California Pacific Airlines – the dream is still alive!

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Ted Vallas still wants to get California Pacific Airlines off the ground

In the late morning on a weekday, the terminal at McClellan-Palomar Airport calls to mind a ghost town.

The building is vacant, the flight board blank. Six rocking chairs in the waiting area sit motionless.

The only sign of life is the whirring of a small plug-in fan operating in the men’s restroom.

But if Ted Vallas gets his way, the cozy airfield that now serves only private flights will soon be bustling with passengers on commercial jets traveling up and down the West Coast.

Mr. Vallas owns California Pacific Airlines, known as CP Air, his latest venture in a peripatetic business career that has included stints in areas as varied as land development and other aviation-related ventures.

CP Air has sat on a metaphorical runway for years — engines idling, ready for takeoff — while awaiting certification by the Federal Aviation Administration.

Mr. Vallas’s patience is wearing thin. After all, he is 95, and he regards the airline as a legacy, an exclamation point to a colorful life.

In a second-floor office on airport grounds bedecked with models of planes and a black-and-white framed photo of his wife of 67 years, Mr. Vallas addresses why he does not abandon the quest.

“If I start something,” he says, “I like to finish it.”

If anything, his quest shows how difficult starting an airline can be in an era of consolidation.

Conceived decades ago, the airline was set to begin operating as early as 2010.

His plan seemed straightforward enough: Serve the booming population north of San Diego with routes to cities including Oakland, Sacramento, San Jose, Las Vegas and Phoenix.

By 2012, Mr. Vallas was confident enough in his venture to hold a gala at the airport where he showed off his first purchased plane.

But then there was that matter with the F.A.A. The agency has repeatedly denied applications. A letter from 2013, one of several from the agency, advised him that the application’s contents were “incomplete, inaccurate and do not appear to have been reviewed for quality.”

Complicating matters has been disagreement between Mr. Vallas and the county, which owns McClellan-Palomar, over whether the airport meets environmental standards.

A news conference this month took a strange twist when an airport spokeswoman, Alex Bell, advised Mr. Vallas that he needed another environmental assessment, which could push back approval by two years.

Having distributed copies of the in-flight magazine at the gathering, Mr. Vallas disagreed and insisted that the environmental hurdle had already been cleared.

In an interview, Ms. Bell said the county supported a commercial presence at the airport and described its dealings with the airline as “most cooperative.”

But, she said, “The need for an environmental analysis should not have been a surprise.”

Still, Mr. Vallas remains optimistic. He points to the economic impact CP Air could provide, and says there is a need in the growing region known as North County that would be well-served by his airline.

“We are supposed to be partners, not adversaries,” he says. “They are overprotective now with these environmental studies.”

At the same time, he concedes that the county and the F.A.A. must adhere to regulations, adding, “I have no animosity toward them.”

John Selvaggio, the airline’s former chief executive and a big proponent of the venture, is less complimentary than his former boss about the support he received from local businesses and county officials.

“What has to change is the political climate in terms of support from the community, the county and maybe the state,” he says.

Mr. Selvaggio, who was recently named senior vice president and chief operating officer of Mesa Airlines, found supporters who were passionate about CP Air. “But they were not people with an economic interest,” he says. “That really was the problem.”

The government shutdown in 2013 and the F.A.A.’s staff reduction did not help matters, the agency acknowledges.

Mr. Vallas “was a victim of the circumstances,” said Mr. Selvaggio, who remains a proponent of the airline, citing growth limitations at San Diego International Airport.

“He had the right game plan,” he said.

The process of greenlighting a new airline has become more complicated since Mr. Vallas sold a previous venture, a charter service called Air Resorts, in 1997.

He acknowledges the vast increase in paperwork since that era but contends that the conditions for acceptance have been met.

Mr. Vallas’s airline is not the only one that has encountered bureaucratic headwinds. Other proposed airlines are in limbo for various reasons, including Baltia Airlines, created in 1989 to fly between New York City and Russia, which still lacks the authorities’ blessing.

