The Los Angeles Board of Airport Commissioners on Monday approved a settlement between Los Angeles World Airports and Alaska Airlines that will enable LAX to move forward with a $271 million renovation of Terminal 6.

Alaska Airlines and three other airlines sued LAWA in 2007, alleging that the agency that operates LAX unfairly levied a tariff on them to cover increased security costs. The airline has agreed to drop the suit as part of a deal that will make it the primary tenant of the renovated terminal for at least 10 years. The announcement did not address the status of the other plaintiffs.

The renovation will include a new ticketing/check-in lobby and in-line baggage inspection system to streamline security screening and allow for both domestic and international flights. Both the renovation and the airline lease must still be approved by the Los Angeles City Council. As part of the deal, eight other carriers currently operating at Terminal 6 will be relocated to other areas of the airport.

“This is a big step forward in the overall modernization of LAX because Alaska Airlines is partnering with us to provide much needed upgrades to the level of service and convenience for not only our international, but also for our domestic travelers,” said LAWA Executive Director Gina Marie Lindsey in a statement.

Roughly $156 million of the project’s cost will be financed from LAWA long-term debt, with another $96 million coming from LAWA cash reserves, passenger facility charges and Transportation Security Administration reimbursements.

Alaska Airlines will spend $18.6 million for branding and other proprietary improvements, including a new club room.

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