“It’s like living in a black hole.” That’s how Herb Kelleher, blunt-spoken head honcho at Southwest Airlines, describes how he feels about his company’s headquarters city, about Dallas. Leaping up and down from an aquamarine leather couch in the new Southwest headquarters building off Denton Drive, chain-smoking and interrupting himself frequently with hearty guffaws, the man dubbed by “60 Minutes” as “The Unusual CEO” and pictured in a chicken suit in The New York Times is reflecting on his recent decision to render his fleet of airplanes unto Houston for the purpose of tax valuation-and not without some glee.

To anyone who has lived in Dallas for more than three years, Herb Kelleher vs. the City of Dallas has a familiar ring. Though the Southwest Airlines/Love Field issue has been strangely quiet for several years, the preceding fifteen years or so saw a steady stream of dollars spent on and hours devoted to researching and debating the relative merits and demerits of an in-town airport. We have battled over taxes and over the Wright Amendment (which restricts Southwest flights to the four contiguous states), but mostly we have fought over noise. With council member Lori Palmer cast as the eloquent and prim Activist Leader determined to “Make Love Quiet,” and Kelleher as the lovable Boss Genius with a weakness for crazy antics and Wild Turkey, the sparring continued unabated from the early Eighties until an accord was finally hammered out in December of 1986. Throughout, Kelleher threatened many times to move his company to a city that showed him a little more respect.

In a way, that’s what he has done. This latest skirmish developed because of a new state law passed in June of 1989-a law that ironically. Kelleher says, was pushed through by American Airlines. Basically the law did two things: (I) it provided a new (and more favorable to the airlines) plan for apportioning the taxable value of commercial airplanes; and (2) it allowed carriers to pay those taxes either in the city where they do the most business, or in their headquarters city. To make a long story short, Houston agreed not to challenge the new law in court. Dallas wouldn’t make that commitment. Houston has more Southwest Airlines flights-about thirty more a week. Dallas has Southwest’s headquarters. Houston hopped to, and wooed Kelleher with decisiveness and speed. Dallas dragged its feet. Guess who won?

And guess who lost some $5 million in tax revenue that it sorely needs? Why, that’s enough to turn the tennis court lights back on for the next fifty years.

The irony is that all this comes on the heels of the “Dallas First” study bemoaning the fact that Dallas is losing large chunks of its tax base to friendlier frontiers in the suburbs.

Is it possible that in our rush to move away from our historic Business-First mindset to more democratic thinking, we have abandoned basic logic and common sense? If we can’t keep large commercial enterprises like Southwest Airlines (which has been estimated to contribute some $2.9 billion annually to the local economy) happy, how can we hope to lure new corporations here?

I liken it to the workplace, where sometimes you have to jump ship in order to be taken seriously for a big promotion or a large salary increase. Southwest has finally quit blustering and poked us right where it hurts. And what will it take to get those tax dollars back? Kelleher says smugly, “They need to approach us the same way they would approach any new prospect considering bringing its 2,500 jobs to the area.”

Kelleher likes to tell a story about a conversation he once had with Robert Folsom,Dallas mayor from 1976 to ’81. He once toldFolsom, “Bobby, I’ve decided I’d like to beburied right by Runway 1 at Love Field. Isthat gonna be okay with you guys?” AndFolsom reportedly replied, “Well, Herb, notif it takes a vote from the City Council.” Andwith that. Herb Kelleher throws his headback and roars laughing.


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