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HomeMy WebLinkAbout2004-02-19 Info Packet~ CITY COUNCIL INFORMATION PACKET CITY OF IOWA CITY February 19, 2004 www.icgov.org IP 1 City Council Meeting Schedule and Work Session Agendas IP 2 Letter from City Manager to University of Iowa President and Vice President: Melrose Avenue/Grand Avenue Traffic Study Recommendations IP 3 Letter from City Manager to Iowa Valley Habitat for Humanity: Location of CDBG and/or HOME Assisted Housing IP 4 Memorandum from City Manager: FY05 CDBG and HOME Funds IP 5 Memorandum from City Manager: Scattered Site Policy for Low and Moderate- Income Households IP 6 Memorandum from City Manager: Procter and Gamble Sewer Use IP 7 Memorandum from City Clerk to City Manager: Special Census IP 8 Iowa City Municipal Airport: Airport Business Solutions Report IP 9 Memorandum from Parks & Recreation Director to City Manager: Indoor Soccer IP 10 Iowa City Police Department Monthly Liquor License (OFF PREMISE SALES) Report: January 2004 PRELIMINARY/DRAFT MINUTES IP 11 Senior Center Commission: January 20, 2004 IP 12 Historic Preservation Commission: February 12, 2004 I  City Council Meeting Schedule and Work Session Agendas February19, 2004 CITY OF IOWA CITY www.icgov.org · MONDAY, MARCH 1 EmmaJ. HarvatHall 6:30p City Conference Board [Separate Agenda Posted] 7:00p Special Formal [Separate Agenda Posted] Council Work Session · Remaining Agenda TBA · TUESDAY, MARCH 2 Emma J. Harvat Hall 7:00p Formal Council Meeting TENTATIVE FUTURE MEETINGS AND AGENDAS · MONDAY, MARCH 15 EmmaJ. HarvatHall 6:30p Council Work Session · Oakdale Drive · TUESDAY, MARCH 16 EmmaJ. HarvatHall 7:00p Formal Council Meeting · MONDAY, APRIL 5 6:30p Council Work Session Emma J./-larvat Hall · TUESDAY, APRIL 6 7:00p Formal Council Meeting Emma J. Harvat Hall · MONDAY, APRIL 19 6:30p Council Work Session Emma J. Ha/vat Hall Meeting dates/~imes/topics subject to change FUTURE WORK SESSION ITEMS Regulation of Downtown Dumpsters Downtown Historic Preservation Survey West Side Plan Private Sponsorship of Public Services No Smoking within 20' of City Building Entrances Lawn Parking for U of I Football Games CITY OF IOWA CITY www.icgov.org February 18, 2004 ~t/o0~"'~ ./.' David Skorton, President OFFICE OF THE The University of Iowa CITY MANAGER 101 Jessup Hall Iowa City, IA 52242 Stephen J. Atkins City Manager Doug True, Vice President steve atkms~iowa-city.org Finance & University Services The University of Iowa Dale E. Helling Assistant City Manager 105 Jessup Hall dale-helling@iowa-city.orgIowa City, IA 52242 Re: Melrose Avenue/Grand Avenue traffic study recommendations Dear David and Doug: On February 2, the City Council heard a presentation on the Melrose Avenue/Grand Avenue Traffic Study Final Report. This report includes the recommended traffic improvements which were developed by the joint City of Iowa City-University of Iowa-Melrose Avenue Neighborhood Association committee which participated in the study last year. In spite of the differing perspectives of the three entities involved in the study committee, it appears that they were able to successfully find some common ground on what the future traffic improvements in this area should be. The City Council reacted favorably to the committee's recommendations, and adopted the report at their February 17 City Council meeting. We are already moving ahead with the highest priority improvement from the study, which is the reconstruction of South Grand Avenue between Grand Avenue and Melrose Avenue. This project is scheduled to be designed this year and constructed next year in conjunction with the expansion of the University's Parking Ramp No. 4 on Melrose Avenue. This project will be funded through a $320,000 grant which the City of Iowa City has received through the Johnson County Council of Governments, and $80,000 of local match funds pledged by the University. This appears to be an excellent project for improving vehicular flow, pedestrian safety, and access to University facilities in the area. There are several other traffic improvements which are recommended for this area in the future. We would like to commence discussions with the University on a strategy for implementing these improvements in upcoming years. Would you please let me know who you would like to have represent the University in discussing these projects. I would appreciate you contacting Jeff Davidson of the Johnson County Council of Governments who coordinated the study committee and will be coordinating the upcoming discussions between the City of Iowa City and the University. You may also wish to discuss this matter with Larry Wilson, Campus Planner, who coordinated the University members on the committee. 410 E, Washington Street Iowa City, IA 52240 Phone: (319) 356-5010 Fax: (319) 356-5009 Thank you for your consideration of this matter. Jeff Davidson can be reached at 319 356-5252 or ieff-davidson~,iowa-city.or.q. I look forward to the continued cooperation between the City and the University. Sincerely, Stephen J. Atkins City Manager cc: City Council Jeff Davidson Karin Franklin Rick Fosse Ron Knoche Larry Wilson mgr/Itr/melrose-grand, doc CITY OF IOWA CITY www,icgov,org February 17, 2004 Iowa Valley Habitat for Humanity Mr. Brad Langguth, Board President Mr. Mark Patton, Executive Director P.O. Box 1241 OFFICE OF THE Iowa City, IA 52244 CITY MANAGER Stephen J. Atkins RE: Location of CDBG and/or HOME Assisted Housing City Manager steve-atkins~iowa-city.orgDear Mark and Brad: Dale E. Helling Assistant City Manager Your letter, dated January 13, 2004, was included in the Council packets for the dale-helling~iowa-city.org February 3, 2004 meeting. As you know, the issue of affordable housin9 is important to our community. Over the years the provision and location of affordable housing has consistently come before the City Council. Last fall the City Council was provided information by the Iowa City School District that highlighted some of their statistics regarding the number and location of Iow-income students. In consideration of this, and other information, in late November the City Council requested the formal initiation of discussion concerning the development of a scattered site policy. This work is just getting started with City staff and Housing and Community Development Commission. Due to the timing of the start of the FY05 Community Development Block Grant (CDBG) and HOME Investment Partnerships Program funding cycle, on December 12, it was not possible to develop and adopt a formal scattered site policy. As such, the language in the FY05 Applicant Guide was provided to all CDBG/HOME applicants as a guideline and notification that location of housing and residential facilities will be reviewed by Housing and Community Development Commission and the City Council during the evaluation phase of the funding cycle. Your letter also requests the City to consider several avenues to assist in the development of affordable housing. These items range from inclusionary zoning to residential Tax Increment Financing. As the scattered site working group completes their work I anticipate that these items, as well as many others, will be considered. If you have any questions about the FY05 CDBG/HOME funding cycle please contact Steven Nasby, Community and Economic Development Coordinator, at 356-5248. Sincerely, Stephen J. Atkins City Manager 410 E. Washington Street Iowa City, IA 52240 cc: Lane Plugge Phone: (319) 356-5010 Director of PCB Fax: (319) 356-5009 City Council City of Iowa City MEMORANDUM DATE: February 18, 2004 TO: City Council FROM: City Manager RE: FY05 CDBG and HOME Funds The final allocations from HUD were just released. Iowa City will receive $804,000 in CDBG (a $22,000 or 2.7% cut from last year) and $714,983 in HOME (a $1,465 or .2% cut from last year). The CDBG decrease was due to 60 new entitlement communities coming on-line this year without any increase in the overall CDBG funding. These numbers were very close (within $1,700) to the planning targets HUD gave us in January. Date: February 13, 2004 To: City Council From: City Manager Re: Scattered Site Policy for Low and Moderate-Income Households The City Council has requested research on the issue of the development of a scattered site policy. In response to that request, I have asked staff to organize a working group and identify a public input process to address this issue. The scattered site policy research will focus on the acquisition or development of housing that is affordable to people of Iow and moderate income, particularly where the City has a funding role or decision-making function such as CDBG or HOME funding, public housing, Iow income housing tax credits, etc. Given the Section 8 program is based on a "housing choice" by a tenant, we do not anticipate including this program within the scattered site policy discussion. The working group as planned would include City staff from Community Development, Urban Planning, Neighborhood Services, Housing Authority and Police. A subcommittee of the Housing and Community Development Commission and a representative of the Iowa City School District would also be included. This working group will research the availability and application of scattered site policies from other communities, as well as collect local demographic and housing information. Following a collection of information, the working group would host several focus groups to receive input and ideas from various organizations and perspectives including consumers and developers of Iow and moderate-income housing. After the focus group meetings, the working group would update the City Council. The Council must provide some direction so policy options can be created. February 13, 2004 Page 2 The HCDC will then begin the review process for scattered site policy options and would hold at least one public meeting to receive public comments prior to making recommendations to the City Council. Ultimately, all of the policy options and the HCDC recommendation will be forwarded to the City Council for their consideration. The tentative schedule is as follows: Late February- April: Information collection and research April - May: Focus group meetings and form policy option May: Work session with Council June: HCDC discussion and recommendation July: City Council consideration cc: Lane PIugge - School District Karin Franklin Doug Boothroy Steve Rackis Steve Nasby R.J. Winkelhake mgdmem/scatteredsite ~ UZ-19-U4 ~ City of Iowa City MEMORANDUM TO: City Council FROM: Steve Atkins, City Manager DATE: February 19, 2004 RI:: Procter and Gamble Sewer Use Procter and Gamble will be adding some product lines that will significantly increase the amount of zinc in their wastewater. Zinc, like most metals, is not easily removed by the biological treatment process at our wastewater plants and the amount they plan to release is much higher than we can treat. To deal with this issue, Procter and Gamble plans to implement on-site wastewater pretreatment at their facility. In addition to removing zinc, the pretreatment process will also remove about two- thirds of their BOD*. Since Procter and Gamble is our largest single customer for high strength waste (BOD), this will reduce our wastewater revenues by an estimated $700,000 per year. There will not be a corresponding decrease in operating expenses. This decrease in revenue represents 5.6% of our total annual revenue of $12,500,000. However, the reduction in waste load will have some positive impacts. Procter and Gamble's waste load had increased so dramatically in recent years that it had consumed most of our remaining capacity to treat BOD. The proposed reduction will create capacity for new industry, which is currently limited. In addition, the nature of Procter and Gamble's waste makes it difficult to treat. A reduction in their waste load will improve the overall performance of the wastewater plants. Procter and Gamble plans to have their on-site pretreatment facility operational by April 1,2004. *BOD stands for Biochemical Oxygen Demand, which is a parameter used to measure organic pollution. Our rate structure includes a surcharge for waste with BOD in excess of 300 mg/L and an additional surcharge for waste with BOD above 2000 mg/L. In the last year and a half Procter and Gamble was paying a heavy excess BOD fees. DATE: February 18, 2004 TO: Steve Atkins, City Manager~¢,-- ~,e .~" ~' ~'~¢'~ FROM: Marian K. Karr, City Clerk ~ ~ RE: Special Census To begin the process of a Special Census, a governmental unit must request an official cost estimate from the Census Bureau. The cost of processing a Special Census cost estimate is $200. Once a request and payment is received by the Office of Special Censuses, a cost estimate and Memorandum of Understanding will be developed specifically for Iowa City and provided within 30 days. The cost estimate will be valid for 90 days once issued. In 1995-1996 Iowa City paid over $200,000 for a Special Census. An additional $10,000 was allocated for publicity. Recently Coralville paid $180,000 for a Special Census, and North Liberty $77,929 based on a population of 6,400. U:specialcensus.doc IOWA CITY MUNICIPAL AIRPORT 1801 South Riverside Drive Iowa City, Iowa 52246 Office Phone (319) 356-5045 February 12, 2004 The Honorable Mayor Mr. Ernest Lehman 410 East Washington Iowa City, Iowa 52240 Re: Airport Business Solutions report Dear Mayor Lehman: On September 22, 2003, the draft plan from Airport Business Solutions (ABS) was presented to the Council and the Commission. ,At the conclusion of every chapter of the report, ,ABS outlined recommendations and suggestions to improve the administration and operation of the ,Airport. The Commission carefully reviewed the report and the summary of our results is attached to this letter. At the November 13, 2003 Commission meeting, corrections and clarifications to the draft report were discussed and forward to ABS. The Commission suggested some minor changes to the draft report that you received in September. The final report will be very similar to the draft report. One of the items mentioned in the report was a perceived lack of communication between the Airport Manager and the City Manager. The Commission does not agree with that assessment. Especially since the Council/Commission meeting in August of 2002, there has been a concerted effort to strengthen the communication between the Airport Manager and the City Manager. The Commission believes this effort has been successful and there is a good exchange of information in both directions. In addition to the ABS report, the Commission continues to work on a Strategic Plan for the Airport. Only two of the odginal Commission members remain from the group that originally started this project. Randy Hartwig and I will continue to work on this plan. A third Commission member, John Staley, attended his first meeting on November 13 and will be able to assist us as soon as he has had time to develop some background. Daniel Clay was appointed to the Commission on January 6, 2004 and attended his first Commission meeting on February 12. It will take him a while to become acclimated to the project. The Strategic Plan will use some of the actionable items from the ABS report, and also include information not specifically covered in the their report. The ABS report will act as a guide for some areas. The goal of the Strategic Plan is to present guiding administrative principles to assist the Commission in addressing all Airport requirements. If you have questions or would like to discuss any of this information in more detail, please contact me at 358-7460 or the Airport Manager at 356-5045. B~r, C hairl:~Cs~ Iowa C[t3F,~rport Commission Cc: City Council Airport Commission Steve ^tkins, City Manager Sue Dulek, Assistant City Attorney Ron O'Neil, Airport Manager Airport Business Solutions Recommendations/Action Items Chapter 1 (Introduction & Historical Analysis) (Commission response) 1. Increased proactive involvement with the local business community and community organizations - Increase interaction with groups like the Chamber and ICAD, Try to speak at more civic organizations 2. Increased interaction with the City Manager - Commission will utilize a direct channel to the City Manager through the Airport Manager Chapter 2 (Statistical Analysis) 1. Better record keeping of Airport operations and related activities - More detail to clarify this recommendation will be requested of ABS. The Manager should assess the value of using preventative maintenance contracts, 2. Continually monitor rates and fees at comparable airports - Participate in rates and fees surveys and use the information when negotiating or renewing leases. 3. Play a stronger role in economic development in the area - Develop a more specific course for the Commission through the Strategic Plan 4. Monitor demographic business and University activity for aviation opportunities - This is something the Commission does, Trying to involve a research- oriented University is difflculL Chapter 3 (Management and Operations) 1. The FBO/Manager should take a more active role in management and development of the Airport - The Commission was in agreement the FBO should not be the Airport Manager. A possible conflict of interest, City controls, liability and lack of potential savings were several issues considered. 2. Immediately begin to implement new organizational recommendations - Not considered an actionable item - see item #1 3. Continue oversight by the Airport Commission - Not an actionable item. 4. The City Manager should maintain a full-time position on the Airport Commission, not as an officer, but as a full voting member and representative of the Mayor's Administration - Not an actionable item 5. Make adjustments to lease agreements - Efforts are underway to adjust lease agreements 6. Begin aggressive joint marketing efforts - This will be addressed as part of the Aviation Commerce Park discussion 7. Restructure advisory and communications distribution to city leaders - This involves keeping everyone informed. The Commission will attempt to report to the Council on a more regular basis. The Council should be invited to events at the Airport to keep them involved. 8. Management team needs to be able to manage several goals simultaneously - This is currently required of the Manager and is being done. 9. Aggressively seek development and installation of a precision landing approach - A precision landing approach is part of the Airport Layout Plan. A precision approach is about $1,000,000 and another $60,000 to $ 70,000 a year to maintain. Funding from the FAA is not likely for an ILS 10. Maintain a high level of safety and security - According to the TSA and IDOT, Iowa City is ahead of many airports in Eastern Iowa as far as safety and security are concerned. Additional security fencing will be needed when Mormon Trek is completed. 11. Provide excellent customer service - This is an ongoing joint effort between the Airport Commission and the FBO {Jet Air) Chapter 4 (Airport Documents) 1. Adopt leasing policy - A template was provided by ABS. It will be customized for Iowa City. 2. Adopt rates and charges policy - A template was provided by ABS. It will be customized for Iowa City. 3. Develop Minimum Standards - The Airport has Minimum Standards. 4. Prepare better lease language for new leases - The Airport has uniform lease language. 5. Require security deposit on all leases - The Airport requires a security deposit. 6. Prepare and maintain emergency phone and address list on all tenants - This is an actionable item. 7. Consider negotiating a separate, independent operating agreement with the FBO to handle day-to-day management and maintenance of the Airport. - The idea was discussed and rejected by the Commission in a previous chapter. Chapter 5 (Marketing Strategy) 1. Plan Airport open houses - The Airport has hosted an annual fly-in for over 20 years. 2. Host contests for area youth - An education program could be developed as part of the Strategic Plan. 3. Host media events - The media is invited to ongoing events. A separate event could be hosted for the media. 4. Take advantage of University student population(potential pilots) - This could be an actionable item in partnership with the FBO 5. Keep updated media list - An updated list is available through the City's web site. 6. Conduct user surveys- The Iowa Office of Aviation is currently conducting user surveys at all Iowa airports and that information will be available to Iowa City. 7. Develop a milestone-based marketing plan - This will be addressed in the Commission's Strategic Plan. 8. Increase interaction with aviation trade associations - Continued participation by the Manager and Commission in state, regional and national conferences, committees and meetings 9. Make Airport and FBO better known in national and regional aviation circles - Incorporated with item if 8 Chapter 6 (Financial Analysis) 1. Reduce and/or eliminate tax subsidy to Airport - FAA grant assurances require the Airport to work toward self-sufficiency. This is a Commission goal 2. Increase T-hangar rates - Rates were reviewed and increased in 2003 3. Improve fuel volumes - Discussed eaHier. Will depend on improvements to the Airport (precision approach and longer runway) and marketing effort by the FBO 4. Restructure management of the Airport to reduce overhead - This idea was discussed and rejected in previous chapters. 5. Develop milestone incentives for the FBO - This will require cooperation between the Commission and the FBO and depends on the FBO's willingness to reopen their lease. 6. Improve financial tracking of revenues and expenses - This idea was discussed earlier. The Manager tracks revenue and expenses directly through the Accounting Department. 7. Review the direct and indirect economic impact of the Airport - If the financing is available, an expert could be hired to conduct an economic impact report 8. Negotiate with the City for a land swap of industrial park property - This is an actionable item 9. Complete a facilities audit and facilities needs assessment - The Airport has a list of fixed assets. The Airport budget is subject to the City's annual financial audit. 10. Complete an energy and environmental study - The Airport was part of a citywide energy audit a few years ago. Mid American routinely conducts energy audits for their customers. An environmental study has been underway since December of 2002 and should be completed in the next few months. . Air ort Airport Business Solutions Business .~ k'aluation and C()n,s'~tlting ServR e.l' lo the ,4 viation Industry" 365 Arroyo Drive, Roswell, Georgia 30075-1258 SolutiOnS Phone (678) 461-4300 Fax (678) 461-4301 December 8, 2003 Mr. Baron Thrower Chairman Iowa City Airport Commission 1801 South Riverside Drive Iowa City, Iowa 52242 RE: Iowa City Airport Business Plan Iowa City Municipal Airport Iowa City, Iowa Dear Mr. Thrower: Per your request, we are pleased to offer the following Airport Business Plan for the Iowa City Municipal Airport in Iowa City, Iowa. The recommendations and requirements herein are included as possible actions for implementation to assist the Commission in achieving the goals contained within this five-year Iowa City Airport Business Plan. In the development of this document, Airport Business Solutions researched many sectors of the local and regional general aviation market, specifically the Midwest region. Moreover, we met on multiple occasions with Airport and City start; in addition to Airport tenants and interested users, in order to create an Airport Business Plan that enables the City to have an efficiently-managed and financially secure airport, as well as meeting all pertinent development and operational demands. The following document outlines our findings and recommendations for the Iowa City Municipal Airport. We appreciate the opportunity to provide our professional services to the Iowa City Airport Commission. If you should have any further questions, please advise. Respectfully Submitted, Michael A. Hodges, MAI Randy D. Bisgard President/CEO Senior Vice President Solutions as Unique as the Problems... Office Locations: ,Itlanta, G4 * Fort Myers, FL * Denver, CO ~ Boston, M,4 * Jacksonville, FL * Memphis, I0 WA CITY AIRPOR T BUSINESS PLAN Iowa City, Iowa Presented to the Iowa City' Airport Commission and City Council of lowa City, IOwa -Airport Date of Report: December, 2003 -- Business ~"-- Solutions I0 WA CITY AIRPOR T BUSINESS PLAN Table of Contents Executive Summary Chapter ! - Introduction & Historical Analysis Chapter 2 - Statistical Analysis Chapter 3 - Management and Operations Chapter 4 - Airport Documents Chapter 5 - Marketing Strategy Chapter 6 - Financial Analysis Appendix Rates and Charges Policy Leasing Policy _ Airport -- Business Solutions Iowa City Airport Business Plan 3 Executive Summary December 2003 EXECUTIVE SUMMARY This Executive Summary is presented to the City of Iowa City, Iowa to provide the City and the Iowa City Airport Commission with an introduction to the multiple goals contained within the Iowa City Airport Business Plan that follows. Specific action items presented in this summary are shown for quick reference only as a prelude to the Business Plan report. Important details and justification can be found within the Plan itself in the Chapters reflected herein. Based upon our analysis, the three primary goals for the future success of the Iowa City Airport are: 1) to improve the image of the Airport both locally and nationally, 2) to reduce the overhead needed to operate the facility on a daily basis, and 3) to gradually improve revenues generated by the Airport to reduce and/or eliminate general fund tax subsidies. Although relatively small compared to many other general aviation airports of similar size and operations, the tax subsidy required for airport operations has a continuing negative impact on the Airport from a public relations perspective. Many comments were received by Airport Business Solutions throughout the course of the Plan's development regarding the positive impact that the Airport has on the community and the University of Iowa. However, the Airport has not taken advantage of this situation and allowed a negative perception of the Airport to persist. Historically, Airport management has been reactive rather than proactive regarding operations and positive image-building for the facility. The City continually benefits both directly and indirectly from the activities of the Airport, and this fact needs to be more aggressively demonstrated. The future potential of the Airport is considered to be good given a more structured environment, improved communications