Most of the funding for CP Air has come from Mr. Vallas’s pocket, with an additional $2 million from “family and friends” and $3 million from a loan, he says.

Some two decades after declaring personal bankruptcy following a breach of contract related to the purchase of planes from Northwest Airlines, Mr. Vallas places his net worth at $20 million.

Jumping into markets already serviced by established airlines can be difficult. John Heimlich, vice president and chief economist of the trade organization Airlines for America, suggested that upstarts might be better off targeting small and midsize locales.

“There are definitely some untapped markets out there,” he said.

Despite the series of road bumps, Mr. Selvaggio said he would be surprised if his onetime colleague backed down.

“He is the eternal optimist,” Mr. Selvaggio said. “He never seemed to let anything faze him. He would take every setback in stride and move on to the next alternative. He is hard to keep down.”

“The only criticism I could say is that he is a little stubborn.”

His wife, June, has tried to nudge Mr. Vallas into retirement after a congestive heart issue, combined with a stroke while in the hospital, sidelined him for a month.

“She’s been very understanding,” he says, acknowledging that the matter has generated tension. As for his doctors, “They always tell you to slow down.”

Mr. Vallas, whose interest in aviation dates to his years in the Navy, may have downshifted, but not much. There is golf twice a week on two replaced knees, plus other forms of exercise.

And an airline to get off the ground. As he approaches centenarian status, Mr. Vallas hears a clock ticking.

Thanks to the New York Times for the article.

Ted Vallas still wants to get California Pacific Airlines off the ground

Ted Vallas still wants to get California Pacific Airlines off the ground

Canadian business aviation contributes huge economic output

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Canada’s business aviation sector directly contributes total of $3.1bn in economic outputs, $1.3 in GDP, $650m in taxes, 11,500 person-years and $800m in wages, according to a new study commissioned by the Canadian Business Aviation Association (CBAA).
The report, 2014 Economic Impact of Business Aviation in Canada, is the first detailed examination of the size and economic impact of business aviation, and reveals an industry that is integral to wealth generation and connectivity for communities and businesses across the country. As well as economic impacts, the report includes case studies, and examines business aviation operations by purpose and by aircraft.
“Having the hard data is a game changer for business aviation” said CBAA president & CEO, Rudy Toering. “For the first time, we can demonstrate the impact that business aviation has, and educate policy makers and the public on the importance and value of business.”

Other key findings include:

Higher wages: Business aviation annual wages average $69,000, well above the national aggregate average of $47,000 and higher than average wages in construction, information/cultural industries, and transportation and warehousing.

From sea to sea to sea: Canada is home to approximately 1900 business aviation aircraft, including both fixed wing (76%) and rotor (24%), spread across Canada with the majority based in Quebec, Ontario, Alberta, and British Columbia.

Close to one out of five flights: business aviation is responsible for 18% of all domestic air movements in Canada.

When all impacts are included (indirect and induced, as well as direct), business aviation’s total contribution is even greater: $5.4bn in economic impacts, $2.6bn in GDP, and 23,500 jobs, and $1.5bn in wages.

“These are credible and defensible numbers. Nothing has been inflated” said Toering “If anything, the report understates the size of business aviation. Our biggest challenge was that data on current business aviation in Canada is limited when compared to the breadth of data available for its counterparts in the United States and Europe.”

The full report, 2014 Economic Impact of Business Aviation in Canada is available on the CBAA website,

Flights haven’t been this full since being troop carriers in WWII

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These days, flying can literally be painful. Airline seats are smaller and closer together than ever before, and more passengers are crammed onto every plane.

“It’s not your imagination that you’re on a fuller plane than you used to be,” says William J. McGee, the former editor-in-chief of Consumer Reports Travel Letter. “We’re looking at rates that we have not seen since the airlines were troop carriers during the Second World War.”

McGee, a current columnist for USA Today and the author of “Attention All Passengers: The Airlines’ Dangerous Descent—And How To Reclaim Our Skies,” says the airline industry is constantly operating at a “breaking point.”

For extra money, customers can get more legroom, board early or get access to Wi-Fi. But a lot of us aren’t willing to fork over the extra cash, so our experience is just getting worse.

