State backing Delta in flight fight

Here's an interesting story from Tampa Bay Online. Read the full excerpt here

Taxpayers could wind up paying a $1.5 million revenue guarantee to Delta Air Lines to compete with Fort Lauderdale-based Gulfstream International Airlines by adding flights between Tallahassee and Tampa, Orlando and Fort Lauderdale beginning April 1.
The state has committed to a $750,000 share, with Leon County and the city of Tallahassee each picking up $375,000 shares, in the "stop-loss guarantee" deal in the event the Delta flights do not generate enough revenue.
That means taxpayers, through the government partners, would pay Delta up to $1.5 million if Delta fell short of the $11.5 million it said it needed in passenger revenue to operate the flights for one year.
The new service is scheduled to begin six months after Delta pulled out of Tallahassee when aviation fuel prices soared.
Delta will use 34-seat turboprop aircraft by its Minnesota-based Mesaba Airlines subsidiary. Gulfstream uses 19-seat turboprops.
Airfares shown on travelocity .com for a round-trip flight between Tampa and Tallahassee on April 13 and returning April 17 were $351 with taxes for both airlines.
"The governor does support the stop-loss guarantee because it is important that citizens have access to their state capital and for Tallahassee," spokesperson Sterling Ivey said in an e-mail.
The $750,000, if needed, would come from the Office of Trade, Tourism and Economic Development, he said.
That has Gulfstream chief executive Dave Hackett livid.
"I was apoplectic when I heard of the deal, and that was from a customer of ours who called me around late January and said 'You will not believe what I've heard,'" said Hackett, whose airline flies as a Continental Connection carrier for Continental Airlines.
Hackett said he called the governor's office when he learned of the deal but got nowhere. He said the deal would not have taken place without the state guarantee.
"We don't mind competition, we always have competition," Hackett said. "But we are the only one who has survived in these markets and for good reason: We are a fairly small airline based in Florida and we have the infrastructure to be successful."
The Delta connection flights by Mesaba will serve Tampa and Tallahassee with two round-trip flights on weekdays and one on Saturdays and Sundays.
The Continental Connection flights by Gulfstream serve Tampa and Tallahassee with four weekday flights and two Sunday flights.