DENVER -- Standard & Poor's Corp. came close this week to placing Denver International Airport revenue debt on CreditWatch, but after three days of intense discussions chose not to change the BBB rating, an official with the rating agency said yesterday.
Standard & Poor's was spurred into discussions because Denver officials said Monday that the airport would not open until March 9.
The delay prompted the rating agency's credit committee to meet three times since Tuesday, according to Ernest Perez, the agency's transportation director.
"It was a very tough committee, We had some serious concerns," said Perez.
The rating official said that if the airport's opening is delayed beyond March 9, "the rating is in jeopardy."
The agency said in a statement yesterday that because the airport is rated BBB, one of the lowest airport ratings Standard & Poor's maintains, "the additional cost and schedule pressure does not currently warrant any rating action." But the rating agency said it would keep a close eye on the project.
On Monday, Denver said that the $2.875 billion airport would open March 9, instead of Dec. 19 as planned. The delay, along with $44 million worth of extras requested by airlines, will cost the city about $85.6 million. The city has said it will use some of the $179 million available in reserve and airport system accounts to to fund the extra costs and then recoup the money through airline leases.
The agency said that the increased costs that will be incurred by the delay are "manageable" and would be drawn from the operation and maintenance reserve, aviation fuel tax, and remaining 1985 bond proceeds. "It is expected that any [operation and maintenance] or aviation fuel tax monies drawn upon will be repaid by the airlines over a three- to seven-year time frame," the rating agency said.
Standard & Poor's said its main concern was that Denver had assured that the airport would open on time and under budget when that was not the case.
"A delay of this length should not have come after repeated and strongly worded assurances that the project was on schedule and within budget," Standard & Poor's said in a statement. "This project needs to open as soon as practicable because of its high profile and controversial nature."
The rating agency said it will "closely monitor the final stages of construction for any signs of increased costs or added delays."
The next critical date for the project is Jan. 1, when the airlines are scheduled to use the airport for two months of training, Perez said.
Gennifer Sussman, the city's assistant aviation director for finance, insisted that the airport would open March 9.
"We are definitely not anticipating any further delay," Sussman said. "Part of the reason why the city took so long to consider the opening date is to choose a date that we were absolutely sure would work for everyone. We are very pleased by the support of all three rating agencies."