The Senate Hartsfield-Jackson Atlanta International Airport Operations and Authority Creation Study Committee (say that ten times fast) held its second meeting Wednesday before a packed committee room at the State Capitol.
The study committee includes a veritable all-star roster of Republican senators, starting with chairman Burt Jones and continuing with Brandon Beach, John Kennedy, Mike Dugan, Steve Gooch, Butch Miller, and Jeff Mullis (among others). Take into account unsteady leadership from the city, (new GM John Selden, named this week, will be the airport’s fourth head man since 2016) and the time seems ripe for the state to pursue putting together an airport authority that would oversee Georgia’s aviation. Indeed, the other named goal of the committee, to explore the possibility of a second major airport in Georgia, is one that could only truly come about through an overarching state authority.
City officials including Atlanta City Council President Felicia Moore and Councilman Matt Westmoreland were on hand in support of the airport’s current management, as were Atlanta CFO Roosevelt Council and city legal counsel Robert Highsmith of Holland & Knight. The purpose of the meeting was to answer questions relating to bond issues and obligations; essentially discussing how the financial details of transferring control of the airport might work.
Not the most thrilling of topics, to be sure, and certainly the debate failed to heat up quite like it assuredly will next month when the vendor procurement process takes center stage at the committee’s third meeting.
But on Wednesday it was budgets and bonds, revenue and restrictions, the nuts and bolts of what the transfer of power over the world’s busiest airport might look like. Matt Nichols, a partner with Parker Poe and an expert in public finance, first gave a presentation discussing the airport’s current financial structure, particularly the layout of its debts. Hartsfield-Jackson is a massive entity, with more than $2.8 billion in bonds distributed and strict rules surrounding them, set in place by the Master Bond Ordinance drawn up in 2000. Those debts comprise the highest financial hurdle faced by a potential state authority, which would have to refinanced in such a way that would cost the state more than that $2.8 billion alone when accounting for tax law changes, market movements, and the need for escrow payments to pay off former bond holders.
Because the airport generates so much revenue though, it is completely self-sustaining, unlike other state authorities such as the State Road and Tollway Authority. So while it would more than double the total state authority debt, as Nichols told those in attendance, “you should be able to pick that box up and move it.”
While subsequent speakers, all brought by Highsmith, were quick to point out how difficult and costly that process would be, the general sense seemed to be that the financials would be a hill to climb, yes, but a manageable one. While there would remain questions whether the move would affect the state’s golden credit rating or if it would throw a wrench into ATLNext, the airport’s ongoing $6.1 billion capital plan, those are questions that have obtainable answers.
The more important questions, and the ones that have brought about this discussion in the first place, are related to the ongoing Atlanta City Hall corruption scandal that is in part rooted in the vendor procurement process at Hartsfield-Jackson. Said Committee Chairman Sen. Burt Jones (R-Jackson), “Would we be having this discussion if not for some of the things that have gone on in previous administrations? Probably not… Let’s point to where we see the issues are and see how we can improve them.”
The state legislature has bandied about the idea of an airport authority for years, but this latest bid has taken on a much more legitimate tone in light of the Kasim Reed administration’s shady backroom dealings.
But don’t expect the city to back down without a fight – Moore’s presence at Wednesday’s meeting shows that city officials are keeping a close eye on the process, and look for the airlines, including Georgia’s own Delta, to throw their weight around in an attempt to maintain the current management structure. Already lawmakers have questions surrounding the 2017 Airport Use and Lease Agreements signed by Delta and Southwestern that would make it more difficult for any transfer of power to take place – namely whether the city pushed for extra restrictions with rumors of a state takeover bid swirling?
Those questions, asked by Sen. Tyler Harper (R-Ocilla), were the closest to fireworks we saw at the meeting, and served as a preview to what should be a raucous (in comparison) affair on October 3rd, when the aforementioned vendor procurement process and all the gory, slimy details behind it come to light.
In the meantime, the committee managed to answer some questions Wednesday even as the larger ones remain.
