Is the Airport Authority Skirting Travel Rules?
Wednesday, August 12, 2009
In an era of transparency and accountability, we'll look at whether the San Diego County Regional Airport Authority is wisely managing their budget when it comes to travel.
MAUREEN CAVANAUGH (Host): I'm Maureen Cavanaugh. You're listening to These Days on KPBS. Sometimes when you're out with people you want to impress, you spend a little more money than you intended to. Maybe you choose a nicer restaurant, stay at a pricier hotel. And if you're spending the money on business travel in the private sector, sometimes your boss will actually okay the higher amount and you'll get reimbursed. But when you're traveling on the public's dime, the situation becomes a lot more complicated. A recent report by voiceofsandiego.org has renewed questions about how much money members of the County's Regional Airport Authority are spending on travel and entertainment. The Airport Authority is a public agency whose $121 million budget is paid for by rent at airport stores and various fees we, the flying public, pay. The members of the Airport Authority are either elected or appointed, and they run most of the Authority's operations like any other public agency except, apparently, its expense reimbursement policy. In fact, the title of the article I referred to at Voice of San Diego is called "Airport Officials Continue Flying and Dining in the Lap of Luxury." With me to explain what's going on is the reporter who wrote the story, Rob Davis of voiceofsandiego.org. Welcome, Rob.
ROB DAVIS (Reporter, Voice of San Diego): And good morning.
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CAVANAUGH: And we also have Bruce Boland, a member of the board of the San Diego County Regional Airport Authority. Thanks for coming in, Bruce.
BRUCE BOLAND (Board Member, San Diego County Regional Airport Authority): Thank you. It's lovely to be here. Thanks, Maureen.
CAVANAUGH: You know, I'd like to invite our listeners to join the conversation. Tell us what you have to do to get your expenses reimbursed where you work. Do you have a policy you have to follow? You can give us a call and join the conversation at 1-888-895-5727. So, Rob and Bruce, let's first establish that the San Diego County Regional Airport Authority is, indeed, a public agency. Rob, in your story, Chairman Bob Watkins called it quasi-governmental but that's not your understanding.
DAVIS: Well, I mean, you can – you can describe it how ever you want but, I mean, it is a public agency. It uses the public's money and it is subject to open meeting laws, it's subject to California's open record laws. It was formed by the legislature. The mayors throughout the region appoint its board members like Bruce. And so you can – you can kind of spin it how ever you want but, I mean, it is fundamentally a public agency.
CAVANAUGH: And, Bruce, is that how you see it as well?
BOLAND: That's true except for the fact that the money that flows to us really comes from revenue that's generated. You said most of the public, actually most of the fees are paid by the airlines and all with landing fees, parking fees and things such as that. But Rob is correct. In the public's mind, it's a public agency and we act like a public agency. All of our meetings are open meetings, all of our policies are established in open meetings and we are subject to the Brown Act and we are very concerned about the transparency of the organization. We reorganized in 2007 and that's when we rewrote most of these policies and all of that, and one of the major things is to ensure that the public has confidence that their airport in San Diego and the land use authority decisions that we make are made correctly.
CAVANAUGH: Just so we can put some of the expenses we're going to talk about in context, Bruce, I wonder if you could tell us, what is the mission of the Regional Airport Authority? What are you guys doing?
BOLAND: We have two missions. One is, of course, is to oversee and run Lindbergh Field, San Diego International Airport. That's a big operation. We have about 350 employees and there's about 6,000 people that work at the airport. And the other thing that's equally important but not seen by the public is the fact that we are the land use authority for all land use decisions that surround all of the 16 airports in San Diego County. That includes the four military airports. We do not have any decision policy for what goes on inside the airports but land use around is ours, and we do that so that we can protect the airports and protect the people that live around it.
CAVANAUGH: Rob, tell us a little bit more about what – where – what you consider public funding for the County Regional Airport Authority.
DAVIS: Well, I'm flying up to Portland in a couple of weeks and there is a $4.50 charge that's attached to that flight that goes to the Airport Authority. Again, I might buy a $3.02 bottle of water while I'm there and that revenue that is generated from that and that that tenant pays goes to the Airport Authority. If somebody flies in and rents a car, there's a fee with that. So it is, I mean, it's money out of the public's pocket.
CAVANAUGH: And why did you decide to look into the travel expenses at the Airport Authority of the staff, of the board members and so forth? There have been questions in the past, haven't there?
