Airport axes five directors in cost-cutting move

August 21, 2009

Five executives are among seven employees let go by the Indianapolis Airport Authority as part of its efforts to cut expenses amid declining airport revenue.

A spokeswoman for the authority, which operates Indianapolis International Airport, said the employees were terminated Wednesday. They include directors of information technology, leasing, parking and retail, as well as the senior director of administration. Two administrative assistants also were let go.

The authority expects the reductions will save it $650,000 annually in salary and benefit costs, spokeswoman Susan Sullivan said. Existing staff will take on the additional responsibilities.

“It was a reduction in [work] force as a part of a larger effort to realign and restructure to operate more efficiently and more effectively,” she said.

Sullivan said she would not disclose the employees’ names until she received approval of the airport’s attorney.

In another expense-related move, the authority voted this morning to raise airport parking rates Sept. 1. Garage parking rises from $16 to $18; long-term parking from $11 to $12 and economy-lot parking from $7 to $9. Express valet parking also is rising, from $18 to $20.  IBJ reported last month that the airport was considering the move.  

Airport officials face a budget shortfall because of fewer flights as well as higher costs from the new, $1.1 billion Weir Cook terminal that opened last year. The airport now pays a mortgage on the terminal of roughly $40 million a year.

The recession has pushed passenger traffic down 10 percent while cargo volume is off 16 percent, helping to contribute to slumping airport revenue that is expected to fall $15 million below projections for the year.
Earlier this month, authority CEO John D. Clark III told IBJ in an interview that the airport needs to begin to look at how to control costs and diversify revenue.

“My hope is that we will begin to look at ways to put some other types of development in place so we’re not dependent on people flying in and out of Indianapolis,” he said.

The employee dismissals come just months after Clark arrived to lead the authority. Directors in April approved his appointment to replace John Kish, who is heading a municipal stadium construction project in Evansville.


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