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HomeMy WebLinkAbout02-10-2003 Airport Commission Meeting Minutes • MINUTES JOINT MEETING - IOWA CITY CITY COUNCIL & AIRPORT COMMISSION EMMA J. HARVAT HALL FEBRUARY 10, 2003, 6:30 PM COUNCIL MEMBERS PRESENT: CHAMPION, KANNER, LEHMAN, O'DONNELL, PFAB, VANDERHOEF, WILBURN AIRPORT COMMISSION MEMBERS PRESENT: ANDERSON, ELLIS, ROBNETT, MASCARI, THROWER STAFF: ATKINS, HELLING, DILKES, DULEK, O'NEIL, O'MALLEY, KARR TAPES: 03-15, Side 2; 03-17, Side 1 STATEMENT OF JUSTIFICATION FOR MEETING SITE CHANGE: Mayor Lehman read the following statement: "For good cause tonight's meeting was moved from the Iowa City Airport tonight to Harvat Hall on less than 24-hours notice due to equipment difficulties which would have prevented the taping of the meeting if held at the airport." INTRODUCTIONS: BUSINESS/STRATEGIC PLANNING PROCESS: Lehman requested a member of the Airport Commission (AC) walk the Council through the strategic plan that the AC had proposed, addressing what they wished to do and what they hoped to accomplish. Anderson said at the last joint session one of the goals was to put together a strategic business plan for the airport. As a result, they had put together a subcommittee. Thrower and Robnett had volunteered to work on that group and had come up with some recommendations. Robnett said Ellis had spoken with the group prior to her joining the AC about doing strategic business planning. She said it had quickly become clear during her first three or four months as part of the AC that that was needed. There was no one source that she could go to to find financial projections, marketing strategy and growth. "There was no one document." She said the master plan that the airport had had a consultant do many years ago talked about how to care for the airport facilities, the runways, the lighting, etc. It talked in detail about what the elevation of the runway was at one end versus the other end, what the prevailing winds were what percent of time and what they recommended for capital to maintain, to improve or keep what the airport had as hardcore facilities. She had not seen any budgets or financial reports on a monthly basis. Robnett said she had read six months of minutes, but it was difficult to tease out what she perceived to be all the projects the airport was working on. That didn't tell her what other projects the AC also wished to work on, how they would get there and how they would finance those changes or growth. Robnett said following Ellis' suggestion, they had moved forward with looking at strategic planning. She said Ellis had done a significant amount of research including looking at l Minutes City Council &Airport Commission February 10, 2003 Page 2 of 20 companies that provided strategic planning for airports and came up with a list of names and companies, researched them all and then requested RFP to be submitted to the Council for funding. Robnett said she thought it was a very reasonable priced RFP from a very experienced consulting firm. Robnett said they knew they wanted to grow and they wanted to market themselves, but there were things they didn't know as aviation persons or as volunteers with no aviation experience. Items that even Thrower or O'Neil might not know that they could have the benefit of for a few short dollars. Robnett said having done a lot of prior work with strategic planning and pricing consultant's services, she didn't think that was very expensive. She had been told they would never find one for less than $25,000 for the College of Nursing, but after having done her research and homework, she had found one. Robnett said (a consultant) was one of the next steps the AC would need. Robnett said some questions she had were, was it feasible to grow?; was it feasible to have no tax support for operations?; how many airports in Iowa made money?; why did they make money?; why wasn't the Iowa City airport making money as a more than break-even analysis? Robnett said after looking the different types of consulting companies, Ellis had asked a very well prepared group to submit the RFP and she was very impressed with it. Champion asked what was the amount of money in cash? Robnett said $10,000 plus expenses. The gentleman was willing to do the work with the least amount of expenses possible because he knew they were actually in the red. The AP had actually tried to find a local facilitator. She had asked Jude West this past summer if he Would be willing to facilitate and use students and faculty from the College of Business, but he had been booked at that time. Unfortunately she couldn't even get a student team to work on the project, as they had been planning to do, because of the negative press and the fear to put students on such a project. Robnett said the UI had teams that would do marketing, business planning, web site design, programming, all types of student teams 'for free.' Ellis said the correct dollar amount was an estimate of$15,000 plus expenses. They wanted $5,000 up front and would bill by the month. Ellis said the AC had kept expenses down. The office of the vice-president of the consultant's company was located in Denver and it was a straight flight from Denver to Cedar Rapids. It had been his expectation to come to Iowa City only once. That was part of a very tailored proposal. The AC had "cut out all of the extra" and went straight for the things that they thought were very necessary. Ellis said beside the strategic plan, which was the vision, they got the action plan which was the business plan, the key initiatives, and a lot of value added product which were things such as the regional analysis of the airport, how it fit in, and what products they could reliably expect to go into so they didn't sit and spin their wheels during vision planning and get all wrapped about the axel about things they could never do. The consultant was going to keep things very tailored, provide the milestones or a roadmap, so the AC could stay on a track in keeping more with who they were and what type of airport they had. Ellis said by having only the one visit, that • was how they planned to keep expenses down. The visit would be for one week's duration while the consultant gathered information and did interviews. The value added would come out when they received an airport operations manual to review their minimum standards, to help write airport regulations and standards. The consultant would review the airport's leasing policies, do a regional analysis of rents, rent structures and pricing, and things they could do both