with local governmental leaders, and a more aggressive marketing and management style. Additionally, although the untimely departure of the previous fixed base operator created a significant financial drain on the Airport, the current FBO appears to be on solid footing and represents a regional business with an excellent reputation. Jet Air, Inc. appears to be in a strong position to assist the Airport in improving operations through a "team management" approach. Given the proper structure, and measured milestone achievement incentives, the City and the FBO could move forward with a plan that could potentially improve the financial position of the Airport and the FBO. This situation would not only help the Airport financially, but _ Airport -- Business Solutions Iowa City Airport Business Plan 4 Executive Surm:nary December 2003 also improve service levels to the end users of the Airport through the incentives provided and demonstrate to the community the commitment to responsible fiscal management of this public asset. It should be noted that there are potential areas where the Airport may be able to gradually increase revenues; however, many of the following recommendations will not be achievable without the City making significant alterations to Airport staff and management structure, including, but not limited to, a contract management agreement with the FBO to facilitate day-to-day management and operation of the Airport. This and other recommendations and other action items will be addressed in greater detail within the body of this document, and are outlined as follows. Recommendations/Action Items Chapter 1 (Introduction & Historical Analysis): · Increased proactive involvement with the local business community and community organizations · Increased interaction with the City Manager Chapter 2 (Statistical Analysis): · Better record-keeping of Airport operations and related activities · Continually monitor rates and fees at comparable airports · Play a stronger role in economic development in the area · Monitor Demographic Business and University Activity for aviation opportunities Chapter 3 (Management and Operations): · The FBO Owner/Manager should take a more active role in management and development of the Airport c Airport -- Business ~ Soluti Iowa City Airport Business Plan 5 Executive Summary December 2003 Immediately begin to implement new organizational recommendations · Continue oversight by the Airport Commission · Make adjustments to lease agreements · Begin aggressive joint marketing efforts · Restructure advisory and communications distribution to City leaders · Management team needs to be able to manage several goals simultaneously · Aggressively seek development and installation of a precision landing approach · Maintain a high level of safety and security · Provide excellent customer service Chapter 4 (Airport Documents): · Adopt Leasing Policy · Adopt Rates and Charges Policy · Prepare better lease language for new leases · Prepare and maintain emergency phone and address list on all tenants Chapter 5 (Marketing Strategy): · Plan Airport Open Houses · Hold Contests for area youth · Host media events · Take advantage of University student population (potential pilots) · Keep updated medialist · Conduct user surveys · Develop a milestone-based marketing plan · Increase interaction with aviation trade associations · Make Airport and FBO better known in national and regional aviation circles _. Airport -- Business Solutions Iowa City Airport Business Plan 6 Executive Sununary December 2003 Chapter 6 (Financial Analysis): · Reduce and/or eliminate tax subsidy to Airport · Increase T-Hangar rates · Improve fuelvolumes · Restructure management of the Airport to reduce overhead · Develop milestone incentives for the FBO · Improve financial tracking of revenues and expenses · Review the direct and indirect economic impact of the Airport · Negotiate with the City for a land swap of industrial park property · Complete a facilities audit and facilities needs assessment · Complete an energy and environmental study Within the report that follows, this Airport Business Plan will outline many of the issues that have historically impacted Airport operations and development, as well as offering potential alternatives to maximize the effectiveness and efficiency of Airport management, while facilitating revenue enhancement and self-sufficiency. _.Airport -- Business Solutions lox~a City Airport Business Plan 7 Chapter 1- Introduction & ltislorical Analysis December, 2003 CIt,4PITfR I - iih, I'RODUCTION & HISTORICAL AA(4L YSIS The City of Iowa City owns and operates a general aviation airport that is located approximately 2 miles southwest of the City center. The Iowa City Airport (FAA Identifier IOW) is managed by a live- member Airport Commission under Chapter 330.17- 330.24 o~' thc 1995 Iowa City Code of Ordinances; Title 13-1. The Airport provides accommodations for propeller and turbojet aircraft and helicopters, and serves as a stinmlus to the local economy through jobs, salaries, local business support, University of Iowa support, and community access. Flight activities inchtde flight training, corporate aviation, emergency services, recreational flying and private aircraft operations. The Airport Business Plan herein outlines numerous issues and rcconnnendations relative to the management, operation and development of thc airport. Within cach section of this Airport Business Plan, recommendations and/or requirements are included as potential actions for implcmentation rclating to thc strategy contained herein. Aitl;or! B~si~wss Sohaio~s has researched many areas in the preparation of this plan and met with Airport and City staff in order to crcate an AitT~ort Business Plan that enables the City to have an efficiently-managed and financially secure airport. Strategic Approach This Iowa City Airport Business Plan is predicated upon a strategic approach, which is an expression of qualitative expectations to dcmonstrate that the City has engagcd in sound, progressive manugcnlcnl of' its facilitics by thc end of a five-year planning period. By the year 2008, the Airport Commission must establish an organization that will not only operate in a business-like manner, but also serve thc public in wuys that exceed their expectations. Furthe~ore, the strategic apporach is one where ~ Ai~ort ~ Business ~_~ ..... Solutions Iowa City Airport Business Plan 8 Chapter 1- Introduction & Historical Analysis December, 2003 the focus on safety and security is the cornerstone of the core organizational beliefs, strategic achievement, and to the greatest extent possible promote financial self sufficiency. In addition to the foregoing, the future strategy for the Airport must include communication and consensus among the Mayor, City Council, City Manager, and the Airport Commission conceming the long-term role of the Airport. With the addition ora more structured management style, it is anticipated that the Airport can continue to be a safe and active general aviation facility and become an improved asset to the community, it is also anticipated that the Airport can reduce its General Fund Subsidies through an innovative cooperative operating agreement with the primary service provider (FBO) on the field. As reflected in the proposed Strategic Mission Statement, it is a major responsibility of the Iowa City Airport to not only provide quality aviation facilities, but also to project a positive image in the local community, while promoting economic development for the entire region. As part of this Business Plan strategy, the City should also place greater emphasis on the Airport's role as a prominent, responsible "citizen" of the business and residential community. Proactive community involvement through interaction and building relationships with business and political leaders and community organizations helps ensure that responsibility is fulfilled. It is envisioned that the City will be presented in a positive manner for its efforts to promote business opportunities, as well as being recognized as a leader with respect to its air operations and development plans designed to protect the community and its environment. The ability of the Airport Commission to operate the Airport in a self-sufficient manner without tax subsidies is a continuing goal. The City and Airport Commission is committed to using best-management practices in operating the Airport, guided by policy decisions that define the appropriate balance between the quality of services provided and the cost of those services. Based upon these goals and objectives, Airport Business Solutions has developed the following Strategic Mission Statement for the Iowa City Airport. _ Airport -- Business Solutions Iowa City Aixport Business Plan 9 Chapter 1- Introduction & Historical Analysis December, 2003 Strategic Mission Statement To provide safe, high-quality general aviation facilities, and to continually strive to improve the quality of service at the Airport through innovative approaches and proven industry standards. We will consistently respond to our tenants, users, and community needs in an equitable, effective, and financially efficient manner. HISTORICAL ANAL YSIS In the course of the development of the Business Plan for the Iowa City Airport, Airport Business Solutions (ABS) conducted interviews of the City Manager, Airport Manager, the Airport Commission Chairman, and the local FBO site manager. In addition, ABS met with various Iowa City Staff Planners, Economic Development personnel, and the City Finance Director. Additionally, ABS reviewed a number of Airport-related documents including the 1996 Airport Master Plan, the Airport Relocation Feasibility Study, Iowa Department of Transportation Airport Condition Reports, Airport Financial Statements, Airport Commission Meeting Minutes, and numerous Airport management documents. It should be noted that much of the research documentation required for this project came from the office of the Airport Manager, with significant gaps in records and historical data. A critical component of our research included discussions with, and research input data from, national aviation support organizations including, but not be limited to, National Association of State Aviation Officials (NASAO), National Air Transportation Association (NATA), National Business Aviation Association (NBAA), Aircraft Owners and Pilots Association (AOPA), General Aviation Manufacturers Association (GAMA), and the American Association of Airport Executives (AAAE). These organizations enhanced our research through access to information they monitor within the _.Airport ~-- Business Solutions iowa City Airport Business Plan 10 Chapter 1- Introduction & Historical Analysis December, 2003 industry, as well as providing ABS with pertinent contact names of industry leaders from their memberships. Information reviewed from all contacts included, but was not limited to, the following: II Based Aircraft [] Flight Operations [] Fuel Sales Detail [] FBO Operations I Airport Inventory [] Comparison with Regional Airports The following is a summary of data obtained, reviewed and analyzed to arrive at the conclusions and recommendations discussed further herein. Based Aircraft During the 5-year period between 1999 and 2003, the based aircraft population at IOW averaged around 62 aircraft, with the peak year being 2003 with two single engine aircraft added to bring the total to 64. Almost all of the based aircraft are light single engine aimrafl (51), with 12 multi-engine aircraft and 1 helicopter. This information was derived from FAA 5010 forms, as reported by the Airport Manager. (It should be noted that the data received from the Airport Manager appears to be estimates only, and not actual count data.) It is estimated that the based aircraft population will begin to increase slowly in direct proportion to improvement in the national economy and with the addition of a precision approach at the Airport in the next t~vo to three years. The flat trend of based aircraft at IOW is reflective of the mid-west region relative to airports of similar size and scope. With the exception of charter and fractional aircraft ownership, the national trend in general aviation aircraft ownership has also been flat with little or no new aircraft added at most airports. There have been some exceptions, including airports along the eastern seaboard, west coast and desert southwest. However, general aviation has remained relatively flat with some signs of expansion in _ Airport -- Business Solutions Iowa City Airport Business Plan 11 Chapter 1- Introduction & Historical Analysis December, 2003 the last two quarters of 2003. The anticipated trend for IOW is consistent with forecasted regional and national trends with moderate increases of 2% to 3% per year over the next five years. This is an average "across the board" increase based on aircraft activity projections and does not include any additional gro~vth that may be seen through aggressive marketing programs or additional improvements to the Airport such as an instrument approach. These i~actors will be further discussed in the financial analysis section of this plan report. Flight Operations The Iowa City Airport has no air traffic control tower (ATCT), nor is one expected in the near future. In 1991, there were 22,500 aircraft operations noted, increasing to 26,400 by 1999. It is clear that these two years' figures were estimates only and not actual activity counts. Likewise, it should be noted that FAA activity reports for the years 2000 and 2002 (as reported by the Iowa Department of Transportation) indicate take-off and landing activity at 26,400 operations. As with the previous years, these numbers are Department of Transportation counts taken three or four times per year. The reported activity available for the Airport is for the 12-month periods ending in July, 2001 (19,130) and July 2003 (18,980). Similar to based aircraft, the flat or slightly decreasing trend in operational activity is also related to national economic trends over the past several years. General aviation operational trends over the past several months have begun to see slow improvement and it is anticipated that Iowa City, like other airports in the region, will continue to see improved activity over the next five years barring any major economic collapses or terrorist activities aimed at aviation. _ Airport -- Business Solutions Iowa City Airport Business Plan 12 Chapter 1- Introduction & Ilistorical Analysis Dcccmbel, 200_~ It should be noted that the highest level of traffic in years 2001 and 2003 (more than 68 pcrcent) is derived fi-om itinerant aircraft (aircraft not based at IOW), with thc majority of the activity being during daylight hours. This lcvcl of transient activity is very positive and is critical to the survival of thc Airport, and a boon the local community since transient users of an airport tend to stay overnight and spend money in the area during their stay (hotels, restaurants, transportation, etc.). 2001 20O3 Local 3,615 18.5% 3,606 19°)0 I Itinerant 13,066 68% 12,906 68% Air Taxi 2,162 11% 2,088 11% Miiit~ry 287 1.5% 380 2% Total 19,130 100% 18,980 100% Airport Business Soluti OTIS Iowa City Airport Business Plan 13 Chaptcr 1- Introduction & Historical Analysis Dcccmbcr, 2003 Fuel Sales Thc best way to gauge a general aviation airport's activity level is to review the volume of t'uel sold. At IOW, the fueling operations have historically been provided by the Fixed Base Operator (FBO), who is prcscntly Jet Air, Inc. Jet Air is a full-service fixed base operation that is headquartered in Galesburg, Illinois. The lowa City location operates as a satellite facility that is overseen by a local on-site manager who has full daily decision-making authority. Thc Company offcrs fi~cl salcs and charter services from thc iowa City and Galesburg locations, and also offers aircraft maintenance and other support services. Without the economies of scale and efficiency of operating the FBO as a satellite operation, it is unlikely that the business would be able to survive as a single-entity operation at IOW under current market conditions. As was seen in the RFP process to select a new FBO operation at IOW, thcrc was little interest in the facility bccause of the track record of the former operator. The City is fortunate to have a quality operator in Jet Air to provide the sole source fuel services on thc field. Currently, the City is dependent upon this Company for reporting fuel sales and providing the Air-port Commission with a fuel flowage fcc of $0.10 per gallon on all retail sales. During the past 5-year period, fuel sales have been nearly flat with a slight decrease in 2001 during the transition to thc new operator. However, based upon year-to-date fuel sales through July, 2003, it is estimated the 2003 year-end fuel volumcs will approach thc pcak volume of 165,000 gallons that was achieved in 1999. With even a minimal amount of markcting, which is nearly non-cxistcnt at present, the Airport should sec volumes slowly increasc over the next several years as the economy improvcs and with the addition of a precision landing approach on the field. YTD 2003 1998 1999 2000 2001 2002 2003 Annualized Jet 49,203 43,617 43,922 34,320 54,151 29,025 49,757 Avgas 99,522 121,569 100,130 73,360 90,919 65,466 112,227 Total 148,725 165,196 144,052 107,680 145,070 94,491 161,984 Airport 0 I O~ltS Iowa City Airport Business Plan 14 Chapter 1 lntioduction & Historical Analysis Dcccmbcr, 2003 100,000- 0 1998 1999 2000 2001 2002 2003 Annualized [II Jet · Avgas ] FBO Operations Iowa City Airport has what would be considered a "traditional fixed base operator." Jet Air took over operations from lowa City Flying Service (ICFS) in 2001 after ICFS abandoned the facilities and they defaulted on their lease with the City. The Commission issued a Request for Proposals for FBO services, and after 15 requests for information, and only 2 responses, the Airport Commission entered into negotiations with Jet Air to provide urgently-needed services on the Airport. Jet Air operates under a fivc-year leasc agreement with the City the runs from January 1, 2002 until December 3l, 2006. Additional five-year option periods are also available at the discretion of Jet Air. As previously mentioned, Jet Air operates the IOW base as a satellite operation to their home operation at Galesburg, Illinois. The Company has an excellent reputation for quality line service (refueling) and aircraft maintenance services in the industry, and is also widely known for their expanding air charter services. Ai~7>ort Business Sohttions Iowa City Airport Business Plan 15 Chapter l- Introduction & Historical Analysis December, 2003 Airport Inventory All of the service and hangar facilities on-airport at IOW are located on the east side of the Airport adjacent to Riverside Drive. The aviation facilities reflect good condition, including the Airport's Terminal building, which has recently been renovated. The current airport facilities include the Terminal building, five corporate hangars, 59 T-hangars, an FBO maintenance hangar, and numerous other miscellaneous buildings or land parcels leased to both aviation and non-aviation tenants. Although Airport Business Solutions received a brief summary of the lease properties on the Airport, none of the actual lease documents were provided by the Airport Manager, as requested. It is believed that all of the T-hangar leases were recently made current. The reader's attention is directed to the lease comparison document that is in the Addendum. Fuel at IOW is supplied via the FBO's refueling vehicles and a card-reading self-fueling system. The City owns the two above ground fuel storage tanks with a total capacity of 24,000 gallons, to include one 12,000-gallon tank for AvGas/100LL and one 12,000-gallon tank for Jet-A fuel. There is also a 10,000 gallon underground tank between buildings G and H. In addition to the facilities on the east side of the field, there is also a 54-acre Aviation Commerce Park on the north side. Divided into 17 commercial leaseholds, the Airport was originally plarming to lease this land to both aviation and non-aviation users. After investing approximately $1.6 million dollars in infrastructure for the site, the Airport received little or no interest from prospective tenants. Currently, the property is for sale or lease. Although it would be in the best interest of the Airport to keep this land for future aviation lease property, the continued financial "drain" on the Airport's budget would likely prevent the Airport from ever becoming financially self-sufficient. Regarding Airport infrastructure, IOW currently has three concrete runways in a traditional military triangle configuration. Runway 7/25 is 4,355 feet in length by 150 feet wide with non-precision approaches and PAPI lights at both ends. There is a displaced threshold on Runway 25. Runway 12/30 is 3,900 feet in length by 150 feet wide and is also non-precision. Runway 18/36 is 2,533 feet long and 150 : Airport -- Business Solutions Iowa City Airport Business Plan 16 Chapter 1- Introduction & Historical Analysis December, 2003 feet wide, and has a displaced threshold on 18 and VASI lights at the approach end of 36. However, it is important to note that Runway 18/36 is scheduled to be closed upon completion of an extension of Runway 7, an FAA-supported obstruction mitigation program and the development of a precision approach plan. Comparison with Regional Airports In comparing the Iowa City Airport on a regional basis, ABS selected five regional area airports for research and analysis. These airports were selected because of competitive reasons to compare and contrast airside facilities. Additional service and hangar pricing comparisons will be provided in the Financial Analysis section. It should be noted that Cedar Rapids is also a commercial service airport. ~i~Craft O~ti~h~ Ru~aY ~ro~ch Iowa City 64 19,000 Runway 7/25 None 1 FBO service (Subject) 4,355' x 150' provider Concrete Bell Plaine 5 2,400 Runway 18/36 None Limited services Municipal 4,000' x 75' available Asphalt Muscatine 36 14,000 Runway 6/24 None 1 FBO service Municipal 5,500' x 100' provider Concrete Washington 23 5,600 Runway 18.36 None 1 FBO service Municipal 4,000' x 75' provider Concrete Tipton 8 2,000 Runway 11/29 None Limited services Municipal 3,000' x 60' available Concrete Cedar Rapids 151 92,000 Runway 9/27 Multiple ILS 2 FBO service Municipal 8,600' x 150' providers (Eastern Iowa) Asphalt/Concrete The Iowa City Airport offers good facilities and Airport infrastructure to enable it to safely operate within the context of this five-year plan. In fact, the Airport has wide (150') runways that are typically only found at large air carTier airports. In addition, the Airport has an excellent service provider who is committed to providing a range of services both locally (on-airport) and regionally (Galesburg). _ Airport -- Business ..'~-- Solutions Iowa City Airport Business Plan 17 Chapter 1- Introduction & Historical Analysis December, 2003 Nevertheless, in order for the Airport to continue to growth and remain competitive in the region, both the FBO and Airport management must work together to improve the image of the Airport in the community, and to improve communications with the Mayor and City Council. This can only be accomplished through more direct dialog with the City Manager. More specific information regarding this approach will be provided in the Management and Operations section of this report. Action items: · Increased proactive involvement with the business community and community organizations · Increased interaction with the City Manager _ Airport -- Business Solutions Iowa City Airport Business Plan 18 Chapter 2 - Statistical Analysis December, 2003 STA TIS?YCAL ANAL YSIS An important aspect of the development of an Airport Business Plan is a statistical analysis of not only local economics and demographics, but more importantly, the state of the aviation industry on a local, regional, and national basis. Within the Plan's development process, ABS completed research and used their extensive experience and knowledge to provide Iowa City with reasonable operational projections for the Airport (as noted in the financial section). This research is performed to identify trends, as well as to determine effective ways to interest aircraft owners in relocating to or using the Iowa City Airport. Such projections are essential to the development of future operational and potential revenue projections. Trends considered include: · Local Demographics ~ Local and Regional Economic Development ~ Comparison with National Aviation Statistics Local Demographics The iowa City Airport is located in the eastern part of Iowa and is within the city limits of Iowa City. iowa City is the home of the University of Iowa and reflects a population of an estimated 62,200 full time residents. The City is located in Johnson County, which has an overall regional population of approximately 111,000. During the fall and winter months, the community also benefits from the student population of the University, ~vhich increases to nearly 30,000 people. The City is located south of Interstate 80 and is about 25 miles from Cedar Rapids, Iowa and 55 miles from Davenport, Iowa. In order for the Airport to succeed, the City and the County must maintain economic strength. iowa City is highly dependent upon the University of Iowa as the primary generator of the economy. Because of the consistent nature of the University, including continuous student and health research activity, the area's economy has historically been very stable. Although no community is completely ~ Airport -- Business Solutions Iowa City Aiiport Business Plan 19 Chapter 2 - Statistical Analysis December, 2003 recession proof, over the past several years, Iowa City has fared better than many other areas in the upper mid-west. The community also benefits from a diverse mixture of telecommunications, manufacturing, services, tourism, and extensive health care facilities. In addition, the area focuses on a constant dedication to maintaining a high quality of life within the region. The population of Johnson County increased by 4.2% from 1990 to 2000 and is predicted to stay strong and continue this pace into the next decade. Median family income is well above the State of Iowa and National U.S. averages. The median family income average for Iowa City is $57,568, followed by the National U.S. average at $50,046, and the State of Iowa at $48,005. Unemployment in the area is yery low, with the County reflecting an overall unemployment rate of only 2.4 percent in 2001, compared to the State of Iowa at 3.3 percent and 4.8 percent for the U.S. With regard to the local employment base, the County's largest employers are the University of iowa (26%), University of Iowa Health Center (8%), Hy-Vee (2%), and ACT (2%). Iowa City Iowa United States $57,568 $48,005 $50,046 Iowa City Iowa United States 2.4% 3.3% 4.8% Ai~ioort B~iness Solutions Iowa City Airport Business Plan 20 Chapter 2 - Statistical Analysis December, 2003 Local and Regional Economic Development As previously indicated, the University is the dominant contributor to the Iowa City economy, followed by health services. The top I4 largest employers are as follows: University of Iowa 17,311 University of Iowa Hospitals and Health Services 5,857 Iowa City Community Schools 1,600 Veteran's Administration Hospital 1,300 Hy-Vee Grocery 1,300 Mercy Hospital Health Services 1, ! 