DAVIS: There have been, you know, really throughout the history of this agency. It was formed in 2003 and this has been kind of a running issue for it. The Union-Tribune in 2007 did a story highlighting some of the lavish travel. The Airport Authority board said, yeah, you're right, this is a little bit excessive. We're going to tighten up the policies. And they did. So now instead of flying business class if it's more than three hours, it has to be more than five or six hours. But they tightened up the policies and their – those policies aren't always being followed. And so you can have the tightest, most strict travel policy in the world but it doesn't do you much good if the employees aren't following it and they're still being reimbursed for expenses that aren't allowed under the rules.
CAVANAUGH: What were some of the kinds of expenses that were found questionable in the first report?
DAVIS: Oh, gosh, you know, people being reimbursed for alcohol, taking local business leaders on trips and paying for them to go to help drum up business for flights to San Diego, and any number of things. Again, just questions about the meals and expenses being incurred and the travel costs.
CAVANAUGH: Now, Bruce, I wonder, following the U-T investigation, the Airport Authority got together and said we're going to tighten up the rules. What did you – Why were the expenses – Why were those expenses that were being questioned being made in the first place?
BOLAND: Well, I can't speak to what occurred before I joined the board in the end of 2006 but I know that our board members got together and we did this publicly over a long period of time in 2007 and looked at our travel policies. One thing we did is we removed all domestic travel on business class. Right now, the only time you can fly business class is your overseas travel. For example, the trip that I took last fall that was a major trip for the airport, I flew economy class to Chicago and then took the overnight business class into London so I could be fresh in the morning. I'm not as young as I used to be and trying to hit the streets in the morning with your business is pretty tough. We also – As Rob pointed out, we have a no alcohol policy unless it's approved. For example, there are some business meetings you go to that you expect that perhaps you can drink a glass of wine, you know, that's by exception by the CEO. I think our major concern that I have and I know the board has, and I thank Rob for looking into this, is the fact that the perception of the lack of transparency on the part of the board. We work very, very hard to ensure that everything we do is transparent. In fact, I wrote a five-page report on our trip to London last fall and in detail of what we did and all the leadership and the work that we did. So that's what's really important for us. If there is a problem, and I noticed in Rob's report there was a problem with reimbursing consultants, we have a specific prohibition against people that once the third party, once they have a business relationship with the Airport Authority that we no longer reimburse any expenses for them and if we're doing that, we're going to look into that and…
CAVANAUGH: I'm speaking…
BOLAND: …things like that.
CAVANAUGH: Sorry. I'm speaking with Bruce Boland. He's a member of the board of the San Diego County Regional Airport Authority, and Rob Davis, a reporter with voiceofsandiego.org, and we're talking about the expenses incurred by Airport Authority employees and board members. And, Rob, you have some really sort of eye-opening expenses that you list in your article. Tell us a little bit about that.
DAVIS: Sure. Well, I mean, to comment on what Bruce said, the issue is not transparency. I mean, the Airport Authority provided, as it's required to, these bills for us to inspect. So the issue is not transparency at all, it's whether they're following the rules or not. So there are expenses that – I mean, there are two categories. There are expenses that are just high and there are expenses that don't follow the rules. Some of the high expenses, Bruce and Bob Watkins, who's the chairman, and a couple of staff members went to London last October on a trade mission. Bob went to the Chargers/Saints game while he was there at a cost of $1200.00 for tickets that the Airport Authority reimbursed him for. His trip cost $11,000.00. And then, on the other hand, you have members of the Airport Authority going out. The president, Bruce, others, going out to lunch together and the travel policy, on the fifth page, specifically says that that type of meal is excluded. And you have subordinates of the president of the organization going out and paying for her lunch then submitting their expense report to her, she signs off on it and approves it, and the expense is specifically not allowed in their policies.
CAVANAUGH: So, Bruce, you've read this article. And you've…
CAVANAUGH: …you've heard what Rob has to say. How do you justify some – some of the things, especially these – the luncheons that – and dinners that you have with other members of the board that – and that those meals are reimbursed when apparently specifically in the reimbursement policy it says that you can't get reimbursed for having meals with other members of the board.
