"Airports Seek Help in Meeting Debts"

Tuesday, September 25, 2001

Airports Seek Help in Meeting Debts


WASHINGTON (Reuters) - Airports asked Congress Tuesday for help in
meeting their debt requirements because of a drastic decline in business
in the aftermath of the attacks on the World Trade Center and the
Pentagon. 

David Plavin, president of the Airports Council International -- North
America, also sought help from Congress to offset an estimated $3
billion in new security costs and the overall loss in business. 

``While airports are spending millions of dollars to increase security,
passengers and revenues are declining, so it is critical that Congress
and the (Bush) administration now focus attention on airports -- whose
problems and fate is inextricably tied with the airlines,'' he said. 

Plavin estimated that security costs and airport revenue losses tied to
the Sept. 11 attacks could reach $3 billion by next year. 

He said relief should come from general federal funds, but said other
financing options included a security fee on airline tickets and
temporary access to federal funds earmarked for other aviation programs.


To help airports meet their obligations, Plavin asked Congress to permit
them to refinance all tax exempt debt and to provide three to six months
of debt service to compensate for the dramatic reduction in airline
business. 

Plavin said the decline in passenger revenue has ``further created
instability'' in the airport bond market, noting the Standard & Poor's
announcement last week that all of its North American airports are on
``credit watch.'' 

His group and the American Association of Airport Executives, also want
Congress to provide certain insurance guarantees, which lawmakers did
for the financially struggling airlines last week. 

``While insurance companies have raised the price of war- risk insurance
for airlines, they are canceling it for airports so that it is not
available at any costs,'' Plavin said. 

``With such a high amount of fixed costs associated with airports, there
are some airports that won't be able to operate with out it and may be
forced to shut down critical operations unless they receive the
necessary relief,'' he said.

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