By Robert C. Herguth And Fran Spielman, Chicago Sun-Times
Wednesday, August 21, 2002
The nation's two largest airlines, both facing enormous financial problems, have asked Chicago to scale back and slow down O'Hare Airport's $3.2 billion gate and terminal expansion project, officials said Tuesday.
While potentially a huge blow to the project, the commitment by American and United airlines to a related proposal--the multibillion-dollar O'Hare runway expansion--remains strong.
"We're trying to get our costs down, weather the financial storm we're facing right now," said Joe Hopkins, a spokesman for United, the Elk Grove Township company that is cutting flights and facing possible bankruptcy. "So we have to look very carefully at our future expenditures and more than ever prioritize."
"The runway program . . . is our No. 1 priority," he said. Referring to World Gateway, the gate and terminal effort the airlines would help finance, he said: "I think what I would say [is]: It's not a high priority, particularly now in the acute financial situation we're in."
Originally, construction was expected to begin last year on World Gateway. It's unclear when work might start now.
"When we get our footing back, we can get back to looking at projects that aren't on our 'A' list," Hopkins added.
Also unclear is whether American wants Mayor Daley to shelve plans for a second World Gateway terminal, shrink or cancel the $1 billion terminal contract already awarded, or assume an even greater share of the financial burden.
American's Mary Frances Fagan--whose airline announced plans to slash flights and jobs to deal with huge losses brought on by the recession, intense competition and the aftermath of Sept. 11--said: "We have asked the city to look at the World Gateway timeline and see if there is any way to defer expenses, at least for now."
The runways are still needed to deal with delays, she added. "If you don't operate as efficiently during times of bad weather, it costs you money. Delays cost money," she said.
At an unrelated news conference Tuesday, Daley refused to even entertain questions about scaling back World Gateway. He attempted to link the new terminals with the runway proposal.
"If you don't fix the terminals, how are people going to get there then? In the long run, with an investment like this, the infrastructure is important. . . . If you delay the infrastructure, the costs will go up tremendously," the mayor said.
Later, Daley's aviation commissioner, Thomas Walker, confirmed that American and United each approached city officials within the past month to ask "us to consider the possibility of scaling back World Gateway."
Neither that decision nor one on funding have been made, he said.
"We don't envision one [a smaller World Gateway], but we always listen," Walker said.
Shrinking the project is a sensitive political issue for Daley, partly because of who holds the contract to build the $800 million-to-$1billion Terminal 6: a company represented by Victor Reyes, the mayor's former political enforcer. Reached Tuesday, Reyes refused to comment.
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