50 American College Testing (ACT) 1,100 Lear Automotive Products 930 Oral B Laboratories 800 Rockwell International Communications 729 MCI Mass Market Services 633 City of Iowa City Governmental Services 580 Procter & Gamble Health Care & Beauty Products 560 Systems Unlimited Assisted Living 478 The Iowa City Airport has benefited directly from the University through numerous charter flights, air an~bulance, and sports-related aircraft operations. The University accounts for approximately 30 to 45 flights per month with many other operations related to business and general itinerant travel. A review and analysis of business growth, family income demographics, and the local economy, generates the theory that given the stable economy and growing industrial and population figures in the County, as well as other areas that generally impact the region, the Iowa City Airport should continue to _ Airport -- Business · ,.~ Solutions Iowa City Airport Business Plan 21 Chapter 2 - Statistical Analysis December, 2003 maintain its current level of activity with some small increases anticipated due to improvements in the national economy and the addition of an instrument landing system on the field. However, in order to maintain current activity levels and accommodate anticipated growth, Airport management must carefully and diligently plan improved marketing strategies and aggressive changes to administrative structure. Comparison with National Aviation Statistics Besides the local social and economic factors, trends within the aviation industry were also considered in the preparation of this Plan. While national aviation averages are slightly higher than in the Mid-Western Region, the trends have a tendency to mimic one another. The following analysis reviews the number of pilots by type of rating. This statistic is significant since it is believed the vast majority of Iowa City hangar tenants are private pilots, and estimated that only a small percentage having commercial ratings. Additionally, with the limited number of flight schools on the Airport, it is likely that the Airport is not benefiting from student pilots that could become future tenants. (Note: It is a major concern that the Airport is not taking advantage of the massive student population for prospective flight training students.) Also included in these statistics are the numbers of certifications issued for various aviation support professions. Although at the time of this writing the FAA's statistical analysis on pilot certifications has only been completed through 1998, the detail is included herein for the purpose of comparing Iowa City with national trends. _Airport -- Business Solutions Iowa City Airport Business Plan 22 Chapter 2 - Statistical Analysis December, 2003 Private (1) 288,078 283,700 284,236 261,399 254,002 247,602 247,226 Commercial (1) 146,385 143,014 138,728 133,980 129,187 125,300 122,053 Student 114,597 103,583 96,254 101,279 94,947 96,101 97,736 Airline Transport (1) 115,855 117,070 117,434 123,877 127,486 130,858 I34,612 Rotorcraft (only) 9,652 9,168 8,719 7,183 6,961 6,801 6,964 Glider (only) 8,205 8,328 8,476 11,234 9,413 9,394 9,402 Lighter-than-Air (2) N/A N/A N/A N/A N/A N/A N/A Recreational 187 206 241 232 265 284 305 pli°~ T°[ai Mechanic (3,4) 384,669 401,060 411,071 405,294 329,239 332,254 336,670 Ground Instructor (3) 73,276 76,050 77,789 96,165 68,573 69,366 70,334 Flight Engineer 61,022 60,277 59,467 60,267 61,459 62,544 63,700 Parachute Rigger (3) 8,163 8,417 8,631 11,824 10,269 10,336 10,459 Dispatcher (3) 12,264 12,883 13,410 15,642 13,272 13,967 14,804 Flight Navigator 1,154 1,039 990 916 847 782 712 Repairman (3,4) N/A N/A N/A 61,223 50,768 51,643 52,909 NonPii0i Totai (5}6)540~8 ~S~;~6 6Si 33~ 53~;~: ?08~ 549~588 Data source: FAA ~ Includes pilots with an airplane-only certificate. Also includes those with an airplane and a helicopter and/or glider certificate. 2 As of 1990, lighter-than-air type certificates were no longer issued. 3 Numbers represent all certificates on record. No medical examination required. Data for 1996 limited to certificates held by those ages 70 years and less. 4 Prior to 1995, repairman certificates were included in the mechanic category. 5 Beginning in 1995, these counts include non-pilots previously excluded because their addresses were incomplete or they requested that their names be withheld from mailing lists. These individuals were excluded prior to 1995. 6 Starting in 1996, data are not comparable to earlier years. 5 Airport Business Solutions Iowa City Airport Business Plan 24 Chapter 2 - Statistical Analysis December, 2003 With the high level of activity within this sector of general aviation, Iowa City should be benefiting from increased flight activity as indicated by the trend towards improved fuel sales in the past few months and the projection that 2003 fuel volumes will reach the peak that was achieved in 1999. As discussed in Chapter 1, the Airport needs to maintain better records relative to operations, tenant activity, and competitive activity at surrounding airports. The Airport is not taking advantage of the large student population nearby for new student start-ups and associated flight activity. It is the experience of ABS that flight schools that are near significant populations of 18 to 24 year olds, such as the case at Iowa City, have better new student activity that other comparable flight schools. Moreover, increased flight training means additional fuel flowage and related services. The Airport, in association with the FBO, must work with the University to develop co-op programs for students to learn to fly through elective class programs. Action items Chapter 2: · Better record-keeping of Airport operations and related activities · Continually monitor rates and fees at comparable airports · Play a stronger role in economic development in the area · Monitor Demographic Business and University Activity for aviation opportunities · Focus on new student flight training activities through cooperative marketing efforts between the Airport, FBO, and University of Iowa c Airport Business Solutions Iowa City Airport Business Plan 25 Chapter 3 - Management and Operational Structure December, 2003 CHAPTiz'R 3- MANAGEMENT AND OPERATIONAL STRUCTURE Appropriate management structure and operational procedures for the Iowa City Airport are critical components in moving the Airport towards more streamlined management, and to ultimately reach a financial level at or near self-sufficiency. As such, ABS has included a proposed organizational structure relative to management for the Airport for both immediate and long-term benefits. As a prelude to further discussion on financial and marketing issues the following information is offered regarding management controls and approach. This chapter will review the following: Current Situation Changes to Reporting Procedures & Control Shared/Contract Management Scenario Current Situation It should be noted that clearly, based upon discussions with local community leaders, businesses, and the aviation community, the Iowa City Airport is a critical asset to the area. As far back as 1994, the Io~va City Department of Planning and Community Development conservatively placed the impact of the Airport at $1.7 million dollars annually. Today this number likely exceeds $2 to $2.5 million annually. Although many residents do not see a direct benefit of having a general aviation airport in the community, industry studies have clearly shown the considerable benefit of having a close-in regional airport. Benefits include a direct monetary infusion by way of employment (wages and salaries), lodging, food, entertainment, and other support services. Indirectly, the community benefits from access to aircraft charter, air ambulance services, organ donor flights, flight instruction, small package freight, and general aviation support to the University and private industry/business. Based upon interviews and our direct observation of the current situation, it is the opinion of ABS that the current management and administration of the Airport is barely adequate, and there are several deficient areas that need to be addressed. The safe operation of the Airport from a flight standards - Airport -- Business · ,-"~ Solutions Iowa City Airport Business Plan 26 Chapter 3 - Management and Operational Structure December, 2003 perspective is good, with the Airport's infrastructure including runways, taxiways, and navigational aids being well-managed through the assistance of FAA personnel and procedures. However, the management of day-to-day airport administrative functions, including record keeping, communications, documentation, financial control, and marketing, are all severely lacking and need to be re-emphasized. The Airport currently has no formal policy on leases or rates and charges, no Airport Rules and Regulations and no formal or informal marketing plan. Issues such as lease negotiations seem to be protracted and lengthy due to unclear definition of the responsibilities and role of the Airport Manager. As an example, lease negotiations with a tenant actually took place at a recent Airport Commission meeting whereby the tenant presented his lease requests directly to the Commission in a public venue. The Commission even considered forming a committee to deal with the tenant's issues. Lease negotiations are situations whereby the Airport Manager, or managing entity, must have the authority to negotiate leases with Airport users directly, based upon strict policies, procedures, and parameters established by the Airport Commission. From a business perspective, "management by committee" is not the best way to run an Airport. It should be noted that the commission has subsequently agreed to reduce their involvement. The Airport Manager must be able to negotiate leases and work with the tenants directly, establishing a mutually respectful relationship that can help foster growth at an airport. From a business management perspective, the Airport has a serious image problem in the community. The Airport Manager attends a weekly department directors meeting with the City Manager, however, communication between the Airport Manager and the City Manager appears strained. In addition, there is a general lack of communication between the Airport Commission and the City Manager creating an adversarial relationship between the Airport and the City Administration. Currently, the City Manager has direct managing authority over all departments of the City, with the exception of the Airport and the Library. However, the Airport Commission has a reporting responsibility to the City Council relative to the financial and operational viability of the Airport leaving the City Manager out of the process. This creates an uncomfortable situation for the City Manager in that he must answer to the Council when there are issues at the Airport, but has little authority to seek change. Over the past several years, it appears the lack of communication between the Airport Manager/Commission and City Manager has created a situation whereby the dialogue that is taking place is being done in the print and broadcast _- Airport - Bu~'iness · ~'~ Solutions Iowa City Airport Business Plan 27 Chapter 3 - Management and Operational Structure December, 2003 media. This situation, combined with the financial subsidies that the City provides to keep the Airport running, has created a two-fold negative effect on the community's perception of the Airport. Due to public outcry, various media reports and articles have called for the disbanding of the Airport Commission and the outright closure of the Airport, an issue that is essentially moot, unless the City wants to pay back the Federal Government the millions of dollars provided by the FAA through Grant Assurances. The public needs to be made aware of the contribution that the Airport provides to the community m~d the University, not only financially, but also from a business development perspective. The Airport Manager and Commission, has not had any recent success with this issue, and a renewed emphasis must be focused in this area. A new public relations effort must be established and directed toward the voting public, the locaI business community, and the national aviation industry. However, none of this will become possible until communication and reporting issues are improved. Changes to Reporting Procedures and Control In order to improve tile on-going operation and management of the Airport several items should be enacted to create a more positive team approach. The Airport Commission should remain in effect to continue to provide an unbiased business perspective toward running the Airport The Airport Commission needs to set policy, but not be involved in daily decision-making The Airport Manager, or managing entity, needs to be empowered to make daily operational and service-related decisions 5 Airport Business Solutions Iowa City Airport Business Plan 28 Chapter 3 - Management and Operational Structure December, 2003 The Airport Manager, or managing entity, must have a more formal structure for reporting to the Chairman of the Airport Commission on a weekly basis The Airport Manager, or managing entity, should have a "dotted-line" reporting relationship to the City Manager, and provide a weekly written report to the City Manager The City Manager should maintain a full-time position on the Airport Commission, not as an officer or voting member, but as a representative of the Council The Airport Manager, or managing entity, must have a stronger presence in the local community and be more active in national aviation trade organizations, to include continuing education offered by recognized aviation trade organizations Shared/Contract Management Scenario In evaluating the situation at IOW, because the Airport can only support a certain level of wages, ,'lBS believes that the City should consider turning over the management of the Airport to a non- governmental entity, namely, the Airport's fixed base operator. In this case, daily management, operation, and maintenance of the airfield would be done directly by the FBO manager and staff, with the on-site FBO manager also sharing the duties as the Airport Manager, with the same reporting responsibilities and management controls, as if they were a City employee but with contractual agreements to reduce liability concerns. With the development of a very solid contractual agreement, which there are several models available from other airports, IOW could quickly solve many of the problems it faces. It is understood that Iowa City Airport was managed by the FBO some years ago. However, research has indicated that at that time there was not a very well-defined approach or reporting structure, ,, _ Airport -- Business · ~"~ - Solutions Iowa City Airport Business Plan 29 Chapter 3 Management and Operational Structure December, 2003 and that the FBO owner was unwilling to work with the City to better develop the Airport and increase the air traffic coming in to the field. Under the latest and most common contractual agreements between municipalities and FBO management companies, some of the critical items that must be addressed include who has day-to-day decision-making authority and under what parameters, the establishment of pricing controls, ensuring quality service standards, improved financial reporting, daily and weekly written reporting procedures, and ultimately, the management/marketing approach that will be used to succeed. The advantages of this scenario include: Although the FBO would want some form of compensation for this job, an immediate and significant reduction in the Airport's payroll (and benefits) would be realized, instantly moving the Airport much closer to financial self-sufficiency Improved market presence in the aviation industry because of the regional presence of Jet Air and their direct daily communication with the users (pilots) at both airports where they operate Access to a larger staffofpersounel, who are already on-site, who could assist with maintenance and upkeep of the field Ability to develop an FBO/City team approach for marketing the Airport and it services, both locally and regionally Ability to operate the Airport from a private enterprise and business point of view, with a total focus on financial health and quality services to the end user. Ability to establish financial milestones and targeted service goal incentives that will motivate the FBO/Airport Manager to get the Airport "in the black" and keep it there. " ~ Airport ~-~ Business · ~ Solutions Iowa City Airport Business Plan 30 Chapter 3 - Management and Operational Structure December, 2003 The FBO must be motivated to provide this service and there are a number of ways to provide on- going financial and lease incentives that will allow both the City and the FBO to benefit as the Airport grows and business improves. Further discussion of this scenario will be provided in the financial analysis section of the Business Plan. Action items Chapter 3: The FBO Owner/Manager should take a more active role in management and development of the Airport Immediately begin to implement new organizational recommendations · Continue oversight by the Airport Commission · The City Council should direct the City Manager to pursue a non-voting position on the Airport Commission. · Make adjustments to lease agreements · Begin aggressive joint marketing efforts · Restructure advisory and communications distribution to City leaders · Management team needs to be able to manage several goals simultaneously · Aggressively seek development and installation of a precision landing approach · Maintain a high level of safety and security · Provide excellent customer service _Airport Business Solutions Iowa City Airport Business Plan 31 Chapter 4 - Document Review December, 2003 DOCUMENT RE VIE W As part of the development of the Iowa City Airport Business Plan, ,'lBS has reviewed existing management structure currently utilized by the City. We have identified that the Airport operates without the typical guiding documents normally seen at a municipally-owned public airport. In this section, ABS will provide recommendations on steps to develop these documents. In addition, .~lBS has identified and developed certain property management documents for consistent and efficient Airport operations. Documents included in the Appendix section of this Business Plan include Leasing Policies and a Rates and Charges Policy. Leasing Policy Rates and Charges Policy '"'"" c Airport -- Business · ~'~'Solutions Iowa City Airport Business Plan 32 Chapter 4 .- Document Review December, 2003 Leasing Policy Included in the process of developing this Business Plan, ABS prepared a series of Leasing Policies for the Airport, including: · Leasing Policy for Commercial Aeronautical Activities - This document is intended to provide potential and current tenants an understanding of the policies and processes used by the Airport Commission when leasing property or providing access to the Airport by entities intending to provide commercial aeronautical services. · Leasing Policy for Non-Aeronautical Commercial Properties - This same document can be utilized to provide potential and current commercial tenants an understanding of the policies and processes used by the Airport Commission when leasing commercial property for non- aeronautical purposes on the Airport. These documents set forth the parameters for leasing Airport land, or accessing Airport property, and have established the following purposes: · Maintain City's public use Airport in a safe manner to ensure that the Airport can fulfill its role as required in a emergency response system · Preserve investment in the Airport · Facilitate orderly management of the Airport · Ensure provisions of high-quality leasing procedures, services, and consistent quality of facilities · Provide equitable and uniform treatment of ali tenants and users · Advance qualified aviation-related services on the Airport · To assist the Airport Commission in the orderly development of the Airport _.Airport ~ Business · ~."~ Solutions Iowa City Airport Business Plan 33 Chapter 4 Document Review December, 2003 · To ensure compliance with applicable laws, regulations, executive orders, policies, guidelines, and requirements as they relate to the application and acceptance of Federal Funds · Facilitate and foster good relations with all local Airport communities and their residents · Enable conformity with the approved Airport Master Plan · To make the Airport available for public use on reasonable terms without undue discrimination · Assist the Airport Commission in maintaining a fee and rental structure with the goal of financial self-sustainability · Ensuring economic growth by providing access to State, regional, local and national markets Rates and Charges Policy The purpose of a Rates and Charges Policy document is to set forth a standardized system for the establishment of rates and charges which will be imposed equally on all users of the Airport and to comply with the Federal Aviation Administration Final Policy regarding Rates and Charges published in the Federal Register, Volume 61, Number 121 on June 21, 1996. It is the intent of this policy to benefit the public by the establishment of a standardized system of rates and charges, which is based on the following obligations: A. Ensure compliance with applicable legal requirements regarding Airport rates and charges through local communications, negotiations, and resolution with the Airport users. B. Ensure the rates, charges, and fees imposed on the aeronautical users of the Iowa City Airport are fair and reasonable. _Airport -- Business Solutions iowa City Airport Business Plan 34 Chapter 4 Document Review December, 2003 C. Make the Airport available for public use on fair and reasonable terms without unjust discrimination. Ensure that any Airport tenant is subject to the same rates, fees and charges as are uniformly applicable to other tenants offering similar services or utilizing the similar facilities at the Airport. D. Maintain a rate, charge, and fee schedule that guides the Airport toward the continuing goal of financial self-sustainability. E. Utilize revenue generated from Airport activities and services only for aeronautical purposes (no revenue diversion). F. At the discretion of the Airport Commission, the Airport may, from time-to-time, apply special rates and fees for and in accordance with the Federal Aviation Administration. Standard Lease Language The Airport Commission has multiple leases to maintain and manage, and the lease agreements vary widely. The leases have been developed by the Commission over time and implemented over many years. The Commission is currently standardizing all leases as they expire and are renewed. The leases include a variety of lease types to include the following: Airport Business Solutions Iowa City Airport Business Plan 35 Chapter 4 - Document Review December, 2003 · Airplane Hangar Lease · Airplane Tiedown Space Lease · Storage Area/Corporate Hangar Lease · Jet Air Business Lease Airplane Hangar Lease Recently, the Commission has simplified the management of the 64 t- hangars by having ail leases expire on the same date. This allows the Commission a single date from which to issue notices for any rent increases or document verification. If a tenant leases a hangar during the year, the agreements are only for the balance of the year and expire when all other hangar leases expire. Additional comments and recent additions by the Commission are: 1. The lease should prohibit the storage of flammable or hazardous materials. 2. The lease should allow for entry of City personnel with 24-hour notification or immediately in the case of an emergency. 3. Although there is a provision that states the tenant cannot sublet, a default provision should be added that states that if a tenant sublets a hangar without written consent from the Commission, that tenancy is forfeited. 4. A security deposit equal to one month's rent should be required. 5. A provision for the Manager to conduct annual hangar inspections should be added. 6. The appropriate size and type of fire extinguishes should be required of each tenant. 7. Addresses and emergency phone numbers should be included on each lease. Airplane Parking Lease (if required) - To simplify the management of the City's aircraft parking (tiedown implies the City has secured the aircraft) leases, the Commission should also consider having ail of these leases expire on the same date. This would allow the Commission a single date from which to issue notices for any rent increases or document verification. If a tenant leases a tiedown during the year the agreement should be only for the balance of the year and expire when all other tiedown leases expire. Moreover, general liability insurance should be required at a specified amount that names the City and its employees as an "additionally insured", and further require that each tenant provide annual notification of ,,, _ Airport -- Business .~ Solutions Iowa City Airport Business Plan 36 Chapter 4 Document Review December, 2003 insurance to the Airport Manager. The general liability amount should be for no less than $20,000. Additional comments are: 1. A security deposit equal to one month's rent should be required. 2. The name of the agreement should be "Airport Parking Agreement." Airports have been sued because the name "tiedown' represents that the airport had supplied secure ropes, cables, or chains, and made sure that all aircraft were secure. When aircraft have broken free, the airport has been held liable. 3. Change all references to tiedowns to aircraft parking. 