Stalled $56 Million Cargo Facility Project At O'Hare Moving Forward With New Lead Contractor
CHICAGO (CBS) -- A project to expand cargo operations at O'Hare International Airport advanced through two key City Council committees on Monday, more than four months after the plan was held up by aldermen upset at a lack of minority participation and not enough jobs going to Chicago residents.
The project is the third and final phase of a million-square-foot expansion of cargo space at O'Hare.
The plan was stalled in September, after several aldermen refused to support the city's plan to borrow $55.6 million to help fund it, because Aeroterm LLC had failed to meet the city's benchmarks to have 50% of the jobs go to Chicago residents in the first two phases of the expansion. Aldermen were also upset that Aeroterm didn't meet goals for hiring minority-owned subcontractors.
Since then, Aeroterm has agreed to replace the original lead contractor on the project, Walsh Construction, with Bowa Construction, which is owned by a Nigerian immigrant. Bowa and another minority-owned firm, d'Escoto Inc., will handle 60% of the project, according to Aeroterm vice president Greg Russell.
Russell said the final phase of the project will be the first major airport cargo facility in the nation to be built by an African American-led team.
Further, if Aeroterm does not meet its benchmark for hiring Chicago residents, it will pay the city "liquidated damages" and face potential fines, according to Aviation Commissioner Jamie Rhee.
Rhee said the first two phases of the project created 1,000 new jobs at O'Hare, and the final phase will create another 200 to 400 jobs.
The first two phases of the project already boosted O'Hare's cargo capacity by 20%, making it the top airport in the country for freight in terms of overall value of goods, and #6 in the nation for total cargo volume.
Ald. Jason Ervin (28th), who chairs the City Council Black Caucus, thanked Aeroterm for listening to aldermen's concerns about the original deal.
"I just want to thank them for their response and leadership on the issue," he said.
Rhee said construction is expected to begin next month, with completion set for early 2022.
With the changes to the project, the Finance Committee on Monday approved the city's plans to borrow $55.6 million to help finance the project. Rhee said the city is essentially borrowing on Aeroterm's behalf, and the company will be responsible for paying back the bonds.
Separately, the Aviation Committee signed off on Aeroterm's lease at O'Hare for the third phase of the project. The 35-year lease agreement calls for Aeroterm to pay the city approximately $960,000 in the first year, with its rent increasing about $30,000 each year after that. The city will also get a 3% share of all Aeroterm's cargo revenue.
The bond deal and lease agreement for the O'Hare cargo project will now go to the full City Council on Wednesday.
In other business on Monday, the Finance Committee also approved a $525,000 settlement with Antwon Golatte, who was shot by police during a traffic stop in 2015.
Golatte filed an excessive force lawsuit against the city in 2017. The officers claimed Golatte tried to run them down after he was pulled over in the 300 block of West 115th Street, but the bullet holes in his car were all in the rear, and Golatte was acquitted of aggravated assault charges.
An investigation by the Independent Police Review Authority – the predecessor agency to the Civilian Office of Police Accountability – concluded the shooting was not justified, and recommended two officers be fired.
However, the Chicago Police Board instead suspended the officers for one year without pay for firing into a moving car that posed no immediate threat, a violation of department policy. The board said the officers never had the authority to make the traffic stop and violated the department's use of deadly force policy, but members stopped short of recommending termination.
The full City Council is expected to approve the settlement on Wednesday.
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