• Costa Rica Real Estate

Alterra Prepares Proposal to Save Airport

May 28, 2004

ALTERRA Partners, the consortiumthat holds a 20-year contract to remodeland operate Juan Santamaría Inter-nationalAirport, is preparing a proposal it sayswill make it possible for much-delayedwork on the country’s most important airportto resume.At press time, Alterra planned to presentthe proposal to the government bytoday, according to Mónica Nágel, wholast week was named executive director ofAlterra Partners.A former Justice Minister and formerexecutive president of the National InsuranceInstitute (INS), Nágel has served as alegal consultant to Alterra for the past yearand a half. She takes the reins of Alterra ata time when it is involved in crucial negotiationswith the government, which if notsuccessful could result in Alterra’s contractbeing revoked (TT, May 7).NÁGEL’S experience working withAlterra and the government is expected tobe an asset in resolving the dispute.“I’ve worked with the company as alegal advisor for a year and five months,”Nágel told The Tico Times on Wednesday.“Obviously, having worked in publicadministration gives me a knowledge ofhow it functions, an understanding of theComptroller General’s Office’s rulingsand other matters. Having worked eightyears in the Costa Rican government givesme a professional advantage.”ALTERRA will make use of all thelegal resources available to put an end to thedispute and continue operating the airport.“We have yet to use up all the possibilitiesavailable in the contract,” Nágelsaid. One of those possibilities is to makean addendum to the contract that wouldmodify the way airport usage fees arecharged – the main sticking point of thenegotiations.However, for Alterra’s proposal to succeed,it must be approved by the PublicWorks and Transport Ministry (MOPT)and the Technical Council of the CivilAviation Authority (CTAC) before beingsent to the Comptroller General’s Office,which has the final say.Nágel said the final details of the proposalwere still being worked out.Alterra is determined to stay and finishthe job it started in 2001, she said.“The company has demonstrated efficiencyover the last three years, not just interms of infrastructure, but also in terms ofservices,” she explained. “It has won severalinternational awards (TT, April 16). It beton this country by investing $120 million.”PUBLIC Works and TransportMinister Javier Chaves said the governmenthas issued its own proposal, but hasnot received a response from Alterra. Thecompany, however, said it had notreceived the proposal, according to thedaily La Nación.Chaves proposes that Alterra pay $8million of its own money, while the governmentagrees to forgo part of its revenues.The contract would be extended for an additionaltwo years and three months to ensurethe company recovers its money plus 16%.The airlines would be required to payfor improvements in infrastructurethrough tariffs.Earlier this month, the Public ServicesRegulatory Authority (ARESEP) sent aletter to Chaves requesting that the newtariffs for the airport correct flaws in thecurrent prices. The request was promptedby a report last year by the Comptrollerthat ruled some tariffs were higher thanstipulated in the original contract.IN related news, the Association ofAirlines of Costa Rica (ALA) which representsinternational passenger and cargo airlinesin the country, last Thursday announcedits position on the ongoing dispute.ALA is in favor of renegotiating thecontract, said ALA president Tomás Nassar.He said President Abel Pacheco lastweek invited the airlines to participate inupcoming negotiations between Alterra,the government and the ComptrollerGeneral’s Office. ALA has accepted theinvitation, he added.Although the airlines are open to dialogue,they will reject any proposal thatinvolves increasing the fees they arecharged for using the airport, Nassar said.Fernando Naranjo, president of TACACosta Rica, the airport’s main user, said,“The situation worries us greatly. Not justTACA, but other airlines as well.”AIRPORT fees at Juan Santamaríaare on average 35% higher than in otherCentral American countries. Raising thefees would make the airport less competitiveand the country less attractive to airlines,according to ALA.“Today, we have the most expensive airportin Central America,” Naranjo agreed.

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