4. Addresses and emergency phone numbers should be included on each lease. Storage Area/Corporate Hangar Lease - To simplify the management of the Airport's aircraft storage area leases, the Commission should consider having all leases expire on the same date. This would allow the Commission a single date from which to issue notices for any rent increases or document verification. If a tenant leases a storage area/hangar during the year the agreement should be only for the balance of the year and expire when all other storage leases expire. Moreover, the agreement must require the individual tenants to carry general liability insurance. This should be required at a specified amount that names the City and its employees as an "additionally insured", and further require that each tenant provide annual notification of insurance to the Airport Manager. The general liability amount should be for no less than $20,000. Additional comments are: 1. A security deposit equal to one month's rent should be required. 2. The lease should prohibit the storage of flammable or hazardous materials. 3. The lease should allow for entry of City personnel with 24-hour notification or immediately in the case of an emergency. 4. A provision for the Manager to conduct annual storage area inspections should be added. 5. The appropriate size and type of fire extinguishes should be required of each tenant 6. Addresses and emergency phone numbers should be included on each lease. Airport Solutions Iowa City Airport Business Plan 37 Chapter 4 Document Review December, 2003 FBO Business Lease - This again is a very specific lease agreement with various troublesome terms and conditions. The Lease is well below market due the rapid departure of the last service provider. The 5-year agreement began on January 1, 2002 extends through December 31, 2006. The lease provides for the FBO to pay no rent in the first 3 months of the agreement, $1,000 per month in months 4 through 12, $1,500 per month in months 13 through 24, and $3,000 per month in months 25 through 60. The favorable rate was due in part to the needs of the City to provide certain Airport activities and services. In addition to the aforementioned rent, the Lessee is required to remit to the City a fuel flowage fee of $0.10 per gallon of retail fuel dispensed. Given that this is a primary revenue source from this lease, and the only source subject to adjustment, the City should consider increasing this fee to $0.12 per gallon at the earliest opportunity. Moreover, audit provisions should be in place to ensure that this requirement is being met to its full requirement. (Note: The previous FBO was paying $0.05 per gallon, xvhich was well below industry averages. However, a $0. i2 per gallon fuel flowage fee is reasonable and should be negotiated.) In all FBO lease documents, the Lessee should carry a general liability policy of a minimum of $1,000,000. In addition, as discussed in Chapter 3, the Airport should consider negotiating a separate, independent operating agreement with the FBO to begin day-to-day management and maintenance of the Airport, which would provide a "win-win" financial situation for the City and the FBO. Such an agreement would benefit the FBO by allowing it to utilize certain "economies of scale" by cross-utilizing FBO personnel to manage and maintain the Airport facilities, while allowing the City to continue their efforts of a goal of financial self-sufficiency. -Airport -- Business Solutions iowa City Airport Business Plan 38 Chapter 4 Document Review December, 2003 Action items Chapter 4: · Adopt Leasing Policy · Adopt Rates and Charges Policy · Prepare and maintain emergency phone and address list on all tenants · Consider negotiating a separate, independent operating agreement with the FBO to handle day-to-day management and maintenance of the Airport ,,,,,,,,,, - Airport -- Business ~ Solutions Iowa City Airport Business Plan 39 Chapter 5 - Marketing Strategies December, 2003 MARKETING STRATEGIES In the development of the Iowa City Airport Business Plan, Airport Business Solutions has completed a market analysis to profile the most probable marketing process for the Airport. Moreover, this section provides a series of marketing strategies to assist the Airport in working with the local community, creating quality media relations, and enhancing the base knowledge of user perceptions through the use of well-orchestrated surveys. Included in the strategy are the following: W Marketing to the Community W Media Relations ~ Surveys III Participation in Trade Associations ~ Market Strategies One of the keys to maximizing Airport development is marketing. While the direct benefits that an airport contributes to its community are relatively obvious (jobs, transportation, emergency services), it still faces the obstacles of the "unknown" to the uneducated (crashes, noise, aircraft utilization). Moreover, the "vocal minority" tends to be better at pleading their case than does the aviation enthusiast. As such, marketing is a vital tool to an airport's acceptance within the community it serves. The Iowa City Airport marketing efforts have been generally nonexistent due to the lack of priority and focus on this issue. The focus has been primarily on the business of managing the airside facilities, and that is important. However, from a business management perspective, little has been done relative to meeting with community leaders, industry leaders, and trade associations. The Airport management team should utilize the vast resources of AAAE and NATA on a more regular basis. More info will be provided on these trade organizations in a later paragraph. At present, the Airport is "taking a beating" in the media relative to the subsidies required to keep the Airport going. However, relative to the overall City Budget, the subsidy to the Airport is insignificant, especially when considering the numerous benefits offered to the community by the Airport's existence. Most Airport subsidies, particularly for general aviation reliever facilities, can -Airport -- Business Solutions Iowa City Airport Business Plan 40 Chapter 5 - Marketing Strategies December, 2003 approach the millions of dollars. However, from a community image perspective, the Airport Commission and City Administration must do everything possible to minimize the amount of money provided to the Airport. The management team at the Airport must also make a better case for the Airport relative to its benefits to the community. Even though most residents don't fly out of the Airport, they do benefit economically from the aviation activity there, particularly from the itinerant flyers coming to the area and the University's utilization of the field and its services. Those in the media and the public voicing their displeasure in editorials must also realize that shutting down the Airport is basically moot. If the Airport were closed, the City would have to pay back millions of dollars in Federal grants that have been provided by the FAA to the Airport over the years. The Airport and City agreed to keep the Airport open and available for public use as set forth in the FAA grant assurance requirements. Moreover, the City must continue to pursue all available grants for further Airport expansion in order to maximize all available revenue producing opportunities. What is Marketing? "Marketing is the process of anticipating, stimulating, developing, managing and satisfying customer needs through exchanges between the organization and the customer. ''~ "The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. "2 Marketing in Action, K. Tuckwell, Prentice Hall, 1991 Marketing News, American Marketing Association z Airport Solutions Iowa City Aixport Business Plan 41 Chapter 5 - Marketing Sl~-ategies December, 2003 Marketing to the Community Marketing in the aviation arena can take on many personas. The following are a few areas for the City to consider in educating the community about the contributions of the Iowa City Airport. Airport Open House An Airport Open House event should continue to be held on an "ad hoc" basis or as an annual event that helps enhance visibility of the Airport and/or tenants. This type of event normally improves relationships within the local community. The Airport has sponsored these types of events in the past and should make the FBO a more integral part of the process. These are time-consuming events that require the resources and time of several individuals. However, Airport volunteers, FBO employees, and interested community members can help reduce the time required of the Airport staff Airport Management should have the ultimate responsibility for planning and overseeing the event, but a key to a successful open house is getting others involved. A committee (utilizing the Airport Commission, FBO Management, City Manager and others in the business community) is the most effective way to keep everyone who needs to be involved up to date with the event activities and progress. Additional external individuals or groups that could assist in the process may include: · LocalChamber of Commerce · University Student and Faculty Groups · Flying Clubs · Local Police and Firefighters · Military personnel · Local service clubs _ Airport -- Business Solutions Iowa City Airport Business Plan 42 Chapter 5 - Marketing Strategies December, 2003 Prior to the event, the Open House spokesperson should arrange interviews with the local media, making sure to include local community leaders and Commission members in the interviews. Additionally, a series of news releases should be prepared and released in the weeks preceding the event. Activities during the event should include at least the following: · Information on the Airport's economic benefit to the community · Local TV and radio personalities doing remote broadcast from the event weather reporters work very well) · Bury an Airport time capsule, developed by local schools · Paper aircraf~ building contest · Static aircraft displays · Face painting for kids of ali ages · Infom~ation booths manned by commercial tenants, displaying their services · Refreshments, which can be handled by local service groups to raise money for their organizations · Essay contest for elementary school children, with the winner announced during the Open House. The topic should be "Why Airports Help Our Neighborhood" In preparing for the event, there are a few basic housekeeping issues that must be addressed. Have someone in charge of taking photographs, insure you have a public address system for making announcements, and include a designated announcer. Do not forget to have an adequate number of toilet facilities and a group assigned for clean-up after the event. Think about where you will be parking cars, and if it is a remote location, how the people can be transported to the Airport activity center. Have clear and simple signs directing people to the various activity areas, and keep staff informed so that they may answer pre-event phone calls correctly, in addition, decide on a "rain date policy". Be sure and say "THANKS", both publicly and personally, and all volunteers on the committee should receive special recognition. _ Airport -- Business Solutions Iowa City Airport Business Plan 43 Chapter 5 - Marketing Strategies December, 2003 Contests for Kids Another way to promote good community relations is to reach out to the children of the community. Within the halls of the terminal building, examples of artwork from area students can be posted. An option on expanding this activity is to hold an Airport poster contest. Establish basic judging rules and let local officials do the judging. Display all entrants in the terminal, as long as possible, with the winning poster displayed for a year. This will bring people to the Airports that may not normally visit the facility. Select a basic theme for the posters, but let the kids' imagination determine the rest. Select the size for the posters and make sure the rules are written so kids can understand them. Tenants or local merchants may want to be involved with judging or awards. Media Relations Often, the media is the first and only contact with the local community, as well as with some tenants, elected officials, and area business owners. Therefore, it is important to know what "works for" the local news channels and individual reporters assigned to the Airport. Using the media ~visely can be beneficial to the Airport, but you must be willing to talk to them about both positive and negative events (when appropriate). This is especially important in Iowa City, where the Iocal media has been especially vocal and generally negative toward the Airport. While you can certainly use the media to help promote the Airports, be sure to only use them when you have a real news story. Hosting media representatives at the Airports can be a valuable tool, as it can help them understand how the Airports function for better accuracy for future broadcast accuracy. It can also serve to help establish a positive relationship with the Airport Management team. Also remember that if you want to get a good media turnout, food and beverages are always good incentives. Be prepared for emergencies. Let the media know in advance what the procedures are, where they can assemble for information, and who is the appropriate contact person(s). This can be accomplished via _-Airport "- Business · ~w Solutions Iowa City Airport Business Plan 44 Chapter 5 - Marketing Strategies December, 2003 an advance letter, and reinfomed during the hosted media event. Provide the media with basic Airport information and a glossary of commonly used aviation terminology. When in an interview, it is difficult to admit to bad news or ignore a bad situation. However, it is always safer to respond honestly to difficult questions. In the event that you have limitations on responses to certain subjects, tell reporters that, "information is not available at the moment" or "I will have to get back to you." Try and avoid the "no comment" statement. Keep an updated media list. This will assist in distributing news releases and should be updated at least once a year. The list will also help in determining the appropriate "release" for different types of news stories, as some stories may be of more interest to local news than Statewide news. The Airport Manager is usually the point-of-contact; however for certain stories you should have pre-selected alternative contacts (e.g., Airport Commission Chairman, Legal, or City Manager, when the Manager is unavailable). Surveys Surveys are by far the most popular method of collecting data. Although the Airport is not overly busy, with only a staff of one, only so much can be accomplished. Therefore, we suggest that the FBO management and Commission teamwork together to better develop a strong plan for "mass marketing." Consistent collection of information from Airport users and tenants is an important activity. Surveys can provide a quick, inexpensive, efficient, and reasonably accurate means of assessing general information from Airport users and the competitive marketplace. Whether a survey is to be conducted via telephone, personal interviews, or via mail, to be successful in the survey process you must complete certain basic steps: 5 Ai~port Business Solutions Iowa City Airport Business Plan 45 Chapter 5 - Marketing Strategies December, 2003 · Determine the objective of the survey · Develop a sampling plan Solicit approval if necessary · Write the field procedures · Develop distribution area · Execute the pro~:am · Collect the data · Analyze the data · Report findings and recommendations Personal Interviews increase the likelihood that all questions will receive answers and usually provides a higher participation. Additionally, this forum creates an opportunity for the interviewer to use props and visual aids. However, the potential exists that the interviewer may cause the respondent to provide answers to please the interviewer rather than revealing tree attitudes, opinions, or beliefs. A standard questionnaire should be prepared and random interview should be done at least once a month. Be sure that the interviewer understands how to properly conduct the survey in a standardized format. Telephone Surveys are the most popular method for conducting surveys. Information gathered is usually complete and respondents are generally more willing to provide detailed and reliable information. However, telephone interviews have a distinct disadvantage because it is easier for a respondent to refuse to participate. As such, make you questions brief and specific, and try to limit the call to 5 minutes. We recommend the Airport prepare a user database and conduct random samplings twice each year to gain an understanding of the needs and desires of the City customer. Staff should also use this method to collect information from competing airports regarding activity, pricing and development plans. Mail Surveys are self-administered questionnaires that are sent to respondents through the mail with an effective introductory letter. Care must be exercised to ensure that the questionnaire is clear, concise, easy to complete, and reflects a professional layout. Mail surveys are usually low-cost and can _ Airport -- Business Solutions Iowa City Airport Business Plan 46 Chapter 5 - Marketing Strategies Dece~nber, 2003 provide more information than a phone or personal interview. While a mail survey can be sent to a much larger sampling group, this type of survey has a low return rate. However, including postage-paid return envelopes will greatly improve the chance of a return. It is recommended that the Airport consider these processes only after developing an agreement with the FBO to assist with surveys, then perhaps the use of mail surveys not less than bi-annually to gather information from local citizens and businesses may prove the best strategy. In addition, the FBO can also survey other service needs relative to their business and take an approach that is somewhat neutral and distanced from City administration, which is better for image and liability reasons. Participation in Trade Associations The Airport Management team must focus additional resources and time participating in aviation trade associations. In particular, two organizations are of key importance. They are the American Association of Airport Executives (AAAE) and the National Air Transportation Association (NATA). AAAE is the organization that represents airport management and airport entities relative to airport issues and airport related management and operational practices. NATA is the group that represents FBOs, charter companies, flight schools and other aviation service companies relative to management and operations. Participation in these organizations provides a wealth of information on what other aviation service organizations and airports are doing to solve problems, market, and survive in today's volatile economic climate. With a minimal investment in association dues, the Airport would have access to seminars, articles, papers, media presentation materials, best practices data, training information, security policies and much more from other member entities. In addition, membership in these groups brings a better level of notoriety to the Airport and helps to market to facility to other potential end users of the field. It is understood that the current Airport Manager is a member of AAAE. This is essential to facilitating new ideas relative to expanding the Airport and managing it more effectively and efficiently. c Airport Business Solutio Iowa City Airport Business Plan 47 Chapter 5 - Marketing Strategies December, 2003 Marketing Strategies The conception of marketing strategies requires management to design efficient and effective programs based upon the following decision-making elements. While we have only identified limited areas, strategies should include: · Marketing objective - What is the objective for this planning period? · Target market - What market segments will be selected? · Positioning strategy - How will it be presented to the selected market segment? · Allocation of resources Who will be dedicated to do the market research, advertise, personal contact, incentives, and reporting? Consideration of marketing the Airport now leads us to understanding the strengths and weaknesses of each Airport and to review the financial history and consider potential revenue from our marketing and development efforts. Action items Chapter 5: · Plan Airport Open Houses · Hold Contests for areayouth · Host media events · Take advantage of University student population (potential pilots) · Keep updated media list · Conduct user surveys · Develop a milestone-based marketing plan · Increase interaction with aviation trade associations · Make Airport and FBO better known nationally and regionally · Conduct surveys · Develop a marketing plan ~ Ai~oort -- Business · ,~"~ Solutions iowa City Airport Business Plan 48 Chapter 6 - Financial Analysis December, 2003 FINANCIAL ANAL YSIS An essential part of this analysis included on-site interviews and surveys to determine the financial strengths and weaknesses of existing Airport operations. Identification of an Airport's strengths and weaknesses is crucial in developing realistic projections, as well as in assessing potential growth opportunities and identifying where improvements are needed. Included in this assessment are overviews of the past revenue and expenses and an overview of anticipated fttture revenues. In addition, ABS has provided a prioritized list of recommended improvements to facilitate the highest potential for success. Items to be reviewed and/or recommended include: Operational Activity Trends Budget Analysis Financial Projections Self Sufficiency Projections Economic Impact Operational Activity Trends While the marketplace in Iowa City has been nearly fiat over the past couple of years, the facility is showing signs of a slow comeback. Fuel volumes are slowly picking up and industry trends indicate gains coming in charter, fractional ownership, and general use of personal aircraft. Forecasts, based on current management operations, are for continued but slow (2%) financial growth in the next five years. As such, if Iowa City continues under the current operating practices in place today, and the Airport Commission decides to not change the management scenario, operations will show this minimal general economic growth. However, if the Airport Commission begins to manage and market the facility more aggressively and changes to a management team approach, annual income could increase more significantly over the next five years. Financial projections are based on minimal and conservative additional revenues from fuel flow fees, increased rents, and increased aircraft traffic to the Airport. _ Airport -- Business Solutions Iowa City Airport Business Plan 49 Chapter 6 Financial Analysis December, 2003 A significant restriction to increased business or flight activity at Iowa City is the lack of a precision instrument landing system approach. The lack of a precision approach limits the attractiveness of the airport for turbine and jet aircraft operators because of the possibility of not being able to get in or out of the airport on a timely basis. This situation is projected to improve with the Airports plan to mitigate various obstructions in the Airport area. This mitigation is required by the FAA in order to be considered for a new approach and Federal funding is available for this activity. As such it is projected that the Airport Commission will be successful in achieving this situation ~vith the help of the FAA. This is anticipated to significantly increase aircraft activity at Iowa City. It is likely that the FAA will fund this program. However, if not completed then the projections for increased traffic at the airport would be limited. Airport Budget Analysis Very little financial information was provided directly by the Airport Manager, with most of the information coming from the City's Finance Department. While it is understood that the financial responsibility and accounting for the Airport is handled by City Administration downtown, it is surprising to note that the Airport Manager had very little financial information on file at the Airport office. Information for this analysis came from a number of source documents including Departmental Adjustments for FY01, FY02 and FY03, General Fund Tax Subsidy estimates, Airport Revenue Summary FY97 - FY03, and the January 9, 2003 Memo from the Finance Department to the Airport Manager "As Presented to City Council". (It should be noted that there is not an individual financial document available for the Airport that depicts revenues, expenses, profit/loss and general fund subsidies in one consolidated form.) Because of these factors, it appears that Airport management has little or no "buy-in" to the accounting process and that there is no responsibility or interest in monitoring the financial status of the Airport on a timely basis. However, based upon standard industry practice, it is our recommendation that the Airport Manager better monitor the Airport's revenues and expenses on a monthly basis, as well as be accountable for any discrepancies from budget. This will allow the Airport Manager to provide a more timely analysis of activities, expenses, and other factors to allow intelligent management decisions, Aitport Business Solutions Iowa City Airport Business Plan 50 Chapter 6 Financial Analysis December, 2003 as well as to be held accountable for all financial activities. In order to run the Airport like a business, better financial tracking and pro-active management practices must be put in place. If financial self-sustainability is the goal of the City for their Airport division, then significant changes must be made in the administration and management of the facility, which includes the City Manager playing a more active role with the Airport Commission. It should be noted that several separate documents were provided for Revenue, Expenses, and General Fund Subsidies, and none of the documents seem to tie together or balance. Revenue Analysis Revenue information was derived from the "Airport Revenue" summary; however, no revenue projections were provided for FY 2004, 2005 or 2006. Revenue summary for 1999 through 2003 is as follows: Description 1999 2000 2001 2002 2003 Transfer General l.evy (Subsidy) $28,000 $64,000 $99,600 $154,800 $166,700 Building Rentals $168,065 $180,852 $173,943 $134,022 $173,251 Land Rental $32,018 $38,082 $31,842 $36,062 $6,643 Miscellaneous Other $2,112 $27,845 $2,662 $140 $13,813 Other Commissions $10,422 $15,967 $5,738 $7,801 $17,818 Equity Transfer $0 $0 $39,844 $0 $0 ~Total Revenue+ Subsidy $240,617 $326,746 $353,629 $332,825 $378,225I Expense Analysis The primary document used to analyze the expenses of the Airport is the January 9, 2003 memo from the Finance Department to the Airport Manager "As Presented to City Council". This document had the most detail and indicates the budget expenses for 2002 (actual) and 2003 through 2006 (projections). A summary of this document is as follo~vs: - Airport Solutio Iowa City Airport Business Plan 51 Chapter 6 - Financial Analysis December, 2003 Description 2002 Act~' 2003 2004 2005 2006 Airport Em?loyee Wages & Benefits 111,802 117,433 123,594 129,743 135,517 Supplies and Eqm? 7,477 8,924 18,535 18,906 19,283 Services,Utilities,Charge-backs,Misc 100,587 112,963 122,882 105,726 107,621 Interfund Loans 125,155 84,990 85,440 85,440 85,440 Total Budget 345,021, 324,310 350,451 339,815 347,861 When reviewing expenses for the Iowa City Airport, the projections seem to be consistent. Projections for wages and benefits are anticipated to increase at approximately 4.5 percent through tile period. Supplies and equipment jump significantly in 2004 primarily due to a $I0,000 line entry for building improvements and materials. Services, Utilities and Charge-backs drop slightly in 2005 and 2006 due to a $19,000 reduction in the line item noted as "Loss Reserve Payment." Based upon a status quo scenario, the Airport will continue to require subsidy payments in the range of $150,000 to $190,000 range well into the future. As noted in the Expense Allocation graphic below, Personnel costs are a significant portion of the budget (36%), while the Interfund Loans are also significant at 26 percent of the budget. As noted previously, if the Personnel costs could be reduced significantly and the City and Airport Commission could work out a land swap or other accounting method for allocation of the land improvement loan, the Airport conld be immediately self-sufficient. Moreover, the change to a "team approach" of the FBO taking over day-to-day management and maintenance of the Airport is more realistic to propose, as it seems unlikely that the City will make changes to the lnterfund Loan. ~ Soil ti Iowa Cit3 Airport Business Plan 52 Chapter 6 Financial Analysis December, 2003 2003 Expense Allocations [nterfund Loans 26% Personnel 36% ~ Supplies & Equip. Services, Util, Chgbacks. Misc. 35% Financial Projections In conjunction with analyzing the historical revenues and expenses at the Airport, a more defined matrix of financial projections for the forecasted five-year period has been provided to assess the potential for self-sufficiency. Thc projections contain important assumptions based upon activity projections, management changes, and cooperation by the FBO entity to move forward with a team management approach of thc Airport. Airport Business Solutions Iowa City Airport Business Plan 53 Chapter 6 Financial Analysis December, 2003 Historically, the City has used General Funds to make up the deficit between revenues and expenses. The following spreadsheet is provided to depict how the Airport could move closer to self- sufficiency. The following assumptions are applied to the financial projections. 