Jan. 26--The Gary/Chicago International Airport is spending down a multimillion taxpayer fund in order to pay the bills for its $166 million expansion project, following a stalled move to borrow $35 million at summer's end.
Records obtained by The Times through an Access to Public Records request show in the last four months of 2013, the Airport Authority approved a total of $9.3 million in expenditures from its Airport Development Zone fund to pay an avalanche of bills from contractors and consultants.
Another $1.5 million in expenditures was approved at the Jan. 13 airport authority meeting.
The fund accumulated $24.9 million by the end of 2012, according to an audit by the State Board of Accounts. The airport's finance department has not yet closed its books for 2013, so the final fund balance is currently unavailable, according to airport spokesman James Ward.
Airport officials, including interim Director B.R. Lane and the airport's finance director, declined to be interviewed about the Airport Development Zone expenditures last week.
The fund has rarely been tapped in its 20-year history. The most recent withdrawal came in the form of a $12 million loan to the expansion project in mid-2012 authorized by a resolution passed by the authority. That money was paid back into the fund at the beginning of 2013.
But claims approved by the Airport Authority from September through December show the money is being used directly for project expenditures. In December alone, 38 bills were paid that way, ranging from landfill tipping fees in Newton County to the tab for Washington, D.C., lawyers.
When asked about the current use of the fund, outgoing Airport Authority Chairman Tom Collins Sr. said he was told by airport officials the money would be reimbursed to the fund once more money was received from the Federal Aviation Administration or the Northwest Indiana Regional Development Authority.
But an airport request for $24 million more from the FAA made in August 2012 has so far not met with success. RDA Executive Director Bill Hanna has said the RDA does not intend to add to its most recent $30 million grant for the airport project.
The airport is expanding its main runway to 8,900 feet in order to handle bigger planes. The project has been beset by cost overruns and delays since its start in 2006.
The Airport Development Zone fund receives about $4 million per year from a tax increment financing district on the west end of Gary. A slice of property tax collections from both homeowners and businesses go into the fund.
The fund has long been held as a last-resort reserve for the expansion project and for others such as repair of the badly deteriorating cross-wind runway. A portion was also to be used as a reserve fund for the $35 million bond issue that was prepared for issuance last summer.
In March 2013, airport financial advisers told the authority it would have to borrow quickly to keep paying the bills for the project. The Airport Authority held a public hearing on a bonding resolution July 8 and on July 22 voted 4-0 to authorize borrowing up to $35 million.
The borrowing has not been discussed publicly since and has not yet been executed. Airport officials have offered no explanation.
The RDA, which has already kicked in about $40 million to the airport expansion, is about to conduct an analysis of the project's financing, according to Hanna. The RDA did one previously in 2012.
The use of the Airport Development Zone money will be a part of that analysis, Hanna said.
"We are not just concerned about our piece of the puzzle at the airport," Hanna said. "We are concerned about all the pieces, so the job gets done."
Copyright 2014 - The Times, Munster, Ind.
The FAA is still working with the state of Illinois on possible layouts and an environmental review has not yet commenced at Peotone Airport.
Mayor Karen Freeman-Wilson today joined officials from the Gary/Chicago International Airport and the Northwest Indiana Regional Development Authority (RDA) to announce that final-phase construction...
Issues over development at Myrtle Beach continue
A New Capital Reliever Stafford County, VA, prepares to add a corporate airport as its latest economic development tool By By John F. Infanger, Editorial Director October 2000...