Monday, May 21, 2018
Business

Tampa International's flights to Cuba hit political, market turbulence

TAMPA

Cuba lies just 300 miles away. It was 50 years, though, that really separated it from Tampa. ¶ That ended in 2011 when Tampa International Airport was allowed to resume commercial flights to Havana for the first time since the trade embargo took effect in 1962. ¶ The city coveted the route, which boosted the airport's international portfolio and gave hope to those who want to restore ties and trade with Cuba. In the 18 months since, more than 57,000 people have traveled from Tampa International to Cuba. Miami no longer had a monopoly on the Cuban travel market, and Tampa's 80,000 Cuban-Americans could visit family without first driving four hours south to catch a plane. ¶ The Cuba flights are considered a Tampa success story. Yet to many key players, there's been a lot of turbulence behind the scenes.

Supporters grumble that the Tampa-Cuba route needs to attract more non-Cubans. The route was also hindered by an airline price war, bureaucratic red tape and — no surprise — Cuban-American politics.

Ralph Fernandez, Tampa's most vociferous pro-embargo, anti-Castro activist, epitomizes those politics. If the market for Cuban flights has stalled, hey, that's just fine with him.

"I should not be as bad as I am and be delighted in their failure," said Fernandez, a Tampa lawyer. "But let's be honest: I am."

• • •

Traveling to Cuba isn't like traveling anywhere else.

Operators must get U.S. government clearance to fly there, and the Cuban government's permission to land. For decades the United States permitted Cuba flights from only three airports — Miami, New York and Los Angeles. In 2011, the government allowed eight more airports to serve Cuba, including Tampa International.

U.S. citizens need the U.S. government's permission to travel to Cuba. Cuban-Americans can get a special travel license to visit family. But tourism is not permitted. Non-Cubans need a reason — cultural, humanitarian, religious — to travel there on what is called a "people-to-people" license.

The past two decades have been a political rollercoaster for U.S. travel policy to Cuba. Bill Hauf has spent a decade on that ride. The 68-year-old California real estate investor has been leading tours to Cuba since 2000.

But for the past year, economics, not politics, was Hauf's biggest problem. An airline price war erupted when the first flight took off for Havana, he said, leading all three of Tampa's airplane chartering companies to lose money.

Now just two companies are left. Hauf runs Island Travel & Tours, Ltd. His rival is Tessie Aral, president of ABC Charters Inc. of Miami.

Hauf said ABC tried to run him out of business by slashing its ticket prices and operating at a loss. That forced him to set round-trip prices under $400 and plunge his company into the red. It went on for more than a year.

"It's as if people were lining up at the gate and I were handing everyone $150 for everyone to fly with me," Hauf said.

Aral, 55, ridiculed her competitor's complaints.

"This is not an elementary school," she said. "You don't say 'Oh no, she hit me. She pulled my hair.' "

Aral agreed that competition has been fierce. ABC recently suspended its flight to Holguin, a city on the eastern tip of Cuba.

Last month the number of flights from Tampa to Cuba dropped from five to three. ABC flies to Havana once a week and Island Travel flies twice a week.

But Aral said she's not trying to drive anyone out of business. She also lobbed her own charge at Hauf, that he tried to undercut her baggage fees. Baggage is a profit center for the charter companies because Cuban-Americans take so much stuff with them to relatives in Cuba.

Hauf said that was just for six months. His baggage fees now match ABC's, he said.

He also said he's done with the price war. Last month, he said he raised ticket prices to make a modest profit. Tickets cost $499 on Friday.

"We're no longer going to engage in this market pricing war," he said.

But Aral has her own problems with the Cuban flight market in Tampa: It's dominated by the city's Cuban-Americans, and that market has peaked.

Something, she said, is missing: non-Cubans.

• • •

The market won't take off, Aral said, until more non-Cubans start using Tampa International as their departure point.

