It’s rare and interesting when business and labor can find common ground on an issue, and even more so when that issue is advocacy for privatization. But that’s exactly what’s happening in Chicago right now, where Chicagoland Chamber of Commerce CEO Jerry Roper and Chicago Federation of Labor president Dennis Gannon are jointly calling on Mayor Daley to re-launch his initiative for a long-term lease of Midway Airport.
In their recent Chicago Tribune op-ed, Roper and Gannon cite the success of the Mayor’s earlier asset leases to support their call for a Midway lease (emphasis mine):
Mayor Richard Daley should affirm his commitment to a public-private partnership at Midway Airport, an initiative that could provide money for infrastructure improvements and shore up public pensions. Earlier privatization partnerships have saved Chicagoans from sharp tax increases, higher unemployment rates and cuts in city services. […]
Not long ago, Midway was a virtual ghost town. Under Daley’s leadership, the airport has become a phenomenal success story, giving Chicago the rare chance to capitalize on this potential investment for the benefit of nonairport purposes like roads, schools and pensions. Only through [the federal airport privatization] pilot program can the city tap into Midway’s value. Failing to take advantage of this exclusive partnership means Chicago may lose close to $1 billion.
The City Council authorized the partnership deal in the fall of 2008. However, due to the global credit crisis, the winning bidder could not arrange financing.
Today, conditions are significantly better, evidenced recently by two successful airport transactions in England: the long-term lease of London Gatwick Airport and the sale of a one-third interest in Bristol Airport.
Midway’s lease value is bolstered by the fact that passenger traffic has rebounded and interest rates have plummeted. If borrowing costs rise in the future, as many predict, the value of the Midway lease could be negatively impacted.
We applaud Mayor Daley for working with business and labor on these partnerships. The parking meter initiative has been a great success for Chicago’s businesses and the public and other cities are looking to replicate that success.
I couldn’t agree with Roper and Gannon more, and it’s good to see them highlight the obvious benefits the city has received through Mayor Daley’s previous partnerships.
In addition to the strong merits of airport privatization and the city’s ability to benefit from the wealth of experience from numerous, similar transactions around the world, a Midway lease would (by law) use hundreds of millions from the proceeds to shore up underfunded public pensions to help address a major looming crisis. This alone would bring enormous long-term benefit to taxpayers and represents exactly the sort of initiative other state and local governments should consider replicating to help deal with their own pension crises.