Government & Politics

Airport group may tweak KCI plan to keep promise not to use taxpayer funds

Kansas Citians have heard the promise before: Taxpayer money will not be used to build the new single terminal at Kansas City International Airport.

The airport’s developer, Edgemoor Infrastructure and Real Estate, says so on a website dedicated to the project. As does the site for the city’s aviation department.

So when the City Council Airport Committee discussed Thursday a provision in the airport plan that would have the city’s aviation department borrowing money from other parts of the city’s budget to get the project started, it raised a red flag for some members.

“I think the problem is we were so adamant in this campaign for this airport that no general fund money, no taxpayer dollars would be used, and now we’re using them,” said Councilwoman Teresa Loar, who acknowledged she understood why the council would use those funds.

“But I think we’re going to lose credibility. I think we’re going to lose trust of the public when we start moving monies around,” said Loar, who represents the city’s 2nd District at-large.

Now committee chairwoman Jolie Justus, who represents the city’s 4th District, plans to offer an amendment next week. She said she would amend the ordinance so that the funds would be borrowed only from the city’s aviation department, which is funded by airport revenues and not taxpayer dollars.

Thursday’s debate was the latest in a long and difficult process to replace the three aging terminals at KCI that’s likely to drag into January or beyond.

Galen Beaufort, who testified on behalf of the city attorney’s office, said the money — $48.8 million — would bridge the gap between the time the council signs off on an ordinance approving the KCI rebuild and the time bonds can be issued to finance the rest of the project.

The money would allow crews to start on demolition at the existing airport terminal and prepare the construction site for the new $1.6 billion terminal soon following the council’s authorization.

Without the $48 million, Beaufort said Edgemoor won’t have money to continue working until the bonds are issued. Ultimately, the airlines are expected to pay the costs of the terminal overhaul.

The City Council has to approve an ordinance with four documents governing the airport project before construction can begin, but it’s waiting for the airlines that serve KCI to come to agreement on how to fund the construction and operations of the new terminal. The $48 million is part of that ordinance and would have originally been borrowed from across city funds.

“We can’t tell you that we won’t use the general fund for the purposes of funding any expenditures that might happen for this project between now and the end of the fiscal year,” Tammy Queen, the city’s deputy finance director, said at the committee meeting, “but we can tell you that we would never leave the general fund in a predicament at the end of the year having funded any part of this when we close the books.”

Under the initial plan, if the the funds weren’t repaid by the end of the fiscal year on April 30, the city would have borrowed money from the private sector to keep the general fund whole.

Mayor Sly James pushed back against Loar’s comments, claiming borrowing the money from across department’s didn’t break any promises the city made.

“The promise that was made to the public is that there would be no taxes raised in order to do this,” James said. “The inter-fund borrowing is something that happens all the time, and I think if you look at the current situation with both of our airports there is no tax dollar in those airports, although there has been inter-fund borrowing for each of those airports over the years.”

James said the city could either borrow the money from itself or borrow externally, which would cost more, and noted the council has borrowed money from the airports in the past. He said that was not a “taxable event.”

But the city’s aviation department says on its website that general revenue dollars will not be used at KCI, and council members have said the same.

Justus said she wasn’t aware before the meeting that the $48 million would be borrowed from other funds instead of taken from the aviation department. She didn’t see it as breaking the promise to not use taxpayer money because the funds would be replaced before the fiscal year closes.

“But if folks are concerned about it, then let’s come up with a solution that really addresses their concerns,” Justus said.

For now, the City Council is in a holding pattern until the airlines come to agreement on how to pay for the construction and operations at the new terminal. Budget airlines Allegiant and Spirit have revolted against the new $1.64 billion price tag for the airport, which rose from about $1 billion when additional gates, baggage handling infrastructure and waiting spaces were added.

James announced Tuesday that the airlines were taking a “second look” at the cost of the project and the city would know more in January.

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