FAA Commits USD$410 Mln To Finish O’Hare Plan

April 6, 2010

The US Department of Transportation on Tuesday committed USD$410 million toward completing an expansion of Chicago’s O’Hare airport.

The Federal Aviation Administration funds will be used to build two new runways and extend a third for the second phase of the O’Hare Modernisation Programme, city and federal officials said at an airport news conference.

The FAA in 2005 committed USD$337 million for the first phase, which adds, relocates and extends runways at the world’s second-busiest airport.

Chicago will issue USD$1.8 billion of bonds for phase 2 after selling about USD$1.9 billion of debt for phase 1, according to Rosemarie Andolino, the city’s aviation commissioner.

City officials still eye construction of a new terminal, estimated to cost about USD$2 billion, but Mayor Richard Daley conceded that was a “tough sell.” The total cost of the project including the terminal is USD$8.6 billion in 2008 dollars, according to a city aviation department spokeswoman.

United Air Lines and American Airlines, O’Hare’s largest carriers, suspended talks with the city in February over phase 2 funding after the airlines were hit with fee and rent increases tied to outstanding debt.

Andolino said Chicago remained committed to negotiations, adding she was confident a deal will be reached.

Chicago has been pushing to complete the O’Hare project in 2014 after delays caused by legal fights. The city approved a deal in November with the suburb of Bensenville, which had long battled the expansion project in court.

Earlier this year, a DuPage County Court granted Chicago title and possession of a cemetery that stands in the expansion’s footprint.

(Reuters)

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