Airline troubles could cost KCI millions, slow renovation

KANSAS CITY, Mo. -- If bankrupt Vanguard Airlines cannot find the financing it needs to get back into the air, its employees won't be the only ones hurt.

The loss of Kansas City's hometown airline, which shut down and filed for Chapter 11 bankruptcy protection on July 30, could cost Kansas City International Airport $2 million to $4 million per year, the city's aviation director said.

"We would all prefer to have Vanguard fly rather than not fly," Russ Widmar told the city council's aviation committee on Wednesday.

If the airline is permanently grounded, Widmar said revenue shortfalls are projected for passenger facility charges, landing fees, terminal rents, parking, and restaurants and retail shops.

Widmar said a team of airport staff members, architects and project managers was reviewing the impact Vanguard will have on the airport's terminal renovation project.

That group will report soon to senior management with recommendations that could include postponing purchases of furniture and nine new passenger boarding bridges, which will cost $500,000 each.

Some phases of the terminal project, which are not scheduled until a later date, also could be changed. The entire renovation is expected to be completed in late 2004.

The only good news, Widmar said, is that other airlines could fill the void left by Vanguard. Midwest Express Airlines might be adding service, and AirTran Airways and Delta Connection will begin flying in October.

Meanwhile, US Airways, which has 10 daily flights at KCI, is still operating but has had its debt payments suspended. The airline pays the city $31,000 in landing fees and $62,000 in rents monthly, Widmar said. It also owes $80,500 in passenger facility charges, but that money is in a trust and not at risk.

Councilwoman Teresa Loar, the chairwoman of the aviation committee, acknowledged tough times ahead for the airport but said she remained hopeful that smaller -- but profitable -- airlines could be attracted to Kansas City.

"Kansas City is at the center of the country," Loar said. "We have a lot of gates available at KCI and are poised to benefit from changes in the aviation industry. We will try to snag some airline business."

On Wednesday, a bankruptcy court judge approved payments to Vanguard of $50,000 a week for the next three weeks from an investment group that is considering buying Vanguard.

The group is headed by Robert H. Brooks, chairman of the Hooters restaurant chain. The money to pay the skeleton staff still working at Vanguard will come from the newly formed Hooters Air Inc.