"I wanted to encourage some of the Americans who travel to Cuba to travel through Tampa," she said, "and for some reason I have not been able to do that."

Those travelers need "people-to-people" licenses. But supporters of Cuban travel say getting those licenses is complicated by politics and bureaucratic red tape.

The U.S. embargo of Cuba is overseen by the Department of Treasury's Office of Foreign Asset Control, or OFAC. It's an acronym supporters of Cuban travel use with little affection.

OFAC decides who can charter the planes, book the flights and who gets to go to Cuba. The agency also enforces numerous — and critics say onerous — rules. OFAC restricts how much Americans can spend in Cuba and makes them file detailed itineraries before they leave.

"They're very arbitrary," said Al Fox, 68, an anti-embargo activist who is also president of his own think tank, the Alliance For Responsible Cuba Policy Foundation. "Politics plays a big role in this."

The political pandering that has neutered Cuban travel is ridiculous, Fox said. He pointed to a 2006 state law that prohibits Florida's public universities from funding travel to "terrorist states" — including Cuba. Private institutions like the University of Miami can go, he said, but not the University of South Florida.

"How ridiculous," said Fox, who has led 88 tours and counting to Cuba. "Since when did a state set foreign policy for us?"

Tampa City Council member Mary Mulhern, who advocates strengthening Tampa-Cuba economic ties, said she felt targeted b y OFAC when the agency asked her to account for her time and spending after a legally sanctioned trip in 2011. Mulhern refused.

"I felt that I was being harassed, and that it was clearly meant to intimidate me," she said. "Since I never heard anything back from them, I suspect that this was motivated by local opponents of opening up a relationship with Cuba."

OFAC said it does not comment on individual cases. In a statement to the Tampa Bay Times the agency said "applications are considered on their individual merits."

The pro-embargo crowd believes as Fernandez does: Rather than bridge the U.S.-Cuba gap, cultural travel is a guise for tourism that helps fund and prop up a regime they detest.

"The influx of money will buttress the position of the (Cuban) government," he said. "They will intercept the lion's share of it. It will go to keep the system in control longer."

• • •

Despite all the politics and regulations and roadblocks, not everyone is unhappy with the Tampa-Cuba route. There are local Cuban-Americans who don't have to go through Miami anymore. And there's Tampa International Airport.

"The city worked very hard to be designated a gateway to Cuba," said Chris Minner, airport vice president of marketing.

Tampa International has been intensely focused on boosting its overseas portfolio. Cuba is one of two international destinations added in the last two years. (Zurich, Switzerland, is the other.) And though the passenger numbers for the Cuba flights are just a blip on the airport's balance sheet, it is a prestigious catch. It comes up whenever airport officials travel the world, marketing Tampa to international airlines.

Last month the airport's governing board, the Hillsborough County Aviation Authority, was pleased with the latest passenger numbers. There was a 64 percent jump in the number of passengers to Cuba from September to December 2012 compared to the same period in 2011.

That's 5,000 more passengers over a four-month span.

"And we took all that from Miami?" board Chairman Steve Burton asked.

"Yes, sir," Minner told the board.

Minner said that in April the airport will meet with its Cuban travel partners to take a fresh look at what can be done to improve the business. The airport is also planning to promote awareness of the flights and educate more travelers about how to legally visit Cuba.

But much of what affects Tampa's Cuban travel market — OFAC's rules, "people-to-people" licenses, the Cuban government, the politics — is beyond the airport's purview.

Still, Minner said, the airport is focused on what it can control, and believes Cuba flights will continue to be a success for Tampa International.

"My role is to make sure that the airport is the best gateway that it can be and that it offers the lowest costs to the carriers," Minner said, "and Tampa's Cuban-American community, which is the third largest in the nation, is a good bedrock for us to build upon."

Times researchers John Martin and Caryn Baird contributed to this report. Jamal Thalji can be reached at [email protected] or (813) 226-3404.

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