Port Authority OKs $5.2B to Upgrade Airports

The board approved a lease with LaGuardia Gateway Partners to design, build, finance, operate and maintain a new Terminal B.

Mon May 02, 2016 - Northeast Edition
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The board approved a lease with LaGuardia Gateway Partners to design, build, finance, operate and maintain a new Terminal B.
The board approved a lease with LaGuardia Gateway Partners to design, build, finance, operate and maintain a new Terminal B.

Underscoring a renewed commitment to its core transportation mission, the Port Authority's Board of Commissioners authorized $2.9 billion for LaGuardia Airport's new Terminal B and $2.3 billion for replacement of Terminal A at Newark Liberty International Airport, two 21st century projects that will serve as gateways to the metropolitan region.

The board approved a lease with LaGuardia Gateway Partners to design, build, finance, operate and maintain a new Terminal B. The lease also includes the construction of a new Central Hall, a key recommendation of Gov. Andrew Cuomo's airport advisory panel, and supporting infrastructure such as new roads and a parking garage.

Under an innovative public-private partnership, the largest in the United States, LGP will design, build, operate and maintain the facility, with responsibility for financing two-thirds of the new terminal. The project is expected to generate $1.3 billion in wages and $5.2 billion in regional economic activity.

The resolution includes a new Port Authority authorization for a total fixed project design and construction cost of $4.015 billion, two-thirds of which is paid for by private funds and existing passenger fees.

The board also approved $2.3 billion for the Terminal A Redevelopment Program at Newark Liberty, a project expected to generate $3.3 billion in regional economic activity overall, and eventually create 9,000 jobs and provide $600 million in wages.

A multi-phased development initiative, the Terminal A project comprises a new terminal building and a parking garage complex. Initial work authorized will include an estimated $196.3 million for construction of an access bridge connecting central terminal roadways to Carson Road, utility relocations, electrical repairs and airside paving, as well as program management and design services for the construction of a new terminal.

“[These] authorizations are a momentous step forward for our airports, for air travelers and for the economic health of the New York-New Jersey region,” said John Degnan, Port Authority chairman. “We're returning to our core transportation mission with an unprecedented investment in our vital aviation facilities.”

“Modernizing our aging airport terminals demonstrates the Port Authority's commitment to focusing on the region's transportation infrastructure,” added Scott Rechler, Port Authority vice chairman. “To achieve operating efficiencies, offer our customers the best in world-class service and meet the anticipated rise in passenger demand, it is imperative that the agency continues to make these investments in our airports.”

The LaGuardia project reflects recommendations from Gov. Cuomo's Airport Advisory Panel, including the new light-filled Central Entry Hall, which will connect Terminals B and C and unify the airport for the first time. By moving the terminal closer to the Grand Central Parkway, it will increase airport taxiways and reduce airport ground delays. In addition to the new terminal and Central Hall, LGP will also construct new roads, utilities, runway improvements, a new West Parking Garage and other supporting infrastructure.

The risk of cost overruns or schedule delays in the LaGuardia project will be transferred from the Port Authority to LGP, a private airport developer selected after a competitive request-for-proposals (RFP) process.

LaGuardia's modernization will be a major economic generator for the region. Consistent with Cuomo's nation-leading goal of 30-percent participation of Minority and Women-owned Business Enterprises (MWBE), construction of the new Terminal B project will provide extensive economic opportunities for MWBE contractors in the Borough of Queens and the region.

LGP is comprised of Vantage Airport Group, Skanska and Meridiam for development and equity investment; Skanska and Walsh Construction as the construction joint venture; HOK and Parsons Brinckerhoff as the design joint venture, and Vantage Airport Group for management of the operations. LaGuardia Gateway Partners' members have worked on more than 350 aviation and transportation projects globally and domestically.

In the case of Newark Liberty's existing Terminal A, it first opened for air passenger traffic in 1973. More than 40 years later, increased passenger volume and larger planes have led to both airfield and terminal congestion, impeding the facility's ability to accommodate modern airline fleets, meet future passenger demand, reduce delays or provide top-rate customer services and amenities.

Scheduled for completion in 2022, the modernization program is expected to result in 2,890 direct jobs and $270 million in direct payroll wages. Currently, there are approximately 21,000 people employed at Newark Liberty, which already contributes about $24 billion in economic activity to the New York-New Jersey metropolitan region and generates about 172,000 total jobs and $9 billion in annual wages.

The authorization also clears the way for the submission of a Port Authority application to recover expenditures for up to $40 million in federal Passenger Facility Charges (PFCs). Airports use these fees to pay for FAA-approved projects that enhance safety, security or capacity, reduce noise or increase air carrier competition.

Founded in 1921, the Port Authority of New York and New Jersey builds, operates, and maintains many of the most important transportation and trade infrastructure assets in the country. The agency's network of aviation, ground, rail and seaport facilities is among the busiest in the country, supports more than 550,000 regional jobs, and generates more than $23 billion in annual wages and $80 billion in annual economic activity. The Port Authority also owns and manages the 16-acre World Trade Center site, where the 1,776-foot-tall One World Trade Center is now the tallest skyscraper in the Western Hemisphere. The Port Authority receives no tax revenue from either the state of New York or New Jersey or from the city of New York. The agency raises the necessary funds for the improvement, construction or acquisition of its facilities primarily on its own credit.

For more information, visit http://www.panynj.gov.

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