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Airport authority board votes 5-1 to endorse public-private development deal

Updated: December 23, 2013 8:57PM

GARY — Two weeks after details of a public-private partnership to redevelop the Gary/Chicago International Airport were unveiled — including a proposed $100 million investment proposal over the next 40 years — the airport authority got to weigh in on the deal.

And its chairman voted against it.

Tom Collins was the lone dissenting vote on Monday, as the authority endorsed the plan 5-1, with Porter County member Tom Cavanaugh absent.

The vote moves the agreement along, with the goal eventually to having the terms set forth in an ordinance, as required under state law.

Aviation Facilities Co. Inc./AvPORTS, whose partnership team includes Guggenheim Partners, a global financial services firm, and Loop Capital, a Chicago-based investment bank, was chosen in October by a committee that evaluated private proposals to run the airport.

Collins said at Monday’s board meeting that the operations portion of the public-private deal, nicknamed the “P3,” is transparent and agreeable for the most part, but the development agreement seems to leave too many unanswered questions.

“We would be entering into a 40-year deal where a development model wouldn’t be presented for a year; as a businessman, I wouldn’t go into an agreement like that. I would hope for more specifics before entering into an agreement,” Collins said.

“Forty years is a very long time, and I just want people to be very sure on what they’re agreeing to,” he added. “AFCO/AvPorts operate all over the country, and they do a good job of it. I’m just not convinced this is the best deal for the airport or Northwest Indiana.”

P3 Chairwoman Carrie Hightman said she remains convinced the agreement they have will prove to be the best deal, but if there’s something better, she would love to hear it.

“We asked the market to tell us what it should ask for, and we have a very lucrative deal for the airport,” Hightman said. “I’m pleased that the board voted to advance it, and I’m confident it will pass the next step.”

Board member Denise Dillard said the agreement might be problematic, but doing nothing would be worse.

“We need to move forward,” she said. “In lieu of doing nothing, which is not acceptable, if not the P3, then what?”

Among the agreement’s major points are a $25 million investment by AFCO/AvPORTS within the first 36 months of the 40-year agreement, with $2. 5 million to be developed within the first six months. Additionally, AFCO/AvPORTS will invest $300,000 toward workforce development within the first three years.

The Authority could possibly hold a public hearing and final vote on the P3 agreement at its Jan. 27 meeting.

The Authority also bid farewell to attorney Pat Lyp, who’s leaving his post as airport attorney to take over as attorney for the City of Valparaiso. Attorney Lee Lane, of Merrillville firm Genetos Retson & Yoon LLP, and no relation to Interim Airport Director Bridget B. R. Lane, was approved unanimously to take his spot.

A former pilot with the U.S. Army, the terms of Lane’s contract will be the same as Lyp’s and will come before the board at its Jan. 13 meeting.

In other business, the board approved 6-0 to bring on Gary Sanitary District Executive Director Dan Vicari as project director for the runway expansion project. Lane said Vicari’s experience as a civil engineer with an environmental background will help “capture the confidence” of the regulatory agencies with which the airport works, such as the Indiana Department of Environmental Management, the U.S. Environmental Protection Agency and the Federal Aviation Administration.

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