Daily Archives: April 25, 2016

California Pacific Airlines – the dream is still alive!

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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