CHICAGO — Chicago plans to sell $1 billion of O’Hare International Airport third-lien general airport revenue bonds next month.
The announcement Wednesday afternoon of a revamped bond deal for O’Hare comes after the city resolved litigation brought by airlines that had challenged its authority to finance remaining projects under an $8 billion airport expansion plan.
The deal will include $1 billion of GARBs and at least another $51 million of refunding revenue bonds backed by passenger facility charges.
“We must continue to invest in our airport infrastructure,” city chief financial officer Gene Saffold said in a statement. “These bonds will provide important financing for continuing our key construction projects at O’Hare.”
Chicago plans to enter the market during the week of April 18. Citi is the book-running senior manager and Siebert Brandford Shank & Co. is co-senior. The city originally intended to sell about $1.1 billion of airport bonds backed by PFCs and federal grants in early February without airline approval for the final phase of the O’Hare Modernization Program.
As the city readied the original sale, O’Hare’s two largest airlines — American Airlines and United Airlines — filed a lawsuit challenging the city’s authority to start construction on the remaining $3.36 billion worth of O’Hare expansion projects, forcing the city to put the deal on hold.
In a deal brokered by federal authorities, Chicago Mayor Richard Daley and airline officials announced last week an agreement that allows the city to begin work on $1.17 billion of remaining projects. Under the pact, Chicago can proceed with construction of one new runway and some land improvements. The city agreed to put off other projects for now and the airlines dropped their lawsuit.