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Article updated: 3/14/2011 4:11 PM

Deal reached on O'Hare expansion

$155 million in extra federal funds grease a compromise between Chicago and airlines

By Jake Griffin

More input on future construction, less immediate construction and an extra $155 million in federal funds helped convince major airlines to put aside their objections to building a new southern runway at O'Hare International Airport.

Leaders from United and American airlines announced Monday they were pulling their federal lawsuit aimed at keeping Chicago from moving forward with a $3.4 billion modernization plan of the airport. In exchange, additional federal funds will ease the cost of agreed-upon projects totaling $1.2 billion and the city won't move forward with another $2.2 billion worth of plans until both sides meet again before March 2013 to discuss the need for further modernization.

The compromise was orchestrated by U.S Secretary of Transportation Ray LaHood, a former Illinois congressman.

"This is a jobs program," LaHood said during a Monday morning news conference at the airport, adding that the new runway, unlike others at O'Hare, will not intersect other runways.

"This project will make flying safer, that's why we insisted everyone sit at the table to work this out," he said.

Both Illinois senators -- Democrat Dick Durbin of Springfield and Republican Mark Kirk of Highland Park -- also had a part in the negotiations, along with Chicago Mayor Richard Daley.

Though United Airlines CEO Jeff Smisek said he doesn't believe the southern runway is a necessity now, he acknowledged its importance in the future.

"We come here today because of a dispute, but let me tell you what's not in dispute: A shared vision," Smisek said. "There's a clear understanding of how important O'Hare is to us all, but this agreement permits us to participate in a fiscally responsible manner."

The airlines filed the lawsuit in January, complaining the companies would have little control over the work being performed, but would be responsible for 58 percent of the costs. For this phase, the airlines are responsible for 25 percent of the costs, according to transportation department documents. The city is responsible for 31 percent of the costs and the rest are covered by federal funds and grants.

Federal transportation officials noted that $280 million in federal funds specifically was earmarked for construction of the $517 million southern runway.

The federal government had already earmarked $410 million for the total project cost, officials said. The additional $155 million will make the federal government responsible for almost 17 percent of the project's total cost.

Other projects included in this planning phase include $35 million for soundproofing, $62 million for a new parking structure, $96 million for upgrades to the airport's transit system and $231 million for north airfield construction.

Projects that haven't been agreed to yet include a new north runway and extension of an existing north runway as well as other taxiway improvements and construction. The city and airlines agreed to meet again on the future of those projects before a March 1, 2013 deadline.

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