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HomeMy Public PortalAboutAAC Minutes 1998 04/22AIRPORT ADVISORY COMMITTEE SPECIAL MEETING MINUTES April 22, 1998 The Airport Advisory Committee meeting was called to order in the dining room of Si Bueno's at 4:04 p.m. Persons present were Rick Fereday, Tom Tucker, Mike Anderson, Marylin Arp, Pat Dorris, Mike Dorris, Brian Olson, Rod Neilson, and Gene Heikkola. Rick Fereday started the meeting off by summarizing the Airport Advisory Committee's concerns about the ALP-06 funds match, airport budget, proposed lease rates, and the substitution of RH2 Engineering in place of Toothman-Orton. Tom Tucker reiterated that the matching funds were previously identified by the former City Manager, with a back-up provision that $100,000 of the $3 Million for the new Deinhard bridge could be used for that purpose. He also objected to the $45,000+ figure in the budget for administrative overhead, which is not an hourly estimate, but a percentage that is based on the wrong figure of approx. $1.5 Million that includes the capital improvement projects instead of the $100,000 (+/-) that represents the airport's true operations. Mike Anderson reminded us all that the airport received a "windfall" of approx. $45,000 when, instead of having to upgrade the AWOS, the National Weather Service decided to install a new ASOS at their expense, and asked where that money went? He restated the Committee's view (which agrees with the former City Treasurer's) that the airport budget should not be an enterprise fund which includes depreciation, but a special revenue fund - to which Ms. Arp agreed. At 4:19 p.m., Brian Olson arrived and joined the conversation agreeing that the accounting practices need to be changed and opined that help was on the way because the City was going to have Jae Hallet of Balukoff, Lindstrom & Co. fill in on a temporary basis for a couple months while the City seeks a new Treasurer. Rick then asked about cancelling T-O's retainer contract and wanted to know if RH2 was indeed qualified to do airport projects at which point, Brian passed out a handout that listed RH2 Engineering's list of project experience which was more complete than the information we all received last week. He reminded the Committee that Rick Harbert is a pilot, as is Rick Ballard, and the FAA likes it when pilots are doing the engineering on an airport project. Rick then asked about the selection process, to which Brian responded that he had sent out an RFP a couple months ago and that RH2 has done a lot of work in conjunction with the Renton (WA) FSDO. Ms. Arp said she didn't feel there were enough proposals to be an ongoing relationship and Mike Anderson added that the Airport Advisory Committee should be included in the "loop". Ms. Arp also stated that the Committee should have been given an opportunity to make some input to the RFP, to which Brian responded that he was working against a deadline to facilitate getting the pre -application submitted in time to make the next grant distribution cycle. He reiterated what was stated in Monday's letter that he expected the Consulting Engineer, whose title is also Project Manager, to verify that project funds do indeed exist. Mike stated that it would be irresponsible for the City to decide to proceed with a capital improvement project if it had not identified the matching funds and that we can't blame the engineers. Brian's position was that we should have checks and balances, but Mike responded that T-O had tried to get financial information for over a year for the Airport Master Plan update and finally had to "make up something" in order to get the document printed. Tom then brought up the fact that the paper had just reported that another $40 Million in Federal grant money was recently made available for airport improvement projects and that we ought to waste no time getting our runway light pre-app in. Tom moved, and Mike Anderson seconded that the City have T-O submit the pre-app and that we meet with RH2 to discuss future arrangements. Rick posed the question of whether T-O would adjust its fee, and suggested that this option be explored. The motion carried. Tom asked if we could go back to the issue of T-O's retainer contract. Brian stated that the City effectively gets no benefit from the $350/mo. it pays T-O on the "retainer" because all they do for that money is attend meetings or attend to other grant -related business, for which they are already being paid. Ms. Arp suggested that we need more information. Rick then asked about the City Manager's proposal to raise the fuel flowage fee to $0.06/gal. At that point, Pat Dorris reminded us that the business season here is only three months long and even then it is only enough to survive on unless there is a busy fire season. He made the point that he has to keep his prices below other airports in the area in order to attract fuel customers. It was his impression that if the City raised the fuel flowage fee, he would either have to absorb the difference, or loose customers. He also mentioned that a bigger problem was the Forest Service practice of bringing in their own fuel trucks and fueling helicopters thereby avoiding the fuel flowage fee. The Airport Manager offered to track that one, and Brian offered to check on the legality of charging a Federal agency. Mike Dorris brought up the point that they hire contractors to supply the fuel, we can charge them, and the charges are reimbursable on the contract. Rick then suggested that we move on to the issue of lease rates. Mike reiterated that the reason we have a two -rate structure here is that in most cases, the hangars occupy only one-third to one- half of the leased lot and, in addition to building their own hangars, lessees are expected to comply with setback requirements, provide their own pavement up to the taxiway, and keep it clear of snow during wintertime. Brian countered that the City clears snow up to 6 feet from the hangars - to which Rick responded that that only applies to the old T-hangars because in that case alone, the lessee only leases the footprint of the building. Tom suggested that it could be an economic incentive for the City to lease at a cheaper rate, say $0.10/sf/yr to attract a new FBO or commercial enterprise. Mike objected to fixing something that isn't broke and Brian said he favors a "two -pronged" approach (increasing taxes and user fees) to be able to fund the kinds of improvements that are mentioned in the Airport Master Plan. Tom said he had done some calculations of total square footage and total lease revenue and had arrived at $0.125 as the overall "melded" lease rate. Mike suggested that the proper approach would be to increase the "commodity" (available lots) rather than the rate structure. Brian suggested that the split between his proposal and the "melded rate" was $0.185 Tom then moved, and Rick seconded that, for new leases only, an