The contract was awarded last week by the VIA Board.
Project scope was cut after the two bidders on the contract came in at $39.96m.
Foremost Paving, the new contractor, has now secured the project with a winning bid of $27.41m.
Initially, a budget of $20m to $21m was allocated for the project.
VIA aviation assistant director Bryan Wren was quoted by MyRGV News as saying: “These were over-budget. We worked with the FAA and we also worked with the contractor to reduce the scope of the work.
“We were able to accomplish that and the low bidder has agreed to the reductions in scope so we were actually able to shed approximately $5m of the contract price.”
The runway in the south will be extended from 8,301ft to 9,400ft, and the longer runway is expected to help airport’s freight haulers to reduce their costs.
Majority of the savings will come from the delayed deployment of the navigational aids at the airport.
The navigational aids include Category II versions of the Instrument Landing System (ILS), which has been developed to assist pilots to guide their planes to land during times of poor visibility.
FAA also gave approval for a new control tower at the airport with an estimated cost of $28m.
VIA aviation director Marv Esterly was quoted by the news agency as saying: “I just want to say, the runway extension, and the control tower immediately thereafter, discretionary money, unbelievable, never seen.
“In the 35 years I’ve been doing this, we never received this amount of money for an airport of this size,” he added.