New Terminal Plans on the Table in Kansas City

Last week, the Kansas City Aviation Department updated the City Council on its efforts to overhaul Kansas City International Airport (MCI). The current planning process got underway after a previous terminal plan from 2013 failed to gain support. This was due in no small part to the fact that the Aviation Department had not consulted or sought the approval of Southwest Airlines (MCI’s main tenant) for $1.223 billion plan.

At the latest meeting, the Aviation Department told the Council that building a new terminal would cost less than refurbishing the existing terminals. The department claims that refurbishing the current configuration would cost more than $1.1 billion dollars, while a slate of new terminal plans would cost less than $1 billion.

Two things are interesting to note here. First, the Aviation Department’s cost of refurbishing the terminals has escalated dramatically from July 2013, when the initial new terminal plan was proposed. At that time, keeping the existing design was supposed to cost up to $785 million, not more than $1.1 billion. This is likely due to the scale of the refurbishment now proposed, which is more extensive than what the department had previously recommended. The cost escalation underscores the fact that the scale of the refurbishment is directly related to the cost. Certainly, fixing up the existing terminals could cost less than $1.1 billion, but that would mean a different and possibly less desirable end product.

The second interesting point is the cost of the new terminal plans, which range between $900 million and $1 billion. The Aviation Department claims that these are not “Taj Mahal” plans, that is to say they are cost effective. However, the department said the same thing for the plan that they proposed in 2013, which was $1.223 billion. The ability to find more than $200 million in savings indicates that either the “old” new terminal plan was in fact more expensive than was necessary, or that the “new” new terminal plans have lowballed cost estimates (or are insufficient).

We will continue to follow this story as the Aviation Department prepares a final recommendation.