Port Authority leases adjacent Army airfields

The Port Authority was operating on a shoestring budget. Funding for capital improvements and airport expansion could not be secured until clear title to all facilities was assured. Due to legal complexities, this was going to take some time. In the interim, the immediate need for space was relieved when, in late February, agreement was reached with the Army for temporary access to the Army’s former wartime airport on the 20th Street side of the field. It was announced that the Port Authority would acquire the former base as soon as the Army declared it to be surplus, which was expected to be imminent. The facilities were leased to the Port Authority by the Army on a month-to-month basis and restricted to use by the charter airlines. The 36th Street terminal was reserved for scheduled airlines. The Port Authority quickly repainted the Army’s former terminal, putting up partitions and counters and installing telephones. Charter airlines were ordered to move to the 20th Street field by March 23rd. At 8:00 AM on opening day the building was humming with activity.

Expansion plans studied

On April 10, Port Authority director Col. Marcel Garsaud announced that a committee made up of the scheduled airlines had been formed to study expansion of the airport facilities. He also announced that removal of the Seaboard Air Line Railroad tracks which bisected Pan Am’s, and the Army’s, airfields was also being studied. It was recognized that removal of the tracks might prove costly and could potentially involve prolonged court proceedings.

Competitive pressures mount

On May 23, 1946, Greater Miami got a seismic jolt when the Civil Aeronautics Board (CAB) ruled that several domestic airlines had been awarded routes to Latin America that bypassed Miami. Known as the “Latin American Decision,” the ruling was the result of postwar efforts to expand and regulate international air travel, particularly in Latin America. The CAB hearings appeared to directly threaten Miami’s status as the unrivalled “Gateway to Latin America.” The competition that the ruling spurred between airlines and the cities they served dominated local and national media. Rivalry between Miami and New Orleans, Houston and New York was particularly intense. With rehearings scheduled for late in the year, the competitive rhetoric only became increasingly contentious as the months rolled by. The panic over losing gateway control immediately resulted in calls for airport improvements, including building a new terminal on the 20th Street side of the field. On May 30, Garsaud announced that the Port Authority would consider putting a bond issue for airport improvements on the November ballot. Miamians were told that they MUST do their part to make the city more attractive to tourists.

Contract carriers dispute fees

As the year wore on, the problems only seemed to mount. In early June a bitter feud erupted between the Port Authority and the contract carriers over airport fees and taxes. The contract carriers claimed they were being charged the highest fees in the country. In particular, the charter companies opposed the imposition of a five-cents-a-gallon gasoline tax which the scheduled airlines were not being asked to pay as well as higher landing fees. In early June, the Contract Air Carriers association threatened to file suit, challenging the gasoline tax and declaring the formation of the Port Authority to be unconstitutional. The lawsuit also threatened to obstruct the State Legislature’s approval of the $2.5 million bond issuance through which the County negotiated the acquisition of the airport from Pan Am. The Port Authority eventually agreed to waive the gas tax but tensions continued to simmer.

Bad news & good news

In August the County Port Authority got more bad publicity when it was nationally excoriated in an article appearing in “Aviation News” for mishandling Miami’s aviation needs. In early September, the tables were turned on the critics when it was announced that MIA was the only large airport in the country to be operating “in the black.” And, as the Port Authority regularly reminded residents, the new airport hadn’t cost Miami taxpayers a penny whereas in other cities, airport improvements were subsidized by taxpayer-funded municipal revenues. A new fee schedule was issued that lowered charter operator fees. The respite was brief, however, when it was learned that only contract carriers who waived their claims for refunds of the five-cent-per-gallon gas tax would be eligible for the lower fees. Tempers again flared. Garsaud was accused of exercising “dictatorship authority” and on October 18th the carriers’ association again announced that it would be bringing suit against the Port Authority.

The Opa Locka question

To add to the County’s troubles, in October, the City of Miami announced plans to take over the former Navy base at Opa Locka, which had been declared surplus. The City Commission announced that it would be put to use as an airport for non-scheduled operators. Given that 60% of the Port Authority’s MIA revenues were generated by the unscheduled airlines, the impact on the County’s revenues would be severe if the City made good on its plans. Speculation arose that the two governing authorities could be headed for Court.

Differences erupt with scheduled airlines

As if that weren’t enough, on October 18th, the Miami Herald reported that a smoldering controversy between the Dade County Port Authority and the five major airlines operating from Miami International Airport had flamed into the open. Earlier in the year the scheduled airlines had agreed to advance $500,000 to the County to expand 20th Street terminal facilities. Pan Am’s former 1929 terminal was severely congested and the need to get moving on expansion plans was sorely felt. But as the year began to wind down, with no progress in sight on the Army declaring its base surplus property, the “Big Five” (Pan Am, EAL, Delta, National and TACA) issued a joint five-page statement accusing Port Authority director Marcel Garsaud of deliberately delaying and failing to cooperate on expediting the move to 20th Street, putting Miami’s aviation future in jeopardy. It soon emerged that the real issue in contention was whether a move by the airlines to 20th Street would waive their right to have a say in the Port Authority’s fiscal policies as they related to that side of the airport, which the purchase agreement of the 36th Street Airport provided for. The County maintained that a move to the 20th Street side of the field was not covered by the trust indenture agreement and that the two airports were separate airfields. Their attitude was that the Big Five should guarantee any deficit in the operations of both 20th Street and 36th Street but should only be permitted to have a say in the operating budget of the latter. To all appearances the Port Authority appeared to be solidly united behind this position. The Big Five insisted that the Army Airfield had always been included in development plans and was covered under the agreement, expressing their belief that the Courts would agree with them. Port Authority attorney J. Mark Wilcox refrained from voicing a public opinion on the matter.

Year ends on positive note

Finally, after two months of contentious wrangling and much saber-rattling, a ceasefire was brokered. The airlines agreed to contribute funds from surplus operating profits to expand 20th Street facilities, including facilities for non-scheduled airlines. In exchange, the County agreed that 36th Street and 20th Street facilities would be considered one airport. The County was also given consent by the airlines to spend all operating surplus from 1946 on airport improvements without refund or deductions of landing fees for the Big Five (to which they would otherwise have been entitled). The fund was to be spent at the Port Authority’s discretion.

By the end of December, it was also reported that 50% of the charter operators had signed releases waiving their rights to refunds of the gasoline tax levied early in the year.