"Our plate is full right now, and a lot of things are happening," Long Beach City Manager Patrick West told the newspaper. The privatization proposal "went to the back burner."
The Long Beach City Council had planned to discuss the controversial issue in a closed session Jan. 6, but postponed it after local citizens and several council members called for opening it to the public. The hearing was postponed, but never re-scheduled.
Late last year, the city received unsolicited inquiries about the sale or long-term lease of the airport from several Wall Street firms, including Citigroup, J.P. Morgan, Goldman Sachs, Merrill Lynch and Morgan Stanley, the LA Times reports.
Privatizing an airport would initially generate a financial windfall, but the controlling public entity — typically, a city government or an aviation authority — would relinquish operational control and future revenue to the private operator.
Long Beach and several other cities are contemplating the option as airport revenues dwindle along with the economy and travel demand. Long Beach is facing a projected $15.7 million revenue shortfall this year, the LA Times says.
The federal government has an experimental program that would allow five airports in the country to be privatized, only one of which can be a hub airport. Chicago Midway is the only applicant still being actively considered, while four other non-hub slots remain available.
(USA Today - Today in the Sky)
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