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1 May 8, 2013 Ms. Sue Pigg, Executive Director Tri-County

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1 May 8, 2013 Ms. Sue Pigg, Executive Director Tri-County May 8, 2013 Ms. Sue Pigg, Executive Director Tri-County Regional Planning Commission 913 W. Holmes Rd., Suite 201 Lansing, MI 48910 Re: Addition of Michigan Flyer TCSP Grant Project to Regional TIP Dear Ms. Pigg: Indian Trails and its subsidiary, Michigan Flyer, have received a copy of a May 3, 2013, letter to the Tri- County Regional Planning Commission (TCRPC) by Robert F. Selig, CEO of Capital Region International Airport. Based on erroneous assumptions and assertions, his letter opposes our planned increase in the frequency of Michigan Flyer trips from eight to 12 times daily between East Lansing and Ann Arbor. We hereby respectfully wish to correct Mr. Selig’s many misstatements of the facts. First, Mr. Selig falsely asserts that MDOT’s support for adding Michigan Flyer’s project to the region’s Transportation Improvement Plan (TIP) merely “renews MDOT’s 2011 request.” In so doing, he confuses our 2012 TCSP grant application—which has already been approved by the Federal Highway Administration—with our 2011 TCSP application, which was not supported by TCRPC primarily because of Lansing airport opposition, and was never approved. The projects we proposed in 2011 and 2012 differ substantially: o In 2011, we applied for a one-time, $1.5 million grant to help begin a new I-96 route between East Lansing, Howell, Brighton, and Detroit Metro Airport in addition to our then existing I-94 route between East Lansing, Jackson, Ann Arbor and DTW. Because that grant was not approved, we did not launch a second route. o In 2012, we discontinued the I-94 route, as well as Jackson service (resulting in a protracted outcry from Jackson-area passengers who are still upset over the loss of local access to Michigan Flyer.) Simultaneously, we began a new I-96 route partly in cooperation with the Ann Arbor Transportation Authority. Through our public-private partnership with AATA, we operate a co- branded “AirRide” service between Ann Arbor and DTW with 12 daily round trips. In 2012, we applied for—and were awarded—a one-time TCSP grant of $595,680 to help complete the establishment of our I-96 route by increasing runs on the East Lansing-Ann Arbor segment to 12 times daily. o Michigan Flyer’s 2011 TCSP grant application competed for funds with other applicants from the Tri-County Region. Our 2012 proposal was selected as one of the most worthwhile in Michigan, and has already been awarded a TCSP grant; adding it to the TIP will have zero effect on others applying for TCSP funds. 1 o If the TCRPC votes not add it to the TIP, the grant would be applied in another region of Michigan, or possibly in another state; residents of the Tri-County Region would lose out on improved transportation options between East Lansing, Ann Arbor, and Detroit Metro Airport. Second, Mr. Selig notes the opposition of 10 businesses and organizations to our 2011 TCSP application as a reason not to add our 2012 project to the TIP. Beyond the apples-and-oranges nature of his reasoning, we have some issues with his list of Michigan Flyer opponents: o At least four of the 10 organizations he cited in 2011 had financial ties to the airport. o Others were swayed by the airport’s false and defamatory assertions of $150 million in annual harm to the regional economy caused by Michigan Flyer, which Mr. Selig recently and widely re- published to further besmirch the reputation of Michigan Flyer and hurt our business. o Specifically, the airport took a 2004 estimate of its own economic value to the region ($871 million), then divided it by the number of local residents who used airports other than LAN in 2009 (530,450) to calculate a “loss” to the region of $1,643 per person. (In LAN’s view, any mid- Michigan resident who catches a flight from Flint, Grand Rapids, or Detroit is a “loss” to the Tri- County economy.) The airport then multiplied Michigan Flyer’s entire 2010 passenger volume (91,250) by the bogus “per-passenger loss” to come up with the fictional $150 million revenue “loss” we supposedly cause the region. Third, Mr. Selig falsely states that “In March 2013, Michigan Flyer was found to be promoting bus ticket sales to Detroit Metro on the Airport Authority’s website, www.FlyLansing.com, without permission.” Here are the facts: o Capital Region International Airport contracts with Traveline—an Ohio company—to process the sale of airline tickets through the www.FlyLansing.com website. Traveline re-published information about our fares and schedules available on the Global Distribution System. o Michigan Flyer participates in the GDS, a worldwide network that connects travel agencies with the reservations systems of airlines and other transportation providers. LAN and its contractor Traveline re-published Michigan Flyer’s