MANKATO — A $31.5 million air traffic control tower at the Mankato Airport is suddenly looking much more likely after federal officials announced $11.5 million in new funding late Monday afternoon.
The grant from the Federal Aviation Administration was welcome news for the city, bringing total federal contributions for construction of the tower to more than $25 million. But it came with a very tight deadline for city officials. Mankato was required to accept or reject the funds by no later than Thursday, a decision that carried some financial risk because the total available funding remains short of the anticipated cost of building the eight-story control tower.
On Monday, City Manager Susan Arntz added the issue to the agenda of the already scheduled council meeting, composing a memo in the afternoon detailing the federal grant, the remaining gap in funds, the possible options for covering the hole in the budget and the potential that local dollars might need to cover some or all of it.
“… A very complex day today,” Arntz said.
The arrival of the funds comes four months after the FAA rejected Mankato’s application for tower construction funding. That decision in May left the city with no viable option for financing a tower that has been portrayed as an increasingly vital safety addition to one of Minnesota’s busiest airports.
“We have a substantial gap in funding as it sits right now without a direct path forward,” Parker Skophammer, the city’s administrative services director, told the council then.
Starting in August, there were hints that better news might be coming from Washington, D.C. before the end of the federal fiscal year on Sept. 30, although no dollar amount was specified.
“About two to three weeks ago, our staff met with the FAA team and they said they’d anticipate making their announcement around Labor Day,” Arntz said.
It happened a week later with Monday’s announcement by Transportation Secretary Sean Duffy of $1.1 billion in airport infrastructure grants across the country, including $10.1 million for Mankato’s control tower.
As Arntz crunched the numbers Monday afternoon, another email arrived at 4:26 p.m. revealing that the federal grant would actually be $11.5 million. Combined with previous federal grants, a congressional earmark and some smaller state and local contributions, the appropriated funding has grown to $28.27 million — including $25.04 million for upcoming construction costs. (The total project cost of $31.57 million includes $3.2 million in design work and environmental studies that have already been completed and paid for.)
A $1.27 million contribution from the Minnesota State Legislature earlier this year is available to cover a portion of the remaining funding gap, shrinking the difference between construction expenses and available revenues to just over $2 million.
“We feel really good with where we’re at right now,” Arntz said.
By accepting the grant, the city is essentially committing itself to filling the funding gap if the tower is built and other financing alternatives come up short. Mayor Najwa Massad said the financial risk was acceptable considering the reduced risk of aircraft collisions that the presence of air traffic controllers would provide.
Massad specifically mentioned the increased safety it would offer to student pilots in Minnesota State University’s growing aviation program, which has been the primary driver of the soaring number of flights originating at the local airport in recent years.
“I think it’s a project we need to move forward on,” Massad said.
The rest of the council agreed, voting 6-0 in favor of accepting the federal funds. The total number of takeoffs and landings at the Mankato Regional Airport has put it among the top three in Minnesota, ahead of cities such as Duluth and Rochester that already have air traffic controllers coordinating the movement of aircraft.
“I believe we’re the busiest airport in Minnesota without a tower,” Arntz said.
If city leaders had opted to reject the federal grant, due to the accompanying responsibility to cover the $2 million funding gap, it would have come with costs of its own. Under agreements with the FAA, the city is obligated to repay the $3.2 million the federal government previously spent on tower design costs if city officials back out of the project. And that decision would have effectively ended the five-year effort to bring air traffic controllers to the airport.
“We give (the dollars) back, and the project is essentially done,” Arntz said of that option.
Instead, the council is moving forward toward construction even as it continues to explore potential sources of the needed $2 million. The most attractive option would be more federal grants, and city staff were told by the FAA they could continue to apply for money in 2027. They could also try to get funds earmarked for the Mankato control tower in a future congressional budget bill. Another possible alternative would be scaling back elements of the tower to reduce construction costs.
The federal deadline for completing construction of the tower and having it certified as operational was originally April 2027, which would have required a groundbreaking at the beginning of 2026. The deadline has since been extended to April 19, 2029.