Wintry mix spreads across Minnesota

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There's nothing the Minnesota Legislature could
do to keep a merged Delta-Northwest headquarters in Minnesota, the
president and chief financial officer of Delta Airlines told state
lawmakers.

      The Delta executive, Ed Bastian, told lawmakers Monday, in
separate House and Senate hearings, that it was too early to
estimate how many jobs would be lost at Northwest headquarters in
Eagan once the merger goes through.

      He repeated Delta's assurances that the Minneapolis-St. Paul
Airport would remain a hub for the merged company, and that there
would be no involuntary reduction of "front line" Northwest
employees who perform customer service jobs.

      That did little to satisfy lawmakers, who repeatedly and
unsuccessfully asked Bastian for more details about how many
headquarters jobs would be lost and what other Northwest divisions
might be shuttered entirely. 

"When will Minnesota know?" asked Sen. Geoff Michel, R-Edina.


      Bastian said it would take six to eight months for the merger to
get federal government approval.

      "We are early in the process of determining what corporate
activities will be combined and how they will be combined,"
Bastian said. "Some of that work will be done in Minnesota, some
of that work will be done in Atlanta. We're early in the process."

      Asked by House Commerce Committee Chairman Joe Atkins, DFL-Inver
Grove Heights, if there was any type of incentive package the
Legislature could approve to convince the company to keep the
merged headquarters in Minnesota, Bastian replied: "No, there is
not."


      Under financial agreements between Northwest and Minnesota
dating to 1992, the carrier is required to keep its headquarters, a
hub and a certain number of employees in Minnesota or else pay back
more than $200 million in bond debt issued by the Metropolitan
Airports Commission and forfeit airport rent concessions worth
another $200 million through 2020.

      Sen. Jim Carlson, DFL-Eagan, pointed out that it would take a
legislative vote to undo those agreements.

      Bastian replied that the company is preparing to negotiate a way
out of the headquarters requirement with Gov. Tim Pawlenty's
office, likely in exchange for keeping a hub in the Twin Cities and
a certain number of jobs. 

But he also said if it comes down to it,
the merged company could afford to buy its way out.

      "If we are required to pay it off, we will pay it off,"
Bastian said. "I don't know if that's in anyone's best interests
at this point."

      Bastian told lawmakers that the merger would result in a
stronger airline that's more equipped to deal with skyrocketing
fuel costs. 

He said it would offer Minnesota and Upper Midwest
customers more nonstop flights and foreign destinations, and he
tried to assure union-friendly lawmakers that Delta -- which is not
unionized -- would not stand in the way if employees of the merged
carrier vote to unionize.

      Steve Gordon, the president of the International Association of
Machinists union that represents Northwest ground workers, said
after Bastian's testimony that the executive "said all the right
things" - but Gordon felt he was not forthcoming about the number
of jobs to be lost in Minnesota.

      "I think people need to start realizing this is going to have
grave effects on the communities where Northwest employees live,"
Gordon said. "Not just on the employees -- on the communities."

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Brian Bakst, Associated Press

Author

The president and chief financial officer of
Delta Airlines is telling Minnesota lawmakers there's nothing they
can do that would keep a merged Delta-Northwest headquarters in
Minnesota.

Delta president to Minn. lawmakers: HQ decision final

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