Budget airline that abruptly pulled plug & filed for bankruptcy leaving 16k stranded is slammed for ‘riverboat gamble’
A BUDGET airline that abruptly ceased operations has been harshly criticized by a government auditor.
Nebraska State Auditor Mike Foley criticized the Lincoln Airport Authority for its failed attempt to expand its airport.
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According to the Nebraska Examiner, Red Way Airlines canceled all flights from Lincoln Airport in Nebraska, stranding 16,000 passengers because they said they weren’t attracting enough customers.
The announcement was made on August 31, less than three months after the airline began operating from Lincoln.
According to KETV, 600 customers are still waiting for a refund from Red Way Airline weeks after the announcement.
Foley described the original decision to expand the airport as a risk that negatively impacted passengers.
He said: “It is clear to me that the Lincoln Airport Authority did this with the best of intentions.
“They are trying to expand air service in Lincoln. That’s a great goal.
“It was quite a riverboat gamble. And it obviously didn’t work.”
“And taxpayers are missing out on a lot of money.”
Red Way did not have a smooth journey at its base in Lincoln, as the company changed routes just two months after it began operations.
The airline previously flew from Lincoln to Atlanta, Georgia, Austin, Texas and Minneapolis, Minnesota.
In early August, the airline moved routes to Las Vegas, Nevada and Orlando, Florida.
According to the Nebraska Examiner, Foley said his office will investigate how a $3 million grant awarded to the airline by Lancaster County and the city of Lincoln was spent.
He said a public audit would “provide taxpayers with accurate information.”
Foley added that the audit could also clarify “misconceptions about government.”
He assured Nebraskans that the audit would be conducted urgently.
Foley said, “We will seek to do this in a timely manner as we believe this is a valuable service to the citizens of the state.”
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