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HomeMy WebLinkAbout04-10-2008 Airport Commission Meeting Minutes MINUTES FINAL Iowa City Airport Commission April 10,2008 Iowa City Airport Terminal—6:30 PM Members Present: Greg Farris, Randy Hartwig,Howard Horan,Janclle Rettig,John Staley Staff Present: Sue Dulek,Michael Tharp Others Present: John Yeomans,Peggy Slaughter,Randy Miller,Al Wells,David Hughes,Minnetta Gardinier,Phillip Woolford,Jay Honeck,Jason Honea, Corey Pospisil DETERMINE QUORUM: Chairperson Farris called the meeting to order at 6:32 P.M. RECOMMENDATIONS TO COUNCIL: none APPROVAL OF MINUTES FROM THE MARCH 13,2008 MEETING: Farris asked if anyone had any changes to the March 13,2008 minutes. Staley moved to accept the minutes of the March 13,2008,meeting as presented; seconded by Hartwig. Motion carried 5-0. PUBLIC DISCUSSION: John Yeomans,Farm Manager with Farmers National Company,stated that he has some pictures of their project that he would like to share with the Commission. He noted that it looks really nice, and that the fence gate is being reinstalled as it was installed improperly. He added that the contractor putting in the roadway found this error. He stated that they have also been trimming brush along the fence and cleaning up the area. Yeomans stated that schedules are getting set up,as is soil sampling,and that the farm is getting ready for spring. ITEMS FOR DISCUSSION/ACTION: a. Aviation Commerce Park—Hartwig made a motion to move Item 4.d.vii up to the discussion with 4.a.; seconded by Staley. Motion carried 5-0. Randy Miller told the Commission that they have bad several more inquiries in regards to lots,but nothing official yet. Peggy Slaughter added that the interested parties need to find investors before they can build,and that this process takes a bit longer to iron out. Dulek 1 Iowa City Airport Commission April 10,2008 Page 2 of 9 noted that an offer was received yesterday on Lot#1, from Mr.Wells (on behalf of his LLC),and that it expired today. She added that it was not accepted because of contingencies that were part of the offer,and that due to the time constraints there was not time to review this with the Commission prior to the expiration at 5:00 P.M. Dulek continued,stating that the Commission has two options now with regards to the United hangar—they can reward the demolition contract to the lowest bidder, or they can explore an agreement with Mr. Wells. Dulek stated that if they chose the latter,then a myriad of issues would need to be addressed,such as when would the hangar come down,what FAA money is available, and other Airport-related issues that could be included in an offer between Mr. Wells(his LLC) and the Airport. She further explained what the Commission needs to decide upon at this evening's meeting. The discussion began with Rettig asking Slaughter what the lot is listed at. Al Wells joined the Commission at this point in the discussion. At 6:45 Rettig moved to temporarily adjourn the meeting due to a tornado warning; seconded by Farris. The meeting resumed at 8:00 ,with discussion returning to the Aviation Commerce Park and the United hangar demolition and offer. Wells noted that his new offer would not have anything to do with the United hangar or the land lease or the fence agreement. He added that what he understands is that Iowa City City Council needs to review the offer, and then the Airport Commission will review it. Wells stated that this offer expires tomorrow at 5:00 P.M. Horan asked what the details of this offer are,and Wells stated that it's based almost exactly on the ITC purchase,$180,000, which is 80%of the asking price,which is what the ITC offer was. Wells added that there are requirements of due diligence that cover adequate enough time to acquire the United hangar and get it over to this lot, if he receives approval for this. Mother alternative,according to Wells,is that if a contractor does get the demolition contract,he could still pursue obtaining the hangar from the contractor. It was noted that the low bid for this demolition is $103,060,and the high bid was $135,040,with four total bids received. Horan noted that it appears to him that the contractors would be considering the value of the salvageable steel when demolishing this hangar, and he questioned the cost to Wells. Wells added that perhaps he could subcontract for the contractor, and take care of getting the hangar down himself. Rettig asked how much they have invested in this bidding process so far, and whether they could revisit this at a later time. Discussion ensued,with Members discussing rebidding and what they might expect if they did do this. Tharp noted that one concern is that they have the bid process underway already,and that he has discussed this with the FAA already. He stated that he believes that if they did rebid,the FAA would not contribute to the cost of doing this a second time. 2 Iowa City Airport Commission April 10,2008 Page 3 of 9 The discussion continued,with Hartwig stating that his concern is that they don't have much time left on this. He asked David Hughes of Earth Tech for some clarification on time frames. Hartwig noted that the historical aspects of the United hangar were taken care of as planned,and that he believes nothing should uphold the opening of the runway, as they have been planning accordingly all along with this project. Members continued to discuss their concerns,with Dulek responding to time frame questions for them. The discussion turned to whether or not the