BOLAND: I don't – I don't recall any of them except myself, I recall specifically what Rob wrote about. I was asked to come to the Airport Authority on a meeting on a presentation that we – I was going to do for the terminal development program, which I'm chairing the Policy Committee on. And we all arrived at noon. It was our Director of Development, our CEO and myself. We realized we hadn't had any lunch. We went to Ogee's Pizza and had a salad and discussed it over that and it was a total of $39.00. I didn't give it a thought. I suppose that I was – it was my error at the time and – But that's the only one that I recall and the only one that I was involved in. The trip to London was a substantial trip. I wrote a five-page report on it. It's a matter of public record on the thing. I looked up my total expenses. When I got there, I spend a – outside the hotel rooms and that, I spent $229.08 for the week that I was there that – so I didn't think that was very excessive on the thing. But it isn't a matter of that, it's a matter of what Rob points out, it's abiding by the policy itself. And we will look into that to make sure that that's done. That's what's really important to do.
DAVIS: I'm curious, Bruce, if you think – if – you didn't go to the Chargers game and you didn't – you didn't charge the public for that and I'm curious whether that was – whether you think that that's an okay expense.
BOLAND: I didn't go.
DAVIS: I know…
BOLAND: And whether or not…
DAVIS: …but your fellow board member did.
BOLAND: Well, whether or not the fellow board member made the decision, we are independent members of the board and all that and I think I would raise that question to Bob. I lived two years in London and I know the city very well. I have a favorite pub there. By the way, I paid for my own pub beverage.
BOLAND: And I sat in the pub and watched the Charger game and it was a terrible afternoon for weather so I was much more comfortable in the pub doing that. But whether or not it was proper for Mr. Watkins to do that or not, I'd suggest that you – you ask that question to him.
CAVANAUGH: Well, you have talked, Rob, to Bob Watkins, chairman of the San Diego County Regional Airport Authority. What was his explanation?
DAVIS: His explanation was that he took a member of Parliament who is involved in airport security issues. And presumably they sat and talked about airport security on the five yard line of the Chargers/Saints game.
CAVANAUGH: I see. And Mr. Watkins also mentioned there were reasons perhaps a reporter could not understand these expenses?
DAVIS: Well, yeah, I mean, he made the suggestion that – His perspective was that there is a gray area. I think that, you know, the mayor of San Diego, the chairwoman of the Board of Supervisors have both indicated that the Authority's rules are the rules. And he has suggested that there's a gray area within these rules, that they should be guidelines and not strict policies. And, you know, he suggested that it's just a small part of the budget, it's less than a percent of the $121 million budget. And his suggestion to me was that I couldn't appreciate and that I was raising questions about these meals because I don't make enough money and I'm jealous of it or something, which is – which is absurd. His suggestion was that – he drew the analogy to a $40,000 a year IRS auditor who goes into a million dollar or two million dollar home and looks around and says, wow, I don't have that.
CAVANAUGH: Bruce, is there something legitimately that we don't understand about how much money it takes to actually do your job?
BOLAND: I'm not sure that that's true. I think the public expects people that are the appointees of our local government to act responsibly and abide by the rules and regulations on there. We expect that the public understands what our policies are and that we – and we abide by them. It's a big business. Our route service personnel, for example, are traveling around the world rather routinely. We're working now to generate traffic from Europe and from Asia into San Diego. That's what our business community is asking for and all of that. But it isn't a matter of the public understanding it. I think the issue is, is we have put together policies and all that and we need to abide by them. If we're not abiding by the policies, we need to take action to make sure that we are. That's what's important to me on the whole thing. And the work that reporters like Rob and others do is very legitimate and they need to look into these things and we need to keep our skirts clean and all of that, and we appreciate that. I have nothing to hide on that and if we have a problem, we need to correct that problem and work on it.
CAVANAUGH: You know, one of the things that stood out to me in the article was not – I don't think that Rob even says that this is a violation of any policy but the fact that there were some trips to L.A. that were made by plane instead of just driving up and the expense – I don't have it in front of me right now. Perhaps Rob can help me.
CAVANAUGH: Was, you know, considerable when in comparison to actually making the drive and I…
BOLAND: Can – can I comment on that?
CAVANAUGH: Sure, yeah.
BOLAND: I got caught in that exactly the same way.
