Airport costs for rental car facility soar

Hartsfield-Jackson International Airport could have saved millions of dollars by moving more quickly to design and construct its massive, off-site rental car facility, an independent audit found.

The so-called "Consolidated Rental Agency Complex," or CONRAC, was budgeted at $479 million four years ago, but now could cost $600 million due to soaring prices for materials and labor by the time it is completed in 2009.

Conducted by the New York-based firm KPMG LLP, the audit found airport officials had difficulty enforcing design deadlines and developing accurate cost estimates. Auditors also criticized officials' inability to negotiate a "guaranteed maximum price" for the entire project.

"There seemed to be within the program office an inability to factor in current market conditions as they were evolving in the Atlanta marketplace," said Geno Armstrong, a KPMG official who presented the audit to the Atlanta City Council's Transportation Committee on Wednesday. The audit cost the city $300,000.

Auditors noted the airport used the appropriate policies and procedures for such a massive project, even though those officials did not always follow those guidelines.

Soaring construction costs associated with the aftermath of Hurricane Katrina and the commercial building boom in China have been cited by airport officials as two of the factors driving up the costs of construction materials and labor for the project.

Airport General Manager Ben DeCosta agreed with its basic conclusions.

"Time is money, and delays moved us into an escalating market," DeCosta said. "When we first started it [construction inflation] was 2.5 percent per year, and it rose to 7 percent or 8 percent." DeCosta said officials will implement reforms pointed to in the audit, such as better accounting procedures and getting construction contractors involved in the cost-control process much earlier.