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To Latitude41: The $500 million cost for improvements at Green may be a "drop in the bucket" compared to the $5 billion cost at Philadelphia. Philadelphia is about 10 times bigger than Green making the numbers about the same. Now USAirways is threatening to pull out of Philadelphia making life miserable for 60 percent of the passenger base there. That move would have a dramatic impact on Green.

Fitch Ratings reports on the Philadelphia recent bond offering: "(cost per enplanement) estimated at approximately $10.23 for fiscal year 2011. The CPE is projected to increase to approximately $13.5 by 2014 and possibly higher in later years in conjunction with a proposed capital enhancement program (CEP);"

Fitch Ratings has warned RIAC that further borrowing would cause a credit rating drop. This is not allowed under Rhode Island debt ceiling statute.

This $10.23 cost per enplanement is lower than Green's $11 or so cost. If RIAC somehow figured out how to get financing, the combination of the glycol plant and the safety improvements will drive Green's cost per enplanement up to around $16 or more.

Then the runway extension at Green would bump it up to over $30 per enplanement - a cost that will drive all the airlines out and probably force the airport to close the passenger terminal. The two are tied together. If USAirways pulls out of Philadelphia as threatened it would probably pull out of Green too if RIAC keeps moving forward with its expansion plan seeking out some crazy strategy to finance the "improvement."

That is why the runway expansion is a pipe dream.

From: Council working on demands of airport

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