The city of Gary Redevelopment Commission has approved paying former Indianapolis Airport CEO John Clark's company $500,000 for its work on the Gary/Chicago International Airport privatization.
Along with Clark, the commission will pay A.C. Advisory Inc., of Chicago, $250,000 for serving as financial adviser on the deal. And Hawthorne Strategy Group, of Chicago, will be paid $67,500 for public relations services.
The Gary airport authority on Monday voted 4-0 to ask the redevelopment commission to pay the fees for all three consultants.
That request was taken up at the commission's meeting on Tuesday and approved, according to Gary Redevelopment Director Joseph Van Dyk. The director said the request was taken up under a joint development agreement forged between the airport and commission to facilitate the airport's recently concluded public-private partnership.
"Certainly both the airport and the development commission will benefit from development around the airport," Van Dyk said. "And it's incumbent that we not only share in that benefit but the costs as well."
John Clark's JClark Aviation was project manager during the 10-month solicitation and negotiation process that led to an agreement in January with Aviation Facilities Co. Inc. (AFCO), of Dulles, Va., to operate and manage development at the airport.
The airport advisers' fees have been in limbo since that agreement was signed.
The joint city/airport committee that negotiated the airport privatization always claimed the winning bidder would pay the adviser fees. But there was no such stipulation in the final contract with AFCO. The airport authority claimed it could not pay the advisers because their contracts called for the winning bidder to pay.
The Gary Redevelopment Commission will pay the advisers' $817,500 tab with funds generated by the Lakefront tax increment financing (TIF) district it manages, Van Dyk said. That district lies just north of the airport. The Lakefront TIF fund has a current cash balance of $3.88 million according to Van Dyk.
In addition to the $500,000 that will be paid to Clark by the redevelopment commission for his work on the airport privatization, he also collected $25,000 from the airport authority for expenses he incurred during the project.
Clark was first hired by the airport authority in May 2012 to work on business development at a rate of $350 per hour. He was hired at the behest of Gary Mayor Karen Freeman-Wilson.
The airport authority paid Clark a total of $189,313 under that contract and subsequent extensions, according to billing records obtained by The Times through an Access to Public Records request.