Director: DSM airport terminal needs outside funding to avoid 15-year delay

By: - April 5, 2021 3:59 pm

The Des Moines airport could delay a new terminal for 15 years. (Photo by Perry Beeman/Iowa Capital Dispatch)

The Des Moines airport will build a new terminal with its own revenues if outside help isn’t available, but that would mean an economically risky delay of 15 to 20 years, the director said. 

“It’s not if the terminal is going to be built, but when,” said Kevin Foley, executive director of Des Moines International Airport. “We can put operating revenue into cash reserves (for the terminal), but that might take 15 to 20 years.

“Then the question becomes what have you done to your market and to the state of Iowa,” Foley added.

Kevin Foley is the executive director and general manager of Des Moines International Airport. (Photo courtesy of Des Moines International Airport)

Foley said he and his airport allies are lobbying hard to fill a $200 million budget deficit for the $500 million-plus project. The existing terminal was built in 1948.

The most promising option would be Congress giving airports the right to raise per-ticket fees, called PFCs or passenger facility charges, Foley said. Those fees, approved by local authorities after Congress sets a limit, have not increased since 2000.

There also has been talk of government grants, but the Legislature has taken no action on a proposed allocation from gambling revenues. Leaders of the Iowa legislative subcommittee on transportation issues did not immediately return emails seeking comment.

“The groundwork is laid”

“It’s very clear that our politicians have heard us, locally and federally,” Foley said. “The governor recognizes the need. The groundwork is laid.”

Congress has balked for years on allowing the locally approved fee increases, despite airport industry pleas and reports indicating there is a $115 billion backlog of improvements needed at airports nationally. 

Current plans call for the Des Moines airport terminal construction to begin in 2026, with the opening in 2028. The Des Moines project could get at least a modest boost from President Joe Biden’s infrastructure plan, which includes $25 billion for airports. Foley isn’t sure how much the Des Moines airport will get from that allocation, but the airport has been able to keep its staff thanks to two previous pandemic relief bills.

If all else fails, Foley said, the airport could save money for the terminal over years, after it finishes a new entrance, relocation of some services and construction of an additional parking garage. But waiting 15 or 20 years to open a new terminal that is likely to be needed inside of the next decade would mean risking losing routes because airlines won’t use the currently dated and nearly obsolete gate systems and alignment long-term, Foley said. 

“We are steaming toward a brick wall,” if outside funding doesn’t turn up, Foley said. The alternative would be to wait until the airport reserves could handle the local share of the project. “You can’t start the project if you don’t have the funding,” Foley added.

The airport terminal has been among the biggest priorities of Des Moines-area business groups, including the Greater Des Moines Partnership.

Business leader: “It’s time”

Partnership CEO Jay Byers said airport traffic already is slowly rebounding. It likely will return to record levels by the end of 2025, if not sooner, industry sources have estimated. Currently, the airport is drawing about half of the traffic it did in 2019, before the coronavirus pandemic.

Greater Des Moines Partnership CEO Jay Byers. (Photo courtesy of the Partnership)

Recent gains in traffic mean the existing terminal, opened in 1948, needs to be replaced to be ready for the full recovery of air travel, Byers said. 

”It’s pretty amazing they’ve made it look as good as they have and have made it seem pretty functional, but the experts will tell you it’s time (for a new terminal),” Byers said of the 1948 facility.

Byers noted that many industry projections suggest the Des Moines airport will draw 3 million passengers annually by 2024 or 2025, returning to record business. At that point, “we’re really busting at the seams,” Byers said.

“Even under the existing schedule, it’s going to take at least that long to get moving with this new terminal. We can’t take our foot off the gas,” Byers said. 

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Perry Beeman
Perry Beeman

Perry Beeman has nearly 40 years of experience in Iowa journalism and has won national awards for environmental and business writing. He has written for The Des Moines Register and the Business Record, where he also served as managing editor. He also is former editorial director of Grinnell College. He co-authored the recently published book, "The $80 Billion Gamble," which details the lottery-rigging case of Eddie Tipton.

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