Council OKs funds to attract new airline to city

March 12th, 2014

News Coverage:

Council OKs funds to attract new airline to city

By Cindy Larson of The News-Sentinel

Wednesday, March 12, 2014 - 12:01 am

Tuesday night Fort Wayne City Council approved an amended ordinance allocating $600,000 in funds that hopefully will attract a new airline to the city that would fly to the East Coast.

Last month Mayor Tom Henry's administration requested $600,000 from the city's Legacy fund to be used as part of a $2.5 million package to entice an airline to provide service between Fort Wayne International Airport and a northeast hub, likely Philadelphia or Newark, N.J. The money would be used to partially offset a carrier's risk of entering a new market.

The proposal was withdrawn when some council members balked at using Legacy funds for this particular use. The city's $71 million Legacy fund, created by the sale of the former City Light utility, is supposed to be used for "transformational" projects. A super majority of council -- six of the nine members -- must approve the use of Legacy funds.

Deputy Mayor Karl Bandemer and Scott Hinderman, executive director of the Fort Wayne-Allen County Airport Authority, were at the council table Tuesday night with a compromise acceptable to eight of the nine council members.

Bandemer asked for an amendment in which 50 percent of the funding, or $300,000, would come from the city's share of County Economic Development Income Taxes, or CEDIT, and $300,000 would come from Legacy funds over two years.

Before council voted, Hinderman made his case for the need for service to the Northeast, showing a map of the United States and the airports FWI now serves. "If you look at the map, obviously there's a hole in the Northeast," he said.

Two carriers are interested in supplying air service from FWI to the East Coast, Hinderman said, but they require a minimum revenue guarantee, which is what the $2.5 million package is for. The airport authority is trying to leverage a $600,000 grant it secured with money from the city, Allen County and local economic development groups.

Council voted 8-1 for the amended resolution, with Russ Jehl, R-2nd. voting against it.

The dispute over how to use Legacy funds, and how to define a "transformational" project, prompted Bandemer to tell council a vetting process needs to be established for future requests from the Legacy fund. He said some council members should be involved in that discussion.