BOLAND: Let me explain for your listeners. The first trip that I made for the Airport Authority, I had a business meeting for the Authority in Los Angeles. It came up real quick and I had to get up there mid-morning. And trying to drive up there at nine o'clock in the morning was going to be an impossibility so I asked our administrative assistant to arrange transportation. She arranged air transportation to me. It cost me $501.00 to do that, okay? The commuter airliners do not want you to fly from San Diego to Los Angeles and return and occupy that seat because they use those seats for their follow-on travel and all of that. I was abhorred when I found out that we had spent that much on the whole thing but I got caught on it. I think the trip, if I recall correctly, that Vernon was going on, he was going up to meet airlines for our – this passenger facility charge that we talked about, the $4.50 and all of that and he had to go up there on a real quick trip. Right now, if I go to Los Angeles on a business meeting, I take the train.
BOLAND: And usually the meetings are around Union Station. But if you have to meet in – at the airport in Los Angeles and you take the train, it's an impossibility. You're all morning trying to get up there. But I was as surprised about the cost of an airline ticket to fly up to Los Angeles and back as Rob was when he – when he saw it.
CAVANAUGH: Let me ask you the larger question here, and that is do you think there is actually a sense of frugality now considering the economic climate that we are in on the County Regional Airport Authority? Or is it sort of like, well, you know, we have so much money to spend, we might as well spend it?
BOLAND: No, you're absolutely wrong. The so much money we have to spend is the revenue that we generate. Nobody's handing us money on the thing, and we are down a bit this year on travel. That reduces the costs that we get for air – for landing fees and all of that. Last year, we redid the budget twice and all of that. That's how it got down to $121 million and all, and we are now within the budget for that. For us to stay within our budget is very, very important. So, as I say, most of the travel that is done is done by our route service personnel and all of that, going around. Meetings that would seem to be frivolous to some are very, very important to establish airline connections and all that on it. So, no, I want to assure the public that we don't have any laissez faire attitude towards our budget and all. We have to make a balanced budget just like everybody else. And if we don't, we hold the staff to an accounting. I'd just like to add one more point and that's the fact that our finance staff has received annual awards from their organizations and all for their methodology of handling and the frugality that we do on it, so I'm very pleased with that.
CAVANAUGH: Rob, what have you found in the difference between the rules that the Airport Authority has to follow in reimbursement and in other public agencies around the city?
DAVIS: Well, other public agencies have strict caps on how much their employees can spend on meals and it's not left to vague wording in the policies. The federal government sets per diem standards for hotel stays and meals and dinners and breakfasts, and the City and the County, for instance, follow those. The Airport Authority requires that the cost of the meal is reasonable. Well, what's reasonable? I mean, if you're at Ruth's Chris Steakhouse then $85.00 is reasonable because that's how much it costs to have a $45.00 steak. And so there is ample room for interpretation of the Airport Authority's policies.
CAVANAUGH: We have a caller on the line. Arlene is calling from Mission Hills. And good morning, Arlene. Welcome to These Days.
ARLENE (Caller, Mission Hills): Thank you, Maureen. My question is has – I don't understand what this agency has done for those of us who might fly out of San Diego airport or the tourists who come in. It seems like what I heard was a pretty big budget and I wonder if things have really improved since this was formed? I – It was my understanding this is one of Steve Peace's ideas.
ARLENE: You – Some of us remember Steve Peace.
CAVANAUGH: Yes, yes, certainly.
ARLENE: And I just don't know whether things have improved that much. Most of us just hate to travel by air now because of the security and all those problems. But – And having to buy that bottle of water. I take an empty bottle and fill it at the drinking fountain when I get through security.
CAVANAUGH: Well, Arlene, thank you for the call and I – I'm just wondering – Rob, would you like to…
DAVIS: Sure. Well, Bruce can talk about the nuances, the budget. I mean, Arlene is right. This was Steve Peace's idea. And one of the big tasks that the Airport Authority was charged with when it was formed in 2003 was this idea of figuring out Lindbergh Field and whether it was going to be the airport of the future, and that's what culminated in 2006 with the strangely worded question about whether we should perhaps maybe sometime move the airport to Miramar which failed in November of 2006. But they run the airport and Bruce can – Bruce, I – can talk about that.
CAVANAUGH: Bruce, to Arlene's concerns?