information without our permission or knowledge. Fourth, Mr. Selig’s main—and equally misguided—objection to our grant is “the use of public tax dollars to subsidize one form of private commercial passenger transportation at the expense of another.” He insists that it is “discriminatory” for the “State of Michigan” to subsidize Michigan Flyer, but not commercial airlines. o In fact, while MDOT sponsored Michigan Flyer’s TCSP application, the ”Transportation, Community and System Preservation” grant program is run by the Federal Highway Administration. o Capital Region International Airport—which receives roughly $5 million a year in taxes on Ingham County residents, plus federal tax dollars—frequently uses such public funds as 2 incentives to entice and support selected private commercial airline carriers. It does not use any of these tax dollars to support Michigan Flyer or Indian Trails. o Previously, Mr. Selig stated that he opposed a TCSP grant for Michigan Flyer and Indian Trails because “such funding should be used to meet the public transportation needs of our region, not private ventures.” o Just last October, LAN received a $1.1 million grant of federal Economic Development Administration funds from the U.S. Department of Commerce. "Business and industry will soon have more than 120 acres of airport property that is completely prepared to support commercial business development,” said Mr. Selig at the time, noting that public tax dollars would be used to “leverage private investment” in the development of Port Lansing. Fifth, while Mr. Selig wrongly accuses Michigan Flyer of damaging the regional economy, the opposite is actually true: Michigan Flyer represents a decided economic advantage for the people and businesses of the Tri-County Region. o Two-thirds of our passengers live in the Lansing and Ann Arbor regions. We help generate millions in economic benefit by enabling them to: Save money on travel, conserve energy and protect the environment, reduce road traffic and maintenance, stay productive en route, and travel between cities for business and pleasure. If a Tri-County resident chooses to fly from Flint, Grand Rapids or Detroit in order to save on average domestic airfares at LAN that are overpriced by $117 in comparison (according to a 2011 New York Times report), that’s not necessarily a bad thing. Tri-County residents tend to spend their savings at Tri-County businesses. Nor can residents be faulted for taking advantage of the choices offered by DTW’s 750 flights a day. o One-third of Michigan Flyer passengers come from out of state to do business, attend Lansing and MSU conventions, and visit family, friends, and our great universities. That’s 30,000 people a year spending millions locally and creating jobs. Convention groups such as Odyssey of the Mind and the Boy Scouts of America (which will bring as many as 15,000 and 7,000 visitors, respectively, into our area from out of state this year) are an important key to economic development locally. Without scheduled motorcoach connections with DTW that operate 365 days a year—such as provided by Michigan Flyer and Indian Trails— the Tri-County Region’s ability to attract such large groups would be vastly diminished. o Michigan Flyer runs both ways. Our I-96 route connects two of our great public universities and represents an opportunity to market mid-Michigan real estate, entertainment, shopping, medical facilities, and schools to residents and businesses along the entire corridor. Sixth, Mr. Selig has falsely stated that a federal TCSP grant to Michigan Flyer would subsidize the expansion of service to towns in Southeast Michigan that would “use that service to compete against our community for badly needed jobs and local transportation services, decreasing the quality of life for local residents.” 3 o Eighty to 100 passengers a day—or approximately 33,000 each year—use Michigan Flyer as an inter-city bus service for travel between East Lansing and Ann Arbor. o Mr. Selig’s suggestion that Ann Arbor is competing against the Tri-County Region in a manner that decreases the quality of life for our residents is utter poppycock unsupported by a shred of evidence. The fact is that increasing the number of daily round trips between East Lansing and Ann Arbor from eight to 12 represents an economic boon for both regions, enabling them to attract more visitors from out of state. o Moreover, for many of our passengers who don’t or can’t drive, including those with disabilities, increased service is more than a matter of convenience—it is an important improvement in public transportation. Seventh, judging by his continuing attacks on Michigan Flyer, Mr. Selig seeks to deprive mid-Michigan people of additional transportation options. o However, it has been proven time and again that much of a region’s economic strength lies in providing as many transportation alternatives as possible—not fewer.
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