Concerned about a bidding process with only one bidder, Chicago Mayor Rahm Emanuel today suspended negotiations for the privatization of Midway Airport.
Emanuel began exploring Midway’s privatization in December, with the aim of alleviating some of the city’s massive debt. The idea earned considerable opposition from Chicago city council members, though the city had narrowed the field of prospective buyers down to two before pulling the breaks.
Its reason? Industry Funds Management and Manchester Airports Group, which made combined effort to bid on the airport, dropped from the running. This left only the Great Lakes Airport Alliance, a joint firm between Macquarie Infrastructure and Real Assets and Ferrovial, in the bidding process.
As Emanuel spokeswoman Sarah Hamilton told the Chicago Tribune, this not the type of “competitive process” that the mayor had hoped for.
Emanuel has been cautious in his approach to selling Midway. Chicago’s last adventure in privatization was former mayor Richard M. Daley’s ill-received 75-year parking meter contract in 2008, a deal in which observers say the city got stiffed. In turn, the city council is reluctant to approve the more dramatic undertaking of privatizing Midway.
In response to public concerns, Emanuel has drafted certain stipulations for the winning bidder. According to Chicagoist, the new owner of Midway would have to agree to “a 40-year lease, a travelers ‘Bill of Rights’ to prevent a contractor from gouging travelers for food, retail and parking rigid safety and cleanliness standards the private contractor footing the bill for police and fire protection and sliding scale revenue sharing with the city over the course of the deal.”
Since the deal is taking place behind closed doors, it’s hard to determine how close the Great Lakes Airport Alliance is to taking over Midway. For now, Emanuel appears to be unsatisfied with the current situation and is unwilling to proceed.