Updated: Thu Feb. 02 2006 10:58:59 PM

CTV.ca News Staff

Plans for a new airline to fly out of Toronto's Island Airport have resurfaced, along with the controversy that originally followed the proposal by Regco Holdings Inc.

At a Thursday news conference Regco announced Porter Airlines will start flying later this year.

Regco president and CEO Robert Deluce said there is a market for the new regional airline.

"We have plans and a vision for a regional airline that will meet the needs of Toronto's business and tourism community and serve as an important economic catalyst for our city," Deluce said Thursday.

The company said it has signed a commercial carrier agreement with the Toronto Port Authority to operate the airline until 2033. The Port Authority also announced plans for a new ferry to carry more cars to the island and a new passenger terminal.

The plans point to an increase in passenger and aircraft traffic for the island airport, which was the source of opposition to Regco's plans in 2003.

Mayor David Miller was elected with a commitment to scuttle plans for a bridge to the island. He said increased airport traffic was not part of Toronto's downtown revitalization plan. With Miller's election win the bridge and airline plans seemed to disappear.

Miller said Thursday he has not changed his mind about expanding the airport.

"My concern and the mandate Torontonians gave me was to ensure that the airport use wasn't expanded," Miller said. "So it depends on what Regco needs to do."

Miller said he will speak with the federal government – who operates Toronto's port authority and the island airport – about moving responsibility to city hall.

The Harbourfront Community Association opposed airport expansion in 2003. With Friday's announcement the community group said it will look to Ottawa for help.

"So what we're hoping is that our new federal government will step in where our last government didn't and say no expanded airport," Association spokesperson Ane Christensen told CTV News.

Meanwhile, the Ontario government is showing no interest in getting involved with the debate. Premier Dalton McGuinty said it is not an issue for the province to consider.

"When it comes to the airport, that is a matter of immediate concern to the city and the federal government and believe me, I have more than enough on my plate before I'm going to want to get in on that," McGuinty said.

The provincial minister of public infrastructure and renewal believes waterfront revitalization is not at risk.

"The issues around the airport will not hinder or prevent us in any way from seeing the waterfront in the City of Toronto revitalized," Minister David Caplan said.

While Regco is taking criticism for its plans, they also have supporters. Canadian Auto Workers Union president Buzz Hargrove praised the upstart airline for creating jobs.

"Good luck in your endeavours, Bob Deluce," Hargrove said.

It is expected that Porter Airlines will create 500 new jobs at the airport. As many as 2,000 jobs could be created at Bombardier's Toronto plant where the Q-400 aircraft is manufactured.

Porter airlines plans to offer flights to several Canadian and U.S. destinations within 90 minutes flying time of Toronto.

The company has not yet announced routes it will fly. However, cities such as Montreal, Ottawa, New York, are all possibilities.