The city of Chicago plans to relaunch a long-term concession for Midway airport by the end of the year.
It will file a draft request for qualifications (RFQ) for an up to 40-year lease with the US Federal Aviation Administration (FAA) ahead of a 31 December deadline to maintain its spot in the regulator's airport privatisation pilot programme, according to a statement. Responses will be due during the first quarter.
The deal will include revenue sharing between the concessionaire and the grantor, dedicated capital investment funds and a minimum service guarantee for passengers, says the city. An upfront payment will be used to defease debt issued since 1996 to rebuild the passenger terminal at the airport.
"I have instructed my team to take this next step to gain a complete understanding as to whether and how the potential lease of Midway airport could benefit our taxpayers and airport travellers," says Chicago mayor Rahm Emanuel in a statement.
The city will also file a preliminary application and proposed timeline with the FAA by 31 December. It says that a list of prequalified bidders will be included in the RFQ.
A deal would require that airlines with two-thirds of the total landed weight at the airport agree to the concession for it to receive FAA approval. Southwest Airlines reviewed the draft RFQ and is "interested" in studying a deal, says the city. The airline carried nearly 90% of the enplaned passengers at Midway during the year ending 30 September, according to the US Department of Transportation.
"Like the City, we want to better understand the market opportunity and the impact on our business and passengers," says Gary Kelly, chief executive and president of Southwest, in a statement. "We look forward to exploring this opportunity with the city."
Citi Infrastructure Investors, John Hancock and Vancouver Airport Authority-owned Midway Investment and Development Corporation won a 99-year concession of Midway with a $2.5 billion bid in 2008. The deal collapsed due to capital market issues during the credit crunch.