June

DIA officials awarded a $24.4 million conract for the new airport's telephone services to U.S. West Communication Services. The officials of DIA had considered controlling its own operations through shared tenant service, which would allow the airport to act as its own telephone company. All calls would be routed through an airport-owned computer switch. By grouping tenants together into a single shared entity, the airport would be in a position to negotiate discounts with long distance providers, thus enabling cost savings to be passed on to the tenants.

By one estimate, the city would generate $3 million to $8 million annually in new, nontax net revenue by owning and operating its own telecommunication network. Unfortunately, DIA officials did not feel that sufficient time existed for them to operate their own system. The city of Denver was unhappy over this lost income.

Exhibit 11-6. Airline Agreements

Term

No. of

Airline

(Years)

Gates

American Airlines

5

3

Delta Air Lines(1)

5

4

Frontier Airlines

10

2

MarkAir

10

5

Northwest Airlines

10

2

Trans World Airlines

10

2

USAir(1)

5

TOTAL 20

(1) The City has entered into Use and Lease Agreements with these airlines. the USAir lease is for one gate on Concourse C and USAir has indicated its interest in leasing a second gate on Concourse C.

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