MAJOR FEDERAL AIR SERVICE GRANT AWARDED FOR PALMDALE REGIONAL AIRPORT

(Palmdale, California -- August 10, 2006) Mayors Jim Ledford of Palmdale and Antonio R. Villaraigosa of Los Angeles announced the award of a grant from the U. S. Department of Transportation (DOT) Small Community Air Service Development Program (SCASDP) today for support of the Palmdale Regional Airport (PMD).

The DOT SCASDP grant, in the amount of $900,000, was awarded to the City of Palmdale to support a revenue guarantee program for regional jet service, on a major U.S. airline, from Palmdale Regional Airport. The program has been in existence since 2002, providing grants to support air service development efforts to small airport communities.

"This is an exciting step forward in bringing commercial air service back to Palmdale", said Mayor Ledford, "and we want to congratulate all of our regional partners on making this application a success, most especially Los Angeles World Airports (LAWA), Mayor Villaraigosa and our local elected officials. This was truly a regional effort and a great day for our region."

Mayor Villaraigosa added, "This is a great day for the Southern California airport regionalization efforts that I have been committed to since my election. This has been a priority for me and I have worked closely with LAWA’s new Board of Airport Commissioners and Executive Director Lydia Kennard to make regional air service at Palmdale a reality. I am pleased to have the federal government a partner in our efforts to alleviate congestion at LAX and I would underscore that this is only the first of many steps in our regionalization process.

"Fostering the long-term viability of Palmdale Airport is one of the many ways regional aviation can be achieved" and the receipt of this grant places Palmdale, Los Angeles World Airports and all of Southern California on the right track towards achieving a true regional aviation system," said Mayor Villaraigosa.

Palmdale was one of only two California cities to receive an award from the 2006 Small Community Air Service Development Grant awarded by the federal Transportation Agency, Chico being the other. In addition, Palmdale received the largest award of all 25 grant recipients, underscoring the potential of the air travel market.

Palmdale received the entire $900,000 it had requested, along with a match of $3.7 million in local commitments from the regional partnership known as “Wheels Up Palmdale” that included Los Angeles County Supervisor Mike Antonovich, the Antelope Valley Board of Trade, the Greater Antelope Valley Economic Alliance, and the Los Angeles Economic Development Corporation. The City of Palmdale contributed $1 million dollars of matching funds but the bulk of the funding, $2.3 million, came from Los Angeles World Airports, the owner and operator of PMD, at the direction of Mayor Villaraigosa.

In addition, letters of support were received from Congressman Buck McKeon, Congresswoman Jane Harmon of El Segundo, State Senator George Runner, State Assemblywoman Sharon Runner, L.A. County Supervisor Don Knabe, the City of Victorville, NASA Dryden Flight Research Center and Lockheed Martin Aerospace Corporation in Palmdale. From Los Angeles, Mayor Villaraigosa and Lydia Kennard Executive Director of LAWA and LA City Councilman Bill Rosendahl, wrote letters endorsing their support for this important air service grant. Councilman Rosendahl, who spearheaded the effort to recruit the support of local elected officials, commented, "This is great news for Los Angeles and all of Southern California. This is a step in the right direction toward building a truly regional system of aviation."

This grant continues to build upon Mayor Villaraigosa`s continued emphasis on regionalization of air service in Southern California. On June 2, the Mayor reactivated the former Southern California Regional Airport Authority (SCRAA) as part of his commitment to the LAX Master Plan settlement agreement and to accomplish the goal of more effectively utilizing available airport capacity at Southern California airports other than Los Angeles International Airport (LAX). The grant from SCASDP fortifies a real commitment to developing air service at LAWA’s regional airports to alleviate the constraints at LAX.

Lydia Kennard, LAWA Executive Director, said of the grant award, "This is a tremendous step forward for not only air service development at Palmdale Regional Airport, but also for the effort to increase the number of flights and destinations that Southern California travelers can have access to at airports that are closer to their homes and places of work. I also appreciate this decision by the US Department of Transportation, as it represents significant federal support of Mayor Villaraigosa`s efforts to develop an effect regional airport system in Southern California."

The $900,000 grant award is, in large part, the culmination of significant efforts during the past several years by LAWA, the City of Palmdale, and the County of Los Angeles, to attract new airlines and air service to PMD, which has not been served by a major airline since 1998. Mark Thorpe, LAWA's Director of Air Service Marketing, who has led this ongoing outreach effort to numerous airlines, said of the grant award, "The incentive program that this grant will allow the Wheels Up Palmdale coalition to develop marks the most significant accomplishment in our efforts at PMD to date, as we will now be able to invest in airline partners that are willing to enter a market that we believe will be a viable growth opportunity in the short-term future and beyond."

The combined funds, totaling nearly $5 million, will be used to provide revenue guarantee support for regional jet service from Palmdale to a connecting hub market such as Phoenix, San Francisco or Dallas-Ft. Worth. These hubs will provide passengers a significant number of connecting market options from Palmdale Airport. LAWA has been in discussions with several network carriers expressing interest in re-introducing service to Palmdale.

In addition to the significant growth of the north Los Angeles County region in recent years, Palmdale and the Antelope Valley region are home to some of the largest Fortune 500 aerospace companies in the nation as well as Air Force Plant 42 and Edwards Air Force Base. The demand for business travel generated by the defense and aerospace industry in Palmdale is well documented.

"It took a little time and energy, and a lot of hard work, but the need for a regional expansion of air service has been realized, and with this grant we now can shift our focus from presenting the travel demand need to actually providing quality service," said Mayor Ledford.