Kansas City officials think they can pay for building a new terminal at Kansas City International Airport, even without significant federal goverment participation.
But the numbers won’t work unless the city issues the bonds for the $1.2 billion project. That means a public vote, and that’s a major uphill climb.
That’s the conclusion from several conversations this week about the push for a single-terminal KCI.
There is a variety of income streams that could be tapped to pay the bonds’ debt service, I was told. That will likely include sales taxes from a greatly expanded retail presence at the airport, as well as passenger fees, airline charges, even parking fees. The bonds could even be stretched out over 30 or 40 years.
But those bonds can only be serviced at the interest rates on municipal bonds, between 3 percent and 4 percent. Private borrowing for the airport might be closer to 9 percent — in which case the revenue streams would be insufficient to pay back the money.
Public borrowing means a public vote.
There has been polling on a new single terminal, and it isn’t pretty. Some 70 percent of Kansas Citians are against the idea as of today.
There is time to change minds, city officials believe, but not a lot of time. If interest rates start creeping back up, the advantage of low borrowing costs may disappear.
That’s why there’s such a push now, well in advance of actually starting the project. Voters may be asked, sooner rather than later, what they think of a Holy Trinity Terminal.