The city of St. Louis has finally figured out how to create a unified approach to transportation policy: It has put forth an airport privatization concept that looks and feels like a railroad job.
Here is the press release from the mayor’s office announcing the plan:
“At the insistence of our chief benefactor and king, Rex Sinquefield, who doesn’t like government, we have decided to sell off our airport to the highest bidder,” a mayoral spokesman said. “We have contracted with one of King Rex’s not-for-profits to study whether or not to proceed with privatization, with the one stipulation that ‘not’ is not an option. We do believe that loyalty is a virtue and will ensure that our political friends and consultants are properly compensated for their service to us in this matter. As for the Board of Aldermen, our plan is for King Rex to purchase its loyalty at a later date.
“The current administration would like to observe that this decision was made largely in secret by the previous mayor on his way out the door—at the behest of King Rex—and we really had no choice but to go forward. We are at least being more transparent than the last guy. Any news outlet portraying our current mayor as a deer in headlights will have its media credentials revoked. We are excited to move forward with this transformational project.”
(I concede that the above statement has been slightly altered from the mayor’s actual public pronouncements—in the interest of bringing them closer to conformity with the truth.)
To be fair, the city officials pursuing airport privatization envision an enormous pot of gold at the end of their rainbow, with some sources offering estimates of as much as $3 billion coming the city’s way for leasing out its operation. Given St. Louis’ undeniable financial woes, that has to be tempting, even if it does have the feel of a pre-bankruptcy disposition of assets.
Those officials can’t be blamed for at least considering participation in the FAA airport privatization pilot program unveiled in 2017. And it can rightly be argued that the application process for the program is extremely complex and time-consuming, which is why Sinquefield’s minions, naturally, slithered into a governmental process that ironically serves his larger purpose of downsizing government.
But the problem with the city’s approach is that it has been top-down, secretive, insider-business-as-usual. With no public input, former Mayor Francis Slay—a major Sinquefield beneficiary for years—made a decision behind closed doors to put airport privatization in motion. His defenders privately argue that he followed the letter of the law for procuring consultants’ services, that Sinquefield is putting up $20 million to $30 million to facilitate the process just because he’s an idealistic man (with nothing to gain personally, of course), and that the ensuing firestorm of protest from the Board of Aldermen, private citizens, and the media is much ado about nothing.
Why, no decision has been made here—this is just a process to decide whether there’s even a decision to make. And we haven’t decided when we’ll decide or even whether we’ll decide.
And you wonder why people don’t trust politicians?
There’s nothing to have kept Slay—and, for that matter, Mayor Lyda Krewson—from engaging in some form of public discussion about whether to consider the airport privatization option. That step was skipped, and the non-debate has already moved on to the non-debated subject of how to get this transformational thing. In the non-process, the mayors not only omitted public opinion but apparently also proceeded on a major initiative without input from the likes of the St. Louis Airport Commission, airport director Rhonda Hamm-Niebruegge, Comptroller Darlene Green, and other officials.
If privatization has a fraction of the potential that its backers claim, wouldn’t they have wanted to get everyone on board in advance? Why would anyone have stood in the way of easy billions for a financially distressed city? If this was all so benign, why wasn’t it turned into a kumbaya moment rather than a scandal over secrecy, conflicts of interests, and general shadiness?
One reason that the whole thing looks pretty shady, I’d guess, is because it is. But I do think there’s a mitigating factor that we should consider: It’s probably never going to happen, because that’s how these things tend to wind up for St. Louis.
One defender of the effort told me that the application process would involve an intensive, highly technical audit of every square foot of the airport, and that just getting our act together would take 18 months or more. So for all of the drama—the letters from understandably miffed aldermen, the angry public comments of officials and citizens, the nasty editorials—the next thing for St. Louis to do is to hurry up and wait for disappointment.
Pardon my cynicism, but I feel I’ve seen this movie before. St. Louis spends millions on consultants and experts and sends a beaming delegation to Selection City, USA, where they walk proudly down a red carpet into a splendid hall, only to discover that our airport dream is to be crushed by Keokuk International—to which we say, “Our beer tastes better than theirs.”
So I’m not too worked up about all this. If I’m wrong and billions pour into town because Sinquefield finally created a potion in his mad-political-scientist laboratory that actually worked, I’ll be happy to praise airport privatization to the skies. More likely, it will be one more debacle (such as his mostly failed war on city earnings taxes) that ends up with the king spending tens of millions for nothing but, strangely, emerging unbowed.
I do, however, think there’s one thing that we can take from all of this: There’s a lesson to be learned about the potential of airports. Think about it. Sophisticated international companies at least appear poised to offer billions for the honor of taking over St. Louis Lambert International Airport’s operations. Why? What could possibly be so lucrative about running an airport? How much more revenue could a new operator generate than the current airport management?
Part of the answer is not much. From all appearances, Hamm-Niebruegge and company do a fine job of managing an airport that looks better but is the source of consternation for many local residents who remember when it was far more bustling in the good ol’ days.
Choose your seismic factor to blame: the evil Carl Icahn and subsequent demise of TWA, the lost hub, the humiliating $2.6 billion runway debacle of the ’90s, the World Trade Center attacks and travel’s resulting decline, the broken promises of American Airlines… The list goes on.
The airport is busier now, however, than it has been in a decade. As this chart shows, its traffic isn’t as bad as you’d think. It’s still in the top 12 or so Southwest Airlines markets. Yes, there are far fewer nonstop flights than in days of old, but that’s partly because St. Louis has been dehubbed (along with Pittsburgh, Cincinnati, Nashville, and other cities). One source told me that a metro region must have a population of at least 6 million citizens to get an airline hub nowadays.
So why would these companies be ready to pay billions to take over St. Louis’ airport? I think the answer is clear: It’s all about real estate development. It’s clear as we look around the nation that the aerotropolis—essentially a small city built around a major airport—is all the rage.
I have a strong suspicion that the smart people who’d pay megabucks to take over our airport operations have something like this in mind. The big money isn’t in airport concessions and landing fees, I’d guess, but rather in economic development rights.
So maybe the priority today has nothing to do with city government’s clumsy privatization application and little to do with airport operations. Rather, the challenge is for local officials, business leaders, citizens, and media to come together in—gasp!—a regional approach to creating an economic development strategy centered on our airport.
Here’s the burning question of the day: Why does St. Louis need to privatize its airport to monetize that airport’s economic potential?
I think the answer is that we don’t, whether King Rex and his beneficiaries like it or not.
