A system and method for a package terminal/split unit air conditioning unit which eliminates condensate leakage normally associated with air conditioning systems. The present invention includes a first section and a second section, where the first section connects to the second section by means of refrigeration piping, drain piping and electrical wiring and the first section includes a blower chamber and a condensing chamber. The air conditioning unit may operate with the two sections joined together or separated. During operation, the second section generates and collects condensate in a drain pan, the accumulated condensate flows, via drain piping, into a centrifugal blower within the first section. The centrifugal fan blower conveys the condensate into the condensing chamber. The heat within the condensing chamber causes the condensate to evaporate, and therefore eliminates leakage of condensate from the second section.