* Delta, AirTran to pay $30 million supplementary rent
* Deal to help fund bond issue for new terminal building
* Bond offering planned for around $620 million
(Adds byline, details on bonds, paragraphs 6-7)
By Matthew Bigg
ATLANTA, Aug 31 Airlines will pay increased
rent at Atlanta's Hartsfield-Jackson Airport under a deal with
the city that will help fund a new international terminal,
Mayor Kasim Reed announced on Tuesday.
Under the deal, Delta Air Lines Inc (DAL.N) -- the current
industry leader -- AirTran Airways AAI.N and other carriers
will pay a supplementary fee of $30 million spread over four
years from fiscal year 2013 to 2016.
That money will help fund an international terminal due to
be completed in early 2012 and enable the airport to retain
adequate financial reserves to maintain its credit rating, Reed
"The deal ... will be another key element of our effort to
ensure Atlanta's airport remains the world's busiest passenger
airport," he said of the deal, which revised an agreement
reached in 2009.
The airport is a major source of economic dynamism in
Atlanta, one of the fastest-growing cities in the United
Later this year, the city will start a roadshow ahead of a
bond issue of around $620 million intended to complete capital
needs for the terminal.
The closing date for the offering of bonds is tentatively
set for mid-November and there will be two additional offerings
in early 2011 for other purposes, according to city
communications director Sonji Jacobs Dade.
The airport would make contractual payments to the airlines
contingent on the strength of the recovery and the airport's
financial indicators in fiscal 2015-17.
Those payments would range from zero to $30 million,
contingent upon the airport achieving debt service coverage of
more than 1.5 for fiscal 2015-17, Reed said. The ratio is a
measure of the airport's ability to cover its monthly
The terminal will serve passengers arriving from outside
the United States and open an eastern access to the airport.
It will also obviate the need for arriving international
passengers to recheck their bags once they have passed through
immigration and customs and before leaving the airport, a
system unpopular with passengers.
(Editing by Kevin Gray and Gary Crosse))