The City of Philadelphia Department of Aviation and its airline partners have agreed to a three-year Airport-Airline Use and Lease Agreement for Philadelphia International Airport (PHL) and Northeast Philadelphia Airport (PNE) that includes options for two one-year extensions. The agreement, which was approved by City Council on June 22 and signed by Mayor Jim Kenney on June 28, is effective July 1, 2023, and governs airline use of the City’s facilities at PHL.
“I am pleased to sign the new Use and Lease agreement between the Department of Aviation and its airline partners. Our airports are major economic engines for the City, generating thousands of jobs for the residents of our City as well as throughout the region. Thank you to the airlines for their continued commitment to Philadelphia and to the millions of passengers the City welcomes through our airports every year,” said Mayor Kenney.
The agreement provides for $935 million in funding for capital projects over the proposed three- to five -year term, including:
- Mechanical and systems upgrades throughout the airport, such as HVAC; wayfinding; moving walkways.
- Airfield rehabilitation to provide for safe takeoffs, landings, and movement across the airport.
- Investment in preliminary design for cargo projects on the west side of airport, and design and construction for aviation-related development in the closed portion of the former economy lot.
- Funding to support terminal access and the movement of people throughout our facility such as roadway work, lighting, and signage.
While the Department of Aviation is undergoing a long-term planning process and analyzing the need for future capital investment, the airports and airlines collectively decided a short-term agreement would better allow for further conversations regarding additional capital investment in the future.
“Air travel is making its way back to pre-pandemic levels. Through this new Use and Lease Agreement, our airline partners are making a significant investment in our facilities and our guest experience,” said PHL CEO Atif Saeed. “This is especially critical as we move closer to 2026, when millions of visitors from around the world will fly through PHL for America’s 250th birthday celebration, the FIFA World Cup and Major League Baseball’s All-Star Game. It is important that we begin our upgrades now to meet the needs of passengers now, in 2026 and beyond.”
The airports use no local taxpayer dollars to fund its operation. Revenue generated through the collection of rates and charges from the airlines and other tenants is reinvested in the City-owned airports, covering the cost of airport operations, financing capital improvement projects, and funding reserves.
American Airlines is PHL’s largest operator and a major contributor to the region’s economic engine, employing nearly 8,500 team members in the Philadelphia area.
“Philadelphia is home to one of American’s key hubs and plays an essential role in delivering our global network,” said American’s Vice President of Airport Affairs and Facilities Amanda Zhang. “We are proud to account for nearly 70% of the annual commercial passenger traffic at PHL, serving the local community this summer with more than 250 daily flights to more than 105 destinations. We are thankful to the City of Philadelphia for their continued partnership and are thrilled to have reached an agreement where we will continue to invest in capital projects that benefit our customers and team members.”
The Department of Aviation’s new Use and Lease Agreement replaces the 2015 agreement, which expired in 2020 and was extended during the pandemic.