The City of Philadelphia, Delaware County, and that county's Tinicum Township signed a multimillion-dollar financial settlement Wednesday to end long-simmering tensions between the city-owned Philadelphia International Airport and its municipal neighbors over a massive plan to expand the airport.
Terms of the agreement, announced in May 2014 and finalized with Wednesday's signing, includes funding to protect tax revenues for Delaware County, Tinicum Township, and the Interboro School District.
Two-thirds of the airport is in Tinicum.
The city also agreed not to acquire 72 Tinicum houses and displace 300 residents.
"This agreement achieves the ultimate goal we have been trying to reach for years - preserving Tinicum's neighborhoods and securing a stream of revenue that will benefit the township and its people for decades to come," said Thomas J. Giancristoforo Jr., president of the Tinicum Township Board of Commissioners.
The agreement was signed by Mayor Nutter; Giancristoforo; Kathy Hauger, president of the Interboro school board; and Delaware County Council Chairman Mario Civera Jr.
The airport, through its "aviation fund," will make an annual payment of $1.86 million, to be split among Delaware County, Tinicum Township, and the Interboro district. Between 1998 and 2007, the airport paid those entities as much as $1.3 million yearly, but because of litigation has not paid them since.
Money for the aviation fund comes from fees paid by airlines that use the airport, concessions, and other vendors.
The aviation fund also includes passenger "facility fees" that are added to every airline ticket and used by U.S. airports to pay for construction projects and infrastructure needs. The fee is $4.50 each time someone boards a plane for a trip. In Philadelphia, the usage fee generates about $61 million annually.
In addition to the $1.86 million, the airport will make a one-time $500,000 payment to Interboro. It will also pay the township $1 million a year for 20 years, or until the multibillion-dollar airport expansion is completed.
The city and Tinicum agreed to a 50-year lease-purchase of Hog Island Road on the airport's periphery. The city will initially purchase 8.6 acres of the roadway for construction of a proposed runway. The portion of roadway property not initially purchased will be leased to the city for $390,000 a year.
The agreement settles four lawsuits and years of litigation with Tinicum, and paves the way for land acquisition and further talks with United Parcel Service about relocating from 212 acres it owns on Hog Island Road.
The plan would save the houses and move UPS's large airfreight operation close to Terminal A and nearly a mile from any homes.
"We are pleased that this litigation has finally been settled," said John P. McBlain, a Delaware County councilman and former county solicitor.
Tinicum and Delaware County had sued to stop the airport from further encroaching into Tinicum, creating noise and reducing tax revenue for the county, nearby communities, and the school district.