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China Cargo cancels St. Louis flight for a second time

Saturday, October 29, 2011 | 4:11 p.m. CDT

ST. LOUIS — China Cargo has canceled its scheduled Monday freight flight to Lambert-St. Louis International Airport for the second week in a row, raising concerns about Lambert's bid to be a cargo hub.

The St. Louis Post-Dispatch reported Saturday that China Cargo landed its first Shanghai-to-St. Louis cargo flight last month and ran a second flight on Oct. 19. But Lambert officials said Friday that China Cargo then canceled its regularly scheduled Monday flight for the second week in a row without explanation.

The cancellations have come since lawmakers failed to approve the China air cargo hub tax credits, which was a multimillion dollar program to subsidize air exports from Missouri to make them cheaper than competing hubs. The program officially died in the legislature last week when both chambers adjourned the special legislative session without passing the bill.

Many Missouri business leaders and elected officials argued that Missouri exports could increase if the state would offer incentives for companies to ship goods through Lambert-St. Louis International Airport and for businesses to build the warehouses and other facilities needed to handle an influx of cargo.

This summer, Missouri House of Representatives and Senate leaders said they had agreed on an economic development package that included $360 million of tax credits for what some dubbed as the "China Hub" or "Aerotropolis" at the St. Louis airport. Gov. Jay Nixon placed the proposal on the agenda for the special session, which started Sept. 6. But it quickly ran into trouble in the Senate, where it was pared back to $60 million of tax credits targeted only for firms that handle the logistics for exports at the St. Louis airport.

That slimmed-down plan also failed to pass because of a stalemate between the House and Senate about whether to place expiration dates on a pair of existing tax credits for the construction of low-income housing and the renovation of historic buildings. The Senate then decided not to seek further negotiations with the House and has not scheduled any additional votes before the special session automatically ends Nov. 5.

Officials from Lambert and the area have been talking with the Chinese for four years about the hub project, which some say could be a boon for the regional economy. They had hoped to start with three flights a week but said they would build from one after the cargo hub bill fell apart.

Airport director Rhonda Hamm-Niebruegge said although there might be some correlation between the failure of the tax credit bill and the canceled flights, the global economy could also be a factor.

"The air cargo market out of China is softer than expected, and the impact is being felt across the world," she said.

China Cargo has a two-year lease on a building and ramp space at Lambert. As of Friday, Lambert officials said they had not heard when the next flight would land.

 


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