United Asks Airport To Table Capital Improvements
Written by Victor Cruz on September 27, 2001
By Victor Cruz
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United Airlines, Miami International Airport’s second-largest carrier, is asking officials postpone as much of the airport’s capital improvement program as possible.
County Manager Steve Shiver said a review of the airport’s capital improvement program is under way and should be released Friday. But Aviation Director Angela Gittens said she doesn’t see cutbacks as the best answer to aviation industry woes.
A laundry list of cutbacks was outlined in a letter to Ms. Gittens from United Regional Director Charles "Pete" Dial Jr. She got the letter Sept. 20, nine days after terrorism attacks on the US crippled air travel.
"We urge Miami-Dade Aviation Department to take immediate and extraordinary steps to reduce costs and eliminate non-essential spending," Mr. Dial wrote.
In spite of action by US Congress to aid the industry through a $15 billion relief package, Mr. Dial said Monday the requests will likely stand at least until the holidays, when the industry can get "a look at advance bookings."
United, which operates 6.1% of traffic at Miami International, is the largest carrier after American, which is responsible for 48.2%, said Inson Kim, spokesperson for the airport.
American has not asked for a postponement, Ms. Gittens said.
Mr. Dial said United’s request has been made across the board to other airports nationwide.
While Ms. Gittens said in recent weeks some parts of the $5.4 billion program could be postponed to keep the massive project in line with airport use that is less than forecasted by previous passenger and cargo projections. Ms. Gittens said Monday it was too soon to tell what projects, if any, might be postponed and to what degree. She also said hiring freezes and the elimination of overtime for airport workers was being considered.
Future forecasts, used to decide what might be delayed, are on hold, Ms. Gittens said. She said she would continue to use criteria based on current needs in assessing cutbacks.
"This is an unprecedented situation. It will be some time before we get a good picture," she said.
Ms. Gittens said her priority is to support projects that "match facilities with demand," but that she does not support postponing projects already "started and moving" such as north and south terminals, a chiller plant and several roadway improvements.
"As long as we contain our costs and it is still needed," she said, those projects should continue.
Although United has the county’s ear at bimonthly meetings, including one this week, it is the aviation department that has the final word, Mr. Dial said.
Airlines pay for capital improvements through passenger charges, bond money and concession revenues, Mr. Dial said.
United’s requests to Miami International include:
nFurlough non-essential employees and place a moratorium on future hiring;
nTerminate non-essential services and consultant agreements;
nNegotiate debt service relief with bondholders;
nReassess passenger facility charges and, if required, seek FAA approval to re-program existing and future funds to offset extraordinary security costs;
nReduce operating and maintenance expenses by at least 20%;
nSuspend future salary and benefit adjustments for aviation department employees;
nDefer planned procurement of capital and non-capital equipment.