The meeting focused on funding and debt capacity as well as what it could mean for the airport's economic if the bond election is called and passed by voters. McKinney Chief Financial Officer Mark Holloway presented information about the city’s debt capacity and what the bond could mean for the city’s current debt services tax rate.
“[The city] can afford this debt today. We can, and without a tax rate increase,” Holloway said.
The total cost of the project is currently estimated to be $300.7 million, according to meeting documents. The financial subcommittee considered projections for the debt service repayment if the bond totaled $200 million with a 30-year debt repayment term. Projections presented from Adam Giombetti of WJ Advisors noted that, assuming a 5% interest rate, the project would likely break even in 2048 and become self-sustaining after that.
Estimates presented at the meeting noted that the potential three-year construction period between 2023 and 2026 could create as many as 3,300 construction-related jobs as well as 3,000 more jobs if the new terminal opens. The projections also indicated the output for the first year of operations once the terminal potentially opens in 2026 would likely be between $600 million and $850 million.
The economic impact study, completed by InterVISTAS Consulting Inc. and presented at the meeting, estimates 533,000 passengers will depart from McKinney National Airport in the first year of operations as a result of adding a commercial terminal.
“Any city that puts in ... an airport ... is taking a bet on the future without having the benefit of looking in the rearview mirror to say, ‘Was it the wise decision?’ But all we can do is our best,” Councilman Patrick Cloutier said during discussions in the finance subcommittee meeting.
The bond committee will meet again on Nov. 9 for its last meeting currently scheduled. Following a series of meetings in October and November, the bond committee will recommend to McKinney City Council whether or not a bond election should be called in May 2023. Council will then ultimately decide whether to call a bond. If it decides to call a bond, that must be done by Feb. 17. If a bond moves forward and McKinney voters approve it, the airport could see commercial services as soon as the spring of 2026.
More information on the potential bond election is available here.
