The Chicagoist will be launching later but in the meantime please enjoy our archives.

Emanuel Delays Midway Privatization Deal

By Chuck Sudo in News on Sep 6, 2013 1:30PM

Photo credit: Peter Behr
Mayor Rahm Emanuel halted plans to move forward with privatizing Midway Airport Thursday. It’s the latest setback in Emanuel’s attempts to privatize city assets to help get the city out from under a mountain of mounting debt.

There’s been increasing opposition by City Council to a Midway privatization deal but according to Emanuel spokeswoman Sarah Hamilton that wasn’t the reason the mayor decided to shelve the plan for now. Industry Funds Management and Manchester Airports Group, one of the final two bidders for Midway, pulled its name from consideration earlier this week.

"The mayor said all along he wanted this to be a competitive process in order to get the best possible deal for the citizens of Chicago," Hamilton said. "With only one company left, that wasn't the case."

There may also have been some “ubi est mea?” (“where’s mine?”) Chicago-style wheeling and dealing behind the scenes, as well. According to the Tribune the Great Lakes Airport Alliance—the group that remained in the running—hired lobbyist William Filan last spring as a consultant. Filan is a friend and business associate of Mark Fary, former 12th Ward alderman and the husband of Chicago Aviation Commissioner Rosemary Andolino. Filan has paid Fary $154,000 since 2007 to lobby the city on behalf of his clients.

Per the Trib:

In an email, Filan said he has only consulted Macquarie and Ferrovial on their bid. He said he has not lobbied the Aviation Department or any other city department on their behalf but registered to do so because he might. Filan said Fary did not know Filan was representing the two Midway hopefuls until after the Tribune inquired about his involvement late last week.

Andolino declined to comment. Fary could not be reached for comment.

City Finance Department spokeswoman Kelley Quinn said any relationship among Filan, Fary and Andolino has had no bearing on the prospects for the Great Lakes lease bid and said the Aviation Department is not taking part in vetting the Midway proposals.

But Quinn acknowledged that Andolino has had discussions about the airport privatization with staff members of Emanuel's chief financial officer, Lois Scott, the mayor's point person on the Midway lease process.

Great Lakes Airport Alliance, a partnership between Spanish firm Ferrovial and Macquarie Group (which holds a 99-year lease on the Chicago Skyway), had a bid in place for Midway worth $2 billion. A source familiar with the negotiations told the Sun-Times the two bidders “fell short of what city taxpayers deserve to be investors in Midway. We set a high bar to meet and nobody got there. The mayor was briefed on the value of what these companies would invest and said it was not what the taxpayers deserve and he said, `no.’ He always said if it was not going to be the best arrangement for the taxpayers, he would walk away.”

Emanuel has insisted the winning bidder for Midway would have to agree to a 40-year lease, a “Travelers Bill of Rights” to prevent a contractor from gouging travelers for food, retail and parking rigid safety and cleanliness standards the private contractor footing the bill for police and fire protection and sliding scale revenue sharing with the city over the course of the deal. Ald. Michael Zalewski (23rd), whose ward includes Midway, expressed concern a deal would result in later flights at “the World’s Busiest Square Mile,” among other issues. Opponents of Ferrovial have accused the firm in the past of union-busting and black-listing of workers.