aeronautical and non-aeronautical — that was value added. The consultant would look at all those things as well as at management practices as part of the things the consultant Minutes • City Council &Airport Commission February 10, 2003 Page 3 of 20 needed to know to help the Iowa City airport develop a strategic vision and an action plan to follow it Anderson said having done a lot of consulting and master planning himself, the only concern he had was he would like to see the consultant here more than one trip, if he could. With two trips, they would get a much better product out of it. Champion asked when would the second trip come? One year later or immediately afterward? Anderson said what he could see happening was the consultant would come to Iowa City, do the research, gather the data and then write the report and make a formal presentation to both the Airport Commission and to the City Council as to what the strategic plan was and be available to answer questions that might come up during the presentation that perhaps only the consultant could answer. Ellis said the consultant had offered that, but he as well as the consultant were trying to keep it as inexpensive as it could be done. Given that in the Airport Commission's point of view they were on a time schedule, they didn't have the amount of time to do a long term analysis over a four-or five-year period. The analysis needed to be done relatively quickly, it would be a 90- day deal. Ellis said the consultant believed we could gather all the information up and produce this vision with the Airport Commission's assistance in a 90-day period, once they started. Lehman asked if it also included a marketing plan. Ellis said yes, it did. Robnett said it was an extensive marketing plan. She said the best part of the plan was the feasibility analysis of the airport the consultant was going to do, potential growth projects that they might be able to take on, and the marketing processes. The consultant had included a large chunk that was free marketing, she had worked in that area. Robnett said there was a substantial amount of free marketing that could be done, it was just how did they do it. That was not her area of expertise, how to do the marketing to the right targeted groups and keep expenses down. Ellis said it was definitely an information plan, not some pie in the sky projection. It was very realistic. Wilburn asked Robnett if she had seen an example of the plan, especially the action plan. Robnett said no, she had not. Ellis said he had talked to the Aircraft Owner's / Pilot's Associations, Airport Support network. They had referenced a website for a copy of an airport business plan that they thought was the best, which came from the American Airport Executive's website, the other trade agency which was actually an accreditation agency for airport management. An example that was used for the industry was the one developed by the same company that the AC was trying to hire. It was very extensive, and much more extensive than anything the AC would try to develop. That was the advantage of bringing in a third-party industry expert. Wilburn said when they had discussed this before and Ellis had mentioned a strategic/ business plan and an action plan, he had been thinking more of the action plan piece — such as "here is how we are going to come up with the fund" Wilburn said he was glad it incorporated that. Robnett said based on the RFP she thought that was more of what it was. It was very "To Do" focused, not theoretical. Wilburn said they had mentioned a specific time table, he was glad they were focusing on that. Wilbum said he thought the Council's focus was on the action planning piece, but what ever else the AC walked away with was fine too. Minutes • City Council &Airport Commission February 10, 2003 Page 4 of 20 He said another example was the Senior Center Commission, who had realized that they were going to have a deficit. Without going through this process and coming up with a strategic or master plan, they had really focused on an action plan for themselves. Wilburn asked if they could speculate how it would benefit us more or what was it preventing us, with the AC getting right at that 'here is what we need to do to come up with.' Wilburn said it might be a step type of thing where this would be a first step and the next time it would be something more broad. He said another example was the Parks and Recreation Commission who had been discussing a Parks and Recreation Master Plan for several years, but in the mean time they had re-evaluated their fees structure and kept true with the policy that fees had to be so much. Anderson said he thought they were really doing some of those short term things. Such as the North Commercial area which was one of those that through sales and leases they could increase cash flow to decrease indebtedness. They had just in the last year increased hangar, etc rents to bring quick capital in. He said the key thing came down to the process. Anderson said in his business every year when they did the business plan, they looked back to a session their six offices had done as a corporation four years ago. They'd spent quite a long time developing the vision for their company by asking, who do we want to be; where do we want to go and what do we want to do. He said on a year-by-year basis when they develop the business plans for that year, they always go back to and look at what was the vision for where they wanted to be and how were they tracking that year to year progress at getting toward their vision. He saw the airport in the same position — unless they really knew where they were going, how did they know what business plan they needed to develop or how to get there. It would be like jumping in with the cart before the horse. If they didn't know where they were going, how did you know what to do to get there? Pfab said the Senior Center program was not working too well. He wanted to caution Wilbum against using that example. Lehman said that was totally another issue. Pfab said perhaps in the fact that the Council had thought it was solved and it really was not solved, perhaps that would be a reason why the AC would take a harder look at the present. O'Donnell said no one had thought it was solved. Lehman asked if there were questions from the Council for the airport commissioners relative to the strategic plan and what they envisioned or what the airport commissioners envisioned Lehman also asked Atkins to join in the session. Kanner said he had some problems in that he felt if a strategic plan