Chicago aldermen signed off Monday on Mayor Rahm Emanuel's plan to refinance $1.5 billion in Midway Airport debt - and got a strong sign that the $2.5 billion Midway privatization that collapsed for lack of financing may yet be cleared for takeoff.
Lois Scott, City Hall's chief financial officer, told the City Council's Finance Committee that only $40 million of the Midway bonds would be spent on new projects - for noise mitigation. The rest would refinance existing debt at reduced interest rates, Scott said. Then, she dropped a giant hint. "If the administration proceeds to lease the airport, there will be a need for a small refunding issue of approximately $300 million prior to executing the lease. . . . .That has to be repaid by January," she said. After the vote, Scott was asked why Emanuel continues to pursue a Midway privatization deal he campaigned against.
"We don't want to turn off anything that could potentially produce a benefit for our taxpayers," she said. "We're evaluating whether Midway makes sense for us to pursue. We've been directed to study it. Right now, that is as far as we've gone. . . . It's really the decision of City Council and the public as to what the right approach will be." When former-Mayor Richard M. Daley left office, he said the 99-year Midway lease was "ready to go" but that he would leave the final decision on the deal to his successor.
Determined to avoid the political furor that followed Daley's decision to privatize Chicago parking meters, Emanuel campaigned on a promise to permanently ground the Midway deal. But the city's decision to seek a pair of extensions from the Federal Aviation Administration - the latest until Dec. 31 - has raised suspicions.
So has the background of two key members of Emanuel's financial team. Scott co-founded a firm that provided strategic financial advice to state and local governments across the country about privatization deals. And, as a private attorney, city Budget Director Alex Holt advised the group that was poised to acquire Midway before the deal fell apart.
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