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Gary airport development deal gets final approval

Updated: January 27, 2014 8:03PM



GARY — The Gary/Chicago International Airport is now set for its next 40 years of development.

The Airport Authority on Monday morning voted 4-0 to approve the ordinance guiding the historic public-private partnership agreement with Dulles, Va.-based AFCO/AvPorts. A special signing and press conference was held after the vote.

Not voting were gubernatorial appointee Tom Collins Sr. and Porter County appointee Tom Cavanaugh, who have resigned from the board, and city of Gary appointee Michael Doyne, who was absent.

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, the 40-year agreement would be reduced to only 10 years if AFCO/AvPORTS doesn’t make the $25 million/36 months target; also, the city and Airport Authority can terminate the contract outright if they don’t reach $25 million by the agreement’s fifth year.

Toward the management agreement end, the Authority will have a one-time right to terminate that agreement at year 10 at its own discretion and at year five because of the developer’s failure to meet the investments. If it chooses to terminate any other time at its discretion, the Authority would pay a $500,000 plus an amount equal to three times the average of the last three years’ performance incentive.

Additionally, the company must invest $300,000 in workforce development.

AvPorts President and CEO Oswin E. Moore was on hand to sign the documents and meet with airport employees, said Tim Touhy, managing partner with Hawthorne Group. AvPorts will handle the day-to-day airport operations.

According to Touhy, Moore told the airport employees said that any time the company comes in to a new property, it retains all employees 99 percent of the time. He also reiterated with them that as it transitions over the next three to six months, a lot of the focus will be on making sure the airport is reaching the requirements of its Federal Aviation Administration certification level.

“There are 16 other airports that AvPorts oversees, so they’ll look at what’s working well currently at the airport or what, if anything, can be implemented from other properties, since every agreement is unique,” Touhy said.

B.R. Lane will continue in her role under the new AvPorts model as they transition in, Touhy said.

On the development side, former Centerpoint Properties CEO Michael Mullen will act as a senior advisor. A resident asked for specifics about the types of jobs and development he would bring to the airport.

“I do developments with warehouses and intermodal facilities. I’ve never done a development project where I’ve built a Taco Bell,” Mullen said.

As of 2009, AFCO/AvPORTS’ manages eight Federal Aviation Administration-certified airports and one major passenger terminal in the U.S., including Newark Liberty International Airport in New Jersey.

It built off-site parking at the Indianapolis International Airport and at Chicago Midway Airport. At Midway, AFCO also developed the Midway Park Ride & Fly service in 2003.



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