AUSTIN, Texas — The company that owns and runs the South Terminal at Austin's airport is trying to stop the City from taking control of it.
LoneStar Airport Holdings filed a lawsuit against the City.
In June, City officials approved a plan to use eminent domain to take over the South Terminal so it can add more gates to the main Barbara Jordan Terminal.
But the South Terminal owners argue they've invested tens of millions of dollars in that property. They had a 40-year contract with the City.
The City previously offered to take over operation of the terminal, but the company refused the $1.95 million offer, calling it "offensive."
"Closure of the South Terminal will kill ultra-low-cost carrier service from Austin, challenged by higher operating fees and inadequate capacity at the main terminal. Options for price sensitive travelers will disappear in our market," said Jeff Pearse, CEO of LoneStar Airport Holdings. "The airport’s pursuit of eminent domain ignores the 40-year lease obligation to LoneStar and will result in years of expensive, time-consuming litigation, delaying expansion plans even further and sending a signal to every business in Austin that making major investments alongside the city is a dangerous bet. This isn’t eminent domain. It is the taking of a business."
The South Terminal opened in 2017. Low-cost carriers Allegiant and Frontier operate out of it. So far this year, the two airlines have carried more than 100,000 passengers from AUS, according to the latest airport data.
The City of Austin's Department of Aviation released the following statement on Wednesday:
“The Department of Aviation is aware of the complaint filed by LoneStar Airport Holdings LLC. The Department will continue to fulfill its contractual obligations and exercise its rights under the South Terminal lease. The City continues to move forward with acquiring the leasehold through condemnation. This action is necessary to increase capacity for more flights at AUS through the Airport Expansion and Development Program. A vital component of the Program is the new midfield concourse, which necessitates the future closure of the South Terminal.”
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