McKinney | June 2023

DEVELOPMENT McKinney considers alternate funding for airport expansion

380

INDUSTRIAL BLVD.

AIRPORT DR.

BY SHELBIE HAMILTON

A proposed expansion to add a commercial passen- ger terminal at McKinney National Airport is still in limbo following a May 23 City Council work session. Following the failure of a $200 million bond proposition in the May 6 election to fund the pro- posed airport expansion project, alternative funding options were presented to City Council members for consideration. However, council members didn’t provide any feedback to city sta on whether to pursue an alternate funding source and proceed with the airport expansion project. How we got here A bond committee convened in late 2022 to con- sider the proposed commercial terminal and addition of commercial service at McKinney National Airport. The plans for the proposed expansion project included adding a 144,000-square-foot commercial terminal with four gates, 2,000 parking spaces, enhanced passenger experience amenities and more on the east side of the airport. The overall project scope totaled $300 million, of which $200 million was proposed to be funded by general obligation bonds. McKinney voters didn’t approve the bond proposition on the May 6 ballot with 58.69% of votes cast, or 12,822 votes, being against the measure. The details There are options for funding a commercial pas- senger terminal at McKinney National Airport despite the general obligation bond proposition failure, according to a presentation at the meeting. Edward Shelswell-White of SkySynergy, an avia- tion consultant who worked with the city during the bond proposition process, presented typical funding sources other than general obligation bonds that can

The proposed commercial passenger terminal would include four gates with room to grow to 16, according to plans presented by city ocials. (Rendering courtesy city of McKinney)

be used for airport capacity projects. According to the presentation, other typical fund- ing sources used include some combination of: • Federal and state funds • Bonds backed by passenger facility charges • Bonds backed by general airport revenue

TERMINAL TIMELINE

McKinney city leaders began considering the possible commercial terminal expansion in 2019.

2019 The city of McKinney receives unsolicited interest from airlines about adding commercial passenger service at the airport. September to November 2022 A citizen bond committee convenes and reviews the plans and bond package. Feb. 7, 2023 A $200 million general obligation bond proposition was added to the ballot for the spring election. May 23, 2023 Council members are presented with alternative funding options for the project. May 6, 2023 The bond package failed on Election Day, with 58.69% cast against the bond proposition. March to April 2023 Public input meetings are hosted to share preliminary results of the environmental assessment of the proposed expansion.

• Cash reserves on hand • Airline development • Public-private partnership development Going forward

Council members didn’t provide any feedback to city sta on whether to pursue an alternate funding source for the airport expansion project. Shelswell-White directed council members to con- sider the results of the bond election as well as other development options and the feasibility of alternate funding methods prior to providing feedback on how to move forward. Shelswell-White also noted the consultancy will remain in contact with representatives of candidate airlines while council members consider the options. “[Airport representatives] understand even better than we do that airport development anywhere tends to have an element of controversy, so what happened here on May 6 is not unusual at all,” Shelswell-White said. “It’s not going to deter the airlines.” Assistant City Manager Barry Shelton said the city would likely retain the city-owned land on the east side of the airport if city leaders don’t proceed with the commercial terminal project.

SOURCE: CITY OF MCKINNEYCOMMUNITY IMPACT

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