were going to be done, he would like to see more of an overall point of view, the main purpose was to see how the AC was going to be independent of City funds within "x" number of years. He said North Commercial had also been mentioned. Kanner said they still did not have an idea of how that was going to affect the bottom line. It was unknown how it would affect the budgets in the future, they did not have a plan. If the AC wished to do a strategic plan that would look at making them independent in 5 years, Kanner said he would be more likely to say, lets vote for it. But he did not hear that as the over-riding, over arching goal of the Plan. That was one of his major concerns with the Plan. Kanner said he thought Atkins had touched on that in his memo to a certain extent. Their main concern right now was the budget, for this year and the next few years down the road. City Council saw their subsidies to the airport going up from the general fund, they were continuing to pay debt obligations, again from property tax which was a different levy. Kanner ' Minutes City Council&Airport Commission February 10, 2003 Page 5 of 20 said that was a concern for him, he needed to see that more directly addressed in a strategic plan than what the AC was projecting. Anderson said as they had mentioned on numerous occasions, the sale of the land in the North Commercial area would take care of the immediate debt burden that the airport had to the City. He said, in actuality they would put some money in the bank that they could draw on for use. Anytime a project came along, such as the extension of the runway or any capital improvement project, that money had to be used for, it had to be used until it was gone, then the federal government would pitch in again. Anderson said at some point in time they would be right back where they were now, if they couldn't get enough business out there. Lehman said that would be taken under the next item on the agenda, but he understood what Anderson was saying. Lehman said he would assume, from his perspective, that a strategic plan looked at the long term value of the airport and where they wanted to be 5, 10, 15 and 20 years from now. "A goal". Anderson said that was correct and hopefully more ways to entice more businesses out there. Lehman said then they started filling in the blanks as to how to get to what the goal was. Atkins said the memorandum that he had directed toward the AC was, as Kanner had pointed out, that their thinking was somewhat similar. It seemed to Atkins that until their financial house was in order, there was very little predicting and projecting that the AC could do. They'd had an economic analysis done in 1994 of the airport. They'd had that information available to them. Atkins said he was concerned reading the phrases "the long term value", because they had to be prepared that the assessment might be that it was not the value that they thought with respect to the economic indicators for the airport. Atkins said he felt that as a matter of policy the City Council had said that the airport would be a functioning part of the package of municipal services and therefore the airport needed to be run as efficiently and effectively as could be. It was a financial issue, the subsidies were growing far greater than any of the other operations. Until they got the airport in line, Atkins said they could wish for all sorts of things, but a strategic plan that didn't have the backing of a city council and/or its own home grown revenues, was not going to do a whole lot of good for the City. Robnett said they as Commissioners were all volunteers and realized that the Council would love it for the AC to develop a strategic plan and give them something more focused, but they could not. They all had full time jobs. Part of what the plan would do was talk and evaluate about potential feasible options that they could implement to grow the airport. She said none of the Council Members were taking on the analysis for how and whether to bring utilities to City owned utility. It was the same question. Could the AC invest in some planning and some money to actually get up and get going? Robnett said part of the reason was they couldn't say it wouldn't become completely independent was because how feasible was it and how many places in the United States were totally independent. She asked O'Neil to answer, "How many airports in the state were making more than break-even'?" O'Neil said he didn't know the exact number. He said, for an example, today's newspaper had had an article about Waterloo, a commercial service airport, who was trying to do some different things so they didn't have to pay out of their general fund. They were a commercial service airport and certainly had more avenues to raise revenue than a general aviation airport did. Robnett said at one point, O'Neil had told her that three airports in the state were making more than break-even. Atkins said that was fine, he understood that. But the Council needed to say that they expected to subsidize. If they expected to subsidize, the extent to which they were going Minutes City Council&Airport Commission February 10, 2003 Page 6 of 20 subsidize was something that they would have to decide, but they couldn't make that decision until they had some sense of what the financial resources were that the airport could generate. It seemed to him to be silly to make a long term strategy when they didn't have the money in the bank to ultimately finance it. Thrower said the strategic planning proposal that they had put forth might be a misnomer in the sense that he heard a great deal of focus being applied to the long range elements of it. They were also saying that went hand in hand with the long range elements, which were literally the tactical implementation, which was literally to the City Manager's point. The short term need and need assessment targeted actions that needed occur for this activity to move forward. If they didn't have their short term house in order they would never reach the long term objective. Any strategic plan that missed the tactical implementation would be wanting. Thrower said another point that had not yet been touched on was the notion, an objective third party. He said clearly the current AC had the ability to apply certain techniques and skills in the amount of time available to all of them that they had to attempt to put something together. He said it might be called into question in regards to overall objectivity. The AC had really wanted to have some 'third eyes' came to the table, look at this