The Missoula International Airport will begin construction of its new passenger terminal debt free, though it expects to take on debt next spring as the project picks up.
Construction is already underway at the airport, which expects to set another passenger record this year. Work on a new $3.1 million access road will wrap up next month, and crews are in the process of relocating security ahead of demolition, at a cost of $1 million.
The new security lanes are expected to open on Dec. 10.
“We’ve paid off all the debt we had in preparation for the terminal project,” Airport Director Cris Jensen said Tuesday. “It won’t last very long, but it puts us in a good position as we go forward with the terminal project, so we’re pretty happy about that.”
Several projects have already begun ahead of major work planned for next year, including a new utility corridor and terminal access road. While the airport has roughly $2 million in reserves, Jensen said, it will need to take on debt some time next year.
The project is funded with airport revenues and federal funding.
“We’re thinking we’ll need to have the debt in place in early to mid-spring,” Jensen said. “We won’t have big draws at that point, just smaller draws, but as things are looking right now, we’ll be looking at debt by mid-spring.”
Sen. Jon Tester secured around $8.7 million in discretionary funding earlier this year, which has enabled the airport to advance further into the first phase of the project without incurring debt.
But with the project now underway, several bills have come due, including early construction work, engineering and schematic designs. The airport is looking to next year when demolition of the existing terminal and major construction begins.
It’s then, Jensen said, that the airport will structure its debt to fund the project’s subsequent phases.
“There’s a number of different ways to structure it,” he said. “One could be some kind of letter of credit. There could be multiple bond issues, or it could be short-term financing, or a construction loan through a local bank.”
The airport has already engaged several financial consultants to help with the process, and it expects to extend a contract to the chosen firm next month.
“We’re now positioned better for an early discretionary grant,” Jensen said. “It may be we get some funding there and we have to match that if we have big expenditures we have to match. There’s also the chance for supplemental funding. There’s some variables out there.”
The airport has launched a “Bear with us campaign” as interior construction plays out, along with improved signage. Utility work includes water, gas, data and electric, all positioned to feed the new terminal.
“We’ve got the lines back in place, filled and compacted, and we’re getting that ready to pave and hopefully open that up in the next couple weeks to parking as we get into the holiday season,” said Tim Damrow, the airport’s projects manager.
Damrow added that interior work could be disruptive to passengers.
“This work is probably going to be starting on Monday, where they’re actually going to be erecting walls around the lobby area and getting ready to secure that area to move TSA equipment in,” he said. “Also, we’re planning this Friday to be putting our new revolving doors in service.”
That will put the restaurant behind the security area, making it inaccessible to non-ticketed airport customers.
“That will be a pretty big change for everybody,” said Damrow.
Under the current timeline, the airport will begin demolition work in January, followed by the foundation for a new five-gate concourse and security wing at a cost of $10 million. Vertical construction is expected to begin next fall.
The first segment of the new terminal is slated to open in 2021. Demolition of the existing terminal will begin shortly after, followed the construction of a three-gate concourse. The two structures will be connected by a central lobby, with restaurants and other amenities.