“It was the stuff of comedy routines years ago,” McGee says. “But the fact is, there is a greater and greater segregation of passengers. And I don’t just mean behind the curtain in first class or business class — even within economy class now.”

Starting in 2015, Delta Air Lines will offer more class options, including “Basic Economy,” where customers can pay less money for fewer benefits. Basic Economy passengers can’t change flights, upgrade their seats, or receive a refund for unused tickets.

“It’s a new sub-class of service where you have even fewer rights,” McGee says. “That is the general direction that the US airline industry is going.”

The low sticker price will attract a lot of bargain shoppers, but the financial relief might not be worth the lack of benefits.

“The fact is, they’re taking away more and more services and products and charging us for it,” he says. “The airlines say, ‘Well, we’re offering more choice and that’s what our customers say they want.’ But these choices are not always reflected in the fares.”

McGee says despite removing complimentary services, airline fares haven’t budged, even in the face of falling fuel prices.

“When fuel prices go up, the airlines are quick to scream about it and add increases in the fares,” he says. “But when the opposite happens we’re told, ‘Well, we hedged our fuel; we bought it in advance, so it hasn’t really affected anything,’ and consumers don’t see the benefit. It’s obviously a system that is gamed. And it’s not gamed in favor of the consumer.”

And airlines aren’t just sacrificing things like a free drink or extra leg room, either.

“Anyone who’s flown in recent years knows that airline service has been degraded,” says McGee. “But my bigger concern is actually that the same mindset that nickels and dimes for bags, crackers and pillows has also created an environment where maintenance of the aircraft is being outsourced to Third World countries.”

For the last several years, McGee says airlines have started to tap the cheap labor of Third World nations — and they often do so at the expense of safety.

“For decades and decades, maintenance was done in-house by qualified and licensed mechanics,” he says. “There were drug and alcohol screenings, and security screenings. Now all of that has gone by the board. The Federal Aviation Administration allows all US airlines to outsource maintenance, and they all do.”

Overseas, unlicensed technicians frequently repair aircraft owned by American airlines, with one licensed mechanic signing off on all of the work being performed.

“It’s a completely different model than we’re used to,” McGee says. “Quite frankly, we haven’t quite seen the full results of what all this will mean.”

This story is based on an interview from PRI’s The Takeaway, a public radio program that invites you to be part of the American conversation.

United Express (United Airlines) closing Palomar airport operations

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United Express stops flights into Palomar Airport
By Ken Harrison, Dec. 20, 2014

United Airlines announced this week that it will be closing its operation at Palomar-McClellan Airport. Operated as United Express through their partner, SkyWest Airlines, the up-to-seven flights daily to LAX will cease sometime before April 2015. United was the only regularly scheduled airline to fly out of the Carlsbad airport.

This may be good news for area homeowners, who often oppose airport expansion — the same homeowners who purchased homes in the runway’s flight path. But for many holding tickets on United’s December 19 Flight 5346, they were surprised to learn of the change.

Christy from Cardiff says she travels through LAX on her way to Saskatchewan about two of three times a year. She chooses Palomar, even though a little more expensive than Lindbergh, so she doesn’t have to deal with the traffic and parking. “My travel is easier,” said Christy.

She said most impacted will be her employers at her office across the street from the field. “They often fly to Europe and always fly out of here for their flights out of LAX. They’ll pay up to $350 more just to not have to drive to L.A,” added Christy.

Fred says he flies through LAX about 20 times a year on business. This time he had his wife and two kids with him. They live in Carmel Valley, and though halfway between Lindbergh and Palomar, he thinks it is much more convenient to fly out of Palomar.

Blair was returning to his home in Houston. He regularly visits his mom in North County. “Now I’ll have to fly into San Diego and rent a car. I’ll miss this little airport,” he said.

Soon, the small ticketing terminal will be empty. United Airlines graphics and those of a planned California Pacific Airlines, which never got off the ground, will be all that remain. The airport, with its 4,897-foot runway, will remain open, in other parts of the field, to private aircraft operations, maintenance facilities, flight schools, and jet charters.

