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Jul 25, 201308:07 AMTransportation Matters

with Debby Jackson

No fat cats in these planes: Demonizing ‘corporate’ jets is counterproductive and unfair

(page 1 of 2)

Bad optics. That is the en vogue way to describe the scene in 2008 when Americans feared an economic meltdown and the CEOs of Chrysler, GM, and Ford arrived in D.C. on their respective companies’ corporate jets to advocate for a taxpayer bailout.

In these days of the 24-hour news cycle, not much gets missed, and “optics,” especially “bad optics,” can gain a life of its own. I am sure Rick Wagoner of GM, Alan Mulally of Ford, and Robert Nardelli of Chrysler never contemplated for a nanosecond that their method of arrival to testify before Congress would become such a lightning rod.

But it did.

If you happen to have a “bad optics day” and it can be seized upon by one of the political parties for some perceived advantage, then Katy bar the door. It will take on a life of its own, and what an interesting life it will be — sometimes even taken at birth, never to be seen again by those who sired it.

It is now 2013, and while the U.S. may not be on the financial footing we all would hope, most citizens are not living in daily fear of economic Armageddon. Yet President Obama still throws around phrases that include some iteration of “fat cats in their corporate jets” with the same regularity that Lady Gaga changes costumes.

Few who listen to those words tie them back to the Big Three automakers and their “bad optics” day, but it doesn’t matter. The phrase has its own life now, and it appears to be an adolescent — living for the moment without regard for the consequences of its actions. (Yes, I know a phrase can’t actually take action, but I have this whole personification thing going on, so work with me.)

What do I mean by consequences? Well, first there are the tangible offshoots of weaponizing the term “corporate jets.” During the debates over sequestration and raising the debt limit, one of the sticking points was whether or not to remove a “tax loophole” for corporate jets.

What is referred to as a “loophole” in this war of words is the current depreciation schedule for privately owned aircraft, which is five years. Proponents of removing this “loophole” are actually recommending changing it to a seven-year depreciation schedule, which is what the big commercial airliners have. Such a change would, of course, generate an infinitesimal amount of money that could go toward balancing the country’s yawning deficit.

The real harm, however, comes not as a result of these policy proposals but from the rhetoric itself. Wisconsin has a tremendous general aviation network and is dotted with small, medium, and larger businesses that use private aircraft to operate more efficiently and improve their bottom line, or in some cases to survive. To insinuate that companies like these are “fat cats” is to do a tremendous disservice.

There are far too many of these stories to mention in this blog, but let’s look at a couple just to get the flavor of what I’m talking about. Look at Hooper Corp. Hooper Corp. was founded in 1913 as C.A. Hooper Corp. — a small mechanical contractor in Madison. In its 100th year it remains a privately owned company that is now involved in nine industries, including electric power. Hooper Corp. also remains a union business.

Fred Davie, president of Hooper, explains that it was really the demands of the electric power arena and the subsequent work for power industries across the country that made the use of general aviation a valuable tool. “When you are up against deadlines and have one- or two-day notice on meetings that are nowhere near a commercial hub, use of private aircraft makes a lot of sense,” said Davie. It is also not necessarily the top brass that is flying to these meetings but project managers, safety managers, and crews.

Hooper owns two planes and leases others as needed from Wisconsin Aviation. Now, there is another fantastic story in and of itself. Jeff Baum started Wisconsin Aviation in 1981. While working as the assistant to the chancellor of UW-Whitewater and teaching finance in the College of Business in the mid ’70s and early ’80s, Baum started flying and instructing at the Rock River Flying Club in Fort Atkinson. That’s when he fell in love with flight and decided to work full time at Watertown Aviation. That company went under, but Baum established Air Watertown, which ultimately became Wisconsin Aviation.

Wisconsin Aviation is now a fixed-base operator (FBO) out of three airports in Wisconsin — Watertown, Dodge County Airport, and the Dane County Airport — and employs over 145 people. The company has well over 50 airplanes and its services include aircraft rental, hangar rental, aircraft maintenance, flight instruction, and fueling services.

Another Wisconsin company that uses general aviation to its benefit is CR Meyer out of Oshkosh. In 1888, a young German immigrant named Charles R. Meyer founded this construction company. More recently, CR Meyer was a pioneer in the design/build process and now has offices located in Rhinelander; Green Bay; Escanaba, Mich.; Muskegon, Mich.; Coleraine, Minn.; Tulsa, Okla.; Byron, Ga.; Washington state; and Chester, Pa.

CR Meyer CEO Phil Martini explains the company’s use of “corporate jets” this way: “It sure as heck isn’t a toy. If one of your people has a two-hour meeting in Chester or Escanaba, do you think it would be a more productive use of their time to turn it into a two- or three-day trip with one to two overnight stays? … The fact of the matter is without the use of general aviation, we wouldn’t be where we are today.”

(Continued)

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About This Blog

 Debby Jackson assumed the role of executive director of the Transportation Development Association of Wisconsin after more than 15 years with the organization. In addition to her vast experience in association management and transportation advocacy, Jackson has a background in business. She leverages the breadth and depth of her professional experience, along with her knowledge of the membership and mission of TDA, to be a strong voice for robust transportation infrastructure in Wisconsin. Jackson started her career as a staff auditor with Price Waterhouse, which led to a series of accounting and corporate management positions with a major national retailer.

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