overall flat lease rate of $0.185/sf/yr be established effective October 1st. In the discussion phase, Rick posed the question of whether this would encourage more people to build "flightline condo" -style hangars and if that was what we wanted. Brian suggested that we could manage that when the time came. The motion carried. Tom then suggested that we might want to advertise that until October 1, 1998 the City of McCall has "X" number of lots available at present rates, which might spur another "boom" in hangar construction. Rick then turned the Committee's attention to the issue of reviewing the Forest Service landing fee contract and suggested that we need to talk to Merrill Saleen. Ms. Arp pointed out that doing so could put him in a precarious position because, although he is a member of the Committee, he also represented the Forest Service which would be a conflict of interest and that it may be better to deal with his boss. Tom asked the Airport Manager if he could check the contract and he agreed. Brian then brought up the concept of "Gem City" status and how it could help with economic development. He suggested that he would like to have at least one member of the Committee involved in that process and that we could attend airshows and rent booths to make pitches for the City. Rick suggested advertising something like a reduced -rate lease to an aviation -related business as an incentive to locate in McCall. Mike Anderson suggested that we explore the possibility of being designated a "Regional Airport" which would give us priority for grant funding. Brian said he'd propose the idea when he talks with FAA representatives Friday at the Northwest Region Conference. Rick then asked if we were on the City Council agenda for tomorrow night. Tom offered to make the presentation since he was present in the meeting Gordon Colburn had with Lee Heinrich. Only problem was he was trying to locate the notes and had already asked Gordon. Brian said he didn't have them, and neither did the Airport Manager. Mike Anderson said he thought he had a copy at home. Tom Tucker brought up the "J-ditch" project alternate site and pointed out that it was an FAA requirement that any new wetlands area had to be at least 10,000 feet from the airport because of the danger that attracting flocks of birds posed to aircraft. The Airport Manager responded that not only was that project a concern, but also the proposed "Regional Best Management Practices" solution to draining water from the 22 acre lot across Hwy 55 from Pioneer Aviation since the idea there was to culvert that runoff to the center of the airport to the area known as "Kangas Pond" - wouldn't that have the same effect?. Tom suggested that a memo be drafted to the City Engineer, and her replacement be informed about this. The meeting was then adjourned at 6:15 p.m. Submitted by: Gene Heikkola, Airport Manager Approved by: Rick Fereday, C AIRPORT LEASE RATES At issue is the cost per square foot that the City of McCall charges lessees at the Municipal Airport. In the recent past, the airport manager (Dale Points) conducted a survey of lease rates at a number of airports throughout the region. The findings then were that the current rate structure at McCall was comparable to what other airports were charging. Gene Hiekolla may have recently updated that survey, but the results are unknown to the Advisory Committee. Now, there is a proposed increase in rates to facilitate funding a perceived deficit in the annual operating cash flow. The deficit is due, in part, to the City's accounting practices, and may not be a true reflection of the actual cost of operating the airport. Committee members have requested a clarification of the income and expenses and argue against the amount of City overhead allocated to the airport. The committee is also opposed to funding all capital improvements and maintenance from operating revenues. A preferred alternative would be an increase in tax levy and/or allocation of all airport generated tax revenues to the airport. The problem in comparing the current McCall lease rates with other rates is that we don't know what the lessee gets for their money in other areas. In McCall, lessees pay $0.10 per square foot per year for surveyed parcels, ranging from 7,125 to 14,250 square feet in size. The area covered by a hangar costs $0.20 per square foot per year instead of the $0.10 for bare ground. Typical hangars range in size from 1,200 to 6,500 square feet. The actual land needed for hangar construction is from about 1/6 to a little under 1/2 of the gross amount of land leased. In McCall, access to a hangar from the City's ramp or taxiway must be leased and improved by the lessee. In most instances, there is a setback requirement from the City's taxiway which necessitates constructing, maintaining, and removing snow from a large paved ramp, all at lessee's expense. Lessees must extend utilities to their lot lines, and there is no provision for auto access or parking. In other areas, lessees may be leasing only the land under the footprint of their hangar. In this case, the lessor would improve, maintain, and remove snow from the adjoining ramp, and, possibly, make utilities available to the edge of the leasehold. There are probably provisions for automobile access and parking on the lessor's property, and there may be airport security and lighting. Without knowing the details of the lease rates used for comparison, it is impossible to draw meaningful conclusions. The Committee agrees that airport tenants should pay a fair rate. Determining what is fair will require more investigation. March 29, 1998 Michael Anderson CITY COUNCIL AGENDA BILL Number /4169� �o Date if. - L3 - 7ef) City Of McCall PO Box 986 McCall, Id 83638 ITEM INFORMATION SUBJECT: Request For County Commissioners To Adjust County Airport Tax Levy Original Agenda Date & BM No. Department/committee/Individual Initials Remarks A Mayor / Council p City Manager 40 p City Clerk / Treasurer R City Attorney O City Engineer V P & Z Administrator COST IMPACT: $50,000 per year income A Public Works FUNDING. SOURCE: L Golf Course S Parks & Recreation TIMELINE: Airport Advisory Committee Originator SUMMARY STATEMENT: The Airport Advisory Committee has conducted preliminary discussions with Valley County officials concerning an incremental increase in the County Airport Tax levy. additional approximate $50,000 per year could be dedicated to McCall Airport improvements which generate job opportunities for City and County residents. mutual goal of the City Council and the County Commissioners. If approved by Council, the Airport Advisory Committee would assist the City Manager and Airport Manager in presenting this proposal for evaluation and vote by the County Commissioners at their April 27, 1998, meeting. The This is a City RECOMMENDED ACTION: Motion to request County to adjust Airport levy RECORD OF COUNCIL ACTION Meeting Date Action