O’Hare Expansion gets Green Light as Airlines and City Compromise

Nearly two months after United and American Airlines sued the city of Chicago to prevent major expansion at O’Hare International Airport, the two sides have reached a compromise that allows the airport to begin construction as negotiations continue the Chicago Tribune reports.

Today’s compromise does not ensure that the entire project will be completed on time, but it does allow the airport to begin construction for a seventh runway, a major piece of the modernization plan while allowing talks over the remainder of the expansion to continue.

A planned far southern runway that was supposed to be the final runway built as part of the $15 billion O’Hare Modernization Program will instead be constructed next, starting in the spring with completion anticipated in about 2016, officials said.

Negotiations between the city of Chicago and United and American airlines will be postponed until 2013 over when to build another runway that is north of the passenger terminals, as well as the planned extension of an existing runway.

Under the compromise, the city will be allowed to go forth with plans to sell $1 billion worth of bonds which the airport’s largest airlines were originally suing to block arguing that an additional runway was not yet needed at the airport notorious for long weather delays and heavy congestion. Thanks to additional funding from the federal government, the airlines agreed to sign off on the next phase of the project and promised to help pay for the bonds using revenue and ticket taxes.

The O’Hare Modernization Program was originally scheduled to be finished by 2014 but with the seventh runway not expected to be finished until 2016 and an additional runway on hold, the timeline for completion remains up in the air.

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2 Responses to O’Hare Expansion gets Green Light as Airlines and City Compromise

  1. Mike C. says:

    Why are the airlines opposed to the expansion? Do they not want to pay higher fees? Or do they not want the additional competition? Any ideas?

    Mike

    • Ryan says:

      What a lot of people don’t realize about airport expansion and renovations is that they are funded, at least in part, by the airlines themselves. So the city decides it wants to expand and then turns around and asks the airlines to help finance. In the case of Chicago, the airlines argue that the city’s expansion plan is way too ambitious considering the uncertainty of airline travel in the U.S. right now. Its a $15 billion expansion and the airlines have argued that they will be left with a substantial bill.

      It’s a little bit of a give and take. Airlines generally welcome newer facilities and renovated terminals especically at an airport like O’Hare which sees some of the worst delays in the country. But there comes a point where the cost-benefit becoems murky, as is the case here I think. The airlines clearly want some sort of expansion because they immediately decided to compromise after the federal govenrment offered to chip in, I think they just arent willing to do it at a price that they believe will be too difficult to afford and since these fees are often passed onto passengers, they are concerned that ticket prices will skyrocket at Chicago, an airport which American and United both connect a lot of passengers through.

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