By Jock O'Connell
This article appears in the May 2001 issue of Comstock's Business magazine.
People from Maine are entirely too fond of telling the story of a stranger who races his car up and down a dusty country road before finally pulling up in front of a farmer who's been watching the whole spectacle while leaning on a pasture fence. "I guess I'm lost," the driver ruefully concedes. "Which way to Boston?" Slowly massaging his chin, the rustic replies: "Boston? Hmm. Well, I don't reckon you can get they-ah from hee-ah." It's a yarn that's usually spun to illustrate some sociological or metaphysical point. For our purposes, though, we'll derive an altogether different moral: a region's transportation system is vitally important to its economic well-being.
Which brings us to Sacramento and, more specifically, its airports.
As the 21st century dawns, the Sacramento region's economic destiny is likely to be determined more than ever on how well our transportation network will facilitate access to the over-hyped but nonetheless very real global economy. For even if a Sacramento- area firm builds the proverbial better mousetrap, the world won't beat a path to its door unless there's one already there -- preferably in the form of a runway 11,000 feet long.
The failure of the nation's air transportation system to keep abreast of rising demand became starkly apparent last summer when millions of airline passengers experienced lengthy flight delays or outright cancellations. Yet, while the plight of stranded airline ticket holders became front page news, the frustrations of businesses trying to negotiate the same air transportation system to get their goods to market received remarkably little attention from either the press or policymakers.
That's unfortunate because chronic breakdowns in air freight operations are apt to have a much more pervasive economic impact than hordes of disgruntled vacation travelers.
"More than ever, shippers are focused on eliminating supply-demand imbalances and removing impediments between themselves and their customers," observes Ted Scherck, president of the Colography Group, an Atlanta-based company that analyzes transportation trends. "More goods are being shipped directly to customers, being shipped more frequently and being shipped in smaller increments. The traditional approach of aggregating shipments, transporting them in bulk to a warehouse, breaking the freight down and distributing from there is fast becoming an anachronism."
The role of air cargo is even more pronounced when it comes to exports. Across the nation, airports handled 34.2 percent of the nation's merchandise exports in 1999 (the last year for which complete data are available). By contrast, waterborne shipments accounted for 26.3 percent of the country's export trade in that same year. (Ready for a shock to the conventional wisdom? Because of the dramatic expansion of trade with Canada and Mexico following the enactment of the North American Free Trade Agreement in 1994, trucks now move a larger share of U.S. exports -- 27.4 percent -- than do ships.)
Here in California, exporters have become even more dependent on air cargo, in large part because of the high value-added goods California industry produces. For items with a comparatively high value-to-weight ratio -- a classic hallmark of high-technology products -- air freight has become the favored method of transportation. As a result, Los Angeles International Airport handles more exports — measured by value — than do the adjacent Ports of Long Beach and Port of Los Angeles, which together constitute the nation's busiest maritime complex. Further north, planes departing San Francisco International Airport carry over three times the value exports hauled on ships steaming out of the Port of Oakland.
Not just high-tech goods get to fly. Whenever timely delivery is critical or if perishable commodities -- such as agricultural and horticultural produce -- are involved, air freight is the only option. Farmington Fresh, for example, maintains a 40,000 square-foot refrigerated warehouse at Stockton Metropolitan Airport, from which the company ships Central Valley farm produce worldwide in jumbo air freighters.
Over the last couple of decades, the Sacramento region's economy has seen both expansion and diversification, trends that are likely to continue. But unless the region's airport capacity grows to match the needs of local companies and consumers, the area's hard-won reputation as an attractive place to be in business is apt to suffer. Transportation bottlenecks — whether on the ground or in the air — ultimately influence business location decisions.
The good news is that the patient is not yet in critical condition. "The Sacramento region has a very rare opportunity to plan for its air transportation needs before its airports are completely hemmed in by residential developments and by other land-uses that are incompatible with airport operations," observes James R. King, president of Applied Development Economics, an economic development consulting firm in Sacramento.
But the clock is certainly ticking for the region's two principal airports, Sacramento International and Mather Field. While both are owned and operated by the County of Sacramento, they serve a market that encompasses not only Sacramento County but also El Dorado, Placer, Yuba, Sutter, and Yolo counties, together with large portions of Amador, Colusa, Nevada, San Joaquin, and Solano counties.
(Sacramento County also owns and operates the smaller Executive and Franklin airports, used primarily for general aviation and pilot training. In addition, the County owns but does not operate the former McClellan Air Force Base, which is planned to be used to support aircraft maintenance and U.S. Coast Guard operations.)
Sacramento International, the facility most familiar to the region's residents, is what is known in the airline industry as an Origin and Departure facility. Unlike hubs like Chicago's O'Hare, some 95 percent of International's passengers -- of whom there were 7.9 million last year -- either began or ended their airline travel here. Current plans do not envision International becoming a hub for any major carrier in the foreseeable future. Nor are non-stop flights to European or Asian destinations expected anytime before 2015, when projected increases in passenger loads may finally warrant flights to London and Frankfurt. On the other hand, International does expect to earn its international status late this year or early next when non-stop service is introduced to at least one destination in Mexico. Officials also hope to inaugurate flights to Canada (most likely to Vancouver) within the near future. To handle these international flights, the former commuter terminal located next to the airport administration building will house the necessary customs and agricultural inspection stations.
International has undergone a substantial makeover in recent years, adding a new runway and the wryly cheerful Terminal A, which doubled the airport's passenger handling capacity. The next big project is a 4,200-space, five-story parking garage that will be built across the roadway from Terminal A, with an elevated walkway connecting the two structures.
