‘Freight dogs’ days of flying commerce across the skies are numbered - East Valley Tribune: Business

‘Freight dogs’ days of flying commerce across the skies are numbered

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Posted: Monday, January 17, 2005 5:38 am | Updated: 9:10 am, Fri Oct 7, 2011.

CHICAGO - As Tawn Makela grapples with the controls of the weather-ragged Learjet, she hears the wind rustle pieces of the American economy.

Crammed inside the plane is a mountain of clear plastic bags, each stuffed with checks: Paychecks. Rent checks. Mortgage checks. Tax refund checks. Checks to buy companies. Checks to settle divorces.

She’s carrying nearly 2,500 pounds of paper worth more than $1.5 billion. That’s just for the first leg of Makela’s shift, which takes her from Chicago to Columbus, Ohio.

By the time the sun rises, and she returns home, she will have spent nearly nine hours in the air — picking up and dumping off a fortune in Syracuse, N.Y.; Windsor Locks, Conn.; and St. Paul, Minn.

‘‘It’s more money than most small countries have in their entire economy,’’ said Makela, 35, a Chicago-based pilot for AirNet Systems. ‘‘What we do is cool. It’s cool to say that you are responsible for so much cash.’’

To collect their money, U.S. banks depend on pilots such as Makela — known by some as ‘‘freight dogs’’ — to transport an estimated 36.7 billion checks a year from one financial center to another.

Sometimes this pricey cargo is sent directly to a bank’s regional offices, which will process the check and pay out the money. Other times, the checks go to a clearinghouse — such as a branch of the Federal Reserve — which, for a fee, will route the funds appropriately.

But that’s about to change. And the freight pilots’ way of life is threatened.

Check 21, a federal law that took effect in late October, lets financial institutions send digital copies of these checks to one another over the Internet. That will allow banks to collect payment sooner, and eliminate the physical process of moving checks across the country.

The nation’s leading financial groups say they will gradually phase in electronic processing this year. The Federal Reserve Banks, which already have rolled out new Check 21 software and services, will cut their number of check-processing centers by nearly half over the next year.

At the same time, consumers are leaving their checkbooks behind in favor of debit and credit cards.

In 2003, the number of electronic payments surpassed check payments, according to a survey conducted by the Federal Reserve and electronic payments companies. Payments made by paper check have declined at an annual rate of 4.3 percent since 2000, according to Federal Reserve officials. Electronic transfers, however, have grown 13.2 percent annually.

‘‘In a computer-based society, it seems antiquated and old-fashioned to still be flying these pieces of paper across the country,’’ said John Hall, spokesman for the American Bankers Association. ‘‘It’s not going to happen overnight, but banks will make this change. Unless cargo companies can fill those planes with other goods, it’s inevitably going to impact the pilots.’’

AirNet employs 165 freight pilots to fly paper checks for more than 100 of the nation’s top financial institutions. These pilots see themselves as daredevils — the toughest and scrappiest men and women in the skies. They boast that they do whatever it takes to get the checks delivered on time, even if it means flying in bad weather or helping with the loading and unloading of the cargo itself. Theirs is a lineage that includes World War I ace Eddie Rickenbacker and Charles Lindbergh, who flew bank deposits during the 1920s.

AirNet’s 128 planes, many of them speedy Learjets, are small enough and nimble enough to pack and leave at a moment’s notice. Safety is important, but so are deadlines. ‘‘If there’s a runway, we’ll fly. Ice? No problem. Tornadoes? Go around ’em,’’ said pilot Joe Pyka. ‘‘We had guys flying checks to the banks during the hurricanes in Florida, even though the banks were shut down. Nothing stops us.’’

Makela works four days a week, and averages 100 hours of flying time each month. In an industry where flying bigger planes often means earning a bigger paycheck, she makes less than many commercial passenger pilots. Air-Net’s most experienced pilots, who are the ones flying the fleet’s Learjet 35s, top out at about $83,500 a year, according to research by Aviation Information Resources.

Pilots with major airlines fly about 80 hours a month and earn as much as $180,000 annually. They’re away from home more because their schedule often requires overnight layovers.

‘‘The AirNet pilots go home at the end of their day,’’ said Kit Darby, president of Aviation Information Resources. In this field, ‘‘it’s a luxury to be able to say you sleep in your own bed every night.’’

Makela likes the regularity of her shift because it allows her to spend more time with her husband and infant son. But many ‘‘freight dogs’’ will readily give up the stability to work with major airlines or become private pilots for executives.

‘‘These are the farm teams of flying,’’ said Jon Safley, president of the Coalition of Airline Pilots, a Washington trade association. ‘‘When the major airlines hire, they want these folks because they’ve literally been through everything.’’

Hauling checks and other financial documents is expected to make up about 60 percent of AirNet’s revenue in 2004. While Check 21 hasn’t yet cut into its banking business, AirNet’s ventures into other arenas — including medical cargo and legal documents — are quickly growing.

The pilots have started carrying tissue samples and other freight for life-science companies. They’ve transported film prints to movie theaters across the country, and boxes of video games to retail outlets preparing for the holiday rush.

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