Minnesota Metropolitan Airports Commission board members last week asked the agency’s staff to renegotiate some terms of a proposed agreement that would allow Delta Air Lines Inc. to close its local Northwest Airlines Corp. headquarters without triggering repayment of $245 million of debt.
Under the proposed agreement, Delta — which acquired Northwest in October — would be required to repay the bonds that mature in 2022 on an accelerated schedule by 2016. Atlanta-based Delta also will still remain eligible to receive concession revenue that it would have forfeited under an existing agreement for closing its local headquarters.
The airline will receive $10 million in financing assistance for a maintenance and administration building at the Minneapolis-St. Paul International Airport that would be repaid with rental payments. Delta also agreed to house its regional operations at the airport.
The commission was presented with a summary of the deal last month. Under the existing agreement, Northwest was obligated to keep its hub at the airport and its headquarters in the region, maintain two maintenance hangars, and continue paying off the remaining $245 million from a $275 million 1992 debt issue.
In the event the airline reneged on its commitment to keep the hub and headquarters, the commission could demand repayment of the bonds that carry its general obligation pledge within the next 12 to 15 months.