Des Moines airport's $500 million overhaul may be delayed years

The funding shortfall for a new Des Moines International Airport terminal has grown by some $25 million, and the project may be delayed for years.

The Des Moines Airport Authority Board heard that updated prognosis Tuesday from infrastructure consulting firm HNTB, which is based in Kansas City, Missouri.

The board voted in October 2016 to build a new terminal on the east side of the airport grounds near Fleur Drive. The total cost of the overhaul, which includes runway improvements, was estimated at about $500 million.

Airport officials had hoped to start construction on the 14-gate terminal in 2022. But after federal delays on funding runway upgrades, construction on the new terminal may not start until 2026, they learned this week.

About $300 million in funding has been identified for the project. That will come from a mix of cash on hand, passenger and airline fees, authority-issued bonds and grant money.

But those initial estimates left a funding hole of about $200 million. "And that situation hasn’t improved," said Kevin Foley, the airport's executive director and general manager.

In fact, it's worsened.

Delays have driven up the price tag as construction costs rise along with a local building boom, Foley said. Yet he remains optimistic Des Moines will see a new terminal.

"I'm as confident today as I ever was," he said. "Exactly what the terminal will look like, I don’t know."

Initial studies have focused on the amount of space needed for the terminal, Foley said. No design work has been completed. So airport leaders will now consider ways to trim costs from the project. Trimming down square footage, choosing cheaper finishes and moves like using a flat roof rather than a sloped one could help bring the cost down.

Foley said one option discussed this week was keeping administrative offices in the current terminal, rather than immediately demolishing it as originally planned. Or, the airport could look at cutting down its 25 percent contingency fund, which is included in the $500 million figure, Foley said.

"It’s a combination of things that will help close that gap," he said.

In the meantime, the airport plans to forge ahead with other projects. A $45 million upgrade of both runways is underway. And the airport will begin moving general aviation hangars north of the current terminal to the south side of the airfield

"That has to happen whether we build a new terminal or not," he said.

Much of the project could hinge on the actions of political leaders in the nation's capital.

Foley said increasing Passenger Facility Charges is key to improving the funding picture. In a Des Moines Register op-ed, Foley laid out his case for increasing the $4.50 cap on those fees charged on every airline ticket.

"Without that increase, a new terminal in Des Moines may not become a reality for many years," Foley wrote.

In that column, he put the current state of the local terminal in stark terms:

"The 1948 passenger terminal is rapidly becoming overcrowded and obsolete. With the growth in passenger traffic, the terminal is at the threshold of becoming a deterrent to economic growth in the state, rather than a tool that fosters growth."

Though funding plans don't currently include any added federal grants, Foley is hopeful that Washington may make infrastructure projects a top priority.

In January, the new airport terminal rounded out a top five wish list of Iowa infrastructure projects from then-Gov. Terry Branstad. The governor responded to a call from Donald Trump, the president-elect at the time, who asked states to prioritize their most urgent infrastructure needs.

"Inclusion in an infrastructure program could secure the project," accelerate construction, and shorten the time frame for completion, the governor's memo stated.

During his campaign, Trump pledged to roll out a massive infrastructure program to repair bridges, airports and ports. Foley believes the White House still wants an infrastructure push, but it may be behind other priorities like tax reform.

"The way things are coming out of Washington, D.C., right now," Foley said, "it's kind of in turmoil there."