JAA faces rising costs for Boeing project at Cecil Airport (Courtesy of the Jacksonville Business Journal) — The Jacksonville Aviation Authority’s build-out of a new maintenance facility for Boeing is the latest project to face additional costs due to rising construction materials.
Monday, the JAA board of directors was notified the final price of the facility will be $183.63 million – a 9.6% increase from what they were told the final price would be back in May.
JAA Senior Manager for Engineering & Construction Derek Power said the cost increases are due to various Boeing requests for specificity on the project and rising construction costs.
The board approved a $12 million budget transfer to complete funding the 370,000-square-foot property on the east side of Cecil Airport that is expected to be completed in 2023.
Prior to Monday’s approval, the authority has $172.9 million in funding for the facility — the majority of which was secured through a $165 million bond it issued earlier this year.
The Haskell Co., the construction management company for the project, notified JAA the facility will cost $172.66 million. The total cost of $183.6 million also includes $10.32 million for architecture and design fees and another $638,028 for pre-construction services.
Monday’s move meant JAA transferred $11 million from a project to build spec hangars at Cecil Airport and another $1 million from landscaping and irrigation projects at Jacksonville International Airport to fund the new price tag for the Boeing facility.
“I see the opportunity for future development for the authority for vertical hangars,” JAA Director of Business Development Jay Cunio told the board. “Currently, being able to transfer dollars to improve critical infrastructure, which is what other folks are looking for. Boeing, in particular, the east side development and other projects we are working on has potential for the east side as well as the west. It’s a timing issue to be able to utilize these dollars for higher and better use.”
Powder noted the design for the project is 90%complete. JAA spokesman Michael Stewart noted that the pricing for projects of this scope is typically finalized once design is 90% complete.
The board also discussed the performance of JAA CEO Mark VanLoh. JAA in October had 252,943 enplanements, an 18% decline from its record-setting October 2019. This year, Jacksonville International Airport is expected to have its second-busiest Thanksgiving week in its history behind the record-setting 2019.
In light of the enplanement metrics, and the authority’s financial footing amid the pandemic, the board approved a 6.6% salary increase to $335,000. He also received a $31,415 bonus. The vote was made retroactive to Oct. 1 to coincide with the beginning of the fiscal year.
VanLoh accepted a 3% salary increase in 2020 and declined a bonus in light of the flux the aviation industry was enduring at the time. Monday, multiple board members cited his ability to navigate the authority through the pandemic as reason for supporting the pay raise.