proposal compared to national and regional standards and apply the national/regional standards objectively to the airport's current infrastructure and make some hard recommendations back to the AC and back to the City Council through the AC Thrower/Robnett subcommittee. Thrower said he thought having both the long term, the short term, as well as the objectivity of the consultant really created a more digestible response to what the City had been asking them for. Lehman requested to move on to item #3. AIRPORT FINANCIAL SELF-SUFFICIENCY (NO TAX SUBSIDY): Lehman said he had been on the Council for nine years. He thought there had always been some subsidy from the City to the airport. It was his understanding that that was true of most airports. There had always been an interest on the part of the City, as he was sure there had been an interest on the part of the airport to generate as much of the funds as necessary to operate the airport. Lehman said he had a real personal problem with the City having an ultimate goal of the airport being self sufficient, he didn't know if the airport could be totally self sufficient. He didn't believe that a policy that said the airport would be absolutely self sufficient was a good policy, it was not one that was in the best interest of the airport. Lehman said the first item under this agenda section was to establish a goal. For him a goal would be to generate as much of those funds as they possibly could, within the frame work of what they had. Beyond that and as long as the airport was well run, well managed, a great operation, it might very well over the years have to have subsidies of varying amounts from the City. Champion said they subsidized a lot of transportation, there was no question about it. She said she didn't really think the airport could be totally self sufficient. She thought the Council's goal was to make them as self sufficient as possible. She said she didn't know what had happened, but she felt the amount of money they were subsidizing now was a lot of money out of the general fund. They could blame 9-11 or the economy or a lot of things, but she thought the quick escalation had kind of frightened the Council. They didn't have the money, it would have to come from some other service. Wilburn said certainly it was reasonable to have an expectation, such as with Parks and Recreation which was a self-imposed goal, that fees would cover a certain percent. Minutes • City Council & Airport Commission February 10, 2003 Page 7 of 20 Mascari said to keep in mind that the reasons the AC had moved forward in trying to sell the property in the north area was to eliminate the debt that the airport had incurred in putting in the infrastructure in the first place. The last estimate that they had received from their realtor was that the property was worth $.40 per square foot, which added up to be a little over 5 million dollars. The amount that the City had loaned the AC to put in the infrastructure in was right around 1.6 million dollars. He said the biggest obstacle, the biggest thing that caused the jump in the subsidy was the fact that they had the main big hangar built a couple years ago, and then lost their tenant He said with the sale of the property, they could see how they could relieve and pay off the debt of the infrastructure, pay off the debt on the big large hangar building, and pay off the remaining debt of the T-hangars that had all been built in the last few years. That would allow them to take the rent that was being received right now for all the 1- hangars and apply it toward the operating budget. Mascari said one thing that they had to keep in mind, which was very important, was that they were mandated by the FM that any funds generated by the FAA had to remain with the airport. That meant that any excess funds that they got out of the North Commercial area sale had to be used for airport development. The problem with that was the FAA typically gave 90% loans on any project. If they saw a balance In the checking account, the 90% would go away. Until that was gone, at which time they would kick back in with the 90%, that was why the AC said that it would be short term. Once the funds were gone, they would be back in the same ball park. Champion asked Mascari to explain what he meant by short term. Mascari said once the funds were gone from the sale of the property by doing airport improvements, then the FM would start with their 90% again. But as long they saw a balance in the checkbook, the 90% went away. Vanderhoef asked if the sale of the land had to go into capital projects or could it also be used for operations? Mascari said he could not answer that. O'Neil said he thought it could go to either one. Lehman said as long as it was airport related it could go to either one. Vanderhoef said when Mascari was talking about money in the checkbook, if it was obligated for airport maintenance, obligated for Ron's salary, all those kinds of obligations, if it was obligated would the FAA still kick in with the 90%? Mascari and Anderson said no. She said Anderson and Mascari were saying, 'when the checkbook is empty', but she was saying, "Here is the budget which says that this much is going out each month of this money for operations." Anderson said they would have to ask the FAA that question. Mascari said to keep in mind too that all the revenues that were being received right now for rents, T-hangars and such, would be free and clear money which they could apply toward the operation of the airport. He said they did have, even without a strategic plan, some goal in mind. Pfab asked for a clarification, Mascari had said that any funds from the sale of the property had to go to the airport, so did that mean that they could not pay off the City debt? Lehman said that was incorrect, that was airport. Lehman said they needed to make something very clear right now. He'd heard what Mascari had said, but there was the airport policy thing that Atkins had written which essentially said the proceeds from all sales would go directly to debt, so that all debt would be retired for the airport. Lehman said he thought that was good business. Anderson said he thought so too. Lehman asked if everyone was all in agreement on that. The consensus, except Champion, was yes. She said she was not in full agreement on it. She said she didn't think they should sell all the land. Minutes City Council &Airport Commission February 10, 2003 Page 8 of 20 Mascari said that idea had been tossed around too, the idea to sell enough of the property to retire all the debt. If they