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Gary Airport board responds to Majestic Star concerns on utility relocation

Updated: December 28, 2012 6:19AM



GARY — Construction on the Gary/Chicago International Airport runway expansion faced a work stoppage that could have stalled the project at a critical point and cost the airport time and money.

The Airport Authority Board voted 7-0 to accept an addendum put forth by attorneys of Majestic Star Casinos that asks for more provisions to a contract approved in August. The $570,250 contract, on which the board first took action at its May 14 meeting, had the airport act on behalf of Majestic Star to move a sanitary sewer line along with two Indiana American Water Co. water lines under the new EJ&E track and CSX grade crossing.

Ideally, the water and sewer lines would be moved together so their new embankment could be built, said project manager Scott Wheeler. Currently, Indiana American Water is already moving its lines.

Attorneys for Wayzata, Minn.-based Wayzata Investment Partners, which now owns the casinos, however, are concerned over who would incur the cost of lost revenue if operations were to shut down for any amount of time longer than the two or three hours the project would take, Airport Authority Attorney Pat Lyp said.

The board agreed that if something happens to prevent the contractor from keeping to the tight timetable, it could seek damages for up to $5 million through the company’s insurer, and then anything above that would fall to the airport. The chances of something major happening, however, are remote, Lyp said.

The casinos must also approve a contract with CSX that covers repairing the line between the two after the line is moved and the new tracks are in place, but Lyp said the railroad’s contract doesn’t appear one-sided.

“The case can be made that the railroad isn’t holding (the project) up,” he said.

Had the board not voted to accept the addendum, Wheeler said the project could have been stalled long enough that it would have to be rebid, and that would take more time and money.

The board also approved 5-2 — with two abstentions — two new policies introduced at its last meeting: a financial self-sufficiency policy and an air-trade development policy. The air-trade development agreement cements Gary’s place as Chicago’s third airport and works to establish it as a low-cost, regional, commercial service airport.

The financial self-sufficiency establishes operational goals to meet its annual operations budget as well as consistent, transparent rates, fees and charges, said Al Stanley, vice president and COO for airport consultant Jclark Aviation.

In other business, the board approved $46,650 in marketing contracts with local radio stations, the Post-Tribune and South Shore RailCats. The contracts will take marketing efforts through the first two months of 2013 and fall under the $75,000 budget the board recently approved, said marketing liasion James Ward III.



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