Pensacola committed to $90M airport terminal expansion, even if it has to bond it

Pensacola will likely pay for much of the Pensacola International Airport terminal expansion with a bond issue.

Pensacola Mayor D.C. Reeves said the city is seeking all possible funding sources to pay for an approximately $90 million terminal expansion that will add five new gates to an airport bursting at the seams. The first week of July saw the airport set another record in the number of passengers boarding planes.

The $4 million design and engineering work of the expanded terminal is getting underway, and city spokesman Jason Wheeler said design plans are expected to be 30% complete by March, which will give the city enough information to have realistic cost estimates for construction.

Previous cost estimates of $70 million are several years old at this point, and Reeves said Tuesday the number was probably closer to $90 million.

Florida Gov. Ron DeSantis signed a state budget last week that included $5 million for the airport expansion.

Reeves said finding a way to pay for the needed airport expansion remains his top legislative priority, but there will have to be an amount that is financed through bonds that will be repaid from airport revenue.

"We have looked at what our bonding ability is if we had to take on the whole thing ourselves, two-thirds of it ourselves," Reeves said. "You play those scenarios out, but we're desperate enough that we're going to make something happen."

Reeves said he believes the city's willingness to bond the project helped the $5 million allocation from the Florida Legislature avoid DeSantis' veto pen, and he hopes it will help the city get more funding.

Reeves already plans to meet with Florida Department of Transportation Secretary Jared Perdue about seeking more state help to fund the airport, and when he travels to Washington, D.C., later this year Reeves plans to "pound the pavement" to meet with federal officials and make the case for Pensacola.

Regardless of how successful Reeves' is in seeking funding for the expansion, Reeves said the project is going to happen.

The drawback to funding more of the project through a bond issue is it will drive up airlines' costs to operate at the airport, which could mean fewer flights in the future.

"We want to be careful, and my job is to go to Capitol Hill and go to Tallahassee and try to have us bond as little as possible and have our state and federal partners help us as much as possible," Reeves said. "And they have avenues to do that, whether it be FDOT, the legislature, or (the Federal Aviation Administration) terminal grant program. It's an annual program. We didn't get anything last year, but those come due in August, and we hope that us being this much further along in the project will help us get funding from the FAA as well."

Reeves said he would like the project to begin construction as soon as the design is complete.

Wheeler said when design plans hit 30% in March the city could then go to the bond market if that option is entertained. The 30% design will also allow the city to meet criteria requirements of the FAA's Terminal Grant Program next summer, Wheeler said.

Reeves said the rush to expand the airport is a good problem to have.

"A great problem to have is we've got an airport in demand, and one that people want to use," Reeves said. "We've just got to now anticipate and meet that growth where it is. So, my willingness to bond and the airport's willingness to bond increases every day, every time I come to you to tell you we just broke the record for the number of people that walk through the front door."