FAA would even allow the hangar to be moved and installed on Lot 1 in Aviation Commerce Park. Wells questioned if the bids would actually go up,if the Commission chooses to do a rebidding process. He stated that he believes the bid prices would go down. Rettig noted that steel prices have climbed,and scrap metal is a high commodity right now. She also questioned Wells having a subcontract type of deal with whoever is awarded the demolition contract. Wells addressed some of the concerns, stating that the"through the fence" agreement is pretty cut and dried. He added that if you follow the minimum standards,you can still have a "through the fence"facility that will compliment the Airport. He stated that the facility he is proposing could potentially have twenty airplanes at it,and that this would be a sizable addition to the Airport. Wells added that he believes this could be a win-win for everybody involved,with the additional development outside of the Airport fence being a real positive. Rettig noted that she is very much interested in Wells' idea,but that she questions how this can all work. Wells continued speaking to the Commission,explaining what all he has researched in coming up with his proposal. He noted that he has had no response and no guidance from the City in this endeavor,and he questioned the process thus far. He added that the purchase agreement he presented this evening is just for the land,and that it does not say anything about the hangar or a"through the fence"agreement. Wells continued to state his case,explaining how he has gone above and beyond the minimum standards required,based on what he has read about"through the fence"agreements. He talked about swipe card systems, identification facts,and single-vehicle entry points at his facility,items that he claimed the FAA requires. He compared the Merschman agreement with his proposal,and responded to Members' questions about his proposal. Wells added that his purchase agreement does have conditions and time frames for other items that do not have to do with the Airport. The discussion continued,with the Commission reviewing Wells' purchase agreement. Rettig asked for clarification of this offer. It was stated that this offer is for Lot 1 and the outlot. Dulek responded to questions regarding the ITC offer,and clarified some of the issues that Members were unsure of. Members continued discussing what they would like to do,whether to continue with the awarding of the demolition 3 Iowa City Airport Commission April 10,2008 Page 4 of 9 bid or trying to work out an agreement with Wells. Various scenarios were discussed,with Rettig asking what type of expenses are they looking at if they stop the bid process for now and see what happens with Wells. Tharp responded that it's the legal publications for the bid process and whatever staff has to do to the plans. Therefore the republication would not be much,but he is concerned about what the new bids could come in at. Staley talked about having Wells deal directly with Zimmerman on the demolition and obtaining of the United hangar that way. Tharp noted that the FAA has to approve what they come up with. It was pointed out that the bids are for not only the demolition and removal of the hangar,but also to remove the debris and the concrete, and to replant the grass in this area. Wells again talked about how in a case like that,he could offer$30,000 to the contractor for the hangar, and how the contractor would still come out ahead. He added that he is not familiar with Zimmerman Excavation,but that he is familiar with the other three bidders. Farris stated that they needed to make a decision and move on. He added that as a steward of the Airport, and with the money and funding that they have,as well as the runway extension and the amount of risk that he sees at the moment,he believes is beyond what they should take on at this time. Farris moved to consider Resolution A08-13 Accepting Bids and Awarding Contract for the Demolition of the"United" Hangar; seconded by Hartwig. Staley added that his preference would be to work out some sort of arrangement to delay the action,but that it is not practical at this time. If they aim to get the extended runway open by July 1, Staley believes they need to move forward. He added that Wells can work out the possibility of obtaining the hangar with the contractor. Dulek responded to this, clarifying Members' concerns. Rettig stated that she will be voting no on this issue,briefly adding that she believes it could be a calculated risk to keeping the United hangar close by. She believes having this hangar on Lot 1 could help relieve space issues. Wells asked if there is a financial penalty if the runway is not opened by July 1,and Members responded to this. Jay Honeck added that he believes Wells has a great idea,and that the Commission is missing a great opportunity if they don't take advantage of this. Motion carried 4-1;Rettig voting no. b. Hertz—Tharp began the discussion, stating that the Hertz lease is before the Commission as there have been some changes to their operations at the Airport. He added that the Commission needs to renegotiate the lease basically. Rettig asked if Tharp obtained the information she had requested. She would like to know how many cars Hertz has on the airfield at any given time. Corey Pospisil and Jason Honea spoke to the Commission on behalf of Hertz,and responded to Members' questions 4 Iowa City Airport Commission April 10,2008 Page 5 of 9 concerning their operations. It was