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New agreement will keep United at Dulles International Airport

The main terminal at Washington Dulles International Airport is shown Oct. 2, 2014, in Dulles, Va. (Mark Wilson/Getty Images)

It’s a rumor that seems to circulate every six months: United Airlines is shutting down its hub at Dulles International Airport.

Well, Virginia Gov. Terry McAuliffe sought to tamp down such nonsense this week with the announcement that the airline had signed a new agreement that will ensure that it maintains a significant presence at Dulles though at least 2025. The agreement is an extension of a three-year deal signed in 2015.

Airport board inks new deal with airlines at Reagan National, Dulles

“Today’s agreement is critical to the economic prosperity of Northern Virginia and air service throughout the Commonwealth,” McAuliffe said in a news release heralding the deal. “The extension of the United lease solidifies Dulles as Virginia’s gateway to the country and the world and a critical piece of our efforts to build a new Virginia economy.”

For years, rumors have swirled that United would eliminate its hub at Dulles because of duplication with its more profitable hub at Newark Liberty International Airport.  Analysts have long suggested that such a move could boost the airline’s bottom line. But such a move would be devastating at Dulles, which had steadily lost market share to its smaller sister airport National and Baltimore-Washington International Marshall Airport.

So how did McAuliffe do it?

Cold, hard cash.

In this year’s General Assembly, McAuliffe championed a measure that would give $50 million in additional funding to the Metropolitan Washington Airports Authority, which manages Dulles and Reagan National airports. The funds were designed to lower the costs for airlines operating out of Dulles. But the money — $25 million over two years beginning in 2017 — was contingent on securing a longer term lease agreement. The agreement covers most of the airlines that operate out of Dulles, but United really is the big dog operating more than 60 percent of the flights at Dulles.

Dulles struggles to find its footing

“As we extend our lease at Dulles, I want to express my appreciation to MWAA, Governor McAuliffe, Transportation Secretary Aubrey Layne and the Virginia General Assembly for their partnership in keeping Dulles competitive,” said Oscar Munoz, United’s chief executive. “We are proud to be a part of the Northern Virginia and the greater Washington community and look forward to the important role that Dulles will continue to play in United’s global route network for years to come.”