Chattanooga's airport plans to take on its biggest loan to finance more parking to accommodate the growth of Lovell Field.
The Chattanooga Metropolitan Authority board voted Monday to borrow $25 million over the next 20 years from Pinnacle Bank to finance the airport's first multi-story parking garage. Although the airport has yet to approve a specific design, airport authority president Terry Hart said he hopes to select the layout and contractor for the planned 1,300-space parking deck by December.
The parking garage will add a net 700 more spaces to the 2,100 parking spots now at airport lots and will provide closer parking to the airport terminal for more passengers. The four-level garage would go on what is now some of the short-term parking lot across from the existing rental car location, Hart said.
Upon completion in early 2021, the rental car operations would move to the ground floor of the garage, he said.
"We're running out of space and need the extra parking for the growth we continue to see," Hart said, noting that passenger boardings in the first eight months of the year were up 11% over last year. "September is off to another great start leading into our busiest month of the year in October so we are on pace for another record year."
Hart said the continued growth of Chattanooga's economy and the apparent drop in the number of Chattanoogans driving elsewhere to other airports is helping to boost traffic at Lovell Field. General aviation is also up and, combined with more and bigger commercial flights, has boosted landing weights in 2019 by 16% above last year.
To accommodate the increased business, the airport's master plan calls for more parking and construction of the airport's first parking garage. Parking rates were raised earlier this year to help pay for the new facility.
On Monday, airport directors agreed to pay off the airport's existing $5.7 million debt remaining from its existing terminal with its cash and other resources and borrow another $25 million at a 2.29% rate for the tax-exempt portion of its borrowing and 2.87% for the taxable portion of the loan. April Cameron, vice president of finance for the Chattanooga Metropolitan Airport, said the public portion of the parking garage represents about 65% of the complex and will be funded with tax-exempt borrowing, while the space devoted to private rental car businesses will be financed with a taxable loan on the other 35% of the $25 million loan.
"We have been impressed with the improvements the airport has made and we really like this project," said Kenny Dyer, president of Pinnacle Bank. "I think the whole community, not just our bank, looks forward to this project moving ahead."
Dan Jacobson, chairman of the airport authority board, praised the decision to move ahead with borrowing the money for the additional parking at what he said are very attractive fixed borrowing rates.
"The action we've taken today is going to propel this project well toward reality," he said.
The airport is also spending money to repair its damaged airport dome, which was damaged from a wind shear in July, and install new runway lights. The cost of those projects will largely be covered by insurance and shared money from the Federal Aviation Administration.
Contact Dave Flessner at email@example.com or at 757-6340