Delta lease sails through city council

By Kelly Yamanouchi and Eric Stirgus

The Atlanta Journal-Constitution

The Atlanta City Council on Monday approved a proposed new lease between Hartsfield-Jackson International Airport and its biggest tenant, Delta Air Lines.

The vote was 15 to 0, and the deal now goes to Mayor Shirley Franklin for signing. Franklin called the deal a "win-win for the city" and one that's "important to the economic viability of the region."

The lease sets gate rental terms and other fees for Delta’s mammoth operation at Hartsfield-Jackson. The seven-year deal will replace a 30-year lease set to expire in 2010.

The Franklin administration wanted to get the lease nailed down before the mayor leaves office, in part to assure a stable revenue stream and secure Delta's support of the city’s effort to finance the continued construction of a new international terminal.

Delta chief executive Richard Anderson applauded the approval, saying it continues "the historic relationship between the city of Atlanta and Deltathat has turned our hometown airport into an economic engine that pumps $23.5 billion annually into our region and supports tens of thousands of jobs."

The swift approval Monday came after a series of work sessions and committee meetings where some councilmembers raised questions and the Federal Aviation Administration's initial criticism of the deal, including issues highlighted by airport manager Ben DeCosta. The FAA later said most of the concerns had been addressed.

The new deal keeps Delta’s expenses at roughly the same level as the old lease, aside from increases when the new terminal opens in 2012. Some councilmembers were concerned about provisions that give Delta sway over future projects.

Council president Lisa Borders said she talked with councilmembers over the weekend to answers questions. Some questioned the length of the lease term. They were swayed to approve the contract largely because DeCosta and Delta officials felt comfortable with the agreement, Borders said.

While approval was unanimous, the council attached an amendment by Felicia Moore directing the city to keep those concerns in mind when negotiations start on the next lease.

The amendment "encourages the mayor and staff" to consider matters including the Federal Aviation Administration's recommendation to eliminate a provision that effectively gives Delta veto power over major capital improvement projects when negotiating a new contract in the fifth year of the agreement.

Dan Benzon, a representative for American, Continental, United and US Airways, in comments at the meeting asked for an amendment that could allow those airlines to retain more control of gates. He said he hopes the airlines can address the issue in their own lease negotiations with the city.