were talking a little over $5M, they probably owed the City less than $3M, which would leave a balance in the checking account. Mascari said if they did not sell all of the property and leased the balance of the property, they could use the lease payments as operating too. Champion said she thought that was a valid thing to do, if it was possible. Lehman said, "IF they could lease it." Champion and Mascari said they didn't know yet if they could lease it. Ellis said they had only given the whole leasing operation one year before they were sort of compelled to doing something else. Champion said she didn't object to them selling part of the land, she thought it was great, it was kind of like eating chocolate when a person wanted something sweet, it took care of it. But you had to diet afterwards. Champion said she hated to see them sell all the land, but if they ended up having to do so eventually, she could live with that. She didn't think the leasing thing was really bad, the roads were already there, the land was pure gold. Lehman said it could be part of the plan that they put together. Atkins said he had calculations that might help to focus the discussion of points A, B, C in Section III. The value of the Aviation Commerce Park (ACP)when sold would be about $5.5M if it all was sold. That would be the income. The outstanding ACP debt was $1.7M. The City had other outstanding obligations from the airport that they were financing. In total, the ACP plus hangars, master plans, other expenses of capital, total $5.4M. Atkins said what he was trying to accomplish by this policy was that they would focus all the proceeds toward the airport. If all the land was sold at $5.5M and they could pay off all the outstanding debt at $5.4M, they were right back at his initial point that they needed money to operate the airport. They could sell ACP and get out of debt, all the debt, if they chose to do so. Or they could choose to focus the payment. Mascari asked Atkins what he meant by the master plan debt. Mascari said they couldn't pay that back, he didn't think that was something that was required of them by the City Council. Atkins said that was his point, that was where he was going. Mascari said they had discussed that last year. Atkins said there were Council Members who were interested in seeing all the debt repaid. Mascari said he thought they needed to discuss that with the FAA first. Atkins said he agreed with Mascari on that, he was not arguing about that. He said that the Council needed to focus its debate, in limit or take it all away with respect to the outstanding debt at the airport. Mascari said he thought that really needed to be discussed with the FAA. He said he didn't think they were allowed to do that. The 10% match that they had to put in with the FAA on their grant money was not something that they expected to be put back using the airport property. Lehman said that was something they could work out. Atkins said if that was the case, they could split out the master plan expense, and cover hangars, terminal improvements, fuel tanks and thing such as that. Atkins said but the important thing to get back to the point, was that they still needed money to operate, to run the day to day. Atkins said he agreed with Mascari's point. He was trying to show the Council the simple arithmetic of the value of the asset they were about to sell off, ACP, the outstanding debt, it was truly coincidental, that they were very close to the City's obligations at the airport. The policy position that he had written and distributed was intended to focus all the money toward payment of airport obligations. If the Council chose to continue to finance through the debt service levy, master plan for example, they could certainly chose to do so. Minutes City Council &Airport Commission February 10, 2003 Page 9 of 20 Lehman said if the north airport property were all sold and all the debt was paid off, and if all the revenue were unencumbered, he wondered how far they would come from covering their costs right now. They might come very very close. Champion said, "But was it a smart idea to sell all the land?" Ellis said the next time they needed to build a T-hanger, they would have to borrow the money, they would be right back to where they were now. Atkins said that is where they as a Council had to decide in collaboration with the AC, if they looked at the policy position, he had made the assumption that their priority for repayment was ACP. There was other outstanding debt. Atkins said they had raised that question with him in the past and he felt the obligation to show that in the policy. The items were listed in order of priority. If everything was paid off, what ever was left would go into an improvement reserve depreciation account because right now to run an enterprise fund for the airport they should have a depreciation account in order to replace some of the capital assets that were out there. Kanner asked Atkins what he was referring to. Atkins said he had written the policy yesterday and given it to Ron, who apparently had given it to only some of the members of the Commission. Atkins said it was very straight forward. Robnett said the conclusion Atkins had just come to was the same conclusion the AC had come to. They didn't plan on selling all the airport land if it was feasible not to. Regardless they were going to get to a point where they had to be self sufficient. That took time to develop those means and it didn't happen overnight. She said what she did for the College of Nursing was start new businesses. It was very rare that a new business even broke even within the first three years. They had to start now so that after they paid all the money off, they had revenue streams coming into the airport. They couldn't wait, if they waited they would be back in the same hole again in which they existed now, in debt beyond their eyeballs. That was a huge chunk of what the plan proposed — what could they do, what was feasible, how could they market the airport and how could they proceed to get the new revenue generating services working for the airport. Lehman said he thought one key thing was when they did the North Airport Commercial, they were thinking of leasing the property. They had set it up on a 20-year payment period and the airport was going to pay so much a year extended over 20-years, just as the hangar rents were going to be used to pay off the notes on the hangar. Lehman said what he was hearing at the meeting, and he thought it was correct, the revenue from the sale of the North Airport