To chart how best to cope with the air transport demands of a fast-growing population, airport officials are currently drafting a master plan. (The final draft is expected to be ready this fall.) Fortunately, International has a large footprint. With some 5,500 acres within its boundaries, it covers more territory than either Los Angeles International or Atlanta's Hartsfield, two of the nation's busiest airports.
It will likely need the room, however. With passenger traffic forecast to climb at an average annual rate of 3.5 percent between now and 2020, the airport's current capacity could be surpassed as early as 2005. By then, crucial decisions will have to be made about whether to renovate or replace Terminal B and to take other steps to ensure smooth operations.
The biggest headaches International will face over the next few years will likely involve improving ground access. Travelers have long lamented the absence of public transportation connections to International. Ironically, the only public transit between downtown Sacramento and the county-run airport is provided by Yolobus. Although there is regular discussion of extending Sacramento's light rail system to International, regional transportation officials admit that goal is not likely to be met for many more years.
While their personnel suffer the same difficulties everyone else has in trying to get to International airport, area companies have an additional concern about airport access. Consider the airport's location in the region's northwest quadrant, just west of the junction between Interstate-5 and Highway 99. Then consider that most of the population and industrial growth taking place in the Sacramento area is occurring at the opposite end of the region, out along Interstate 80 and Highway 50 in communities such as Roseville, Folsom, and Rancho Cordova. Now remember the opening scenes of the movie Cast Awayin which Tom Hanks' Federal Express taskmaster frantically tries to blur the lines between efficiency and emergency in making sure the packages get through on time. With the region's highways already congested, transportation plans will have to stretch to accommodate International's access needs.
One possible solution backed by civic boosters and corporations such as Hewlett-Packard calls a new highway, the so-called Placer Parkway, that would be constructed between Hwy. 65 near Roseville and Hwy. 99 near the Sutter County line and just east of International. Yet whether it will be built anytime soon is unclear. There is first the price tag, an estimated $300 million that seems suspiciously conservative. There is also opposition to the project from environmentalists and others worried the new roadway will merely encourage further urban sprawl. It's a controversy that will likely enliven civic debate for many years to come. But how it is resolved will definitely have a profound impact on both passenger and cargo operations at Sacramento International.
Since the closing of Mather Air Force Base in 1993, officials at the Sacramento County Airports Department have been urging air freight carriers to move to the Rancho Cordoba facility. Currently, the roster of carriers there includes Emery Worldwide, United Postal Service, BAX Global, Airborne Express, and Kitty Hawk.
There is no question that Mather's air freight capabilities have been a valuable tool in luring businesses to the region, according to Rusty Hammer of the Sacramento Metro Chamber of Commerce. Unfortunately, as Hammer points out, Mather Field is not alone in having legitimate land-use priorities to assert: "If we don't provide sufficient housing near to all the new jobs being created in Rancho Cordova, congestion along 50 will only get worse."
The dilemma is that full development of a regional air cargo hub at Mather may ultimately be imperiled by the new housing developments slated to be built nearby. When Mather was a base for B-52 bombers carrying nuclear weapons, the Air Force maintained a 60,000 acre exclusion zone around the field. When the base was handed over to civil authorities, the County of Sacramento reduced the exclusion zone to 12,000 acres. That move effectively put up a "Build Here" sign for developers eager to meet a burgeoning demand for residential housing. In retrospect, it was unfortunate that decisions that would affect the long-term viability of Mather were taken at a time when the importance of air cargo to the regional economy was imperfectly understood.
Airport planners are not merely worried about the safety issues involved in locating residential housing or schools in close proximity to Mather's runways. While a future crash like that of a DC-8 airfreighter in February 2000 represents the nightmare scenario, airport authorities are also concerned that residential development will inevitably create an anti-airport constituency. In that event, Mather is apt to face the same sorts of problems that have limited airport operations elsewhere in the state. For example, law suits brought by neighboring communities have obliged John Wayne Airport in Orange County to ban commercial flights between 10 p.m. and 7 a.m. Similar restrictions are enforced at Hollywood-Burbank.
Or it may be compelled the deal with noise complaints in other costly ways. Both Los Angeles International and San Francisco International have been obliged to spend substantial sums on programs to mitigate aircraft noise in adjacent neighborhoods. The San Francisco Airport Commission has already appropriated more than $150 million to insulate homes in northern San Mateo county from the noise made by airplanes flying in and out of San Francisco International.
The prospect of thousands of new and potentially litigious close-in neighbors is not the only concern at Mather. Flight paths into and out of Mather have routinely taken big jets over existing (but rapidly growing) residential communities in Folsom, El Dorado Hills and Citrus Heights. A noise complaint hotline maintained by Sacramento County already logs an average of ten calls a day about flight operations at Mather. These grievances have led the Federal Aviation Administration to impose new incoming flight rules, requiring jets to come in higher from farther out to mitigate noise. But the new plans will not affect the noise the planes make on take-off.
Reaching an equitable compromise between conflicting land-use demands will be of critical importance to the region's ability to participate fully in the global economy. The problem is that land-use policy is ultimately defined through a process that is fundamentally political. As such, it is a process in which outcomes are normally determined not by elegantly drawn master plans whose logic might seem compelling but by the clash of opposing interests. That's why it's unfortunate that firms in the Sacramento region with a major stake in ensuring sufficient air transport capacity at both Sacramento International and Mather have not been more vocal in articulating the air transport case.
Until they do...well, to paraphrase an old adage, the meek may inherit the earth but not necessarily the landing rights.
For other articles by Jock O'Connell, click on "Essays "