Because of the political friction surrounding Itami, planners began work in the 1970s to relocate many of its flights to an offshore location. This plan led to the opening of Kansai International Airport in 1994 on an artificial island in Osaka Bay.
There were originally plans to close Itami Airport following the opening of Kansai, but nearby communities opposed such a move for economic reasons, so Itami was retained as a domestic-only airport after Kansai opened in 1994. The only international passenger flights to use Itami since 1994 have been in connection with state visits. Air Force One visited Itami in November 2005, and Chinese premier Wen Jiabao landed at Itami in April 2007. All Nippon Airways retains a large maintenance base at Itami which occasionally services aircraft ferried in from overseas without passengers, and some international cargo flights continue to use the airport as well.
The Japanese government has taken further moves to limit operations at Itami in order to spur development at Kansai and Kobe. Commercial passenger aircraft with more than two engines were banned from Itami effective April 2006, although such aircraft may continue to make ferry flights to and from Itami for maintenance purposes. The government proposed changing Itami's status from first-class airport to second-class airport, which would saddle local governments with one-third of its operating costs; after protests from the surrounding local authorities, the national government withdrew this proposal. The government also proposed banning widebody aircraft from Itami, although this proposal was criticized as unrealistic given the volume of traffic there.
Since July 2008, Osaka Prefecture governor Toru Hashimoto has also been a vocal critic of the airport, arguing that the Chuo Shinkansen maglev line will make much of its domestic role irrelevant, and that its domestic functions should be transferred to Kansai in conjunction with upgraded high-speed access to Kansai from central Osaka. In 2009, Hashimoto proposed closing Itami and converting the site into an "International Campus Freedom City" operating in the English language with 20,000 residents; the governor of Hyogo Prefecture, who advocated the resumption of international service at Itami, criticized the idea as "complete nonsense." Hashimoto later expressed support for Transport Minister Seiji Maehara's plan to maintain Itami with further restrictions on the size of aircraft.
In May 2011, the Diet of Japan passed legislation to form a new Kansai International Airport Corporation using the state's existing equity stake in Kansai Airport and its property holdings at Itami Airport. The move was aimed at offsetting Kansai Airport's debt burden.
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