When Palomar first accepted commercial aircraft, America West Airlines serviced North County flyers with several daily flights to their hub in Phoenix. The cost of flights from Palomar to an America West destination was the same as out of Lindbergh, a marketing plus for the popular airline. America West service was shuttered when US Air bought it out in 2005.

Palomar’s convenience, ease of parking, lack of traffic, can be expensive. United charges more for their flights out of Carlsbad vs. San Diego. And sometimes offers long layovers, up to six hours, to connecting flights at LAX.
As an example, booking a round trip flight from Carlsbad to Chicago, from a Sunday to a Saturday, with a 21-day advance purchase, would cost $586 (Lowest non-red eye quoted by the airline’s website on December 19).

However, of the seven flights out of Carlsbad, only one had a less-than-two-hour layover in LAX. It was $645 round trip. The other flights, as low as $547, had an up to five hour, 35 minute layover, or added additional stops in Austin, Las Vegas, Oklahoma City, or Wichita.

United offers two nonstop flights from San Diego to Chicago for $476 roundtrip. Flights as low as $378 could be found with one stop in either Denver, Houston, LAX, or San Francisco.

The reason given for the pulling out of Carlsbad: SkyWest is transitioning out of its fleet of Brazilian-made, 30 passenger, turboprop Embraer 120 aircraft. New FAA regulations starting January 2015 will make slower planes like the Embraer less effective to operate, with the new regulations regarding pilot on-duty times.

Unfortunately for local homeowners, corporate planes and chartered jets, soon to be the airport’s mainstay business, have been increasing over the years. SurfAir, an all-you-can-fly membership airline began serving Carlsbad to seven California destinations on November 17, out of the Premier Executive Jet terminal.

History of California Pacific Air

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Origins of CPAir Collage

by Ted Vallas

In 1980 I had received air carrier permits and approvals to operate a scheduled 121 operation out of Carlsbad Palomar Airport to a number of California, Nevada, Arizona, and Mexico cities.

Just prior to my first start, I had moved my Flag and Domestic Air Carrier operation from the Caribbean to Carlsbad’s Palomar Airport. The move added five Convairs and a complete repair station to my Palomar Operations.

At approximately the same time and prior to my start, a Lear Jet operator began a Lear training program using Palomar’s instrument landing system (ILS) and other facilities. He moved in a number of very noisy Lear Jets from other areas for touch-and-go operations. His flights caused hundreds of noise complaints from the area residents, which were definitely justified.

Even though I had received approvals for any operations after a number of hearings, the airport manager approached me to delay my flights until the Lear Jet operator completed his program and the complaints quieted down. I agreed with the understanding that the permits already granted to me would not require any further hearings.

After the Lear Jet operation left Palomar, but before I could start my schedule, area residents requested that I go through new hearings. The airport manager went along with their request and did not honor his commitment to me. He withheld my counter space and gate area telling me that the pressure from the area residents was too great on the City Council and him without new hearings. Realizing that I would not get new permits approved, I moved the flight operation to San Diego’s Lindbergh Field.

Barishnikov TourI was able to continue my helicopter operation, repair stations and my Super 580 Aircraft company modification center at Palomar. In preparation for my operations, I had built a number of hangars and office buildings at Palomar. I also approached the County to allow me to build a much needed new and modern terminal building and restaurant hoping that it would open the door for the return of my desired scheduled operations. Even though the airport manager and the County of San Diego approved of my request, the FAA did not.

About three decades later, the County of San Diego, owner of the airport, has taken an entirely different approach to its vision for the future of Palomar Airport by building a modern air terminal that meets my desire for a facility to support a scheduled airline operation. The first piece of my dream is now in place.

My business plan of 1980 was nearly identical to my proposed plan of 2009. I recognized thirty years ago the need for scheduled service from North San Diego County, which could be recognized as a “hometown airline.” Today, anyone who resides or conducts business in the North County will see an immediate need for better air transportation from our own area.

