DENVER -- People here have put up with a crippling depression for five years, making the best of foreclosures and unemployment. But last year, things started looking better, particularly after construction got underway on a massive, $2.3 billion airport that boosters hoped would turn Denver into a more important regional center of finance, services and trade.

Designed to be seven times larger than the existing Stapleton International Airport, the new Denver International Airport was seen as a panacea for the region. Some estimates predicted 25,000 to 30,000 jobs directly related to the new airport. It didn't matter that air traffic into Denver had been declining for four years, down a full 20 percent, or that one of five concourses at Stapleton had been shut down for lack of use. By the logic of economic planners, airports have become like the rail crossroads of the 19th century -- magnets for new companies that would reduce the region's dependence on extracting oil and minerals from the ground.

Best of all, this new airport would be as close as one gets to a free lunch. The cost of the construction would be paid for by the airlines that would use it, without a penny of local taxes.

Now, however, some flaws are beginning to show in that elegant financing scheme for the Stapleton site. Continental Airlines, the second-largest airline in Denver after United Airlines, whose cooperation is critical to the success of the new airport, last week petitioned a federal bankruptcy court for relief from its various financial obligations. Although Continental says it suffers only from a short-term cash flow problem that resulted from a quick run-up in jet fuel prices, not everyone is reassured. News of the bankruptcy court filing shook Denver's financial district to its foundations, and tremors were felt at City Hall, where the city's bond rating was lowered because of it.

Although construction began at Stapleton more than a year ago, Continental was the only major airline to have committed itself to tenancy in the new facility -- and with it the obligation to dedicate a portion of the revenue from every ticket in and out of Denver to pay for servicing the city's Stapleton bonds. Now, under a bankruptcy court reorganization, Continental may have the opportunity to pull out of its commitment, or at least renegotiate.

Such prospects led one of the major bond rating agencies, Standard & Poor's Corp., to immediately place $700 million of the airport bonds on its "credit watch" list, cautioning investors that the risk of being paid back was increasing. It also downgraded another $274 million of bonds to a BBB rating. For investors now holding the bonds, that means they are worth less should they want to sell them on the open market. For the city, it will mean that it will have to pay higher interest for any bonds it may need to issue in the future.

Continental Chairman Hollis Harris was quick last week to reassure that the bankruptcy will not have any effect on Denver or its new airport. Calling it a "business-as-usual bankruptcy," Harris said none of Continental's 7,000 employees in Denver would be affected by the filing, nor would there be any change in the 150 daily flights in and out of Denver.

The size of the airport -- which will cover a land mass more than twice as large as Manhattan -- has always been an issue here. Originally, the airport was to have four concourses, fed by underground trains similar to Atlanta's Hartsfield International Airport. Then it was cut back to three. Now it may need to be cut again.

"We might decide to build two concourses instead of three," Denver Mayor Federico Pena said last week. "Depending on the market and depending on how much money is raised {through bonds}, we can always adjust the airport."

Other city officials said they are confident that, even if Continental's troubles continue and it is forced to cut back or close its Denver operations, another airline -- most likely American Airlines -- would move in.

American officials refused to speculate about its future Denver plans, but it has turned down the prospect of becoming a big player at Stapleton once before. After negotiating with airport officials about the possibility of locating a hub in Denver, it pulled out last year, leaving only United and Continental.

As for Continental, a number of airline analysts said this week that it might be forced by creditors to cut back on its Stapleton plans, but none predicted a wholesale retreat.

"Continental will emerge as a significant player, perhaps slightly smaller in size than it is now," said Robert Decker, an analyst with Duff & Phelps Inc. in Chicago. "And one of its strengths when it reemerges will be its hub in Denver."

Not so, said Richard Young, a Denver attorney and one of the leaders of a band of determined opponents to the airport. Not surprisingly, he predicted that Continental is finished with Denver. "Over the past four years, Continental has dropped from 275 flights a day in Denver to 138," Young said.

"There are only four cities in the country with two airline hubs -- Chicago, Atlanta, Dallas and Denver. Denver {with Continental} and Atlanta {with Eastern Air Lines} aren't doing well. Continental just opened a regional hub in Cleveland. And now it is moving equipment and some operations out of Denver to Cleveland. It's also moving equipment to Seattle," he said.

Politics and airport politics are closely linked in Denver. Two weeks ago, Pena surprised many when he announced that he would not seek a third term after eight years in office, despite continuing popularity with voters. Pena considers the new airport his greatest achievement. Ironically, he announced his decision not to run just days before Continental declared bankruptcy and just days before the Denver Post broke a story involving land speculation around the new airport financed by the defunct Denver-based Silverado Savings and Loan.

Airport land speculation has been a cottage industry here ever since a site was chosen nearly a decade ago. Those involved expect the land will soon be sold at a handsome profit for the hotels, parking lots, restaurants, warehouses and office parks that will surround the airport. And not surprisingly, they were talking down the importance of the Continental situation.

"I don't think the bankruptcy will have any impact," said Steward Mosko, a land broker who specializes in airport properties. "People are investing not because of the strength of any particular airline, but because of the development opportunities that occur around a new airport."

A member of a family that owns land around the new airport said he wasn't concerned whether Continental pulled out or stayed. "If they {Continental} die, American or even Delta will come right in," he said, speaking on the condition that his name not be published. "In fact, I will sue to prevent United from being the only hub airline in Denver."

George Doughty, director of aviation for the city of Denver, said he strongly believes that Continental will return from bankruptcy court the same size and financially stronger. Not only has Continental agreed to occupy the new airport, Doughty said, but it recently increased its request for gates by 15 percent.

But behind those figures is a shift in Continental's strategy. The airline has scaled down its primary operations in Denver even as it has increased its commuter operations through a subsidiary, Continental Express. The request for more gates is for Continental Express, not for Continental proper.