With heavy construction work coming soon on Mobile’s new international airport terminal, the Mobile Airport Authority Board has begun to take steps to assure that the cash can flow as needed for a project whose predicted price tag is now over $380 million.

That’s a substantial jump from a year ago, when officials said the estimated price tag had risen to $330 million. But they said they’re confident that ongoing efforts to secure state, local and federal funds can bridge a funding gap that has grown along with the estimated cost.

At a special MAA board meeting on Thursday, Airport Authority planners took the first steps toward securing a revolving line of credit needed to mediate between the amount that is in hand or pledged, well over $200 million, and the checks that the MAA will have to write in the near future.

The MAA is in the process of shifting commercial passenger traffic from Mobile Regional Airport in west Mobile to the Brookley Aeroplex, in the expectation that interstate access and proximity to downtown will make Mobile more appealing to air travelers and more competitive with other airports in the region. It has built a small terminal at Brookley to serve low-cost carriers, but the plan requires a full new international terminal and all related facilities. In the meantime the smaller terminal has been used off and on by carriers such as Avelo, which recently announced a seasonal suspension of flights to Orlando.

As the board met Thursday, participants had to follow a detour around work on Michigan Avenue to reach the existing passenger terminal, using a temporary roadway across an empty stretch of airfield asphalt. The temporary route was fully fenced in; Curry confirmed that even such seemingly mundane steps had to meet FAA standards and sometimes involved Transportation Security Administration oversight as well. “Essentially, you’re modifying the airfield,” he said.

Continual heavy truck traffic in and out of the nearby Airbus campus, where girders for new buildings were visible, has been the norm for a while now. The detour was a concrete sign that similar activity is not far away for a second massive project at Brookley.

Primary participants in the discussion were Elliot Maisel, chairman of the MAA board; MAA President Chris Curry; and representatives of Hoar Program Management (HPM), which is overseeing the project. Conducted in broad terms, it outlined the complexity of the airport funding situation: Though well over $200 million has been committed to the project via city, county, state and federal sources, the money isn’t available for use whenever and however the airport authority might like.

Much of it is regulated by the Federal Aviation Administration, limiting its uses. Some is available up front, some later. Much is available on a reimbursement basis. Curry said the FAA won’t support revenue generating structures such as a planned parking deck or even concession areas within the terminal – so there’s a whole set of calculus to determine what percentage of the terminal cost is eligible for FAA funding. (It’s right at 70%.)

“Within our program management team, there is a position within their team that is specifically assigned to make sure that we are using the right buckets of money to their maximum potential,” said Curry. “Because if you don’t get that piece right, you can have enough money, but if it’s not properly allocated, you could have money left over in places that you can no longer use.”

James Adams, an HPM regional vice president, and HPM Project Manager Foster Veazey cautioned that a financial summary sheet handed out to board members contained some out-of-date numbers. The real picture, they said, was laid out in a far more complex spreadsheet.

That said, the summary sheet showed a total funding needed “based on executed contracts and cost estimates” of $381 million. That’s substantial jump from a year ago: Around the time a ceremonial groundbreaking was held in December 2022, Curry said rising costs, particularly when it came to construction materials, had pushed the estimate to $330 million.

The rising price tag increases the difficulty of opening the new facility debt-free, as Curry has said he hopes to do. When he first spoke about that goal in late 2021, the new airport was projected to cost about $252 million.

The summary sheet used at Thursday’s meeting showed available funding of $264 million; Curry said Monday that the actual figure was more like $241 million. That would leave a potential gap of $140 million. However, both Maisel and Currey expressed confidence that more funding was available and that the MAA’s ongoing efforts would bridge the gap.

“I see this through the prism of where we started some number of years ago,” Maisel said during the meeting. “We had nothing. So my sort of gut feeling is that we’re going to get the rest … The project is going to transform the city. It’s well known in the city, it’s well known in the state, it’s well known in D.C. There’s nobody that doesn’t understand what we’re doing. There’s eligible funds available that we haven’t tapped yet. The legislature meets every year. I’m very confident we’re going to get it.”

Curry said several factors are behind the growth of the projected cost to $381 million. One is the addition of additional surface parking that will cost more than $2 million. Another is that the construction management team have been developing more detailed plans and estimates. A third is that plans for the new terminal itself have been modified.

“When we started three years ago with this project, we were, we were at around $252 million,” Curry said. “That was three years ago for the master plan. The latest number that we carried as we got closer to construction and design, once we brought the construction and design team on, we had a number of about $350 million.”

“We tweaked some components of it,” he said. “And we found out that we needed slightly more space within the terminal after our consultation with the airlines, with TSA and with Customs & Border Protection.”

The $381 million price tag is conservative, Curry said. “It could be lower as those bids come in. We just don’t know. But that’s the number that our construction management team has estimated for the project.” Maisel and Curry both said that so far, some bids have been running below estimates. They hope that trend will continue.

The biggest chunk of the funding gap concerns parking: $66.2 million for a parking deck and $2.3 million more for surface parking lots. The deck and lots are ineligible for FAA funding.

Maisel commented that if the MAA were to finance the construction of the parking deck, it’s likely that revenue from parking would go to servicing that loan. That’s one path forward, he said, but not the preferred one. “We need the revenue from the parking garage for cash flow,” he said. For that to happen, the MAA has to find money to build the deck.

After a brief executive session, the board appeared to have mapped out a plan of action: Between now and the board’s February meeting, staff will develop several scenarios to define its anticipated credit needs. Maisel said he expects that’ll come in between $75 million and $100 million. By its March board meeting, the board should finalize its presentation to potential lenders. The line of credit needs to be in place before some big bid packages come up in the summer.

Maisel expressed confidence that the board was taking a prudent, conservative approach to its calculations. He also said he thought the MAA’s past success in lining up money for the project will continue. That said, it makes sense to develop a plan based on “where we are right now,” he said.

From here, Curry said, visible activity will ramp up quickly.

“We’re on a very aggressive schedule to meet a November 2025 opening,” he said. “We’re going to be be moving extremely fast. One thing I would say is that I’ve been in and around the industry quite a bit, and for quite a bit of time, and there is no other airport that I can think of, pound for pound, that has been able to garner the amount of participation monetarily in an airport terminal program as Mobile. From Senator Shelby’s help in Washington, to the governor, to the mayor, the county, everybody has stepped up by their monetary participation.

“So for us to have the amount of money that we have right now, that’s dedicated to this project, is phenomenal. Especially when you think about it, and as Elliot said, we started with zero. So we’re very, very optimistic that we’re gonna get there.”

“I’ve been here six years and if you would ask people over the years, they would certainly say that they had doubts about this ever happening,” said Curry. “And even as we started construction, some people probably still have doubts. But it’s going to happen.”