VIA FEDERAL EXPRESS 

October 17, 2005 

Robert Span, Esq. 

Paul, Hastings, J anofsky & Walker LLP 

515 South Flower Street 

251

h Floor 

Los Angeles, CA 90071-2228 

Re: EWR Rates and Charges 

Dear Mr. Span: 

~ PORTAln1iORITYOF NY& NJ 

Darrell Buchbtrtder, General Counsel 

Carlene II. Mcintyre, Chiet Opinions and Appeals Division 

RECEIVED 

OCT 18 2005 

PAUl HASTINGS 

Mr. Buchbinder has referred your letter of October 11, 2005 to me for a response. Your 

correspondence includes a detailed request for infonnation, which you indicate you need 

to evaluate Newark Liberty Airport ("EWR") rates and charges on behalf of Continental 

Airlines ("Continental"). 

Before moving to our response to your request, let me address some of the statements in 

your letter about the Port Authority's obligation under federal law governing aeronautical 

rates and charges since your letter does not address some key points, which I hope you 

will agree, are particularly relevant to your inquiry. 

You malce reference to federal law, which "requires that aeronautical rates and charges be 

fair and reasonable, and calculated in a consistent and transparent marmer." As you 

know, that policy also states a strong pi·eference that airports and airlines negotiate with 

each other and reach agreement on rates and charges. It is significant, therefore, that the 

rates and charges which are the subject of your inquiry are the result of just such 

negotiation between Continental and the Port Authority, and the resulting agreement 

contains formulas and a methodology for the computation of those fees which was agreed 

to by both parties. 

Moreover, to the extent you question any net surplus earned at EWR as a whole and seek 

infmmation about non-aeronautical revenue, including the expenditure of any net 

revenue, it is important to note that the federal rates and charges policy does not regulate 

the level of fees charged to non-aeronautical users of airport facilities, and that, absent 

agreement, aeronautical users are simply not entitled to share in revenues generated from 

non-aeronautical sources. I refer you to the recent Instituting Order issued by the 

Department ofTranspmiation in the proceeding by the airlines at Terminal B, which fully 

sustained this principle with regard to EWR (DMS website, Docket 20407). 

Accordingly, all financial information to be shared with Continental will be limited to 

that needed to understand the rates and charges as governed by the tenus of the 

agreement. 

EXHIBIT SS 

225 Park Avenue South, 13th Floor 

New York, NY I 0003 

T: 212-435-3503 

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I 
Let me assure you that we are closely examining your request and that we will be 

providing you with info1mation which we hope will bring Continental to an 

understanding that the EWRrates and charges computations are fully consistent with the 

agreement. However, in order to streamline this process, let me recommend that you 

review the info1mation that will be supplied at the upcoming Finance Subcommittee of 

the Airline Airport Affairs Committee on Tuesday, October 18, 2005. The agenda for that 

meeting, which was prepared by a Continental representative, as chairman ofthe airline 

users group, is attached. After you have had an opportunity to take a look at the 

information provided to the airlines at that meeting, if there is any additional information 

you require, please so inform me and include in that request a reference to those sections 

of the agreement which relate to your request. 

As you may know, next Tuesday's meeting is part of a process whereby Continental, 

along with all other airlines, which operate at Newark, receives information related to the 

state of the airport on a semi-annual basis through the Airline Airport Affairs Committee. 

The information provided at these meetings includes airport cost components and 

provides a year-to-year comparison so that variances can be identified and reasons for 

variances discussed. In the EWR financial part ofthe presentation, rate components are 

identified. These are the flight fee, the monorail fee, the airport service factor, phase 1 A 

and the Central heating charge, police costs and the fuel fee. The significant cost 

components of the rate categories arc identified and the meeting is open to questions. 

Airlines are requested to provide their weight estilnates for the following period so rate . 

estimates can be forecasted with as much precision as possible. The meeting ends with an 

opening to questions. If answers to specific questions are not readily available, staff gets 

back to those airlines that require additional information. 

I look forward to our future communication and I am certain that we can resolve auy 

concerns Continental may have regarding these matters. 

{~ /1 fo ~:Hr.r'h.pl;~ Carlene V. Mcintyre 

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