““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
Airport neighbors seek curbs on jet traffic
Flying your business jet into certain airports these days could land you in the middle of a political battlefield.
In 2008, Suzanne Paulson, a professor at the University of California Los Angeles, conducted a pollution study to see what emissions could be detected around Santa Monica Airport in Southern California. The study found that aircraft operating there spew ultra-fine particles into the atmosphere at average concentrations of 10 times the background level measured 100 meters downwind from the airport's east end and 2.5 times background at 660 meters. (Traffic on nearby roads causes the background emissions.)
People who live near the airport have complained for years about growing noise due to a fourfold increase in jet traffic, but now they have latched onto the UCLA study as another tool to fight the field. Many claim that airport emissions cause cancer and other diseases, although no federal or state standard limits ultra-fine particles, nor has research been conducted to assess what harm they might do.
Democratic congressional hopeful Marcy Winograd sees political opportunity in the pollution study. On January 20, Winograd sent a "no more jets pledge" to California Governor Arnold Schwarzenegger and other celebrity users of Santa Monica Airport, asking them to "stop flying jets in and out of" the facility. Some recipients of the pledge have signed it, but not Governor Schwarzenegger, who commutes from the airport to his office in Sacramento in a Gulfstream IV.
The pollution debate is just one more effort to reduce jet traffic at Santa Monica Airport. The city itself has tried to ban larger jets but the FAA blocked that attempt because it would have set a precedent for other communities. Publicly funded airports like Santa Monica cannot discriminate against users.
Efforts to discriminate against certain types of aircraft are under way elsewhere. In Livermore, Calif., residents are trying to get an airport growth-control initiative on the ballot. The Livermore Airport Citizens Group believes the initiative would slow the influx of business jets by forcing the city to require a public vote on any expansion of airport facilities. The FAA hasn't yet weighed in, and it is too early to tell whether it will bear fruit for the aggrieved Livermore Airport neighbors.
In Venice, Fla., the city has blocked attempts by airport businesses to build more hangars and also asked the FAA for permission to downgrade the airport so that it can keep larger jets away. The FAA rejected that request and also pointed out to the city that it doesn't have the authority to block legitimate requests to build hangars.
While the FAA is clearly on the side of airports remaining open to all types of customers, efforts like these are bound to create endless battles that result in less investment in airport infrastructure improvements, observers say.
The National Business Aviation Association is evaluating the Santa Monica pollution study. "Airports in the Los Angeles basin are very important," said Steve Brown, NBAA senior vice president of operations and administration. "Those airports support the economic vitality of the region and support high-tech, well-paying jobs and the transportation needs of the region. We're trying to be the best neighbors we can from an operational perspective, and we'll continue doing that."