We only have to look back some twenty years when the pride and joy of San Diego residents was its Pacific Southwest Airline (PSA). It was a true regional airline flying point-to-point through the state and region. Back then, the entire San Diego County population was not as large as today’s North County of 1.3 million people.All Aboard

CP Air will rejuvenate the regional air system concept. You might rightfully say that I am copying and improving upon the successful portions of the old PSA plan of point-to-point service.

Operations out of Carlsbad’s Palomar Airport will save North County residents (1) a typical three-hour roundtrip to San Diego’s Lindbergh Field, (2) a delay of ninety minutes standing in lines, clearing security, and preparing for flight, and (3) an average expense of $24 for parking.

To augment my original plan, I will use new, state of the art jet aircraft featuring 2 by 2 seating. This seating configuration offers a much more comfortable experience eliminating the dreaded “middle seat”, at least 31 inches of legroom, and the widest coach seat in the air. To add to the comfort and convenience, each of our passengers will receive a seat assignment.

2014 – California Pacific to acquire airline and its AOC

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California Pacific Airlines (Carlsbad, CA) founder, Ted Vallas, says his start-up is planning to acquire an unnamed, “small airline” in the coming months with the aim of using its Air Operators Certificate (AOC) to launch operations out of Carlsbad, CA.

“You’re immediately certificated,” Vallas told the Coast News. “It only takes a couple of months to add a new type of aircraft to the certificate.”

Though Vallas would not name the airline he intends to acquire, he did state that it currently operates five Boeing 737 aircraft on flights nationwide. Should the merger and takeover be successful, Vallas intends to continue operation of the B737s and within two years operate a total of twelve EMB-170s and EMB-190.

Since its launch in 2010, Cal Pacific has encountered numerous obstacles on its path to certification with the US Federal Aviation Administration (FAA) blaming “a number of deficiencies relating to safety, maintenance and inspections” for its latest rejection. The federal regulator postponed a subsequent reapplication on the grounds it did not have adequate manpower and resources available.

With the granting of its AOC on the cards last year, California Pacific had planned to operate an EMB-170, N760CP (cn 17000006), on flights out of Carlsbad, CA to Sacramento Int’l, San José, CA, Oakland, Phoenix Sky Harbor, Las Vegas McCarran and San José Cabo.

2013 – FAA delays approval (again)

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2013: The commercial airline that plans to fly out of Carlsbad’s McClellan-Palomar Airport is seeing another big delay.

The Federal Aviation Administration has informed California Pacific Airlines that it will not be able to review its latest application to fly until at least next year.

The delay is so lengthy that California Pacific has furloughed all employees and suspended operations until it hears back from the federal agency, Chief Executive John Selvaggio said Tuesday, adding that he has returned to his Florida home. It’s the latest setback for California Pacific, first proposed in 2010 by owner Ted Vallas of Rancho Santa Fe.

The airline plans to provide commercial service to such regional destinations as San Jose, Oakland, Sacramento, Las Vegas, Phoenix and eventually Cabo San Lucas. A 72-seat Embraer regional jet landed to fanfare in summer 2012 but has been idled during a series of disputes with the federal agency.

The airline has seen its application rejected, and then consideration of its reapplication delayed due to sequestration, the $1.2 trillion of across-the-board federal budget cuts over 10 years that began in March. The FAA eventually denied that application, before the airline resubmitted it for a third time in September.

Last week, the FAA sent a letter to Selvaggio, informing him of the latest holdup.

“The recent government shutdown, along with personnel changes and other resource losses within FAA Flight Standards has unfortunately resulted in further delay of the California Pacific Airlines air carrier certification,” says the letter from Keith Ballenger, assistant division manager for the FAA’s Western Pacific region. “The FAA will review our staffing situation in early 2014 to determine whether we can resume the California Pacific Airlines certification project. We will certainly inform you immediately if we can start certification work for CP Air any sooner.”

Airline management had repeatedly expressed confidence that California Pacific would begin service by the end of 2013.

The Embraer jet was ultimately sent back to the manufacturer, so the airline didn’t have to continue paying $200,000 per month in rent. California Pacific had raised at least $11 million from investors.