1. The Airport will contract with Jet Air to provide management and maintenance services for the City. This will create an immediate reduction in the overhead of the airport. However, it should also be understood that this scenario would also create some nominal costs for the Airport operation to compensate the FBO for services provided. 2. The management team of the City, Airport Commission and the FBO will begin additional aggressive marketing and public relations activities. Thi~ will increase fuel volumes by 4% in FY 2004, 6% in 2005, 8% in 2006, and 10% in Years 2007 and 2008. A new base fuel flowage fee rate of $0.12 per gallon is also recommended (currently at $0. I0 per gallon). This means an additional $0.02 per gallon on the "base" of 160,000 gallons, plus the percentage increases noted above. 3. Additional hangar revenues will be generated by increases to rental rates. It should be noted that Iowa City is generally in the middle of the marketplace when cost of services and hangars are compared with the other regional airports listed in Chapter 1. It is believed that the market could bear some increases in this area and still maintain a competitive scenario. Other than Cedar Rapids, IOW ranks as one of the best airfields in the area relative to runways and other infrastructure. In addition, with the addition of an Instrument Landing System (ILS), the Airport will be much improved, and be in a position to charge more for T-hangars because of this market situation. ABS has projected that rates be increased by $15.00 per month in FY 2004, $15.00 per month in FY 2005, and $15.00 per month in 2006, and remain at that level throughout the projection period. Currently the Airport Commission has not approved any hangar rate increases. _ Airport -- Business Solutions iowa City Airport Business Plan 54 Chapter 6 - Financial Analysis December, 2003 Financial Self-Sufficiency Projections 2004 2005 2006 2007 2008 Estimated Subsidies Under Status-Quo $180,000 $187,000 $194,000 $200,000 $208,000 Adjustments Per Assumptions Elimination of Salaries and Benefits ($123,000) ($129,000) ($135,000) ($140,000 ($146,000) Add Back Compensation for FBO $12,000 $15,000 $18,000 $21,000 $24,000 Additional Fuel FIowage Fees ($3,968) ($5,166) ($6,859) ($9,145) ($11,659) AdditionaIT-Hangar Revenue ($10,620) ($21,240) ($31,860) ($31,860) ($31,860'~ l'otal Subsidy Required (New Scenario) $54,412 $46,594 $38,281 $39,995 $42,481 Based upon the above scenario, which is conservative and achievable, it is suggested that the Airport may never be totally self-sufficient without the benefit of new development or non-aviation revenues from the Airport Commerce Park or other sources. However, the relative amounts of subsidies under this scenario are minimal and relatively insignificant when compared to other comparable general aviation airports nationwide, as well as the total Iowa City budget. In addition, regarding the accounting of the land improvement loan, the Airport could become self-sufficient depending upon the approach taken on the 54-acre land parcel that is currently for sale. It is also recommended that at the end of the five-year initial term of the FBO, that the lease be renegotiated based on a more realistic rate analysis. Changes would be based upon the FBO's current status and financial strength due to increases in charter and other services, as created by continued investment in and resultant growth of the Airport. As the FBO grows, due to marketing efforts by the management team, the City should also benefit from increased business, if the FBO reaches certain established milestones, then the Airport should be given back a percentage of the profit. This should be structured so that as the FBO business "ebbs and flows", the Airport shares in the ups and downs. However, this scenario would only take place over and above the management scenario as outlined in the financial projections noted above. It must be a win-win scenario from a business perspective for this to work. Airport Business Solutions iowa City Ai~,port Business Plan 55 Chapter 6 - Financial Analysis December, 2003 Economic hnpact While an extensive economic impact study of the Airport was not a direct component of this Business Plan, consideration of the Airport's value to the community must be considered relative to its overall economic contribution to the region. When considering the economic value of the Airport to the community served, credit must be applied to the measures of overall economic activity that can be assessed such as gross revenues, economic value added, employment, and labor income. In addition, consideration must be given to capital investment, taxes, tourism, and population. Gross Revenue is defined as the total annual income derived from direct economic activity less inter- business purchases and sales. Economic value added is the measure of value added economic activity includes wages, interest payments, depreciation, dividends, overhead and corporate profit. Employment figures should be documented in terms of total person-years of all airport-related employment. Labor income is comprised of the total annual wages, salaries and benefits received as a result of airport- related employment. Capital investment is considered as the replacement cost of all capital assets permanently stationed at the Airport. This includes Airport land, buildings and facilities, Airport utilities, and dedicated Airport operations equipment. An assessment of capital investment provides a guide to the size of the public asset. The FAA recommends specific guidelines for calculating an airport's economic impact. The various components of an airport's total economic impact are estimated through comprehensive economic assessment, including airport and aviation industry surveys, interviews via phone, passenger or user Airport Business Solutions Iowa City Airport Business Plan 56 Chapter 6 - Financial Analysis December, 2003 surveys, mail and on-site visits. Under FAA methodology, economic impact is divided into three categories: direct, indirect and induced. Direct Impacts Direct impacts are generated by economic activities carried out at the airport by tenants, FBOs, and airport management. Most direct impacts occur on the airport grounds. The distinguishing feature of a direct impact is that it is an immediate consequence of airport economic activity. Indirect Impacts - Indirect impacts are derived from economic activities that are attributable to the airport, but are not direct part of the aviation industry. These activities include services provided by travel agencies, hotels, restaurants, retail establishments, and other non-aviation related tenants. Many indirect impacts occur off-site and are a result of expenditures of airport users, and represent economic activity that would not have likely have occurred in the absence of the airport. Induced Impacts - Induced impacts result from the economic multiplier effects of the direct and indirect impacts. These are the resulting increases in employment and incomes, as well as the corresponding increases in expenditures, that occur in addition to the combined direct and indirect impacts. Successive "rounds" of spending and nexv development around the airport create these induced impacts. For example, most of the take-home income earned by airport employees goes to local businesses and becomes income to the business owner and their employees. In summary, the value of an airport to the community it serves extends well beyond the physical boundaries of the airport itself. While serving as an important piece of the transportation system in its community, as well as contributing value through the provision of emergency services, it is also a substantial contributor to the economy of the community it serves. Iowa City Airport management must do a better job of projecting this to the community. 5 Airport Solutions Iowa City Airport Business Plan 57 Chapter 6 - Financial Analysis December, 2003 Action items Chapter 6: · Reduce and/or eliminate tax subsidy to Airport · Increase T-hangar rates and fuel flowage fees · Improve fuelvolumes · Restructure management of the Airport to reduce overhead · Develop milestone incentives for the FBO · Improve financial tracking of revenues and expenses · Review the direct and indirect economic impact of the Airport · Negotiate with the City for a land swap of industrial park property · Complete a facilities audit and facilities needs assessment Complete an energy and environmental study 5 Airport Business Solutions Iowa City Airport Leasing Policy Presented to Iowa City, Iowa Date: September, 2003 Leasing Policy Iowa City Airport TABLE OF CONTENTS SECTION I: INTRODUCTION ...................................................................................... 3 SECTION II: LEASING POLICY ................................................................................... 4 SECTION Ill: MISSION STATEMENT ........................................................................... 5 SECTION IV: DEFINITIONS ....................................................................................... 6 SECTION V: APPLICATION ...................................................................................... 12 SECTION VI: GROUNDS FOR DENIAL OF APPLICATION ............................................. 15 SECTION VII: GENERAL LEASE PROVISIONS ............................................................. 17 SECTON VIII: COMPETITIVE REQUEST FOR PROPOSAL ........................................... 22 SECTION IX: APPLICABLE DOCUMENTS .................................................................. 23 Leasing Policy Iowa City Airport SECTION I - INTRODUCTION Iowa City, Iowa (City) owns and operates the Iowa City Municipal Airport (FAA Identifier IOW). As set forth by the Federal Aviation Administration (FAA) by way of its Airport Sponsor Assurances, any airport developed with Federal grant assistance is required to operate for the use and benefit of the public and is to be made available to all types, kinds, and classes of aeronautical activity on fair and reasonable terms and without unjust discrimination. As the Airports' sponsor, the City receives Federal airport development funding. This Leasing Policy will assist the City in maintaining compliance with the Airport Sponsor Assurances, as not to jeopardize their ability to obtain future Federal airport development funding, as well as to provide for the fair and equitable treatment of all Airport tenants and users. This Policy has further been developed to assist the City in competing fairly with other airports and to maintain fiscal responsibility of the Airport assets entrusted to the City. The purpose of this document is to set forth a standardized system for the leasing and rental of Airport properties, which will be utilized for all future tenants of the Airport, and to assist the City in maintaining compliance with the Federal Aviation Administration Policies, Regulations, guidance documents and Advisory Circulars. 3 Leasing Policy Iowa City Airport SECTION II - LEASING POLICY This Leasing document is intended to provide potential and current tenants an understanding of the policies and processes used by the City when leasing property or providing access to the Iowa City Airport. This document sets forth the parameters for leasing Airport land, or accessing Airport property, and has established the following purposes: · Maintain City's public-use Airport in a safe manner to ensure that the Airport can fulfill the role as required in a emergency response system · Preserve investments in the Airport · Facilitate orderly management of the Airport · Ensure provisions of high-quality leasing procedures, City services, and consistent quality of facilities · Provide equitable and uniform treatment of all tenants and users · Advance qualified aviation-related services on the Airport · To assist the City in the orderly development of the Airport · To ensure compliance with applicable laws, regulations, executive orders, policies, guidelines, and requirements as they relate to the application and acceptance of Federal Funds · Facilitate and foster good relations with all local airport communities and their residents · Enable conformity with the approved Airport Master Plan · To make the Airport available for public use on reasonable terms without undue discrimination · Assist the City in maintaining a fee and rental structure with the goal of financial self- sustainability · Ensuring economic growth by providing access to State, regional, local and national markets 4 Leasing Policy Iowa City Airport SECTION III - MISSION STATEMENT The Airport is an important component of the State's overall transportation network, generating economic growth and enhancing livability throughout the area. The City has established this Iowa City Airport Leasing Policy to foster safe, efficient, and high quality services offered and facilities to Airport users and tenants. The City' goals include developing aviation as an integral part of the local transportation network; creating and implementing strategies to protect and improve the areas transportation system; encouraging aviation-related economic development; supporting aviation safety and education; and enhancing airport development and general aviation services in the area. Additionally, one of the City's primary goals is to ensure the existing and future airport system will be adequate to meet the needs of the citizens and businesses relative to air mobility. Leasing Policy Iowa City Airport SECTION IV - DEFINITIONS A. Aircraft (1) Aircraft - any device used or designed for navigation or flight in the air including, but not limited to, an airplane, sailplane, glider, helicopter, gyrocopter, ultralight, balloon, or blimp. (2) Aircraft Charter or Air Taxi - the commercial operation of providing air transportation of person(s) or property for hire by either on a charter basis or as an air taxi operator. (3) Aircraft Fuel - all flammable liquids composed of a mixture of selected hydrocarbons expressly manufactured and blended for the purpose of effectively and efficiently operating an internal combustion, jet, or turbine engine. (4) Aircraft Operation - an aircraft arrival at, or departure from, the airport. (5) Aircraft Owner - a person or entity holding legal title to an aircraft, or any person having exclusive possession of an aircraft. (6) Aircraft Parking and Storage Areas - those hangar and apron locations of the Airport designated by the City Airport Manager for the parking and storage of aircraft. (7) Aircraft Rental - the commercial operation of renting or leasing aircraft to the public for compensation. (8) Aircraft Sales - the sale of new or used aircraft through brokerage, ownership, franchise, distributorship, or licensed dealership. (9) Based Aircraft - an aircraft which the owner physically locates at the Airport for an undetermined period and whenever absent from the Airport, its owner intends to return the aircraft to the airport for long-term storage. Leasing Policy Iowa City Airport B. General (1) Aeronautical Activity - any activity or service conducted at the Airport that involves, makes possible, or is required for the operation of aircraft, or which contributes to or is required for the safety of such operations. These activities include, but are not limited to, air taxi and charter operations, aircraft fueling, aircraft storage, flight training, ground school, aircraft rental, aircraft sales, aircraft repair and maintenance, and any other activities, which because of their relationship to the operation of aircraft can appropriately be regarded as an "aeronautical activity." (2) Airframe and Power Plant Maintenance - the commercial operation of providing airframe and power plant services, which includes the repair, maintenance, inspection, constructing, and making of modifications and alterations to aircraft, aircraft engines, propellers and appliances including the removal of engines for major overhaul. This category of service also includes the sale of aircraft parts and accessories. (3) Airport - All of the City-owned or leased real or personal property, buildings, facilities and improvements within the boundaries of the Airport, as it presently exists or as it may exist when it is hereafter modified, expanded, or developed. "Airport" includes all of its facilities as shown on the most current Airport Layout Plan. (4) ALP - the current Airport Layout Plan or drawing available for the Airport. (5) Commercial Aeronautical Activity - the conduct of any aspect of a business, concession, operation, or agency in order to provide goods or services to any person for compensation or hire. An activity is considered a commercial activity regardless of whether the business is nonprofit, charitable, or tax-exempt. A commercial business activity that involves makes possible or is required for the operation aircraft, or ~vhich contributes to or is required for the safety of aeronautical operations. (6) Commercial Operator (Operator) - a person, firm, corporation, or other entity conducting commemial aeronautical services or activities at the Airport for compensation or hire. Leasing Policy Iowa City Airport (7) Non-aeronautical commercial business A business located on the airport, which does not provide goods or services for aviation activities or operations. (This classification may include, but is not limited to, customs, border patrol, police and fire stations, etc.) (8 Exclusive Right - a power, privilege, or other right excluding or debarring another from enjoying or exemising a like power, privilege, or right. An exclusive right can be conferred either by express agreement, by the imposition of unreasonable standards or requirements, or by any other means. (9) General Aviation - all phases of aviation other than aircraft manufacturing, military aviation, and scheduled or non-scheduled commercial air carder operations. (10) Hazardous Material - any substance, waste, or material which is toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic, or otherwise hazardous, and is or becomes regulated by any governmental authority, agency, department, commission, board, agency or instrumentality of the United States, the City, or any political subdivision thereof, and including the presence of which requires investigation, removal and/or remediation. (11) Minimum Standards - the qualifications or criteria, which may be established by the Airport owner as the minimum requirements that shall be met by businesses offering commercial aeronautical activities for the right to conduct those activities. C. Governmental (1) Airport Manager - The designated individual or duly authorized individual appointed by the Airport Commission to administer and manage all operations of the Airport and Airport facilities. (2) FAA - the Federal Aviation Administration. (3) FAR - the Federal Aviation Regulations as published by the FAA. 8 Leasing Policy Iowa City Airport D. Fueling (1) Fueling or Fuel Handling - the transportation, sale, delivery, dispensing, or draining of fuel or fuel waste products to or from aircraft. (2) Fuel Storage Area - any portion of the Airport designated temporarily or permanently by the Manager as an area in which gasoline or any other type of fuel may be stored or loaded. (3) Self-Fueling - The commercial operation of an unmanned stationary fuel tank and dispensing equipment for general use via card reader. This includes the operation of Persons utilizing this type of equipment to provide fuel for sale or reuse. (4) Self-Service - An aircraft owner, who may adjust, repair, refuel, clean, and otherwise service his/her own aircraft, provided the service is performed by the aircraft owner or his/her direct employees with resources supplied by the owner. The services must be conducted in accordance with roles and standards established by the City. E. Lease and Agreements (1) Lease - the written contract between the City and an Operator (Lessee) specifying the terms and conditions under which an Operator may occupy and operate from certain Airport facilities and/or property. (2) Sublease - the ~vritten agreement stating the terms and conditions under which a third party Operator leases space from a Lessee and has been approved by the City. (3) Agreement - the written agreement between the City and an Operator specifying the terms and conditions under which the Operator may conduct commercial aviation activities or access Airport property "through-the-fence". 