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             HELICOPTER AIR SERVICE PROGRAM            283

STATEMENT OF M. F. BAGAN, PRESIDENT, SAN FRANCISCO & OAKLAND HELICOPTER AIRLINES, INC., ACCOMPANIED BY ROBERT REED GRAY, OF THE FIRM OF HALE, RUSSELL & STENTZEL

Mr. BAGAN. Thank you, Senator. I have with me our counsel for San Francisco & Oakland Helicopter Airlines, Mr. Robert Gray, of the firm of Hale, Russell & Stentzel.
Mr. Chairman, I have quite a lengthy statement here. What I would like to do is have your permission to have the whole statement placed in the record.

Senator MONRONEY. We will publish the entire statement of 17 pages in the record. You may highlight it.

(Statement follows:)

STATEMENT OF M.F. BAGAN, PRESIDENT, SAN FRANCISCO & OAKLAND HELICOPTER AIRLINES, INC., BEFORE THE SENATE AVIATION SUBCOMMITTEE

My name is M. F. Bagan and I am president of San Francisco & Oakland Helicopter Airlines, Inc. (hereinafter referred to as SFO Helicopter). Since the incorporation of the company in January 1961. I have served as president of the company, and as chairman of its board of directors. In this capacity, I am responsible for all matters of company polcy. My purpose in testifying before this subcommittee is to offer whatever help I can in connection with your investigation of helicopter service.

In addressing you on this subject, I intend to dwell in large measure upon my experiences with SFO Helicopter, for these experiences have left me with several firm convictions which may be of benefit to you in your considerations.

In 1961 we held a press conference in San Francisco to announce the formation of the SFO Helicopter Airlines. We stated the aims of our company were to provide the residents of the Metropolitan San Francisco Bay area with regularly scheduled helicopter service, to provide a quality of service unexcelled by any helicopter airline in the world.

Many people were openly skeptical of our chances for success. Some experienced members of the air transportation industry were frankly pessimistic about our future. Not only did they question our faith in rapid public acceptance of the new service, but they had strong reservations, in light of the experience of other helicopter airlines, concerning our ability to operate and grow without the support of Federal subsidy. Today, that skepticism has been largely replaced by a realization that scheduled helicopter service can be operated on an economically sound basis without the total emphasis being placed upon governmental support.

If the operation of SFO Helicopter Airlines have been successful to date, and we believe they have, we may be able to provide certain guideposts for use by your subcommittee in considering the establishment of a national helicopter transportation policy.

In November, 1963, we became the only scheduled helicopter carrier in the United States with a permanent certificate of public convenience and necessity. The certificate was issued by the Civil Aeronautics Board. There are now three other scheduled helicopter carriers with federal certificates, but all are issued on a temporary basis. The other carriers, over a 17-year period, have received approximately $50 million in subsidy payments.

AREA OF OPERATION

The geographical area which we are now serving and which will be served by SFO Helicopter Airlines as our route system develops, is experiencing a population explosion. A growth of 100,000 residents a year is taking place in a region where natural water and mountain barriers subject all surface transportation to very circuitous routes. These natural barriers funnel surface traffic into increasingly congested narrow channels. Where the area of service is highly populated, where it is separated by barriers, whether natural or artificial, and where unreasonable periods of time are required to commute from point to point by surface travel, the optimum conditions exist for the operation of a scheduled helicopter service.