SAN ANTONIO – The City of San Antonio and Southwest Airlines will head to court Monday afternoon to argue over the airline’s 11th-hour attempt to stop a new airline use and lease agreement (AULA) from taking effect.
San Antonio’s largest airline argues the city used “bait and switch” tactics during the AULA’s negotiations, which ended up leaving it out of the still-under-development Terminal C at San Antonio International Airport. It says Airports Director Jesus Saenz verbally committed to Southwest that it would get most, if not all, of its 10 gates at Terminal C, but instead the airline got relegated to the smaller, older Terminal A.
The airline also claims the city improperly used selection criteria like routes and airline lounges to determine which carriers did get the highly coveted gates in the new terminal.
The Dallas-based airline has asked a federal judge in San Antonio to issue a temporary restraining order to stop the AULA from taking effect on Tuesday. The hearing is scheduled for 1:30 p.m. Monday at the U.S. District Court for the Western District of Texas in San Antonio.
‘False and irrelevant’
In a response filed Monday morning, the City of San Antonio called Southwest’s legal maneuvering “an extreme case of sour grapes,” and said the harm to the city from blocking the AULA would be worse than the harm to Southwest were the lease to take effect.
Based on the difference in rates, the city says it would lose $1.2 million per month if the new AULA doesn’t take effect. Without the AULA, the city claims, the $1.4 billion program to develop Terminal C would also be delayed. It’s currently expected to be completed in 2028.
The city says eight other airlines have agreed to sign the AULA, and the agreement was passed unanimously by the San Antonio City Council on Sep. 12.
The city scoffed at Southwest’s claims it used improper factors to determine which airlines got spots in Terminal C.
“It is difficult to imagine a more fundamental proprietary right than the efficient allocation of space among multiple tenants in a City-owned airport,” the city argues. “And it is equally difficult to imagine how the City could allocate space within the terminal without reference to an airline’s ‘rates, routes, and services.’”
The city’s response also calls Southwest’s “bait and switch” argument “false and irrelevant” and flatly denies “the City” made any such promise.
However, it does not outright deny any assurances were made to Southwest during negotiations. Instead, the response carefully defines who would be able to make such a promise, saying “only senior City leadership and the City Council had authority to make a final decision.”
“Southwest alleges that Mr. Saenz told Southwest that it would go into Terminal C,” the city’s response states. “However, even assuming Mr. Saenz made such a statement, he did not have the authority to bind the City on that point.”
AULA terms
The new AULA would have Southwest remain in its current home of Terminal A, though with 10 gates instead of its current six.
The agreement has a 10-year term with an option to extend for another five years.
Southwest has expressed concern that the $200 million included in the AULA for renovations to the terminal. However, the city says Southwest also declined a city offer to add $100 million to the budget — half funded entirely by the airport, and the other half would be subject to approval under the existing process by the other carriers.
Though the airline has not threatened to leave San Antonio over the dispute, it has said its growth plans could be in jeopardy.
If the AULA goes into effect Tuesday, Southwest will become a non-signatory airline and have to pay higher rates.
Read more: