June 10, 2014

Council approves $6.5 million tax incentive for American Airlines

American sought the tax incentive on an $88 million operations center it plans to build in Fort Worth for its new combined operation with the former US Airways.

American Airlines won approval Tuesday night for a tax incentive that would give the company an estimated $6.5 million in tax rebates on a new operations center in Fort Worth over 15 years.

The City Council unanimously approved the incentive. The deal will rebate up to 85 percent of the project’s real and business personal property taxes.

American Airlines said it wants to build an $88 million, 150,000-square-foot office building at 4700 American Blvd. for about 1,300 employees, which will house workers from American Airlines and others relocating from a US Airways operations center near Pittsburgh.

In December, American and US Airways completed their merger, which came about as part of American’s two-year bankruptcy case.

The average wage at the operations center would be $60,000 annually, the council learned.

The incentive also includes the waiver of $32,000 in development fees. American said it plans to spend $55 million on construction and $33 million to furnish the building, all by Dec. 31, 2015. To receive the incentive, American agreed to criteria regarding how much is spent on the project with Fort Worth companies and how many Fort Worth residents are hired.

Councilman Joel Burns told an American Airlines representative at a pre-council meeting that Fort Worth has a long history with the airline and that he hopes the carrier will make “good faith” efforts to make sure to refer to its headquarters as being in Fort Worth.

“Everyone at this table wants to make sure we continue to keep Fort Worth-based American Airlines Fort Worth-based,” Burns said. “This [incentive] will put us a little bit farther down the road on that. I know there are other changes the airline is looking at in the coming years and we certainly want to be receptive and helpful in helping make sure American Airlines does remain here.”

In other business

The city will maintain ownership of the 444,000 square feet of hangar space at Alliance Airport after American’s lease ends. The airline built the space and has been using it as a maintenance site in a long-term lease from the city.

American is backing out of the lease, signed in 1990, because of the bankruptcy proceedings. The Alliance Airport Authority Board voted Tuesday to end the lease effective Feb. 1, 2015.

“We are very pleased with the resolution because this will allow the city of Fort Worth to use that facility,” said Councilman Jungus Jordan, who is president of the Alliance board.

Staff writer Caty Hirst contributed to this report.

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