An Airport on Autopilot; A Veil of Secrecy has Shrouded this Canadian Airport

The City of Hamilton, Ontario, has poured millions of dollars into its airport over the past 10 years without once having looked at the financial health of the airport or the private operator that runs it. A Spectator investigation shows the...

The City of Hamilton, Ontario, has poured millions of dollars into its airport over the past 10 years without once having looked at the financial health of the airport or the private operator that runs it.

A Spectator investigation shows the city has never verified the airport's revenues, obtained key financial information about TradePort International Corp. or exercised its right to look at that company's books.

The city also plans to spend tens of millions more to help TradePort develop business at John C. Munro Hamilton International Airport. When Hamilton signed its 40-year deal with TradePort in 1996, it was supposed to shut off the flow of money from the city to the airport and put an end to an annual operating deficit that reached about C$400,000 a year.

But The Spectator's investigation shows that:

* The city has spent C$12 million on airport projects since 1996, even though there was no requirement for it to do so.

* The city plans to buy another C$15 million in land for airport use by 2009.

* The city may be getting as little as $35,000 in revenue sharing from TradePort this year, a fraction of the C$300,000 that was expected.

That meagre payment after 10 years of tax-free operation of the airport by TradePort has sparked outrage among some members of city council.

Next year marks the first opportunity that the city has to break the agreement it has with TradePort.

There are now signs that the city is prepared to reconsider the entire airport arrangement. It is an arrangement that raises important questions concerning public accountability around one of the city's most significant assets.

The Hamilton airport injects C$400 million a year in the local economy and is responsible for 1,700 direct jobs, according to the city. TradePort officials say the airport is healthy and heading toward fulfilling its promise as a leading cargo hub and a major passenger centre.

But for the past 10 years, this important economic engine has been operating with virtually no direct supervision from the city.

The Spectator has learned that:

* It's mandatory for the city to review TradePort's performance once a year, but not one such review has taken place.

* Council ordered its first review of TradePort last June. But the review hasn't started yet and it's already expected to cost about twice what was forecast.

* The city doesn't know if it receives all of the financial information that TradePort is obliged to deliver under the contract.

It's a sign of the city's lack of oversight over the past 10 years.

Unlike most Canadian airports, there's no independent board that watches over the Hamilton airport.

Until last year, there wasn't a single city staff member whose sole responsibility was supervising the airport deal.

A thick veil of secrecy shrouds the TradePort deal.

Key parts of the airport contract have been kept from public view since the beginning.

TradePort made it a condition of the lease that important financial, shareholder and management information would not be disclosed to the general public.

There is a growing desire to reduce the level of secrecy around the deal.

"This is an emerging theme," said Hamilton Mayor Larry Di Ianni. "It is an area we think we would need to explore."

On Day 2 of this series, you'll learn more about the secret clauses of the TradePort lease and the confidential projections about the airport's performance that have been kept from the public for a decade.

Councillors are allowed to see the full lease, but not reveal certain parts publicly.

On Day 3, you'll learn about airport land issues and why a piece of land key to the airport's development remains vacant 10 years later.

You'll also learn about a piece of land the city bought, but refuses to explain how it paid for it.

On Day 4, you'll learn how the airport deal is an example of Hamilton's turbulent history with private-public partnerships.

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