9 Leasing Policy Iowa City Airport (4) Permit - administrative approval issued by the City to a person or company to conduct a commercial aeronautical activity, and provide such services, to based and transient aircraft, only from facilities and locations where such services are authorized. (5) Person - an individual, corporation, firm, partnership, association, organization, and any other group acting as an entity, to conduct business on the Airport. Person includes a trustee, receiver, assignee or similar representative. F. Commercial Aeronautical Activities (1) Avionics Sales and Maintenance - the commercial operation of providing for the repair and service of aircraft radios, instruments and accessories. Such operation may include the sale of new or used aircraft radios, instruments and accessories. (2) Fixed Base Operator (FBO) - a full service commercial operator who engages in the primary activity of aircraft refueling, and additionally has the option to conduct any of the approved secondary activities: airframe and power plant maintenance, flight training, aircraft rental, avionics maintenance and sales, air charter or taxi, and aircraft storage/hangars. (3) Flight Training - the commercial operation of instructing pilots in dual and solo flight, in an aircraft, and related ground school instruction as necessary to complete a FAA written pilot's examination and flight check ride for various categories of pilots licenses and ratings. (4) Flying Club - a non-commercial and nonprofit entity organized for the purpose of providing its members with any number of aircraft for their personal use and enjoyment. Aircraft must be vested in the name of the flying club owners on a pro-rata share, and the club may not derive greater revenue from the use of the aircraft than the cost to operate, maintain, and replace the aircraft. (5) Preventive Aircraft Maintenance - maintenance that is not considered a major aircraft alteration or repair and does not involve complex assembly operations as listed in FAR Part 43, 10 Leasing Policy Iowa City Airport except for Item 22 in the Regulation. Item 22 involves the replacement of prefabricated fuel lines, and shall, for purposes of these regulations, be considered a major aircraft repair. (6) Specialized Aviation Service Operation (SASO) - an aeronautical business that offers a single or limited service according to established Minimum Standards. Examples of a SASO include, but are not limited to: flight training, aircraft maintenance, air charter or taxi, aimraft sales, avionics maintenance and sales, and aircraft storage. G. Infrastructure (1) Airport Operations Area or A OA - the area of the Airport used for aircraft landing, takeoff, or surface maneuvering including the hangars, navigation, and communication facilities. (2) Airpark - a development or area not located on, but lying adjacent to, and with access to the AOA. Said area may include permanent residences, structures, and taxilanes. (3) Roadway - any street or road whether improved or unimproved, within the boundaries of the Airport and designated for use by ground vehicles. (4) Taxilane - the portion of the Airport apron area, or any other area, used for access between taxiways and aircraft parking or storage areas. (5) Taxiway - a defined path established for the taxiing of aircraft from one part of the Airport to another. (6) UNICOM - a two-way communication system that provides airport advisory information. (7) Vehicle Parking Area - any portion of the Airport designated and made available temporarily or permanently by the City for the parking of vehicles. I1 Leasing Policy Iowa City Airport SECTION V - APPLICATION 5.1 Application Each corporation, person, or business desirous of becoming a tenant at the Airport must complete and submit an application form for review and consideration. Additionally, if an existing tenant experiences a change in ownership of 51 percent or more, or the leasehold is altered or modified, the City has the option to request that the tenant resubmit an application for tenancy. At the time of, and as part of its application, the City reserves the right to request from a prospective tenant in written form the following information, and thereafter such additional information as may be required or requested by the City. Said request may be applied to either new tenants or existing tenants requesting a lease renewal or extension. As a prerequisite to occupancy on and the granting of commercial operating privileges at the Airport, the prospective Operator must submit a specific, detailed description of the scope of the intended commercial aeronautical activities, and the means and methods to be employed to accomplish the contemplated activities. Required information for commercial aeronautical activities shall include but not be limited to: (A)The legal name of the entity filing the Application and its business name (if different). (B) The name, address, and telephone number of the entity and primary contact person. (C) The names, addresses, and phone numbers of all owners of 5 percent or more equity interest, management control, or debt in the entity. (D) The proposed date for commencement of the intended activities and proposed term for conducting same. (E) A comprehensive listing of all activities propose to be offered, along with copies of all applicable Federal, State, or local operating certificates and licenses held. 12 Leasing Policy lo,va City Airport (F) For proposed agreements to lease (or requests for assignment) existing structures or improvements, a description of the size, location, and proposed utilization of office, hangar, tiedowns, and vehicle parking areas to be utilized. (G) For proposed agreements for lease (or requests for assignment) of unimproved Airport areas, a layout (to scale) of the size, configuration, and location of the property desired to be occupied and a preliminary drawing of the buildings and improvements to be constructed, together with identification of vehicle parking areas. Drawings should be legible and reproducible with clearly defined dimensions. Each drawing should be on an 8.5 inch x 11 inch paper as a minimum and be drawn in ink. City retains the right to request a metes and bounds legal description of lease property boundaries. (H)The number of persons to be employed, including the names and qualifications of each management/supervisory person, and specifications as to whether the employees will be full- time, part-time, or seasonal. (I) The number of aircraft to be utilized in cormection with the proposed activities and the make, model, passenger seating capacity, cargo capacity, aircraft registration number, and copies of applicable operating certificates for each aircraft. (J) The tools, equipment, vehicles, and inventory proposed to be utilized in connection with the intended activities. (K) A written business plan, including a market analysis, to include a written statement addressing each of the following areas: a. Definition of target markets b. Intended market share c. Promotional marketing techniques d. Description of existing competitors e. Percent of intended sales related to aircraft based on the Airport f. Evidence of support from potential customers, such as surveys, testimonials, and/or related documents g. List of products to be sold or distributed (if any) and a list of manufacturer's or distributor's requirements for obtaining dealership (if applicable) 13 Leasing Policy Iowa City Airport h. List of suppliers, subcontractors, and associates i. List of any proposed subtenants i. Business plan shall include process for ensuring all tenants/pilots subtenants and aircraft are registered with the State and procedures for maintaining these records. 5.2 Financial Responsibility As evidence of the applying Commercial Operator's financial capability, the prospective operator shall provide a statement from a bank or similar financial institution or from such other source as may be acceptable to the City and readily verified through normal banking channels. The prospective operator must also demonstrate the financial capability to initiate the activities, construct proposed improvements, and provide working capital to perform proposed activities. The demonstration of financial capabilities shall also include cash flow and profit and loss calculations for the first five-years of the proposed operation, a three-year historical profit and loss statement (if applicable), and a current (within 90 days) balance sheet. 5.3 Experience The prospective commercial operator shall furnish the City a statement of its past experience in providing the specified commercial aeronautical service for which the application is being made, including resumes of management individuals who will be directly responsible for the proposed operation, together with, business, financial and managerial references. This information must be presented in a form acceptable to the City. 5.4 Bonding and Insuring The prospective cormnercial operator shall provide evidence in a form acceptable to the City, of its ability to supply: 14 Leasing Policy lo,va City Airport (A) A performance bond in an amount equal to 100 percent of one year's rent and/or fees established and agreed to for conducting the activities and entering into the agreement sought (cash may be used in-lieu of a performance bond). (B) A performance bond in the amount equal to the cost for constructing the proposed improvements in a form submitted to the City for approval (C) All required insurance coverage's as specified and applicable to the Airport where the proposed improvements are to be constructed 15 Leasing Policy Iowa City Airport SECTION VI - GROUNDS FOR DENIAL OF APPLICATION City may deny any commercial application for any one or more of the following reasons. (A)The Applicant's proposed activities, operation, and/or construction would create a safety hazard at the Airport and/or surrounding community. (B)The Applicant, for any reason, does not fully meet the qualifications, standards, and requirements of the City. The burden-of-proof shall be on the prospective operator and the standard-of-proof shall be by clear convincing evidence. (C) The granting of the application will require the City to expend funds, or supply labor or materials, in connection with the proposed activity and/or construction that the City is unwilling to spend, or the proposed activity and/or construction ~vill result in a financial loss (or hardship or liability) to the Airport. (D)No appropriate, adequate, or available space or buildings exist at the requested Airport, which would accommodate the operation of the Applicant at the time of the application, nor is such contemplated within a reasonable time frame. (E) The proposed operation, development, and/or construction does not comply with the Master Plan of the Airport (and/or ALP) in effect at that time, or anticipated to be in effect within the time frame proposed by the Applicant. (F) The development or use of the area requested by the Applicant will result in congestion of aircraft or buildings, or will unduly interfere with operations or activities of any present operator on the Airport and/or prevent adequate access to the assigned lease area of any present lessee and/or operator. (G)The Applicant has either intentionally or unintentionally misrepresented or omitted material facts in the application or in supporting documents. (H) The Applicant has failed to make full disclosure in the application or in supporting documents. 16 Leasing Policy lo,va City Airport (I) The Applicant or an officer, director, agent, representative, shareholder, or employee of the Applicant, has a record of violating the rules, regulations, statues, ordinances, laws, or orders of any other Airport, civil air regulation, FAA regulations, or any other rules, regulations, statues, ordinances, la~vs, or orders applicable to the Airport. (J) The Applicant or an officer, director, agent, representative, shareholder, or employee of applicant has defaulted in the performance of any other agreement. (K)On the basis of current financial information, the Applicant does not, in the sole discretion of the City, exhibit adequate financial responsibility or capability to undertake the proposed operation and activities. (L) The Applicant cannot or will not provide a performance bond or applicable insurance in the amounts and type required for the proposed activity. (M) The Applicant or an officer, director, agent, representative, shareholder or employee of applicant has been convicted of any felony or of a misdemeanor involving moral turpitude. (N) Applicant's activities or operations could be detrimental to the Airport. (O) For any other reason deemed as not being in the best interest of the Airport, as determined by the Manager. 17 Leasing Policy Iowa City Airport SECTION VI1 - GENERAL LEASE PROVISIONS 7.1 Property Lease Once the City has approved the lease application and the Applicant has read the Minimum Standards, Airport Rules and Regulations, Rates and Charges Policy, and Leasing Policy, the Applicant shall be provided a Draft Lease for review. This Draft Lease will include, but not be limited to the following details: 1. Description of leasehold (City retains the right to request a metes and bounds legal description) 2. Term of lease 3. All fees and charges associated with occupying and operating on the premises 4. Payment procedures relating to all fees and charges 5. Approved activities 6. Prohibited activities 7. Subleasing requirements and restrictions 8. Lease assignment provisions 9. Maintenance requirements 10. Restrictions on hazardous substances 11. Default and penalty provisions 12. Remedies on default 13. Vacating the premises procedures 14. Insurance amounts required 15. Names and addresses of responsible parties 16. Reversionary clauses 17. Information on all taxes, liens and utilities 18. Compliance with FAA regulations 19. Aircraft registration requirements/pilot registration 20. Construction or alteration procedures 18 Leasing Policy Iowa City Airport 21. Landscaping 22. Fire Prevention 23. City entry onto premises 24. Compliance with laws 25. Termination for Airport development 26. Transfer of Airport ownership 27. Bankruptcy 28. Ingress and Egress to Property 29. Sale of Improvements 30. Lease Renewal Options 7.2 Lease Term At the City's discretion, initial lease terms for FBO and/or SASO leases may be up to a term of twenty (20) years (identified as the Base Term), with two (2) consecutive five-year (5) options. The City, at its sole discretion, may grant longer or shorter terms based upon the proposed capital investment in the property by the tenant. At the expiration of each lease, the City maintains the option of retaining ownership of all leasehold improvements, or requiring the tenant to remove any and/or all structures and returning the site to its original unimproved state, at the tenant's sole cost. 7.2.1 Lease Renewal Options In accordance with Section 7.2 - Lease Term above, Lessee shall have the option to request an extension of the lease beyond the Base Term, subject to the satisfaction of all of the following conditions. (A) The existing Lease must not be in default (B) Any improvements on the Premises must be structurally sound and capable of safe and legal occupancy for the remaining term of the option periods. Lessee will be required to obtain an inspection by a certified structural engineer on building code compliance to verify the condition of the structures. All inspectors must be approved by the City in advance. 19 Leasing Policy Iowa City Airport (C) File a written notice with the City that the Lessee has complied with (A) and (B) above, and that the Lessee intends to exercise the option at least 90 days prior to the expiration of the preceding lease term. (D)The City may refuse the options if any of the stated conditions are not met, or in the event the City makes a determination that the Premises are required for Airport development. In the event of Airport development, the City may, providing other suitable land is available, submit an alternative site to Lessee for consideration and the parties shall make good faith effort to negotiate a new lease. Any renewal options related to a lease shall be subject to the same conditions as set forth during the Base Term. However, the City maintains the right to adjust any and all rates fees and charges, as detailed in the City's Rates and Charges Policy in effect at the time commencement of the option. 7.2.2 Rates and Charges It is the intent of the Rates and Charges Policy to benefit the public by the establishment of a standardized system of rates and charges procedures, which is based on the following City obligations: (A) Ensure compliance with applicable legal requirements regarding Airport rates and charges through local communications, negotiations, and resolution. (B) Ensure the rates, charges, and fees imposed on the aeronautical users of the Airport are fair and reasonable. (C) Make the Airport available for public use on fair and reasonable terms without unjust discrimination. Ensure that any airport tenant is subject to the same rates, fees and charges as are uniformly applicable to other tenants offering similar services or utilizing the similar facilities at an Airport. (D) Maintain a rate and fee schedule that guides the Airport towards financial self- sustainability. (E) Expend revenue generated from Airport activities and services only for aeronautical purposes (no revenue diversion). 20 Leasing Policy Iowa City Airport 7.3 Insurance Requirements Each tenant shall maintain the types and mounts of insurance as specified in the lease or agreement to adequately cover the respective categories of commercial aeronautical services provided and to meet all City insurance requirements. Each commercial tenant shall at ail times maintain the following applicable levels of commercial general liability, personal injury, contractual liability, automotive liability, aircraft liability, hangarkeeper's liability, products-completed operations liability, and environmental clean-up liability insurance. Each tenant shall maintain at all times fire and extended property coverage for all improvements and fixtures on premises in an amount not less than the full replacement cost of same improvements and fixtures. In addition, each tenant, if applicable, shall maintain at all times Worker's Compensation insurance as required by Iowa State law. Each tenant shall provide the City with a proof of insurance certificate annually. All insurance policies shall contain indemnification and hold harmless language that covers the City and its employees, Council members, Airport Commission, and officers (individually or collectively) as additional insured ~vith respect to liability arising from activities performed. 7.4 Minimum Standards and Exclusive Rights The City owns and operates the Iowa City Municipal Airport, and receives Federal airport development assistance. As such, the City assumes contractual grant obligations including compliance with Federal Aviation Administration Advisory Circular 150/2190-5 Exclusive Rights and Minimum Standards for Commercial Aeronautical Activities, which is subject to updating from time to time. Minimum Standards are developed to provide the threshold entry requirements for those persons desiring to provide commercial aeronautical services to the public at the Airport. The Minimum Standards are established based upon the conditions at the individual airport or class of airport, the existing and planned facilities at the airport, and the current and future aviation role of the airport. The prospective commercial aeronautical operator shall agree to offer the described minimum level of services 21 Leasing Policy Iowa City Airport in order to obtain an agreement, permit, or lease to operate on the Airport. In summary, each Airport's Minimum Standards will establish the minimum requirements to be met by individuals and companies for the privilege of providing commercial aeronautical services at the selected Airport. All operators are encouraged to exceed the "minimum" in terms of quality of facilities and/or services. The City may establish separate Minimum Standards for the Iowa City Airport to assist in providing not unjustly discriminatory and effective management. The FAA policy on exclusive rights prohibits the creation or continuance of agreements at the Airport granting exclusive rights to a single commemial operator or service provider. The FAA concludes that the existence of an "exclusive right" aeronautical activity or a local monopoly at an airport restricts the public use of the airport through the absence of competitive enterprise. The City is prohibited from granting an exclusive right to a single operator at the Airport, with a few exceptions. However, it should be noted that an Airport with a single commercial operator does not represent the granting of an "exclusive right" or monopoly to that operator by the City. 22 Leasing Policy Iowa City Airport SECTION VIII - COMPETITIVE REQUEST FOR PROPOSAL PROCESS In order for the City to determine the level of market demand, the City maintains the right to seek competitive proposals at their discretion for commercial property leases at the City-owned Airport. The proposal process will include public notices and information and availability of proposal documents on the City web site. All Requests for Proposals will be consistent with any and all applicable City policies, and a fair and objective evaluation process will be utilized to select the proposals that best meets the interests of the City criteria as defined within the proposal documents. 8.1 No Exclusions of Existing Qualified Operators Current tenants will not be excluded from submitting competitive proposal at the Airport. 8.2 Proposal Evaluations Each Request for Proposal ~vill contain specific information regarding the Airport property currently being considered, and all proposals will include requirements for detailed information from the respondents regarding: · Qualifications · Capitalinvestment proposed · Experience in services being offered · Experience of management personnel · Proposed services and products · Financial ability 23 Leasing Policy Iowa City Aiiport SECTION IX - APPLICABLE CITY DOCUMENTS All tenants and prospective tenants are encouraged to inquire about tenancy at the Iowa City Airport, and to review all applicable documents. These documents can be obtained by contacting the Airport Commission. The following lists of documents are recommended; however, please contact the City for information on other pertinent policies regarding your proposed tenancy and operations. · Leasing Policy · Minimum Standards · Rules and Regulations · Rates and Charges Policy 24 Rates and Charges Policy for the Iowa City Airport Presented to Iowa City, Iowa Date: September, 2003 Rates and Charges Policy 2 Iowa City Airport Table of Contents Section Page 1. Statement and Purpose of Policy ................................................................... 3 2. Definitions ............................................................................................. 6 3. Establishment of Rates and Charges ............................................................. 11 4. Types of Rates and Charges .......................................................................13 5. Adjustments of Fuel Flowage, Access, Tiedown, and Special Use Fees ................... 17 6. Adjustments of Unimproved Land, Improved Land, and Facility Rents .................... 18 7. Appraisal/Market Rent Analysis Standards ..................................................... 21 8. Penalties .............................................................................................. 24 9. Revenue Diversion ................................................................................... 25 Rates and Charges Policy 3 Iowa City Airport Section 1 Statement and Purpose of Policy Iowa City, Iowa (City) owns and operates the Iowa City Municipal Airport (FAA Identifier IOW). As set forth by the Federal Aviation Administration (FAA) by way of its Airport Sponsor Assurances, any airport developed with Federal grant assistance is required to operate for the use and benefit of the public and is to be made available to all types, kinds, and classes of aeronautical activity on fair and reasonable terms and without unjust discrimination. As the Airport sponsor, the City receives Federal airport development funding. This Rates and Charges Policy will assist the City in maintaining compliance with the Airport Sponsor Assurances, so as not to jeopardize their ability to obtain future Federal airport development funding. This policy has further been developed to assist the Airport in competing fairly with other airports and to maintain fiscal responsibility and oversight of the assets entrusted to the Airport by the residents of Iowa City. The purpose of this document is to set forth a standardized system for the establishment of rates and charges which will be imposed on all users of the City-owned Airport and to comply with the Federal Aviation Administration Final Policy regarding Rates and Charges published in the Federal Register, Volume 61, Number 121 on June 21, 1996. This policy statement was adopted by the City on the day of ,2003 and is not retroactive, but is applicable to all future leases, as well as renewals or assignments of existing leases, unless invalidated by terms and conditions of an existing lease. It is the intent of this policy to benefit the public by the establishment of a standardized system of rates and charges, which is based on the following obligations: A. Ensure compliance with applicable legal requirements regarding Airport rates and charges through local communications, negotiations, and resolution with the Airport users. B. Ensure the rates, charges, and fees imposed on the aeronautical users of the Airport is fair and reasonable. Rates and Charges Policy 4 Iowa City Airport C. Make the Airport available for public use on fair and reasonable terms without unjust discrimination. Ensure that any airport tenant is subject to the san~e rates, fees and charges as are uniformly applicable to other tenants offering similar services or utilizing the similar facilities at the Airport.. D. Maintain a rates, charges, and fee schedule that guides the Airport toward the goal of financial self-sufficiency. E. Utilize revenue generated from Airport activities and services only for aeronautical purposes (no revenue diversion). F. At the discretion of the Airport Commission, the Airport may, from time-to-time, apply special rates and fees. All existing and prospective commercial tenants are required to review the City's Minimum Standards document dated and the City's Leasing Policy dated Rates and Charges Policy 5 Iowa City Airport Section 2 Definitions Aeronautical Property: Any property located within the Airport Operations Area (AOA) that supports or directly provides an aeronautical use. (Also known as Airport Property.) Aeronautical Use: Any activity that involves, makes possible, or is required for the safety or operation of an aircraft. Agreement: A written contract between the City and a Tenant that specifies the terms and conditions under which the Tenant may conduct aeronautical activities or access the airport property. Airport: Iowa City Airport, and all of the City-owned or leased real or personal property, buildings, facilities and improvements within the boundaries of the Airport, as it presently exists or as may exist when hereafter modified, expanded, or developed. Airport includes all of the facilities shown on the most current Airport Layout Plans or drawings when available. Airport Manager: The designated individual or duly authorized individual appointed by the Airport Commission to administer and manage all operations and facilities of the Airport, and to supervise all Airport projects. Airport Operations Area or AOA: The Airport property used for aimraft landing, takeoff, or surface maneuvering including the hangars, navigation, and communication facilities. Appraisal: A valuation process conducted by a qualified and experienced appraiser to estimate the current fair market value of Airport property or facilities for rate-setting or adjustment purposes. Based Aircraft: An aircraft that the owner physically locates at the Airport for an undetermined period and whenever absent from the Airport, its owner intends to return the aircraft to the same Airport for long-term storage. Base Term: The specified initial term of a lease, excluding any specified renewal options. Rates and Charges Policy 6 Io~va City Airport Commercial Activity: Those services provided to the public by a person, business, concession, operator, or agency for compensation or hire. An activity is considered a commercial activity even if the business is non-profit, charitable, or tax-exempt. This commercial activity also applies to sublessees. Consumer Price Index or CPI: A measure or indicator of inflation established and published by the United States Bureau of Labor Statistics for cost-of-living and economic purposes. CPI used by the City to determine periodic adjustments for Airport user rates and charges. Existing Leases: Those lease agreements currently in place at the Airport at the time this policy is adopted, in which specific leasehold areas and improvements are defined, and a termination date is specified. FAA: The Federal Aviation Administration. Fair Market Rent: The most probable rental rate that a property should bring in a competitive and open rental market. Fair Market Value: The most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale. This includes the assumptions that the buyer and seller each act prudently and knowledgeably, and the price