The authority and its longtime leasing consultant,
Carriers would no longer be responsible for making up any airport revenue shortfalls. They are also expected to incur per-passenger airport costs lower than those currently paid.
The authority board of directors voted unanimously Monday to sign the new agreement unless the contract-language review be
ing conducted by the airlines leads to major changes.
The agreement comes as the airport authority prepares to pay off its long-term debt. Since 1992, the airport authority and its air carriers have shared responsibility for paying
Most years, the airlines profited from the arrangement. In the most recent fiscal year, about
The airlines acted as the equivalent of a bond co-signer. The bonds were sold during a "volatile" period in the airline industry, Piccolo said. They have been a backstop for the airport's annual
Under the new arrangement, the airport authority will earn a lot more cash. The authority has about
"That provides a wonderful pot of seed capital," Bates said.
That money will allow the airport to risk having to pay shortfalls. The potential payoff, Bates said, is worth it.
Previously, the authority could only generate a limited amount of revenue for itself. Even money made off authority property not connected to the airport is shared under the current agreement.
The new agreement allows the airport to take in all revenues associated with those properties, all profits from leased spaces inside the terminal, a 50-percent share of net concessions revenue and 50 percent of terminal area revenues, including car rentals and parking.
Airlines will receive an increase amount of space under lease in and around the terminal. The airport authority will be responsible for making up any revenue shortfalls caused by vacancies.
The airlines will continue to pay landing and terminal space fees at a rate expected to be
Lower fees probably won't lead to lower fares, but should make the airport more attractive when carriers think about adding flights and routes, Piccolo said.
"I think it gives us a little bit of competitive assistance," Piccolo said.
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