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Taxpayers on the hook if new KCI violates FAA policy

Posted at 3:07 PM, Sep 27, 2018
and last updated 2018-09-27 20:26:11-04

KANSAS CITY, Mo. — According to the city's legal department, taxpayers will end up footing the bill if the Federal Aviation Administration imposes penalties related to a community benefits agreement for the new terminal.

The FAA has strict rules when it comes to the use of airport revenue, and the agency previously articulated concerns with several items in the agreement presented.

"Every dollar that is received by the airport has to be spent on the airport," said FAA expert and Washington, D.C. attorney Robert Cohn, who is working for the city on the CBA. 

Specifically, the FAA flagged a donation to Love Thy Neighbor and the creation of a Northland fund.

Edgemoor, the developer of the terminal project, had previously committed to funding any items rejected by the FAA, but Cohn said any money flowing directly from a member of the KCI-Edgemoor team is risky. 

"We would prefer if Edgemoor was not involved in any of that transaction," he said.

During a presentation to council members, Cohn also said an FAA audit of the project is likely. 

If any violations are found, the penalties are severe, including:

  • repayment of any funds improperly diverted;
  • civil penalties that can add up to triple the amount diverted; and
  • loss of $15 million in federal grants for the airport. 

A member of the city's legal team confirmed to 41 Action News that those penalties would need to be paid out of the general fund, meaning taxpayer dollars.

One option Edgemoor is currently considering is to pay for the rejected CBA items through a charitable contribution from the Clark Construction Group. A spokeswoman emphasized they will study several options and make sure the city is not at risk in any donations.