Commercial would be applied to whatever outstanding debt they had at this point on hangars and the infrastructure on the North Airport Commercial. He had been told the airport would be free and clear of capital debt. He didn't recall that the issue of master plan had been an issue. He said he thought there was another issue that they had to get cleared. Lehman said he was sure there were FM regulations relative to the sale of airport property, how proceeds from sales and leases were used, and he thought that the City needed to have copies of those regulations. It would prevent the Council from having the questions is this or that okay? He said the regulations should be in written form which would be to both of their benefits so there would be no questions. Lehman said he heard the Council saying that they would use the revenue to retire the debt. He said he suspicioned that as the North Airport sold, it would be a lot easier to lease property if there were buildings going up there than it would be as a vacant property. They might decide at some point that leasing was better than selling because then they would have a revenue stream, which along with the rents from the hangars would go a long way toward making the airport self sufficient. Minutes City Council&Airport Commission February 10, 2003 Page 10 of 20 Lehman said another issued they had touched on, but he had not heard a definitive answer on was, was the Council of an opinion that the airport must be self sufficient? Champion said she thought, "As near as possible. The goal should be to be self sufficient," Lehman said he agreed with that. [There was over lapping discussions if this should be listed as a goal or not]. Lehman said the goal would be self sufficiency but the Council would recognize that from time to time the airport might need a subsidy from the City. Atkins said, "Why not make the goal self sufficiency, back into the number, and then they could assess the consequences." Atkins said as a statement, "We will be sufficient.", indicating that that was the outcome and not just a tentative goal. He said in doing so, if airport hangar rent had to go from ten to twenty dollars, that was unacceptable in this market, so then they would have to make an adjustment. Atkins said when they aimed at nothing, they hit it every time. They needed to have a goal, and then they could back off from the goal and the Commission could report back to Council that they had to take these sorts of financial steps in order to bring the airport subsidy toward some identifiable numerical point. Atkins said hopefully they could design a policy similar to the City's own reserve position where they had the five-year floating average policy. Robnett said that is why she had felt so naked without financials, she had always been responsible for financial aspects of department in hospitals she had been in. That was exactly what they had done. Atkins said they had to be hard on themselves. Robnett agreed saying once they had established the dollar figures, where they needed the help was how did they get to those dollar figures. To her that made total sense, the shot-gun-shooting hoping they made some money was not good. Mascari said he wished to remind the Council that the airport was not a service that they provided. It was in fact a facility, not unlike other facilities within the City. Fortunately for them, their facility had the ability to generate some income. They applied the income toward the operations of the facility. It was in fact a facility, it was not something they did for other people as a service. It was not something they could charge more money for because they were providing a service for them. Lehman said they understood that, but it very definitely was a service. If it weren't for the service aspect, it would not be an airport. There would be no reason to have an airport. Mascari disagreed. Lehman said it was a service, it served the community of Iowa City. Mascari said it was a facility that served the community. Ellis said he thought it was also important to know, that if they wanted to reduce costs at the airport, they had talked about cost reductions at their last joint Council/Commission meetings. The AC had told Council that they had cut expenses just about as low as they could go. They hadn't added anything and nothing had changed. The top three things they paid for were: debt resurfacing, employee costs and electricity. Below that were very miniscule amounts of money and they had done things like reduce janitorial services. Ellis said those were inconsequential amounts of money that could be reduced from the operating budget. Lehman said he thought Ellis was exactly right. Vanderhoef said reduction was not the problem, it was the income. Ellis said income had to stay with what the market would allow them. Lehman said Ellis was correct. Ellis said that was in the grant assurances that the FAA sent them, that the ideal of self sustaining on an airport was just that, an ideal, which was an almost unattainable one because of market conditions. Ellis said it was important to know that there were over 13,000 airports in the United States. Over 5,000 were public owned, public use airports. 360 were operated with airlines, of those 300, 80% were self-sustaining. Ellis said he had called and checked with a number of places on self sustaining airports. He had found two commercial airports that did not have commercial service which were totally self sustaining. One was in Nebraska where they had discovered oil on the property, the second Minutes City Council &Airport Commission February 10, 2003 Page 11 of 20 was DuPage. Champion said they were not arguing that. Ellis said the self sustainment issued needed to go to rest. Lehman and Champion said it was a goal. Ellis said it was exactly that, a goal. Kanner said the airport industry was one of the most heavily subsidized with public dollar industries. Ellis said that was a fact. Kanner said he thought it was at the expense of other more widely used more beneficial ones. He said getting back to a point that Lehman had made earlier, he thought the AC did a fine job of what they were doing, The question was up to the Council of what they wanted to do, they were the ones who needed to set the goal from their perspective. He thought self sufficiency was possible. Kanner thought they should set a goal and could do it at a gradual level, similar to what was done for Parks and Recreation. For example, starting with 50% of the total operation repayment was subsidized by the City and • eventually working it down