BOLAND: Hi, Arlene. I have the same concerns and I'm not going to be the apologist for the TSA when they search all of us going through the – I go through the same thing you do and they do not work for us. We just house them there and I do fill my bottle on the inside also on the thing. But more to your question, we've morphed into a much different organization since the early days of the Airport Authority. It's our job to make sure that Lindbergh Field, which is the airport of the future, is the most effective, safe and efficient airport that you can fly out of. We are in the process right now of beginning the build-out of the new Terminal 2 West to accommodate ten more gates and the traveling public, I think, you will be very pleased with that, although I will admit for about the next three years you're probably going to see a lot of construction going on there. But our job is to ensure that. We do surveys all the time with our traveling public and over 87% of the traveling public gives very high marks on our service and the convenience of flying out of Lindbergh Field. But our job is to make sure that you fly effectively, efficiently and safely to your destination and come home, and a lot of our tourists certainly like stepping out at Lindbergh Field and seeing that beautiful bay and going downtown. And we appreciate the fact that you're using the airport and we hope you enjoy it.
CAVANAUGH: You know, Bruce, we – I have a question from one of our reporters here, Alison St John, who is a metro reporter. She wants to know, on that trip to London that you took, you visited a single runway airport that's similar to Lindbergh Field but is more profitable. And is – Did you find out why? Is there a report coming? Is there some conclusion?
BOLAND: I don't think it's more profitable. It's very much controlled and all. And, in fact, all of their employees are very organized and it's a – it's a very difficult operation for them. But I did – We looked at – I wanted to go to Stansted Airport, particularly. Most people are not familiar with Stansted. It's north of London, about 45 minutes north of Liverpool Station by train. And interestingly enough, 46% of their traveling public goes by train or public transportation there because it was set up that way. But it does look just like Lindbergh Field. It's got a single 10,000 foot runway, operates about – moves about 23 million passengers a year and all that. But to say it's more profitable, I – I'd have to talk to Alison to ask her where she got that information.
BOLAND: I didn't get that but it – it is run – the airlines like Southwest operate out of there and support operations throughout the U.K. and into Europe. We also visited Heathrow and one of the main reasons we went on the trip was to – wanted to talk about generating business. As you know, east of England is a big biocom center and they're very interested in having connections to San Diego. We're very interested in airline connections for them. The other thing was, is the mayor's Destination Lindbergh program was in high gear at the time and we wanted to make sure that we were looking at airports that had commuter facilities and all the rest of that on it. It was a very profitable, intellectually, trip from that standpoint. I wrote a five-page report and I'll leave a copy of you with it (sic) that you can see. It's a – was very interesting. I assure you it was no boondoggle on my part and I don't think the rest of the people thought it was either.
CAVANAUGH: Well, thank you. And you wanted to respond now.
DAVIS: I was just going to say, and not to speak for Alison but that information came to me this week from Bob Watkins, who's the chairman, talking about the profitability of the airport there.
CAVANAUGH: Okay. All right. Let me ask you a final question. Would you say, Bruce, that some of the information in Rob's story needs to be looked into by the Airport Authority?
BOLAND: Absolutely. There's no doubt about it and all that. Now the issue of when you go overseas and you spend for a luncheon, if you travel to places like Singapore and Hong Kong and London and all that, it's a lot more expensive to live and all that. But, certainly. We have policies. If the policies are not being abided by, we'll find out why the policies aren't and correct that. But I do think that the fact that our CEO on our development, the vice president and myself spent $39.00 over a luncheon because that's the only time we could get together from our busy schedules was a bit of a stretch, Rob.
CAVANAUGH: And, Rob, you get the last word.
DAVIS: You know, I mean, to accuse me of exaggerating something or making a stretch, it's – your – the Airport Authority says we won't reimburse you for this expense. And repeatedly the Airport Authority is reimbursing people for those expenses. And, you know, it's – it may be a $30.00 lunch, it's also been a $550.00 meal at Bertrand at Mr. A's. And so, you know, to talk about the nuances of, well, this unallowed expense is okay but this other unallowed expense is not okay doesn't seem to make sense and to jive with the rules that the Airport Authority has. They are rules. They are policies. And I don't think that the public expects that there's going to be a lot of gray area in them.
CAVANAUGH: Gentlemen, we'll leave it there. I want to thank you both so much for joining us this morning. Bruce Boland, member of the board of the San Diego County Regional Airport Authority. Thanks, Bruce.
BOLAND: Thank you. And I hope you'd invite me back so I can tell the – your public about what we're doing at the airport to make it even bigger and better…
BOLAND: …for San Diego.
CAVANAUGH: That's fair enough. And Rob Davis of voiceofsandiego.org, thank you so much.
DAVIS: Thanks so much, Maureen.
CAVANAUGH: And These Days will continue in a moment. Stay with us here on KPBS.