Airport deal continues to be a soap opera
The long-running drama over operations at Juan SantamarÃa airport took another turn Tuesday when the ContralorÃa General de la República rejected a change in the nation’s contract with Alterra Partners.
The decision by the ContralorÃa, the financial watchdog, effectively voided a deal Alterra has made with the Consejo Técnico de Aviación Civil that supervises the airport.
The net result is an additional delay in improvements at the nation’s main airport. A new international terminal is being built, and the government has a list of other jobs for Alterra.
Even though the airport is important, the implications of the long-playing soap opera at the airport cut to the core of the current administration’s plan for development. Alterra is a concessionaire, a private firm selected to do a public function: run the airport.
The Óscar Arias administration has plans for many other concessions in the country, and a new law covering the awarding of such pacts is was passed July 25 in the new legislature.
In a concession, a private company puts up money to do a job and splits the income with the state. Costa Rica wins because it does not have to come up with front money for large projects. The concessionaire wins because it gets income that is supposed to represent a fair return on its investment.
Last May the government said that a Czech firm has made a $120 million offer to improve the nation’s railways under a proposed concession.
Concessions are being used to improve and run the nation’s docks.
Several new highways will be built as concessions, including the route from Ciudad Colón to Caldera and the Pacific. An agreement was signed March 9 that empowers the firm Autopista del Sol S.A to build the $150 millionhighway and collect tolls to pay for it over the next 25 years.
Gold mining in Miramar and in northern Costa Rica are run as concessions with the government getting a share of the proceeds.
Costa Rica already got in trouble by effectively nullifying the exploration concession it granted to Harken Petroleum for the Caribbean coast. The long-running Alterra saga has been a concern for companies that might try to bid for concessions here.
This is the third time that the ContralorÃa has rejected proposed changes in the Alterra contract. This time Alterra, part of the London, England-based, Alterra Partners Ltd., was going to get 65 percent of the income generated.
Alterra took control of the airport in 2001 with a concession contract that was expected to last 20 years. The government at first was going to receive 50 percent of the income.
Alterra Partners was to invest $240 million during the 20 years. About $160 million of this was to be invested during the first three years of the agreement.
Karla González, the minister of Obras Públicas y Transportes, the parent organization of the aviation consejo, further muddied the waters. She told reporters that the government would insure the airport would continue to operate up to international standards. That gave the impression that Alterra was packing its bags.
In the past the government has threatened to take over management of the airport, but the threats have not been taken seriously because Obras Públicas is the same organization that can’t fix potholes in the nation’s roads. It is unlikely the agency could generate the money to build a new control tower and extend the runways.
Meanwhile Alterra is getting squeezed by its investors and subcontractors, which have lost money and work because of the flip-flops by Costa Rica.
Not everyone favors concessions. The Partido Acción Ciudadana applauded the action by the ContralorÃa. The party wants the country to keep close control of its facilities. An independent legislator also opposes the idea.