Delta, Hartsfield-Jackson reach lease deal

By Kelly Yamanouchi and Eric Stirgus

The Atlanta Journal-Constitution

Hartsfield-Jackson International Airport and Delta Air Lines have reached a crucial lease agreement that continues their decades-long partnership and clears the way for the airport to continue construction of its new international terminal.

The deal to extend Delta's lease through 2017 comes after months of contentious negotiations that included a threat by Delta that it could move some flights from Atlanta to other hubs and threats by Hartsfield-Jackson that it could stop construction of the international terminal.

The agreement, which will replace a 30-year deal set to expire next year, is subject to approval by the Atlanta City Council and Delta's board of directors. Documents have not yet been finalized.

City officials said they expect to work out similar lease agreements with AirTran Airwaysand other airlines that use the airport.

Mayor Shirley Franklin, who leaves office at the end of the year, said the deal keeps Delta’s headquarters in Atlanta and ensures Hartsfield-Jackson will be "the best airport in the world for years to come. This is especially good news here in Atlanta during these difficult economic times."

The city said the lease extension paves the way for finishing the $1.3 billion Maynard H. Jackson International Terminal, which is the last major project in the airport’s $6.2 billion capital improvement program.

The legislation was introduced on behalf of the mayor's office Monday by council members Clair Muller and C.T. Martin.

Muller, who chairs the council's transportation committee, said the committee will begin reviewing the agreement next week. Muller said she'll also plan a work session to allow the entire council to examine the deal.

"It's a big contract and we need to thoroughly discuss it," Muller said.

Martin said he is glad that the lease does not extend several decades.

"We need something that could be looked at frequently if the market changes or other kinds of things," he said. Muller said she understood that most airport lease agreements last five or six years.

Martin said he wants to make sure the agreement ensures a commitment to participation of minority-owned businesses in the completion of the Jackson terminal.

Delta said the agreement will "ensure the continued growth of air service" in Atlanta. Hartsfield-Jackson is the world's busiest airport and Delta is the world's largest airline, with its largest hub at Hartsfield-Jackson and a 70-year history in Atlanta.

Airport officials in July got city council approval for an $800 million bond deal to complete the international terminal, scheduled to be finished in 2012. The city expects to issue bonds for the completion of the terminal in the next several months.

Delta sought to keep its costs low at Hartsfield-Jackson, and a dispute between Delta and the airport over the cost of the international terminal complicated the lease discussions. One of the airport's interests in its competition plan was "to assure an airline does not unreasonably have the ability to block necessary capital improvements."

The existing lease does not expire until Sept. 20, 2010, but the city had been working toward a new agreement before the end of this year.