noted that Hertz has two full-time employees at present, and plan to add a third in the next month or so. Rettig asked ag.in how many rental cars could be expected to be on the airfield, and was told it could be as high as 50 rental cars,plus employees'. She asked how many spaces Hertz rents from the Airport, and Tharp responded that their lease defines it as seven to eight spaces. The Hertz representatives explained a typical week for their business and continued to respond to Members' questions. Rettig stated that she is all for leasing space to Hertz,but that their lease needs to be redone to reflect the space they are actually using. Hartwig stated that he agrees,as the original lease dealt with the seven to eight spaces at the south end of the lot. He questioned though if they have the space to have 50 cars. The Hertz reps responded again, stating that they would most likely not have 50 cars on the airfield at all times. Rettig asked for more details on the sublease that Hertz has with Jet Air, and stated that she would like to review a copy of this lease. She asked Dulek for clarification on subleases on the airfield,and Dulek stated that most likely there is a provision that there are no subleases without the Commission's approval. Rettig stated that she would make the motion to dissolve this lease with Hertz,and in the interim,negotiate a new lease with them. Horan agreed with her, stating that he would like to see the monthly fee of$100 go to $300,and to lease three more parking spaces to Hertz at$40 a month. The discussion continued,with Dulek responding to questions on the original lease with Hertz. Members also discussed what time frame they will give in renegotiating this lease,and the Hertz reps explained what they need to do on their end. Rettig refined her motion,adding a 90-day time frame to negotiate this lease. Rettig also clarified the lease agreement that Hertz is to continue following,until their new lease is agreed upon. Honea noted that he does not know what the management at Hertz will want to do,and that he will have to go through the channels on his end to see how they want to handle this. Rettig volunteered to serve on the subcommittee that will work with Hertz on the lease negotiations. Rettig made the motion that the Airport Commission give 30-days notice to dissolve the current lease with Hertz,and in the interim a new lease will be negotiated within 90 days; seconded by Horan. Motion carried 5-0. c. U.S. Army—Tharp stated that two issues have come up with this lease. One is that the Army wants more than a 30-day notice to vacate. They would like to have 180 days. Also,Tharp noted that there was a clause that Dulek had some opinions on the"reasonable consideration"issue. Dulek briefly addressed this with the Members. Rettig asked if the U.S. government is actually nine months behind on their lease,and Tharp stated that that is true. Rettig added that they would not accept this from any other lessee. 5 Iowa City Airport Commission April 10,2008 Page 6 of 9 i. Consider a Resolution Amending Lease--Staley moved to consider Resolution A08-10,amending lease; seconded by Hartwig. Motion carried 4-1,Rettig voting no. d. FAA/MOT Projects—Earth Tech i. Runway 7/25—David Hughes addressed the Commission,stating that the Members have a resolution to approve tonight which will accept the work for the Phase 2 runway grading. Hughes added that they have met with the pavement contractor. 1. Consider a Resolution Accepting Work for the Phase 2 Runway 7-25 Extension Grading--Farris moved to consider Resolution A08-11,accepting work for the Phase 2 runway 7-25 extension grading; seconded by Horan. Motion carried 5-0. Hughes added that they are currently in the design phase for the rehab on the remaining portion of the runway. He noted that this would be an overlay. Hughes stated that the FAA has shortened their fiscal year by three-quarters;therefore,he stated they need to have a grant in place by mid-June. He stated that the Commission would need to have a special meeting in order to meet the timeframes being set forth by these deadlines. A discussion ensued on the best time to hold these meetings, and Monday,April 28th,was chosen for a morning meeting to take care of the overlay issue. ii. South Aviation Development Study—Hughes stated that they would be finalizing this report soon. iii. South Taxilane Rehab—Hughes noted that they have met with the City and are working with the contractor on a few issues. iv. North Taxilane Rehab—Survey was completed,and Hughes stated they are in the design phase. v. Jet A Fuel System/AvGas Upgrade—Hughes stated they have met with the FBO and the contractor,and are resolving some issues. vi. Terminal Apron Rehab—Hughes stated that the contractor is basically done,and is requesting an early release of his retainage. 