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 Excepted from the Indianapolis Star: Airport may seek consultant to find hub tenants The Indianapolis Airport Authority will hire an additional consultant to find tenants for the abandoned United Airlines repair base, under a proposed agreement with United bondholders. The contract with SH&E, an aviation consulting firm in Cambridge, Mass., is contingent on the majority of bondholders agreeing to the pact announced Friday. It would distribute $40 million in unused proceeds of United bonds the authority floated in the 1990s. The authority issued about $220 million in bonds to build and equip the center United leased at Indianapolis International Airport for $697,000 a year. United pulled out last May, idling more than 1,500 workers. The airport authority filed a lawsuit last year in a Marion County court to prevent the bondholder's trustee, Fifth Third Bank, from distributing the $40 million to bondholders. The authority said it wanted to "become satisfied that there would be sufficient funds available to maintain, insure, protect and lease the IMC." Under the agreement, the authority would have access to $14 million of the proceeds -- $7.5 million for maintaining the base and $6.5 million that could be used for capital improvements to attract a new tenant. The deal was reached with a group representing 44 percent of bondholders, although it is expected that most will sign on, said airport Director Patrick Dooley. Airport officials have argued that setting aside some of the unused proceeds for upkeep and improvements helps bondholders by making the base more marketable to a tenant or tenants. United, now in bankruptcy reorganization, stopped paying interest on the bonds last May. The airport authority recently authorized $1.5 million in "one-time" expenses to mothball the base. Assuming a majority of bondholders approve the deal, the authority will hire contractors to conduct a full environmental audit of the base and a wider audit of tools and equipment. BACK Aviation Solutions plans to hire dozens of former United mechanics to conduct the tool audit, Dooley said. The jobs would be temporary, however. SH&E has worked previously as a consultant to the state on the United base. It will supplement consulting work being conducted by Denver-based Strand Associates, which was hired by the city last year. Officials will not identify prospective tenants. Aviation Line Preservation, a local group headed by former United mechanics, has presented a proposal to take over the base.
Webster O’Brien, Director - Corporate Marketing, SH&E © 1996-2004, SH&E, Inc., All rights reserved
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