Coverage of the merger between American Airlines and US Airways

Kansas City Could Lose Again In AMR Bankruptcy

AA seeks to end lease payments to KC

By Scott Friedman
|  Thursday, Dec 1, 2011  |  Updated 12:30 PM CDT
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KC Could Lose Again at Hands of AMR

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AA hopes to save $1 million per year with the filing.

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One of the first losers in American Airlines bankrupcty could be Kansas City.

American wants to rid itself of the $1.1 million lease payments it makes to the city every year, according to a bankruptcy document the company has filed in a New York court. 

The payments cover American's lease on a giant maintenance facility that the Fort Worth-based airline abandoned in 2009 while laying off hundreds of employees.

Just four years before American decided to close the Kansas City base, the city helped AA obtain more than $30 million in financing to overhaul the building.  In return, the airline signed a 25-year lease, pledging to stay in the community and employ a minimum of 700 workers there.

Now, city officials will have to fight in court to recover the money they're owed.  According to the Kansas City Star, the mayor briefed city council members on the situation this week and the city's aviation department has said it will do what it can to prevent American from gaining permission to scrap its payments.

Bankruptcy records also show American is also seeking to scrap lease payments to the city of Chicago on unsused terminal space at O'Hare International Airport.

American Airlines Bankruptcy:
Find complete coverage of the American Airlines Bankruptcy proceedings, expert analysis, and impact to customers and the local economy in our Special Section. Click here for more.


American Airlines Merger:
Complete coverage of the merger between American Airlines and US Airways into the newly-formed Fort Worth-based company, American Airlines Group (AAL). Click here for more.

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