is not affected by undue stimulus. (Also known as Market Value) Fixed Base Operator (FBO): A full service commercial operator who engages in the primary activity of aircraft refueling and, some or none of the following secondary activities: airframe and power plant maintenance, flight training, aircraft rental, air charter or taxi, avionics maintenance and sales, and aircraft storage/hangar rentals. Fuel Flowage Fee: A fee payable by each entity dispensing fuel for each gallon of aviation fuel sold, or transferred on Airport property. General Aviation: Any aviation-related activity, property, or operation, excluding air carriers and military activity. Rates and Charges Policy 7 Iowa City Airport Lease: A written contract between the City and a Tenant (Lessee) that specifies the terms and conditions under which the Tenant may occupy and use certain Airport facilities and/or property. Leasehold: A defined parcel of land, and any improvements thereon, which is leased to Person for their exclusive aeronautical use. (Also known as Leased Premises) Leasing Policy: A City policy document that contains standardized lease application and renewal procedures, lease terms and conditions, sublease rights, insurance requirements, capital investment considerations, and other lease-related information. Lease Renewals: Those extension or renewal options granted by an existing lease contract, which with the approval of the City, may be exemised by the Lessee upon scheduled expiration of the base term of the lease. Market Rent Analysis: A valuation process conducted by a qualified and experienced appraiser or aviation consultant to estimate the current fair market reni of Airport property or facilities for rate-setting or adjustment purposes. Minimum Standards: A City document that contains the minimum requirements that shall be met by operators at the Airport engaged in commercial aeronautical activities. New Leases: Agreements with parties who are not leasing land or improvements at the Airport, or new agreements with existing Lessees for additional land and/or improvements at the Airport, which are not leased by the Lessee upon adoption of this policy document. Permit: The administrative approval issued by the City to a Person to conduct a specific aeronautical activity. Person: An individual, corporation, firm, partnership, association, organization, or any other group acting as a unit, to conduct business on the Airport. Person includes a trustee, receiver, assignee or similar representative. Rates and Charges Policy 8 Iowa City Airport Point of Ingress~Egress: The area where the City's Airport property adjoins a Tenant's property to facilitate aircraft access to/from the AOA. Revenue Diversion: The use or appropriation of revenue generated from Airport activities and services for any purpose other than the operations, maintenance, and capital improvements of the Airport. Self-Fueling: The commercial operation of an unmanned stationary fuel tank and dispensing equipment for general use via card reader. This includes the operation of Persons utilizing this type of equipment to provide fuel for sale or reuse. Self-Service: An aircraft owner, who may adjust, repair, refuel, clean, and otherwise service his/her own aircraft, provided the is performed by the aimraft owner or his/her direct employees with resources supplied by the owner. The services must be conducted in accordance with rules and standards established by the City. Sublease: A written contract approved by the City, stating the terms and conditions under which a third-party leases space from a Lessee at the Airport for the purpose of providing commercial aeronautical services at the Airport. Tenant: Any person, partnership, corporation or other entity that leases property or facilities from the City at the Airport. Tiedown: The Airport property that is designated for parking based or transient aircraft. Transient Aircraft: An aircraft that is visiting. Rates and Charges Policy 9 Iowa City Airport Section 3 Establishment of Rates and Charges Iowa City has the option to utilize various methods to assess Airport user rates, charges, and fees for the public use or tenancy of the City's Airport property and facilities. The City also has the option to grant Airport use privileges by contract, agreement, permit, or the direct assessment of fees. A tenant may be granted a lease agreement, under which it pays the City either an agreed rent for a defined land parcel, a hangar or other facility it occupies, or a variable payment (related to fuel flowage, volume of business, aircraft operations, etc.) for the use of the Airport property by its own aircraft or those of its customers or a combination of these fees. The City shall use the following methodologies for assessing Airport user rates and charges: A. Existing Leases - All extension options granted by an existing lease, which may be requested by the Lessee and require the approval of the City, shall be subject to the same terms and conditions indicated within the existing lease agreement, and may be subject to rate adjustment. B. New Leases - All rental rates and charges applicable to a non-aeronautical or aeronautical property (i.e., unimproved land, paved ramp/apron, buildings, hangars, etc.) at the Airport shall be determined by appraisal or market rent analysis to obtain fair market value/fair market rent. In new leases, whereby all or part of the capital improvements are constructed at City's expense, the City reserves the right to amortize all or part of the construction costs of the capital improvements, plus a reasonable rate of return, during the term of the lease granted to the Lessee. The City may further determine due to the location of the property being leased or the total size of the leasehold that a variance in airport property lease rate is applicable. C Fuel Flowage Fees, Access Fees, Tiedown Fees - All rates and fees applicable to fuel flowage fees, access fees, tiedown fees, shall be determined through an analysis of similar activities, rates, and charges at comparable non-City owned airports with consideration to ensure rates are fair and reasonable and to meet the requirement for the Airport to be self-sustaining. All fees will be reviewed and may be modified on an annual basis. Rates and Charges Policy 10 Iowa City Airport D. Special Use Agreements - All rental rates and charges applicable to special use agreements (FAA, agriculture spraying, recreational parks, weather equipment sites, etc.) shall be determined through an analysis of similar activities, rates, and charges at comparable airports in addition to consideration of overall benefit to the public, community, and City. E. Negotiated Fees - The City has established an equitable rates and charges schedule for aeronautical activities conducted at the Airport. However, unusual circumstances may arise, and the City must retain sufficient flexibility in rate and fee negotiation to address such circumstances. Since the primary mission of the Airport is to develop and promote aeronautics, the City reserves the right to negotiate a specific rate or fee to accomplish such mission. F. Waived Fees - The City may waive certain fees for government aircraft to comply with Federal airport improvement grant assurances. The City may also waive certain fees from an organization or person engaged in a non-profit aeronautical program or activity that benefits a char/table organization or community. Examples of persons or organizations potentially eligible to receive such non-profit fee waiver are those conducting aviation safety programs, fly-ins, or air shows. G. Other Fees - The City currently provides for certain administrative fees and charges to be charged to tenants at the Airport. Said fees and charges shall be in accordance with the prevailing fee schedule on file at the Airport. Rates and Charges Policy 11 Iowa City Airport Section 4 Types of Rates and Charges The obligation to make the Airport available to the public does not preclude the City from recovering the costs of operating and maintaining the Airport through fair and reasonable rates, charges, and fees. Each tenant of the Airport shall be subject to one or more of the following types of rates, charges, and fees for the use of the premises and the rights granted by the City: A. Unimproved Land (Ground) Rent Tenants leasing unimproved land (ground space) for private and commercial building sites or aeronautical-related structures shall be assessed an annual rental rate per square foot of leased area. Tenants shall also pay any applicable real property taxes assessed for the unimproved land lease. Rent shall be payable to the City and shall be based upon the appropriate annual rental amount paid in equal monthly installments, or in accordance with a payment scheduled detailed in tenant lease. All payments are required in advance. B. Improved Land (Ramp) Rent Tenants who lease improved land (paved ramp or apron) for private use, non-aeronautical commercial activities, or aeronautical-related activities, shall be assessed an annual rental rate per square foot of leased area. Rent shall be payable to the City and shall be based upon the appropriate annual rental amount paid in equal monthly installments, or in accordance with a payment scheduled detailed in tenant lease. All rent payments are required in advance. Rates and Charges Policy 12 Iowa City Airport C. Facility (BuiMing and Hangar) Rent Tenants who lease structures for private use, non-aeronautical commercial activities, or aeronautical-related activities shall be assessed an annual rental rate per square foot of leased building area. Rent shall be payable to the City and shall be based upon the appropriate annual rental amount paid in equal monthly installments, or in accordance with a payment scheduled detailed in tenant lease. All rent payments are required in advance. D. Percentage Rent The City retains the right to enter into an agreement or lease that requires a commercial aeronautical operator to pay to the City the greater of either a fixed base rent (including unimproved land, improved land, and/or facility rent), or a specified percentage of gross receipts, for the right and privilege of doing business on the Airport. In addition, the City retains the right to enter into an agreement that requires the payment of a specified percentage of gross receipts, in addition to a fixed base rent. Gross receipts shall be determined in accordance with the definition stated in the operator's lease agreement. E. Fuel Flowage Fees A fuel flowage fee shall be assessed on a "per gallon" basis for all types of aviation fuel delivered, used, or transferred into aircraft at the Airport. Each FBO, self-fueler, or self-service fueling operation shall be subject to payment of fuel flowage fees to the City to support the financial self-sustainability of the Airport. At the discretion of the City, the fuel supplier may pay the fuel flowage fee. 1. Fixed Base Operators (FBOs) - Each FBO shall submit quarterly fuel flowage delivery reports to the City for each type of aviation fuel delivered during the quarter, accompanied by fuel delivery receipts from the fuel supplier(s) for the same period. Based upon the quarterly fuel flowage delivery report, each FBO/Supplier shall submit to the City the current fuel flowage fee payment (gallons delivered multiplied by the prevalent fuel flowage fee) in full by the last day of the reporting period. Failure to provide required documentation may be considered a lease default. Rates and Charges Policy 13 Iowa City Airport 2. Self-Fueling Operators - Each self-fueling operator shall submit quarterly fuel flowage delivery reports to the City for each type of aviation fuel delivered reporting period accompanied with fuel delivery receipts from the fuel supplier(s) for the same period. Based upon the quarterly fuel flowage report, each self-fueling operator shall pay the City the current fuel flowage fee payment (gallons delivered multiplied by the prevalent fuel flowage fee) in full by the last day of the reporting period. The fuel fiowage fee for self-fueling operators shall be equivalent to the fuel flowage fee being paid by the FBO(s) at the same Airport. Failure to provide required documentation may be considered a lease default. 3. Self-Service Fueling Operator/Owner - Each self-service fueling operator/owner shall submit quarterly fuel flowage delivery reports to the City for each type of aviation fuel delivered the reporting period accompanied with fuel delivery receipts from the fuel supplier(s) for the same period. Based upon the quarterly fuel flowage report, each self-service operator/owner shall pay the City the current fuel flowage fee payment (gallons delivered multiplied by the prevalent fuel flowage fee) in full by the last day of the monthly reporting period. However, the fuel flowage fee applicable to self-service fueling operator/owner shall be $0.02 per gallon greater than the prevalent fuel flowage fee being paid by the FBOs and self-fueling operators on the same Airport. Failure to provide required documentation may be considered a lease default. For auditing purposes, the City reserves the right to inspect the fuel storage and delivery equipment, business records, and/or fuel supplier invoices of any FBO, self-fueler, or self-service fueling operator. The City retains the fight to hire an independent auditor to conduct a fuel flowage report audit during normal business hours by providing 24-hour notice to the FBO, self-fueler or self-service operator. If as a result of such audit, a deficiency of 5 percent or more is discovered in the fuel flowage reports or payments, the cost of such audit shall be borne by the tenant. The tenant shall remit payment to the City for any amounts under-reported, plus penalty fees described in Section 8 of this policy. Rates and Charges Policy 14 Iowa City Airport F. Access (Ingress/Egress) Fees Each non-commercial and commercial aeronautical operator granted the right and privilege to access or ingress/egress the Airport property shall be assessed an airport access fee for such right and privilege. 1. Commercial Aeronautical Operators - Monthly access fees shall apply to the Airport commercial aeronautical operator that maintains an Airport access agreement. The monthly commercial access fee shall be a percentage of gross revenue, as defined in the operator's lease, or a flat fee, whichever is greater, or a combination of both rates. The access agreement grants the commercial operator unlimited Airport access. Each commercial operator with a City access agreement shall submit a standardized quarterly report stating the commercial operator's gross revenue and applicable percentage access fee for the previous month. Commercial access fee reports and payments are due and payable in full by the last day of the reporting period. 2. Non-Commercial Aeronautical Operators - Annual access fees shall apply to each non- commercial aeronautical operator that maintains an Airport access agreement. The annual access fee shall be a flat fee, based solely upon the current access fee set forth for the Airport by the City. The access agreement grants the non-commercial operator unlimited Airport access. The non- commercial access fee shall be payable to City in full, annually at the lease commencement and on each anniversary date of the lease agreement. G. Tiedown Rent The City offers Tiedown facilities to based and transient aircraft at the Airport. Based aircraft operators can rent an available paved Tiedown from the City. Tenants renting a tiedown on an annual (12 month) basis shall be assessed a monthly rate per tiedown, payable in full to the City bi-annually at the lease commencement and on each six month anniversary date of the lease agreement. Transient aircraft operators shall be assessed a daily Airport user/tiedown fee, payable to the City through the Airport Management Office. Rates and Charges Policy 15 Io~va City Airport H. Special Use Agreements Special and unusual airport property leasing agreements require the City to retain sufficient flexibility in rate and fee negotiations to address such circumstances. The Airport Commission reserves the right to negotiate a special use agreement rent or fee to benefit the public, community, or City. Examples of special use agreements include, but are not limited to: Air Traffic Control Towers, fire protection facilities, sports complexes, farming rights, weather equipment site leases, and concession storage areas. The rent shall be payable in full to the City annually at the lease commencement and on each armiversary date of the lease agreement. Rates and Clxarges Policy 16 Iowa City Airport Section 5 Adjustments of Fuel Flowage, Access, Tiedown, and Special Use Fees All fuel flowage, access, tiedown, and special use fees imposed through new and renewal agreements shall be subject to periodic adjustment during the base term of the agreement and during all extension periods. A. The City reserves the right to review and adjust such fees bi-annually during the base term of the lease, as well as at the commencement of any extension option exercised by the Lessee and approved by the City. B. Through either internal analysis or an independent contract services agreement, the City shall review the rate and fee schedule of the Airport and comparable airports to determine those fee adjustments that should be made to ensure equity among all revenue sources and maintain the Airport's financial self-sufficiency. The adjustment factor shall then be applied to the annual fee for the preceding year, to determine the new annual fee amount. Rates and Charges Policy 17 Iowa City Airport Section 6 Adjustments of Unimproved Land, Improved Land, and Facility Rents All unimproved land (ground), improved land (ramp), and facility (building or hangar) rents, to include new leases and lease renewals, shall be subject to periodic adjustment during the base term of the lease and during all extension periods. A. The City reserves the right to review and adjust such rents annually during the base term of the lease, as well as at the commencement of any extension option exercised by the Lessee and approved by the City. B. Rent adjustments shall be determined using the Consumer Price Index for 'GAll Urban Consumers" for the State of Iowa. Adjustments shall be determined by dividing the index prevalent at the date of adjustment with the index corresponding ~vith the date of lease commencement or date of the most recent lease adjustment. The adjustment factor shall then be applied to the annual rent for the preceding year, to determine the new annual rent level. The rent adjustment shall not exceed 3 percent of the previous year at any given adjustment interval. C. At the end of each 5-year period of the lease, the City retains the option to hire a qualified and experienced appraiser or aviation consultant to conduct a new appraisal or market rent analysis to determine the current fair market value and/or market rent for the leasehold. 1. The appraisal or market rent analysis shall consider only those improvements which were in place at commencement of the base term of the lease, unless specified by the lease, or both parties have agreed to prior reversion of any or all of the improvements. 2. The City shall be responsible for the engagement of an appraiser or aviation consultant. All costs (to include fees and expenses) for the appraisal or market rent analysis shall be divided equally between the City and Lessee. Rates and Charges Policy 18 Iowa City Airport D. At the time of the engagement of the appraiser/aviation consultant, upon mutual agreement, the City and Lessee shall have the right (to the full extent allowed by applicable law) to render the conclusions of the appraiser/aviation consultant as legally binding. 1. In the event that the conclusions of the appraiser/aviation consultant are not rendered legally binding, or if upon completion of the appraisal or market rent analysis either party disagrees with the conclusions of the appraiser/aviation consultant, then the disagreeing party shall have the right to obtain a second appraisal or market rent analysis, which shall be conducted by an unbiased, objective third party appraiser or aviation consultant, subject to the same qualification standards set forth herein. 2. All costs relating to the engagement of this second appraiser or aviation consultant shall be the responsibility of the party requesting said appraisal or market rent analysis. 3. If the conclusions of the two appraisals/analyses reflect a variance of 10 percent or less, then the conclusions of the appraisals/analyses shall be averaged to determine the new market value/rental rate. 4. If the variance exceeds 10 percent, then the City and Lessee shall mutually select a third appraiser/or aviation consultant (subject to the same qualification standards) who shall serve as an Arbitrator. a. The Arbitrator shall review both appraisals or market rent analyses and have the discretion to request a hearing at which both appraisers/aviation consultants shall be available to provide additional information and/or clarification to the Arbitrator. b. The Arbitrator shall derive a conclusion based upon data contained within each appraisal or market rent analysis or each appraiser's/aviation consultant's files. However, the Arbitrator shall have the right to gather, analyze and consider additional data not provided by either appraiser/aviation consultant. Rates and Charges Policy 19 Iowa City Airport c. The expense related to contracting an Arbitrator, to include fees and expenses, shall be divided equally between the City and the Lessee. d. All decisions rendered by the Arbitrator shall be legally binding to the full extent allowed by applicable law. 5. Prior to the time of any scheduled rent adjustment, if either party determines that significant changes have occurred at the Airport or within the local area, either party shall have the right to commission a new appraisal/market rent analysis on the property. Significant changes include, but are not limited to, the reversion of improvements prior to lease expiration, leasehold expansion or reduction with regard to land and/or facility areas, and significant changes within the marketplace (either physical or economic). Costs associated with a new appraisal or market rent analysis shall be the responsibility of the party requesting said evaluation. Rates and Charges Policy 20 Iowa City Airport Section 7 Appraisal/Market Rent Analysis Standards A. Appraisal/Market Rent Analysis Requirements: Any appraisal of aeronautical property for the purpose of sale, exchange or lease shall be performed by a Member Appraisal Institute (MAI) appraiser or equally qualified and experienced appraiser who is certified by a recognized appraisal organization. 1. Any appraiser selected to perform appraisals on aeronautical land or improvements shall have working knowledge of the general aviation industry (to include both fixed base operations and other aeronautical uses) and demonstrate familiarity, to the satisfaction of the City, with FAA roles, regulations, and policies affecting airport properties. 2. The appraiser shall have completed a minimum of five (5) appraisals of aeronautical property within the past three (3) years and, upon request, shall provide a list to the City that identifies the location and type of appraisal conducted. Appraisals performed on real property not located within the AOA of an Airport, or not being used for aeronautical purposes, shall not satisfy these requirements. 3. In cimumstances wherein the City determines that an appraisal is not required, the City retains the right to utilize a qualified and experienced aviation consultant to complete a Market Rent Analysis. Consultants other than appraisers who are contracted by the City to establish market rents and fees other than for the sale or exchange of Airport property, must possess qualifications and experience commensurate to the assigned task, demonstrate the education, skill, learning, and experience necessary for such task; be independent; and execute a statement that he or she does not have a conflict of interest with the City or any existing/prospective tenant. Qualifications and experience determinations shall be at the sole discretion of the City, but shall be generally consistent with those required for a qualified and experienced appraiser. B. Appraisal/Market Rent Analysis Methodology: Appraisals and market rent analyses performed on all aeronautical properties, to include land only or land and improvements, shall meet the following minimum requirements: Rates and Charges Policy 21 Iowa City Airport 1. An income analysis must be employed through the evaluation of rental rates, fees, and charges of similar aeronautical land and improvements at comparable airports. 2. All appraisals and analyses shall utilize current methods, which are appropriate in the valuation of aeronautical properties and facilities. 3. Survey data compiled by recognized aviation organizations may by utilized as ancillary support for rental rates and fees used in the process. However, ali survey data utilized in the analysis shall be obtained from and confirmed by the Lessor or Lessee in the transaction. 4. Rates of return utilized in the income analysis shall be obtained through reasonable and acceptable methods and must be adequately discussed within the report, where appropriate. C. Highest and Best Use: It shall be the primary goal of the appraisal or market rent analysis to derive an estimate of the market value and/or market rent of a property assuming that the highest and best use of the property is for some type of aviation-related use. Consequently, it should be assumed that the property under analysis will continue to be part of an operating airport and that access to the infrastructure and amenities of the airport will continue to be available. D. Rate of Return: 1. Unimproved Land: If the appraisal is for the purpose of determining the value of unimproved land only, then the value conclusion shall be subject to a "target" rate of return of not less than 10 percent to yield the appropriate annual ground rental rate. The rate of return utilized shall be commensurate with the term of the lease and capital improvements to be completed on the property. 