Atlanta Mayor Kasim Reed announced a deal between the city and airlines at Hartsfield-Jackson International Airport for a temporary boost in revenue as the airport seeks bond financing for its international terminal.
The mayor, flanked by chief executives of Delta Air Lines and AirTran Airways, announced Tuesday that the airlines will pay a combined supplementary terminal rental payment of $30 million over four years starting in fiscal year 2013. The airport expects $12 million in the first year, $8 million in the second year and $5 million in each of the last two years.
Reed and interim airport manager Robert Kennedy said the supplemental payments will enable the airport to get bond financing by the end of this year to complete the international terminal in spring 2012, in line with its latest plans.
But the airport would then make up to the full $30 million in payments back to the airlines, dependent upon the strength of the economy, financial indicators and the airport’s debt service coverage ratio.
Reed also announced Tuesday his signing of a new seven-year lease with Orlando-based AirTran, following the Atlanta city council’s approval of the AirTran lease in July. AirTran has its largest hub in Atlanta. The city finalized its new 7-year lease with Atlanta-based Delta last year.
Atlanta City Councilman C.T. Martin said when the city negotiated the airline leases earlier, there was “an understanding that there were items that were left on the table.”
The city’s move to collect more revenue from Delta and AirTran comes as it seeks to increase fees charged to other businesses at the airport, including shuttle operators and other ground transportation businesses, as well as off-airport parking lots. The airport has also increased its parking fees for travelers.