New Orleans Aviation Board unveils $826 million overhaul of Louis Armstrong Airport

January 17 2014 | Latest News

By Richard Rainey, | The Times-Picayune

The New Orleans Aviation Board today is expected to recommend an $826 million redevelopment plan meant to thrust Louis Armstrong New Orleans International Airport into the modern era - a reimagining of the sleepy, mid-century airstrip that would be in lockstep with what Mayor Mitch Landrieu has said he would like to see built in time for the city's 300th anniversary in 2018.

The plan includes building a new, $650 million, 30-gate terminal with three concourses and a parking garage, as well as a $17 million privately financed hotel, all on the north side of the airport's east-west runway, according to documents obtained Tuesday by The Times-Picayune.

The overhaul would also include a $72 million, state-financed power station and a new $87 million ramp on I-10 to direct eastbound traffic to the new terminal.

"Looking at all the variables," Aviation Board member Doug Thornton said, "it appears to us that is the best option.

Building a terminal to the north of the runway isn't the cheapest plan, but its supporters argue it's the best way to position the aging airport to attract more airlines, compete with rival cities and boost the city's economy for the next 30 years.

Nonetheless, it could be a tough sell to a skeptical public that just finished watching a $305 million overhaul of the existing terminal in preparation for the Super Bowl last February. Thornton called that renovation, which included a new $92 million rental car facility, a necessary upgrade, but more cosmetic than substantive.

"They're adequate, but they're not world-class," he said.

The latest proposal's mission, Aviation Director Iftikhar Ahmad said, is geared toward increasing air traffic to New Orleans, but also toward lowering the costs associated with running a large, outdated and underused terminal.

"What we're looking for is higher revenue, (and) lower cost, so we can entice the airlines into the city," he said.

The Aviation Board will be presented with four redevelopment options a team of consultants has been exploring for the last 20 months, city officials said. The board bumped up its regular April meeting from Thursday to 8:30 a.m. Wednesday to hear the consultants' presentations on all the options. Landrieu is expected to address the media afterward, spokesman Ryan Berni said.

Landrieu began the push for a new airport in August 2011, calling on the Aviation Board to examine redevelopment possibilities described in a 2007 rewrite of the airport's master plan. That version, the mayor pointed out, showed preference for a new terminal to the north, but was sidelined as too ambitious as the region continued to recover from hurricanes Katrina and Rita.

The mayor is the latest in a long line of city officials who have tried to revamp, move or even sell the public airport in the last 40 years. Built in 1959, the existing terminal was expanded to add two new concourses in 1974 and an expanded runway in the 1980s.

For years afterward, groups lobbied to move the airport to eastern New Orleans or as far away as Donaldsonville. During his second term, then Mayor Ray Nagin seriously contemplated privatizing the airport. That debate died in 2009, around the time the acting aviation director was being investigated for insurance fraud.

At Landrieu's request, the board hired five consulting firms to look at four possible options that would best suit the airport's operations through 2048.

Parsons Brinckerhoff is managing the project; Leo A Daly/Atkins is leading design efforts; RS&H is conducting environmental impact studies; Roger Bates of Unison Maximus Consulting Solutions is doing the financial analysis and Jones Lang LaSalle is examining the plans' land-use options. The firms have been paid more than $761,000 through March for their efforts.

None of the plans call for new runways, the single greatest expense for any airport redevelopment. Instead, they all push for a consolidated security checkpoint, concession stands to be placed closer to gates and an automated baggage screening system, all pet projects of Ahmad and other airport officials.

Additionally, none of the plans call for city tax dollars to be used. Like the $305 million Super Bowl renovation, the airport will borrow the money it needs against its future revenue. New Orleans Airport generates about $107 million a year through concession sales, rents, leases, fees and other operations. It also charges passengers $4.50 each to use its facility, a standard rate that brings in another $20 million a year.

Additional financing could come from the FAA's Airport Improvement Program, as long as the final proposal meets the program's guidelines.

Although the city-owned airport is making money, federal law bans it from using that extra revenue to allay the city's budget woes, Ahmad said. And any future borrowing will certainly add to the airport's $141 million debt from past projects, though Ahmad said that sum should be paid off by 2023.

Despite its grandeur on paper, the $650 million plan would actually shrink the airport: the new terminal would be little more than half the size of the existing 1.2 million square-foot facility. Its price tag also includes demolishing much of the existing airport terminal and possibly privatizing concourse D, which was renovated last year. The plan also looks to better connect the airport to railroads and the Port of New Orleans, he said.

The other options explored by consultants include:

- Refurbishing the existing 54-year-old terminal for about $472 million. This option would require the terminal to remain in use during construction and offers no guarantee it will keep operating costs down afterward.

- Demolishing concourses A, B and C and building two new concourses on the existing footprint for about $641 million. Again, parts of the terminal would have to stay in operation while construction was underway.

- Build a new, three-concourse terminal west of the existing facility for about $538 million. Because it's a new, separate building, there would be less restraint on design improvements. Nonetheless, consultants estimated that such changes could push the price up to $723 million. It would also require relocating some cargo operations currently using its proposed site.

Should the board recommend the northern terminal option as expected, designers will flesh out the proposal before sending it to the Environmental Protection Agency and the Federal Aviation Administration for review.

Board member Roger Ogden wouldn't say which option he believed the board would choose, but said all involved have the same goal.

"Whatever option we choose, we want to deliver for New Orleans a world-class airport," he said, adding that he had been lobbying for a new airport for more than 10 years.