Published Tuesday, Dec. 4, 2012 | 11:59 a.m.
Updated Tuesday, Dec. 4, 2012 | 12:22 p.m.
Limousine businesses serving McCarran International Airport are hurting, a year after the airport cut from five to four the number of limo companies at the airport.
Business has gotten so bad, in fact, that Jacob's Transportation stopped operation at midnight Friday. Now just three companies serve the airport.
At Tuesday’s regular meeting, Clark County commissioners, who oversee McCarran, discussed how to help the operators.
Commissioner Susan Brager suggested lowering the maximum guaranteed rent the limousines pay the airport by 35 percent.
Randy Walker, McCarran’s director of aviation, said limousine business was down 21 percent from a year ago.
Walker also said the airport had taken unusual steps to help the limousine businesses, especially in the new, developing Terminal Three, such as allowing limos to be parked at the curb and moving the limousine booth from inside to outside of the terminal.
Walker didn't express optimism for letting companies refashion new agreements with the airport when their initial revenue plans don’t work out.
"To keep people honest, you have to hold people responsible to what they said they would pay." he said. "If we continue to allow them to not fulfill their commitments, then everybody will be able to just bid high, get the (job), then when it doesn't work, ask for a reduction."
Walker added some "difficult decisions" would be coming if companies were allowed to renege on agreements, then get big reductions in expected rental or other payments to the airport.
"We'll have to raise rates somewhere else, say parking, to give these companies a reduction in what they promised to pay ... or we can lay some employees off, because we don't have any place to go to get the kind of money we're talking about," he said
Commissioner Lawrence Weekly asked Brager how she came up with a 35 percent reduction plan. Walker answered, saying that Jacobs Transportation was once offered a 35 percent in their "minimum annual guarantee" payment to the airport. Jacobs rejected that amount, but Walker said other limo services heard about it and asked for the same 35 percent.
Now that Jacobs has left the airport, that's a loss of $1.8 million. It would be a bigger revenue hit, Walker said, to now reduce the "mag" from the other limo companies by 35 percent.
Brager said Walker was considered the airport "expert," and when he comes to commissioners with vendors who pitch revenue guarantees as too high, they go along with him.
"When you bring us things and pitch stuff, and we think it's too high, it puts everyone in the position where you're the leader out there," Brager said to Walker. "Maybe we should have (pointed out their reservations) when you brought those and said, 'it's unrealistic.'"
Commissioners unanimously voted for airport staff to return in two weeks with potential reductions in revenue guarantees by the three remaining limousine companies.