Architects Of Proposed Agreement To Rework Disputed Details

Despite lengthy negotiations in the works for several months, Northwest Airlines and the Twin Cities' Metropolitan Airports Commission have reached an impasse, sending commission staff back to the drawing board to come up with a revised agreement.

The Pioneer Press reports the proposed new legal agreement concerns matters such as leases, promised numbers of daily flights, a schedule for paying off bonds, and which corporate functions will remain at Minneapolis-St. Paul International Airport, as recently acquired Northwest moves its center of operations to new parent-company Delta's headquarters in Atlanta.

Northwest officials, unhappy with the delay in coming to a workable agreement, expressed the need to reach common ground to facilitate the remaining integration with Delta and to provide security for employees.

"We need an answer now as to whether this agreement is an agreement," Delta general counsel and negotiator Ben Hirst said, as he pleaded with commissioners. "Every word in that term sheet has been negotiated."

Some of the problems stem from a 1990 agreement between the MAC and Northwest, allowing the airline to borrow funds backed by bonds. Subsequent agreements have pushed the total to $245 million owed by Northwest, subject to repayment on demand if it ever moved its headquarters.

Delta is reluctant to pay back the entire amount at this time, hence the give-and-take in negotiations. In addition, the MAC also wants Delta's regional headquarters to stay in the state, along with reservation centers and its pilot training center, for at least three years.

"Are these deal-stoppers? I don't know that yet," said Tom Anderson, general counsel for the MAC who negotiated the terms that commissioners turned down last week. Anderson will have until January 26 to revise the proposed agreement, for presentation at the next MAC meeting with airline negotiators.

FMI: www.delta.com, www.northwest.com, www.mspairport.com/MAC