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6 It is in this context that functional obsolescence outpaces country. Some airports were dominated by a single carrier. At typical depreciation schedules or master plans that address many airports, Majority in Interest (MII) clauses gave signa- future needs in 20 to 30 years. At some point, both airlines tory airlines rights to approve or disapprove airport capital and airports face the difficult decision about what to do with projects in exchange for airlines backing debt. outdated facilities that no longer can operate efficiently in today's environment. In several instances around the coun- However, starting in 1989, bankruptcies of major carri- try, the decision to demolish passenger terminals can be ers resulted in (1) rejected leases on aircraft and buildings, complicated by public interest to preserve iconic architec- (2) altered airport/airline operating agreements, (3) reduced ture. Passenger terminals such as Eero Saarinen's TWA networks, and (4) discontinued connecting hubs. Table 2 Flight Center and the original Pan Am Worldport (Figure 3) shows the extent of airline bankruptcies. During this period, seem oddly out of scale and function for today's expanded United Airlines closed major maintenance centers in India- travel market. The Port Authority of New York and New napolis and Oakland, and Northwest Airlines (NWA) did the Jersey (PANYNJ) is working hard to integrate the TWA same in Duluth and Atlanta. Eastern Airlines, Pan Am, Bra- Flight Center into the passenger flow of JetBlue's Terminal niff International, and Trans World Airlines (TWA) ceased 5. But not all terminals with strong architectural elements to exist. US Airways changed the status of Pittsburgh from a will be preserved at John F. Kennedy International Air- major connecting hub to a focus city. American Airlines shut port (JFK). Delta Airlines announced in August 2010 that down its San Jose, Nashville, and RaleighDurham hubs. It it would demolish the Worldport in 2013 to make room for acquired the assets of TWA and dismantled the TWA hub at an expanded Terminal 4 and build a connector to its existing St. Louis. Delta has reduced flights at Cincinnati and Mem- Terminal 2. Renowned architect I.M. Pei's Terminal 6 at JFK phis. US Airways merged with America West; Northwest is also slated for demolition. and Delta merged, and most recently, United Airlines and Continental merged. The challenges of vacated property through mergers and bankruptcies have also extended to general aviation airports. For instance, the Chapter 7 bank- ruptcy (liquidation) of Adam Aircraft resulted in vacant han- gars and research facilities at three general aviation airports. Airport revenues are highly dependent on both airlines and passengers. Figure 4 shows how important airline- and passenger-dependent activity (such as concessions, parking, and rental cars) contributes to the operating revenues at air- ports of all sizes. FIGURE 3 Original Pan Am Worldport at JFK (1960). (Source: Port Authority of New York and New Jersey.) Airports in other parts of the United States also have addressed the functional obsolescence of their older termi- nals. Pittsburgh International built a new midfield terminal in 1992 to accommodate the US Airway's hub and the new air mall. Southwest Florida International Airport also built a new midfield terminal complex, which opened in 2005. Both airports decided to demolish their former terminals. India- napolis International completed its new terminal in 2008; the airport authority has hired a consultant to recommend FIGURE 4 Operating revenues at U.S. airports. (Source: FAA ways to recycle the former terminal and maximize revenues. CATS 127 Reports, 2009.) The dislocations that have occurred by changes in the rout- INDUSTRY CHANGE ing of connecting passengers have had a profound effect on air- port enplanements, both positive and negative. Table 3 tracks Airlines, as the principal tenants of commercial service air- enplanements at U.S. connecting hub airports from 2000 to ports, have greatly influenced the build-out of airport proper- 2009. For all primary airports during this period, enplane- ties. During the late 1980s and early 1990s, network carriers ments declined by 12.5 million (1.8%). Given the 20082009 sought to control markets and market share through extensive recession, a modest absolute decrease in enplaned passengers development of hub and spoke networks that crisscrossed the is actually surprising. However, total change in enplanements