Airport authority trims executive ranks in cost-cutting move

The Indianapolis Airport Authority has eliminated three executive positions, a move its board president says reflects a return to a more conventional and efficient corporate structure.

“You never like to do this but we need to streamline,” said President Michael Wells.

Wells didn’t like the executive structure put in place by former airport CEO John Clark, whose three-year contract wasn’t renewed in March.

Since Clark’s departure, interim CEO and airport veteran Robert Duncan has been reorganizing the way the airport is structured as it faces financial challenges

IBJ reported May 12 that the airport recorded a $31.3 million operating loss in 2011 due in part to airline restructuring, a sluggish economy and debt costs from the $1 billion midfield terminal project.

The three executives eliminated were Mark Hedegard, senior director of business development; Mark Kratky, controller; and Patzetta Trice, chief communications officer.

Duncan, in a memo to airport employees, said the changes were part of a process to ensure “that our organizational structure was efficient and supported our goal of reducing bureaucracy and refocusing on our core aviation mission.”

“With these changes, the chief communications officer, senior director of business development and the controller are no longer positions within the IAA organization,” he said.

Wells said the executive-level communications post wasn’t necessary. Trice, who was hired in 2005, is well known in community circles and had worked previously for Indianapolis-based Allison Transmission Inc.

Kratky's duties will be handled by existing staff.

Hedegard, a former Simon Property Group executive hired in 2010, had extensive retail experience. The airport will broaden the business development position to include economic development and responsibilities in working with surrounding counties and municipalities. The new post being created will also further revenue development from such operations as parking.

Parking generated $39 million last year, up 1 percent, and is the second-largest revenue generator at the airport, trailing only the $50.3 million from terminal revenue, which fell 2 percent.

Wells, president of real estate company REI Investments, was appointed in January by Mayor Greg Ballard, who wasn’t satisfied with the pace of development at the airport.

Wells and Duncan want more action on redeveloping the former terminal and in generating revenue from other sources.

The midfield terminal, which opened in 2008, added nearly $40 million a year to the airport’s debt service. The airport’s operating income was dinged further by a $44 million depreciation charge on the new terminal in 2011.

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