1. Consider a Resolution Approving Early Release of Retainage— Staley moved to consider Resolution A08-12 Approving Early Release of Retainage; seconded by Hartwig. Motion carried 5- 0. vii. Obstruction Mitigation—FAA approval on funding has been received. Mediacom and MidAmerican are lined up to get their pieces done. viii. United Hangar—(Discussed above under 4.a.) 6 Iowa City Airport Commission April 10, 2008 Page 7 of 9 IDOT FY2009 Grant Application—Hughes stated that there are different options for hangars—one being corporate style, and the other is community type t-hangars. He added that they have talked to some hangar manufacturers, and he shared the cost of installation per square feet. A 120 X 120 hangar would be about $1.4 million. Hughes continued to respond to Members' questions regarding the cost of building new hangars. It was noted that the deadline for this grant is May 2"d. The discussion continued,with Members talking about what they may be able to afford to do since the price of steel has climbed so dramatically. Tharp and Hughes shared what they have come up with,cost wise,for a possible hangar project. Rettig asked if they shouldn't look at an 80 X 80 hangar, and what type of revenue they could expect from it. Tharp stated that with Hughes' figures,this would be around$600,000 to build. Hughes asked the Members for a dollar figure so that he can work to see what that would build. Rettig stated a maximum of$650,000 sounds good, and hopefully the State would give them$250,000. After a brief discussion,the Members agreed on the$700,000 range and what type of building could they get for that amount; and what type of return would they get on their investment. Tharp and Hughes will work on gathering this information for the Members. e. Airport"Operations": Strategic Plan-Implementation; Budget; and Airport Management—Rettig had asked questions of Tharp in an earlier email, and they shared this with Members. The first item was a question about unemployment and seasonal employees. Next she asked about Tharp's classification in the budget. Tharp explained that he was hired at 60%time, and Rettig questioned how he could have increased his time without approval. A discussion ensued on this,with Members reviewing how this would have occurred. Rettig explained that the Commission has not approved Tharp to be paid at a higher rate. Dulek stated that they need to decide how they will deal with this from now on. Staley asked if the Chairperson doesn't have the authority to sign the timesheets and to allow Tharp's position the hours it needs. Staley moved that they give the Airport Commission Chairperson the authority to sign the timesheets for the Airport Specialist to authorize payments based on what the Chairperson feels is necessary to get the job done. Horan stated that he is in favor of staying within the budget, and that he found it difficult to count up all the hours for the employees when he was faced with this. He added that there is not much they can do about what's already happened,and that he agrees they need to decide what to do from here on.. Hartwig agreed, stating that he believes they can rely upon the Chair to handle this as Staley has suggested. Staley moved to give the Airport Commission Chairperson the authority to pay beyond the.6 FILE,if needed; seconded by Hartwig. Motion carried 4-1,Rettig voting no. 7 Iowa City Airport Commission April 10,2008 Page 8 of 9 Rettig then asked what they plan to do about this as they are over budget. She asked that the Legal Department address this, and what happens when they have beyond the budgeted 1.6 employees. Horan added, how can they operate over budget. Tharp stated that he also has the snow removal report, and Rettig asked that he hold that for the next meeting. She asked that Tharp explain how they will get through the summer, and where they are going to get the extra money they need for the budget. Staley stated that he has one comment in looking at the total, and times four,he believes they will have no problems. Tharp explained the changes to the various budget lines that Rettig had questioned in her earlier email. Rettig noted the memo from Jeff Davidson that the Members received, and Tharp stated that a request was made from the City Council on how airports are funded elsewhere, and that he received a copy of this memo from the Interim City Manager. Rettig expressed her concerns about this issue. Tharp stated that in his conversations with Hertz recently,it was brought to his attention that there is some roof leakage and that he is working on getting someone out to look at it. Hartwig also noted a concern about garbage in the wash bay area, and Tharp stated that this has been relayed to Hertz personnel. f. FBO Staff Report—Phillip Woolford of Jet Air stated that he didn't have much to add this evening. He noted that they are looking forward to the runway opening. Horan asked how long it is taking to fuel up with the Jet A fuel system, and Woolford responded. It was noted that for the helicopters,it is working well. g. Subcommittees' Reports—Farris stated that as soon as the weather breaks, they hope to start on the shelter. He noted that they will be meeting the first part of May to finalize some fundraising plans. h. Commission Members' Reports—Horan noted that he drove down and looked at the gate that Merschman put in, and that it looks like things are moving forward. Farris stated that he has been meeting with the City Council Members,and he hopes to get Regenia Bailey down for a flight. Farris then spoke about Angel Flight and their thank you to the Airport recently. i. Staff Reports—Tharp reminded Members of the Aviation Conference on April 23 and 24. SET NEXT REGULAR MEETING FOR: May 8,2008, at 5:45 P.M. ADJOURN: Meeting adjourned at 10:13 P.M. S/ISt20°? C s r 'ERSON DATE 8 Iowa City Airport Commission April 10, 2008 Page 9 of 9 Airport Commission ATTENDANCE RECORD YEAR 2008 (Meeting Date) TERM 1/10 2/14 3/6 3/13 4/10 5/8 NAME EXP. Randy Hartwig 3/1/09 X X X X X Greg Farris 3/1/13 X X X X X John Staley 3/1/10 X X X X X Howard Horan 3/1/14 X X — X X Janette Rettig 3/1/12 X X X X X KEY: X = Present O = Absent O/E= Absent/Excused NM= No meeting — = Not a Member 9