Northwest assumes ailing airline's BWI center America West workers are heartened by news

December 21, 1991|By Robert Lee

It will be a Merry Christmas after all for about 200 America West workers who had been told to expect layoffs next month, thanks to a deal struck between Northwest Airlines, Anne Arundel County and the state.

Northwest has agreed to buy the Phoenix-based airline's Hanover reservations center and give America West employees the first opportunity to be trained for the new jobs. Northwest spokesmen said state grants and loans helped seal the deal.

"We were told we 'were done' if Northwest didn't come in by Jan. 15," said reservation agent Barbara Poole. "I had been holding back on buying things for Christmas. . . . The first thing I did when I knew last night was head to the store to buy toys for my children."

Northwest spokesman Jon Austin, who came to Hanover for a press conference, said $5 million in loans and $150,000 in employee training grants from the state and Anne Arundel County were crucial to luring Northwest to the Commons Corporate Center near the Baltimore-Washington International Airport.

St. Paul, Minn.-based Northwest lost a company record of $302 million last year, and another $153 million by the third quarter of this year. But the airline -- now the nation's fourth-largest carrier -- has expanded nonetheless, adding 8,000 employees in the past two years and by buying routes and equipment from faltering competitors.

Mr. Austin said business has picked up substantially since the Persian Gulf War and the company needs to hire between 300 and 400 employees nationwide, at least 200 of those at the new BWI facility, to handle the additional reservations expected in 1992.

The Hanover plant may eventually hire 500 unionized reservation agents at hourly salaries between $10 and $17, Mr. Austin said.

On Monday, the state of Minnesota offered Northwest an $834 million package of loans, tax credits and free infrastructure to build a huge service facility employing 1,500 workers in a depressed area of that state.

Jim Peiffer, an official of the Maryland Department of Economic and Employment Development, said that competition among states has been "mind boggling" in the battle to attract companies.

"Maryland in general has deliberately chosen not to get into the big bidding wars," Mr. Peiffer said. "We make a judgment of how much [to spend] based on the economic impact of the project. Here was an opportunity to not only capture a new major employer but retain 300 jobs when companies are leaving."

Gov. William Donald Schaefer said he hoped the deal would silence DEED critics, some of whom have called for the abolition of the department.

"I'm so sick of the demagogues who say that. Just this one deal by itself will pay all of DEED's salaries for a year," the governor declared.

Northwest, which has a joint marketing alliance with America West, has agreed to buy America West's two-year-old reservations center for $5 million using:

* A $1 million loan from the state and Anne Arundel County at an interest rate of 5 percent.

* $4 million in taxable bonds issued by the state through the Maryland Industrial Development Financing Authority.

* A $100,000 state grant to defray the costs of start-up training.

* A $50,000 state grant to upgrade skills.

* The state will also screen and recruit new employees for Northwest through the Maryland Job Service.

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