Miami Airport Expansion Experiences Turbulence

<I>Miami</I> - While American Airlines chairman Robert Crandall envisions Miami International Airport as being an international hub of global proportions, attaining that goal has not been easy.

MIA director Gary Dellapa forsees the airport as having a fourth runway, a $150 million addition to an ongoing, $4 billion expansion program that will allow the facility to continue its exponential growth.

But neither Crandall nor Dellapa is likely to realize his dream without overcoming some obstacles, as court cases, construction problems and regulatory logjams have mired the landlocked airport's attempts to expand its facilities at a rate commensurate with its burgeoning passenger counts.

In 1995, MIA became the sixth busiest airport in the United States in terms of total passengers, with about 33.2 million travelers passing through the facility. And while final tabulations for the 1996 passenger count were not yet available, year-to-date totals at the beginning of December showed the airport with about a 0.8 percent increase in total passengers, and a 3.2 percent increase in international passengers, the airport's fastest-growing customer segment.

As construction problems have occurred, such as when structural problems were discovered recently in a new $27 million parking garage, critics have made the inevitable comparison to problem-plagued Denver International Airport. But MIA has one fundamental problem that DIA doesn't face, even though both airports handle about the same yearly passenger volume.

While Denver's new airport has 39,900 acres on which to build and expand, MIA has less than one-tenth that much land-3,200 acres-and no chance of acquiring more, since the property on all sides of the airport is thoroughly developed and would be prohibitively expensive.

"We have an immense challenge at MIA," Dellapa said. "We are literally building a new airport on top of the old one while we remain fully operational and accommodate 35 million passengers a year, plus nearly two million tons of cargo."

Dellapa said MIA's growth has made a fourth runway vital, with the current level of runway congestion causing an average 20-minute delay per flight.

Airport officials estimate that at the current rate of air traffic growth, in four years the average flight delay will reach 40 minutes. Plans call for an 8,600-foot runway on the north side of the airport complex, a project that would take five years to complete. But, because the runway plan's environmental impact statement has been stranded within the Federal Aviation Administration regulatory bureaucracy, the soonest that runway construction could begin is 1999, say MIA officials.

Another big airport project, a new passenger terminal that would cost almost $1 billion, has hit a snag. Just over a year ago, five carriers-Air Canada, Delta Air Lines, TWA, USAir and United Airlines-filed suit over the method of financing the terminal, which would call for the carriers to share the cost based on their usage. American Airlines fought the suit, stating that it was not about financing, but about the increased level of competition American has brought to MIA. Since 1989, American's presence in Miami has grown from 20 flights a day to almost 300 (193 American flights and 89 American Eagle commuter flights).

The bulk of American's growth at MIA-the carrier's most profitable and fastest-growing operational hub-has been in its Latin American and Caribbean flights, which Crandall said account for nearly 25 percent of the carrier's total revenues and an even larger percentage of its profits.

The carriers that filed suit to contest the financing plan for the terminal say the plan forces them to help pay for a new terminal they didn't ask for. The new terminal plan calls for such amenities as 1.4 miles of moving sidewalks, which opponents criticize as frills.

But on Nov. 7, a Miami federal district judge dismissed about half the complaints in the suit, referring them to the FAA for a ruling. The judge delayed consideration of other parts of the suit until after the FAA takes action in the primary issues, a move that lawyers for the two sides expect to take several months.

Both Dellapa and Alvin Davis, an attorney representing American in Miami court hearings, said the funding plan is fair, and would require American to pay for nearly half of the costs of a terminal complex that also would serve 130 other airlines. Dellapa said the new terminal is necessary to keep MIA competitive as an international airport. The new terminal, which would be the third at MIA, would have 47 jet gates and 29 gates for the prop jets used by commuter carriers. Terminal plans also call for 70 escalators and 50 elevators. Airport officials say the terminal will take about four years to construct.

Meanwhile, the problems with the new airport parking garage surfaced in December, the month the 1,554-parking space facility was scheduled to open. The airport staff reported that structural cracks were found in 65 percent of the beams that support the garage, and that opening might be delayed by as much as a year.

Despite the obstacles, however, MIA continues to grow.

In November, discount carrier Western Pacific Airlines, based in Colorado Springs, Colo., opened service to MIA. Western Pacific, launched in April 1995, now serves 22 cities, including Los Angeles, Phoenix and other western cities. The Western Pacific service gives Miami travelers a price-competitive alternative for transportation to the West Coast, via Colorado Springs. Western Pacific has recently been locked in a fare war with United Airlines, the dominant carrier at Denver International. United also flies between its Denver hub and Miami. Like Southwest Airlines, the granddaddy of discount carriers, Western Pacific has a history of lowering average fares and increasing passenger travel each time it opens a market. When Western Pacific opened service between Colorado Springs and Houston, the average ticket price for all airlines serving that route dropped from $176 to $94 and passenger traffic increased by 600 percent, according to a Department of Transportation study.