, the city retained the firms of Morrison & Foerster and Wilson & Becks, both of Los Angeles. Stein called Morrison & Foerster “the premier firm in airline litigation in the United States.”

Stein and Jack Driscoll, executive director of the city’s Department of Airports, on Sunday characterized the fee increase as fair and reasonable. “The airlines make more money per passenger off of LAX than any other airport in the world,” Driscoll said.

The money from the higher fees will go into an airport capital improvement fund for use in contingencies, they said.

But Chris Chiames, a spokesman for the airlines’ Air Transport Assn., defended the lawsuit, saying that the fund is just a smoke screen, a way to hold the money while Los Angeles seeks to change federal law to allow airport profits to be diverted for police or other non-airport costs.

“Everyone in Los Angeles and everyone in the industry knows that the ultimate purpose for building up this excess revenue is eventually to divert it to the city,” Chiames said. “City Council members have told us privately that’s the goal and to say now it’s for another purpose is a smoke screen.”

But Stein called such assertions “a red herring.”

“The airlines in their complaint concede that there has not been one cent of money diverted from Los Angeles International Airport,” he said. About $30 million is in a capital improvement surplus fund and that is where any surplus over operating costs from the increased fees will go, he said.

Asked if he would promise that the city will not try to shift the money to the general fund in order to hire more police or for some other purpose, Stein would only answer: “At this point that $30 million is in the capital improvement account for the airport.”