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300    HELICOPTER AIR SERVICE PROGRAM

For 1965, for fiscal year 1964 or calendar year 1964?

Mr. BAGAN. That is for calendar year 1964.

Senator MONRONEY. You are just beginning on 1965. So it is hard to tell exactly.

Mr. BAGAN. We had our loss for 1964, I think, shown as $160,000 or something.
Senator MONRONEY. $164,000.

Mr. BAGAN. In that is approximately $75,000 inventory adjustment. We thought now is the time to make it. I bought this maintenance facility. There was some inventory that might be old or something. The actual operating loss we figure was around $100,000 this year.

We hope that possibly we can operate in-the-black during 1965. But again I must point out I am going into a new equipment program. I am taking on the S—61.

I would like to also point out that losses have bothered us some, but we are looking at this loss long-range. Mr. Halaby said we have a franchise which is very valuable. We have great faith in the future out there. We think we have a very valuable franchise. There is great demand for the service, and that is where we are.

I would like to state, you have this problem before you of the congressional committee saying that the helicopter experiment should be terminated. We don't agree with this. We think the helicopter has contributed a lot and we support the continuation of the helicopter. Very much so.

However, we would like to see this expanded. We believe it should be expanded to Boston, and Atlanta, Miami, Dallas, Fort Worth, Detroit, Seattle, Washington.

I have read everything in the last 3 or 4 years on this subject. I have read every committee hearing. I have read the congressional hearings to date from both the House and Senate floor. It definitely appears, and I haven't seen anything to the contrary, that the problem is that limiting this subsidy to these three cities, I think they should be expanded to other cities, even SFO if we need it. If we needed as we expand, we should have the same right as the other carriers. I think if Congress or this committee, and the board, would encourage other cities like Miami, Dallas, Detroit, Seattle, and these other major communities——

Senator MONRONEY. Certain cities require it.

I doubt whether the list of cities would be as long as you included. Certainly certain ones of them, where you have two airports to work between, and heavy traffic going in and out of both, and where you have distant principal airports removed great distances from the cities as you have between the Baltimore-Washington complex, Friendship, Dallas, and Washington National. I think the situation has to fit the town.

We would like to see more cooperation along the same lines as you have had from your trunklines. We feel that the trunkline cooperation, with the cooperation of the helicopter line, and with the cooperation of Federal subsidies, we could get that $5 passenger fare available for most of these points.

I fail to think that even though the line is another 5 or 10 miles that it deserves to be doubled because the cost of boarding and de-boarding the passenger is the major cost of the trip regardless of