Atlanta Mayor Shirley Franklin said Monday that she has recommended the City Council approve legislation that would extend the lease between Hartsfield-Jackson International Airport and Delta Air Lines covering gates and other space for seven years, ensuring that the world’s busiest airport does not lose its largest hub airline.
“The proposed extension continues the important partnership between Delta and Atlanta that dates back to 1941,” Franklin said in a statement. “It keeps Delta’s headquarters in Atlanta. This is especially good news here in Atlanta during these difficult economic times.”
Lease negotiations have delayed the city’s efforts to sell $1.4 billion of new-money and refunding bonds for Hartsfield-Jackson. The City Council actually approved the issue in July and the bonds were expected to price in August.
Extending the lease of Delta and other airlines now will help pave the way for pricing the bonds.
The offering will include $800 million of new debt largely to complete the $1.3 billion international terminal and $590 million to refinance outstanding variable-rate bonds. The VR refunding is critical because of remarketing difficulties and higher debt service costs due to downgrades of MBIA Insurance Corp.
Delta’s lease extension still must be approved by the city’s Transportation Committee next week and the City Council after that.
Atlanta also is preparing to sell $454 million of water and wastewater revenue refunding bonds, which were rated A with a negative outlook by Standard & Poor’s on Tuesday. The bonds will refinance Series 2001B and C variable-rate demand obligations that converted to bank bonds earlier this year when the liquidity provider did not extend its liquidity facility.
