The Clock is Ticking on New Pact for Worcester Regional Airport

Between now and June 30, the future of Worcester Regional Airport will have to be decided. On that date, the contract with the Massachusetts Port Authority, which has been operating the airport since January 2000 while absorbing much of its deficit, will expire. Unless a new agreement is hammered out, the airport has no future.

The clock is ticking. In view of the immense complexities involved in crafting the next operating agreement, negotiations should be well on their way. City Manager Michael V. O'Brien has been playing his cards very close to the vest, so it is hard to know what is happening. According to my sources, the manager has had two or three preliminary discussions with Massport CEO Thomas J. Kinton, who, in turn, briefed the board chairman, John A. Quelch, and some members.

But the seven-member board, which will have the final say, has yet to deal with the issue. "It has not been much of a topic for the board or part of our mission," Fred Mulligan of Worcester, the board's newest member, told me recently. "Much of the board time has been devoted to resolving the controversial issue of accumulated sick time for employees." Massport officials privately expressed concern about the lack of progress at staff level.

Meanwhile, there has been much speculation and confusion. "Airport may be up for sale," newspaper headlines trumpeted. "Neighbors weigh future of airport." Some city councilors seem to believe the sale or lease of the airport could result in a financial windfall and ease the predicament of Worcester that faces a $21 million budget shortfall. That is a misconception. Financial benefit for the city will come from getting out of the airport business.

It is therefore a given that the next operating agreement with Massport should lead to the authority taking title to the 1,300- acre facility. Ownership would allow Massport to make much-needed capital investments and guide the place toward long-term viability. Anything less would make the pact meaningless.

In 2005, a six-month study by Infrastructure Management Group Inc., the city's independent airport consultants, concluded that Worcester's only viable option is affiliation with Massport, and that "consideration be given to Massport acquiring the facility." Other alternatives - such as privatization, sale or closing the place - were rejected. "Closure is not a recommended option as the FAA is unlikely to allow the city to cease aviation activity without meeting certain criteria that would in all likelihood require the city to pay a significant amount of the FAA grants received to date," IMG reported. "In addition, the FAA may require all, or a portion, of the proceeds from the sale or redevelopment of the property."

Despite these findings, which have been largely ignored until recently, various suggestions have surfaced for the future use of the airport - ranging from a wind farm to a gambling resort.

Since it took over operations in January 2000, Massport has invested nearly $10 million in picking up large portions of the operational deficit - ranging from 68 percent to 100 percent of the total, in addition to about $3 million worth of professional services. Let's face it: Without Massport, the airport could not have survived, and without Massport, it has no future.

For the city, the airport is both an asset and a liability. But its value lies in being an irreplaceable component of regional transportation in the years ahead. Properly managed, it can also be a lucrative economic resource. Massport sees the benefit of long-term investment in Worcester as well. "Worcester is important because no new airport could be built anywhere in New England in the foreseeable future," Mr. Mulligan told me.

Massport, a semi-autonomous agency whose board members are appointed by the governor, "is being operated like a business, with a focus on fiscal health," said Mr. Mulligan, president of Cutler Associates, a Worcester-based design and construction company. He was appointed to the board in September because of his long expertise in the construction trade. John Quelch, a professor and associate dean at Harvard Business School, is board chairman. Other members come from business, industry, the labor movement and government. Ranch Kimball, now a hospital administrator, is the former state secretary of economic development.

Mr. Mulligan surprised me by articulating the sentiment frequently voiced by former Massport CEO Craig Coy: "Massport has fulfilled its obligation to Worcester. Unfortunately the same cannot be said about the city, which refused to even consider an east-west connector road. We would be kidding ourselves if we believed the airport can be successful without an access road."

An unknown factor is the role of the current state administration. Gov. William F. Weld brought Massport to Worcester. Paul Cellucci considered the Worcester airport an integral part of a regional transportation strategy. So did Jane M. Swift, who had worked at Massport before becoming governor. Mitt Romney did not believe Worcester needed a commercial airport, and he treated it with benign neglect. There have been indications that the political power trio of Deval L. Patrick, Jim McGovern and Tim Murray is paying attention. Bernard Cohen, the current secretary of transportation, is said to favor Massport takeover. Leslie Kirwan, secretary of administration and finance, actually came from Massport. All that should help.

Mr. O'Brien said he didn't want to "give away" the airport. He expects "fair market value" for the land and assets, as well as many other benefits. Indeed, it is the manager's responsibility to see that the city gets the best possible deal, and he has a reputation as a tough bargainer.

However, Worcester's expectations should be realistic. There is no long line of suitors banging on the door, eager to take on an airport that loses money, has no airlines, cannot be sold and needs infrastructure improvement. Under its current leadership, Massport has been known for prudent fiscal management.

Revealing bargaining details while negotiations are under way would be unwise. But a certain openness is warranted in the public arena. The immediate goal is to extend the operating agreement and keep Massport's financial support, with specific steps leading to a transfer of ownership. There is much to be done. The sooner the process moves from the talking stage to formal negotiations, with teams of experts around the table, the better. The clock is ticking.

Robert Z. Nemeth's column appears regularly in the Sunday Telegram. He has served on the Worcester Regional Airport Commission for the last eight years.

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