DENVER -- The city of Denver's 1994 airport finance plan is nearing completion, but the most important ingredient -- a start date for Denver International Airport -- remains unknown.
At yesterday's airport committee meeting of the city council, city officials introduced a resolution designed to alert the public that Denver might issue $81 million of bonds to replace airport system reserve accounts. The resolution is a legal requirement by the U.S. tax code.
Debra DeMuth, assistant airport director for finance, said the airport financing plan has been delayed a month from the end of June to the end of July, adding that a plan will be hammered out in the next couple of weeks.
"We're looking at mailing a [preliminary official statement] by the end of July," DeMuth said. "Our timing has slipped a little bit."
Denver is looking to refinance $180 million of 1985 airport debt and has considered borrowing from $50 million to $100 million more to pay for the costs of the delay of Denver International's opening and for limited capital projects for the rest of this year.
The $81 million would refill the coffers of three reserve accounts that have been used to pay for delay costs: $36 million from the aviation fuel tax fund, $18 million from the capital fund, and $26.4 million to repay United Airlines for its contribution to delay costs, according to DeMuth and assistant city attorney Lee Marable.
As of June 1, Denver had $305 million in its main debt payment reserve account. The city also had $30.3 million in its capital account, $14.4 million in its operation and maintenance reserve, $3.6 million in its excess bond reserve, and $47 million in a coverage account.
In May, Denver delayed Denver International's opening a third time.
A fourth date has not been set. It costs approximately $16 million a month to keep nearby Stapleton Airport open during the delay.
DeMuth said that talks between the city and United Airlines on the airlines pledge to prepay $8.8 million per month toward delay costs are progressing and should be resolved SOOn.
"We're getting close. They've been at the bargaining table," DeMuth said.
United, Denver's dominant hub airline, offered to prepay its portion of the delay costs in order to relieve financial pressure on the airport United would recoup its money through discounts on lease payments after the airport opens, Other airlines would pay higher rents to make up for their unpaid shares of the delay costs.
Denver delayed the airport because its state-of-the-art, $193 million baggage system has not worked. No news on the baggage system came forward in the committee meeting. Designers continue to work out bugs, run minor tests, and prepare for this Tuesday's resumption of more extensive testing.
In other Denver International news, budget writers reported that the $2.924 billion budget appears to be underspent by $5.4 million. The figure fluctuates each week as the city completes its negotiation phase with contractors about how much they should be paid..
About 200 contract issues totaling $9.4 million remain to be settled with contractors, said city budget analyst Woods Alice. About $2.9 billion has been "encumbered," or committed to by the city, Allee said.