2. Improved Property: If there are any improvements situated on the property which would include, but not be limited to, paved ramp/apron, office facilities, hangars, and terminal buildings, the value conclusion shall be subject to a "target" rate of return of not less than 10 percent to arrive at the appropriate annual rental rate. The rate of return utilized shall be commensurate with the term of the lease and capital improvements to be completed on the property. Rates and Charges Policy 22 Iowa City Airport 3. If an appraisal is performed, the appropriate rental rate shall be derived by multiplying the rate of return by the final value conclusion. Rates and Charges Policy 23 iowa City Airport Section 8 Penalties A. Late Fee Penalties For any charges or fees due to the City, a Tenant shall pay a penalty for late or delinquent payments of not less than 1.5 percent per month on any past due balance calculated from the date the amount is due until the close of the business day upon which the delinquent payment is received by the City. B. Returned Check Fee Whenever a bank-issued check is presented for payment of any Airport fee, and said check is returned because of insufficient funds, closed account, or other similar reason, the City shall charge to the person presenting such check an additional fee of $50.00, plus any and all collection fees. If the initial charges and returned check fees are not paid after notification to the person, the City has the option to suspend, revoke, or place in default all of the person's permits, agreements, or leases in force at that time, according to the terms specified in such contract. Rates and Charges Policy 24 Iowa City Airport Section 9 Revenue Diversion All revenue generated from City-owned Airport activities and services shall be expended only for Iowa City Airport operations, maintenance, and capital improvements. The City shall keep a current and accurate account of all revenues and expenses, including any revenue surplus, for the Airport. IP9 "Discover the Benefits (7 I T Y 0 t7 I 0 W A C I I Y 220 SOUTH GILBERT STREET PHONE (319) 356 5100 IOWA CITY IOWA 52940-1632 www.icgov.org FAX (319) 356-5487 February 13, 2004 To: City Managerrector ~¢'~--,, From: Parks & Recreation Subject: Indoor Soccer The issue of the indoor soccer facility, as proposed by the Iowa Soccer Club (ISC), was discussed at the February 11th meeting of the Parks and Recreation Commission. While the commission feels an indoor soccer facility is a good idea, and they wish ISC well in their efforts, they also feel that pursuing a private facility through the commission or staff is not the most appropriate avenue. Since the City does not own a building to accommodate ISC's needs/desires, the commission feels their search should be through the private sector. They discussed the fact that there are three primary soccer organizations in town (the Kickers, the Alliance and ISC). It seems to the commission (and staff) that if an indoor soccer facility is a high priority, the three organizations should discuss a cooperative effort. I had a brief conversation recently with John Cook, Coaching Director of ISC, and he told me the three groups did discuss this possibility a couple of years ago, but determined they didn't have the financial resources to proceed at that time. Perhaps this approach needs to be revisited. If, for some reason they need our involvement in this process, I would be most willing to talk with them. Iowa City Police Deparlment Monthly liquor license (OFF PREMISE SALES) Report IPJ January 2004 YEAR 2004 Monthly Total Year to Date Totals Arrest/Visit Business Name A I I B _A I I B YTD A&J MINI MART~2153 ACT CRR. o 0 AAJAXXX LIQUOR STORE BIG KAMART-HOLL'CNOOD BLVD. ,; ~ ~, ~:~ .~ y~¢~ 0 0 CUB FOODS ~ ~ 0 0 DAN'S SHORT STOP CORP DELIMART-E. BENTON 3 ~ ~ ~ ~ 0 0 DELIMART-MORMON TREK 1 ~;;~ ~ :~ ~ 0 0 DELIMART-HWY 1 2 2 0 0 DELIMART-LWR MUSCATINE 1 1 0 0 DOC'S STANDARD : 0 0 DRUGTOWN 0 0 EAGLE FOOD CENTER-N. DODGE ~, ~ 0 0 FAREWAY STORES INC GASBY'S EAST-2303 MUSCAT. HANDIMART-DUBUQUEST. ,;,~ '. :~ ' 0 0 HANDIMART-N. DODGE 2 ~¢~¢ 2 0 0 HANDIMART-WILLOWCREEK ~::~:~ .: ~;~ ~ ~;.; ~ 0 0 HARTIG DRUG-MORMON TREK ~;~,~.~,~ ., 0 0 HAWKEYE CON ST-COMMERCE ~ ~:~"~ ~¢~¢'~ HAWKEY CON ST-KIRKWOOD 1 ~ ~'r 1 0 0 HY-VEE-N. DODGE ' ~ ~* *~ ~ HY-VEE-S. 1ST AVE  . _ . ~ ~ , ~,~ 0 0 JOHN'S GROCERY INC ~ ' 0 0 KUM & GO-GILBERT/BURLI. 2 ~4~ 2 0 0 KUM & GO-MORMON TREK 1 ~ 1 ;~; 0 0 KUM & GO- S. RIVERSIDE 2 , ; __ , ~ __z ~ ~,, 0 0 KUM & GO- W. BURLINGTON 3 ~ , 3 ~ : 0 0 L&M MIGHTY SHOP INC ~ ,: 0 0 LIQUOUR HOUSE 1 1 0 0 LINN STREET CAFE ' ' 0 0 MINI MART ; 0 0 NEW PIONEER COOP ~.~,--. ~ 0 0 NORTH DODGE ESPRESS 1 ~~' ~' 0 0 ON THE GO CONV. STORE INC 1 0 0 OSCO DRUG 0 0 PANCHEROS * 0 0 PETRO-N-PROVISIONS 1 ~ ~ . 0 0 PIZZA PALACE ~ ~ ;'~ ~ ~ 0 0 RUSS' AMOCO SERVICE ; ,:~ ; 0 0 SUBJERBAN AMOCO ?~ ~ 0 0 S~BURBA~ AMOCO-K[OKHK , 0 0 T&M MINI MART ~ [: ¢ 0 0 TOBACCO OUTLET PLUS-S. RIV. ~ ~ ~ ~ 0 0 WALGREENS TOTAL 22 ; 0 22 0 0 Column A is the number of times a license holder is visited specifically checking for underage sales. Solumn B is the number of people charged with possession under the legal age. Note, this is not the total number of chargess. MINUTES DRAFT~ SENIOR CENTER COMMISSION TUESDAY, JAN. 20, 2003 MEMBERS PRESENT: Lori Benz, Jo Hensch, Jay Honohan, Betty Kelly, Sarah Maiers, and Charity Rowley. MEMBERS ABSENT: Nancy Wombacher. STAFF PRESENT: Michelle Buhman, Linda Kopping, and Susan Rogusky. GUESTS: Sue Dulek, Mike O'Donnell, and Charlotte Walker CALL TO ORDER MINUTES Motion: To approve the December minutes as distributed. Kelly/Maiers Motion carried on a vote of 6-0. PUBLIC DISCUSSION Walker asked if there were plans for a Commission goal setting session this year. Kopping responded that at this time there were no plans for a goal setting session. Walker requested that in addition to the agenda, all commission handouts be made available to the public at the time of the Commission meeting. THE APPOINTMENT TO THE SENIOR CENTER COMMISSION AT LARGE POSITION- Dulek At the November 17, 2003 meeting Commissioners voted by secret ballot when selecting the candidate for the at-large appointment. Dulek explained that when voting for the At-Large Commission appointment the voting record needs to be open and part of the public record. Motion: Amendment to the November 17, 2003 minutes of the following vote: Candidate Voting Record Sarah Maiers Honohan, Benz, and Rowley (3) Irene Bowers Monsanto, Schoenfelder (2) Eve Casserly Kelly (1) Motion carried on a vote of 6-0. Honohan/Rowley MINUTES DRAFT SENIOR CENTER COMMISSION TUESDAY, JAN. 20, 2003 Dulek also reported that the minutes from the November 17, 2003 meeting needed to reflect that no discussion about the At-Large Commission applicants took place during the brief executive session that took place during that meeting. Motion: Amendment to the minutes from the November 17, 2003 Senior Center Commission meeting notes no discussion of the At-Large Commission applicants during the executive session. Motion carried on a vote of 6-0. Honohan/Rowley REVISION OF FAMILY MEMBERSHIP POLICY- KOPPING Kopping distributed a draft policy revision to Section B-3 and section B-5 of the Open Participation, Membership Benefits and Fees Policy for the Senior Center (Attached). The change in the policy would allow people under 50 years of age to become a member of the Senior Center if they have a family member 50 years or older who is a current paid member of the Center. Consideration of this policy change was precipitated by a request from an active member who wanted his wife (who is less than 50 years of age) to become a registered member. Motion: To adopt the revisions to section B-3 and Section B-5 of the Open Participation, Membership Benefits and Fees Policy as distributed. Motion carried on a vote of 6-0. Rowley/Maiers REVIEW AND DISCUSSION OF FY04 OPERATIONAL BUDGET STATUS- Kopping Kopping reviewed how the membership fee amounts were established and distributed a chart outlining the revenue generated from membership fees during the fist six months of FY04. The chart shows that the current operational budget shortfall is approximately $34,500. Kopping indicated that the Commission needed to revisit and possibly modify current plans for generating operational revenue and develop a plan for promoting participation and membership. Commissioners agreed that a long term marketing plan is essential and long over due. Kelly cautioned that the marketing plan should be one that will not generate expenses and add to the current shortfall. Honohan proposed that a committee be formed to develop strategies for promoting membership at the Center. Benz, Hensch and Honohan agreed to serve on the Marketing Strategies Committee. Kopping distributed a preliminary estimate of nutrition program operational costs that are funded through the Center's operational budget. She noted that while the utilities are a planned, operational expense, kitchen repairs and maintenance expenses are not budgeted items. In FY03 repair and maintenance expenses for the kitchen cost approximately $8,614. In the first six months of FY04 $2,162 has been spent. It is anticipated that additional repair and maintenance expenses for the nutrition program in FY04 will be between $6,908 to $8,815. In addition to the cost of maintaining and replacing the kitchen facility and fixtures, utility costs associated with the operation of the nutrition program are significant. Preliminary estimates show annual utility costs for gas and electric are around $11,114.00 MINUTES DRAFT SENIOR CENTER COMMISSION TUESDAY, JAN. 20, 2003 Parking expenses for the nutrition program that are paid for by the Center were also discussed. Rowley suggested that the Senior Center Commission and staff re-evaluate the current lease agreement with the Elder Services. Pending further investigation, it might be appropriate to ask Elder Services to provide funding to suppod the program's operational costs. A breakdown showing the number of meals and areas served by the nutrition program was distributed. It was noted that Pathways, Autumn Park and Emerson Point were receiving meals prepared in the dining program and Commission members questioned whether or not these were for profit or not for profit agencies. Regardless, Commissioners questioned whether the Senior Center should be subsidizing these programs in the face of the current budget shortfall Walker suggested that the Commission look at the funding streams for the Witwer Center in Cedar Rapids and compare it to the funding received at the Iowa City Senior Center. Kopping was asked to invite Connie Benton-Wolfe, Director of Elder Services, Inc., and the nutrition program Director, Diane Flemming to the next Commission meeting to discuss these issues. DISCUSSION OF PARTICIPATION IN THE COMMUNITY FOUNDATION OF J©HNSON COUNYY- HONOHAN Honohan reported that he has been asked if the Center establishes a fund in the Community Foundation, will it be able to withdraw money from the fund and if so, how it would work. Honohan reported that he had talked with Michael L. Stoffregen, Executive Director of the Community Foundation of Johnson County, and Stoffregen reported that the fund could be set-up in one of two ways: 1. It is only possible to withdrawal the income generated by the investment. Or, 2. The investment money can be withdrawn, but only in the event of emergency. Honohan reviewed and discussed questions from a memo written by Rowley as well as his written responses to these questions. Copies of both memos were distributed to the Commission. (Attached) The various ways the money generated from the foundation would be managed also was discussed. Honohan reminded Commissioners that if the Center contributed $25,000 to the Community Foundation, the Foundation has indicated that it will match $3,000 of the Center's investment. Kopping reported talking with City of Iowa City Finance Director, Kevin O'Malley, about alternative ways to invest gift fund money in order to generate additional revenue for the operation of the Senior Center. She will provide additional information related to this at the February meeting. MINUTES DRAFT SENIOR CENTER COMMISSION TUESDAY, JAN. 20, 2003 SENIOR CENTER UPDATE Operations--Kopping No report. Programs- Seal An attendance list from the fall programming was distributed. Rowley commented that the Spring Program Guide has a wonderful selection of classes and activities and that the design is an improvement from the Fall Program Guide. Volunteers- Rogusky Rogusky distributed a copy of the total number of volunteers and volunteer hours worked in 2003. Rogusky repoded that Richard Tiegs have volunteered to direct the Voices of Experience. Benz suggested that the Senior Center contact the local newspapers to run an article about Tiegs. A new activity group calling themselves the Red Hat Divas has been formed with around twenty-five members. Benz suggested that a similar group targeting male participants be created. Rogusky also reported that the Model Railroad Club has quickly grown to twenty members and is looking for space in the Senior Center to build and display a Model Railroad display. Rogusky reported that the City Television Group (CTG) has agreed to fund the salaried of the temporary Senior Center Television (SCTV) staff out of passthrough funds in FY05. The CTG will consider continuing funding for SCTV in future years. Membership and Fundraising-Buhman Buhman reported that as of January20, 2004, 725 people have registered as Senior Center members, seventy-one (71) members have purchased membership at the discounted rate. Donations in the amount of $5,019.50 have been collected for the Operational Budget. Copies of this report are available at the Secretary's desk. ELECTION OF OFFICERS FOR 2004 The slate of nominated officers was reviewed without additional nominations from the floor. Motion to elect officers as proposed by nomination committee. Motion passed on a vote of 6-0. Hensch/Maiers The following officers were elected: Honohan as Chair, Kelly as Vice-Chair, and Rowley as Secretary. COMMISSION DISCUSSION Hensch noted that the exercise equipment is always very clean well maintained. Honohan reported that he went to the both the City Council and Board of Supervisors meeting Past month and gave a brief report on the progress of the membership drive and projects the commission will be working on during 2004. Honohan volunteered will write the Post article for this meeting. Rowley volunteered to write the Post article for the February 17, 2004 meeting. MINUTES DRAFT SENIOR CENTER COMMISSION TUESDAY, JAN. 20, 2003 Honohan and Kopping will attend the budget meeting with the Iowa City Council next week. Motion to adjourn, Motion carried on a vote of 5-0 Kelly/Hensch. IP12 DRAFT MINUTES IOWA CITY HISTORIC PRESERVATION COMMISSION EMMA J HARVAT HALL FEBRUARY 12, 2004- 7:00 P.M. MEMBERS PRESENT: Richard Carlson, Michael Maharry, Mark McCallum, Jim Ponto, Amy Smothers, Tim Weitzel MEMBERS ABSENT: James Enloe, Michael Gunn, Paul Sueppel STAFF PRESENT: Shelley McCafferty OTHERS PRESENT: Helen Burford CALL TO ORDER: Chairperson Maharry called the meeting to order at 7:05 p.m. PUBLIC DISCUSSION OF ANY ITEM NOT ON THE AGENDA: McCafferty said the Commission will need to hold a special meeting in February for a Section 106 Review of a house on Crescent Street that is over 50 years old. She stated that Habitat for Humanity purchased the lot and plans to use federal funds to demolish the house and build a new one. McCafferty said the house is not in a historic district, but because it is over 50 years old and federal funds are to be used, the Section 106 Review is required. Weitzel said the Section 106 review requires an architectural survey, and an archaeological survey may also be required, depending on what SHPO determines. Smothers asked if the archaeological survey would be waived because of the regrading of Highway Six, and Weitzel said that could be an argument to have it waived. Maharry said that on February 26 at 1:30 p.m. in the Public Library in Meeting Room B, Don Longwell would speak on the use of federal historic tax credits for property. He suggested holding the special meeting on the 26th SO that Longwell could hold a discussion with the Commission. The consensus of the Commission was to schedule the meeting for February 26 at 7:00 p.m. IOWA CITY HISTORIC PRESERVATION HANDBOOK: McCafferty said the Handbook was adopted by the City Council. She said the City Attorney had her insert a little bit more language regarding criteria for changing the classification of properties, and there were three criteria for that. McCafferty said she would mail out updated copies to Commission members. CERTIFICATE OF APPROPRIATENESS: 1220 SHERIDAN AVENUE: McCafferty said this is an application for the replacement of a window on a house in the Longfellow Historic District. She said this is a kitchen window that is deteriorating on the back side of the house. McCafferty said this part of the house is actually an addition and not part of the original structure. McCafferty said the owners propose to replace the window with a wood, double hung WeatherShield, metal clad window. Weitzel said this house has an overhang porch that has been filled in, and there has been a mud room/porch added on in the back, which has another addition added on to it. He said that for those reasons he would not have much of a problem with this. Iowa City Historic Preservation Commission Minutes February 12, 2004 Page 2 Weitzel said the owners do talk about blocking down the window, and he would not want to see the window end up to be porthole-sized. He said the owners want to use a standard window instead of a custom size, because of cost considerations. McCafferty said the dimensions of the proposed window are 46 by 49 inches, so this would not significantly block it down. Weitzel said the Commission does not officially consider the back of the house differently from the front, but this window can only be seen from the alley and the house behind this one. Weitzel asked if it is permissible in the guidelines to use a different sized window and then block in the opening with non-standard trim. McCafferty read from the application, "Trim may be slightly wider or narrower than existing trim, as standard size replacement window must be used." She suggested requiring that the trim be no more than one inch smaller or greater than the existing trim. Carlson said this also depends on whether there are any other windows on the back to which people would compare the new window. He said if there is only one window of this kind on the rear facade, it would not really be a problem. MOTION: Weitzel moved to approve a certificate of appropriateness for the replacement of a window at 1220 Sheridan Avenue, subject to the reduction in the opening being no greater than one inch on each side and subject to the replacement of deteriorated trim to match the existing. Ponto seconded the motion. The motion carried on a vote of 6-0. HISTORIC REVIEW SUBCOMMITTEE: McCafferty said that Gunn has done a lot of work on this and suggested that he be present before the Commission discusses the matter in any depth. McCafferty said there would probably be three people on the subcommittee, possibly one on a permanent basis and two rotating positions. Weitzel said he would like to possibly see the subcommittee consist of the chair; an architectural historian, if available; and someone who is very familiar with the guidelines. Maharry said that McCafferty would be present at the subcommittee meetings as well, and she is very familiar with the guidelines. 2004 WORK PLAN: Maharry referred to the list of projects for 2004. Maharry suggested coordinating public hearings or any meetings regarding the neighborhoods to be held during Historic Preservation Week, which is the first week of May. He said there could be discussions about the North Side or Goosetown Districts. McCafferty said she and Burford, who is the Executive Director of Friends of Historic Preservation, have discussed ways to raise public awareness of Historic Preservation Week. She said that perhaps the Commission could arrange for Marlys Svendsen to discuss the North Side and/or Goosetown, possibly as the keynote speaker for the awards event. McCafferty said another possibility is to hold a College Hill Walking Tour. Burford said that Roger Gwinnup is working on a television program about the Salvage Barn for the library. She said it will be shown during Preservation Week, and the Salvage Barn will also be holding an open house during that week. Burford also suggested opening the Englert Theatre for tours. Maharry said the Commission had discussed asking the City Council to reduce the cost of building permits that would not have to be applied for in other districts for those in historic or conservation districts. He did not know if eliminating the fee altogether would go over but would like to see a 50% reduction in the cost of the permit. Maharry said it would be good to announce such a change during Historic Preservation Week. McCafferty said there could be a talk about the Butler House during Historic Preservation Week. She said the City does not intend to spend money on the Butler House at this time. McCafferty said the National Iowa City Historic Preservation Commission Minutes February12,2004 Page 3 Register nomination for the Butler House is not yet complete. She said the nomination still needs historic photographs and comments on issues regarding archaeology. Weitzel said he would help with the archaeology aspect. Maharry asked if it would be possible to have a walk-through of the Butler House during Preservation Week. McCafferty said it would. Weitzel stated that attendance at such an event would be a good gauge of interest in the house. Maharry asked what the next steps are for Goosetown Neighborhood designation. McCafferty said the next step would be to hold a neighborhood meeting. She said the names and addresses have been compiled and the map is completed. McCafferty said that she would coordinate with Marcia Klingaman to hold the neighborhood meeting in early March. Maharry said the step after the neighborhood meeting(s) would be for the Historic Preservation Commission to hold one public hearing. He said there would then be two Planning and Zoning Commission meetings and possibly three to four City Council meetings. Maharry asked if one of the City Council meetings could potentially coincide with Historic Preservation Week. McCafferty said she would check the schedule. Maharry suggested seeing if Svendsen would be in town any time in March and would be able to do a presentation. McCafferty said she would find out. Maharry said it is very helpful to have the presentation done by the person who did the research. McCafferty stated that Michaelanne Widness and Jean Walker have contacted her with their concerns about the Melrose Avenue Neighborhood, specifically the area south of Melrose, just south of the hospital. McCafferty said Widness and Walker would like to do whatever they can to put pressure on the University to save that area. McCafferty said the University has been buying property in the area and has fairly concrete plans to build Hope Lodge, a three-story building, between Melrose Circle and Melrose Place. Weitzel said that during the University's campus-wide meetings held last year, people were invited to bring up concerns and issues, and historic preservation was mentioned repeatedly. He said the University's planning statement says that it will pay attention to historic preservation and stewardship. McCafferty said she asked Svendsen if there was potential for a historic district in the area, and Svendsen thought there would be. Svendsen also informed her that the cost of a survey for the approximately 85 properties in the area between Melrose Circle and Brookland Park Drive would be $15,500. McCafferty said she would inform Widness and Walker that the Commission would be in favor of a historic district here but would also tell them not to count on getting money for this from the City. McCafferty said she recommended to Widness and Walker that those in attendance at their neighborhood meeting draft a letter asking the Commission to look into this. McCafferty added that if volunteers do some of the research, it would keep the cost of the surveying down. Maharry said it would be good to have alternatives to recommend to the University. He added that a three-story structure would be out of place south of Melrose Avenue. McCafferty said she would inform Widness and Walker of the Commission's general support. Regarding the brochures, McCafferty said Burford had volunteered to do some of the writing but has not had the time. McCafferty said completing the text is what is holding up the project. Weitzel volunteered to help with the writing. Maharry asked what the timetable is for completion. McCafferty said she would like to at least have a mockup prepared in time for Historic Preservation Week. Iowa City Historic Preservation Commission Minutes February 12, 2004 Page 4 McCafferty noted that McCallum had volunteered to send notification letters to area realtors regarding the location of historic and conservation districts. McCallum said he would be happy to do so. McCafferty said she had a sample letter to provide him. Smothers volunteered to work on Preservation Week planning. Regarding a potential downtown historic district, McCafferty said the survey and evaluation of the downtown area is complete. She said it has been determined that there is an area of downtown that would be eligible for a nomination. McCafferty said the issue is that there is a SSMID district being formed downtown and also a number of different interest groups. Communication with these groups must take place. Maharry asked if three City Council members would have to recuse themselves on a vote on a downtown district. Weitzel said City Council members are able to vote on other issues that have financial implications for downtown. McCafferty said she would have to obtain an opinion on this from the City Attorney. McCafferty said that this is a good time for the Commission to do some consensus building and work with the downtown groups. Maharry suggested also doing some one-omone lobbying. McCaffedy said the Commission may want to draft some guidelines to dispel any myths regarding what having a downtown district would mean. Weitzel said the text could probably come right from the CLG grant proposal. Maharry said it would be beneficial to have a downtown brochure mockup fairly soon. Regarding the regulations and programs, McCafferty said she needed to work on drafting language for the historic preservation ordinance, economic hardship ordinance, and putting together other information. She added that she would write up a strategic plan of the different steps the Commission needs to take to complete these things, who is responsible, and the target dates for each. ADJOURNMENT: The meeting was adjourned at 8:14 p.m. Minutes submitted by Anne Schulte data on citynt/pcd/minutes/hpc]h~c02*12A)4.doc