to a zero over a number of years. Kanner said he thought it was within Council's realm to say that. He said, as had been mentioned, that future Councils could also change that. He thought it was up to them, as a Council, to set the goal and then say to the AC, "Make it work." Just like they set the broad policy in others and said to Staff or to the City Manager, Make it work. Anderson said the airport was used by a lot of other people besides Iowa City, If the Commission knew how many businesses came in (here) that were going out to Coral Ridge Mall, the airport was providing services for more than just Iowa City. They were providing for Coralvilfe, North Liberty, Johnson County and the University was a very large user. He asked if there was any way of getting some revenue from the different users. Lehman said no, it would probably not happen. Vanderhoef said there had been an article in Monday's paper regarding Waterloo and Cedar Falls doing just that very thing. Initiating an airport tax or some such thing that covered a lot more people so that one city didn't have to carry the burden for the region. Kanner said that is what he had suggested. He said he thought the Council would set the goal and it would be up to the AC to initiate ways to meet the goal, such as charging people not of the City a higher price and start charging landing fees. Kanner said it was up to the AC to figure out how to get that (revenue) and how to get it from other communities through increased fuel fees or hangar fees or fund raising. There were a number of different ways. Ellis said they had addressed landing fees at the last joint Commission/Council meeting. They were not allowed to charge landing fees, that was a state requirement. Champion said they could not price themselves out of the market. They were an airport. Lehman said the market would dictate that. Kanner said, "Who was the market for?" Ellis said this was one of the things that the third party consultant could help them with. Kanner said approximately 600 persons a week used the airport, which was miniscule compared to the other transportation systems that they put money into. Roads and public transportation, tens- of-thousands used them every week. Kanner said to Champion, the question was, "How much did the Commission want to give for approximately 600 people a week using the airport. " He had gotten his figures from Ron. The airport was not used by a great amount of persons. Ellis said 68% of the traffic in and out of the Iowa City airport was non-local. They were not people who lived here. They were people who either flew in to conduct business, be tourists or buy and sell things. Minutes City Council &Airport Commission February 10, 2003 • Page 12 of 20 Lehman said they had one thing decided about what they were going to do when they sold the property. Lehman asked if it was it fair to say that the goal of the Council was to ask the airport to be as nearly self sufficient as they could possibly be. He said he didn't think that was any different than what the AC's goal was right now. The AC agreed with Lehman. Atkins and Vanderhoef said they either needed to say 'self sufficient' or 'not self sufficient'. Vanderhoef said, "Don't say, as nearly as possible." Atkins said he meant his next statement respectfully, "It was half pregnant." Pfab said he'd heard Mascari make a statement, but he was not sure that he understood it correctly. Pfab said Mascari had said that as long as there was money in the checkbook, the federal government would not go back to a 90-10 help facility. Pfab asked if it was to an advantage to be totally self sufficient. Pfab said he wanted to ask about the study the AC had. Who were the people that they had looked at? Were they the people who had drawn up the master plan for the industry group or for more than one big airport? Ellis said they were the same folks that gave them the proposal for their strategic vision plan. Pfab asked what were their credentials? Ellis said they were a nationally accredited airport planning firm. They didn't do businesses for FPO's, they worked almost exclusively for airports. Pfab asked if they had a track record? Ellis said that was correct, they had written some of the documents used by an accrediting agency. They had a very broad expertise. Pfab said he thought perhaps, or perhaps not, now was the time to take and spend money to have the consultant. He was aware of other cities and operations not too far from Iowa City who'd had miserable histories and opted to utilize a consultant service and were now doing a heck of a job. Lehman said that was what the AC was telling the Council. Mascari directed a question to O'Neil. Mascari said he knew there was something in the grant assurances that the FAA put out that addressed self-sufficiency. Ellis read, "An airport is supposed to be financially self sufficient and as sustaining as possible given the circumstances that exist at that airport." Mascari said what they were trying to say was that they were already mandated by the FAA to do just what the Commission was telling them to do. Ellis said the document went on and on to discuss the market and conditions that would prevent an airport from becoming self-sufficient. Lehman said he thought what the Commission would be telling them was that they didn't want them to be half pregnant, they would like them to be self-sufficient. Kanner said he thought the Commission had to set the goal, a definite, yearly goal. O'Donnell said they could have bake sales at the airport, but he didn't think that was realistic. Kanner said they had an animal shelter that had fund raising, there were a number of commissions, there was Parks and Recreation and they could ask more from the AC. O'Donnell suggested that Kanner get together with the AC to discuss his proposed sales. O'Donnell said he had a question on leasing versus selling. He asked if the FAA mandated how a property could be leased, for example number of years. Lehman said yes. Ellis said the FAA's original issue with leasing was that they didn't want a property leased so long it became a sale. He said as far as they could research, the reality of the industry was that a 99- year was possible. That was about as close to a sale as one could get. Ellis said other airports had done so, but they had not specifically addressed it. The FAA had allowed them to go forward with the sale, he didn't think, especially given the way the airport was set up, if they sliced off that land and once it had become developed, it would not be returnable to airport Minutes City Council &Airport Commission February 10, 2003 Page 13 of 20 use. He didn't think either the FAA or the AC would encourage, as they had discussed at one of their meetings, the broker. If they could offer a 99-year lease, would it help them in attracting some business? He said that was again one of the things that they hoped to find an emerging trend or some practical concepts from the business consultant. The consultant knew what was out there, what was working and what wasn't. Anderson said they had had many discussions. He said the AC was on the same page as Champion, they would rather be leasing if they could. It was a much better deal than selling. That was their goal. Champion said she hated to have them sell all of it, but she thought selling part of it was a really good idea. It might inspire persons to lease once they got some buildings out there, it would not be just a little isolated area. Champion said she thought the AC all did as good a job as they could, there had been some circumstances and the economy had not been the best to help finance or to help anything. She said, as elected officials, they all got pressure from persons who didn't like the airport, not everyone liked it. Champion said she really wanted to see them maintain their autonomy, and she didn't want to be forced to have the City take over the airport. Lehman said it seemed to him that for a number of things that they had been discussing he didn't know if anyone really knew the answers. Lehman said he thought that if nothing else, they were making a really good case for some sort of strategic plan. He said as far as the time to become self sufficient, he didn't think they knew enough to be able to tell the AC on "this date" you will become self-sufficient. He said neither the Council nor the Commission had a basis yet for establishing an exact date. Lehman said there was more that they didn't know than they did know, and they knew they didn't know. Champion said she knew that Atkins didn't have this in the budget. She asked what they had left in the Council budget? She said she thought if they could finance a water study, perhaps they could also finance this study. Lehman said he thought that if they did go forward with a strategic plan, one of the goals of the plan had to be self sufficiency. Anderson said that had been their goal for a long time. Vanderhoef said from the memo, if they were talking about the $50,000 that was placed in the Council budget, there would perhaps be some left over [$35,000 for the electric and $10- $15,000 left over.] She said there was one other point that she wanted to make people aware of but it wouldn't probably effect what they did. She said the sale of the land would put it into private property, which then became taxable and assisted the general fund. Having the balance between leased and purchased was win-win for both parties. Lehman said even the leased property had to pay taxes on it. Vanderhoef said they would pay on the building but not on the leased property. Kanner said they were asking for TIFS, which he assumed would be on the building part, which would abate any taxes for a number of years. Several Councilors replied, "If we approve it." Vanderhoef said one by one they would look at each project. Kanner reminded the Commission to keep in mind that there might not be any [sentence unfinished], that the Council tended to approve TIFS. Champion said they liked TIFS. Vanderhoef said the TIF was there for an economic development tool that built the tax base that would continue to produce taxes over a very long period of time. She said when they looked at 3-5 years on a TIF or declining abatement of taxes, that was still a good investment in her mind. Minutes • City Council &Airport Commission February 10, 2003 Page 14 of 20 • Atkins asked Lehman what the Council had decided. Lehman said he thought that they had agreed that the goal of the airport was self-sufficiency. Lehman said, speaking for himself, he didn't think they could put a date on self-sufficiency. There had to be something come back to them in the way of a plan that said we believe we can do it by"date". Lehman said the Council might decide that the time was too long and negotiate something. Unless they had numbers and data to work with, there were so many variables, if the economy went sour and they didn't sell land for three years, or if it was all sold in one year, --there were so many variables. Mascari said they were very fortunate that they had the land to sell. Many airports didn't have that option. Lehman said he thought the land was really choice stuff. Champion asked if they were all agreeing to the strategic plan. Anderson said that is what he thought he'd heard. Atkins said he was asking if they had confirmed the strategic plan. Lehman asked, "Do we agree that the strategic plan is a necessary part of what they were asking the Airport Commission to do?" Pfab asked for a clarification of what Lehman was asking. Multiple Councilors answered him. Vanderhoef said they were asking the City Council to approve financing and the Council had chosen to finance it. O'Donnell said the AC had come to the Council asking for help and he was in favor of it. Lehman asked if they concurred. Kanner said he went along with Atkin's memo, he thought they had to.get other things in order before they approved the strategic plan. He said Atkins memo addressed issues that he also had concerns about, so he was not in favor at this time of approving it. Vanderhoef said with the plan that they had, it was very difficult to reach the spot where Atkin's memo was talking about on the marketing and the value of the assets to create money. She thought it was a total package. She was willing to go so far as to say to get where they needed to go she thought they needed the whole package, not just a start of the money and try to work backwards. Champion said one thing that they had talked about last time was the airport manager reporting to Atkins on the everyday business or weekly or monthly business. Lehman said he thought that would come up under item 7. Wilbum said he was okay with going forward with the strategic plan, but they had to have the piece to answer the question. Lehman said he didn't think they could get the pieces without it. Wilburn said he understood that, but if they walked away from the strategic planning process without that piece, then it had failed. Robnett said then they would not pay them, that was part of the product that they were asking for. Lehman said they had 6 to in favor of moving forward with the process. Atkins said it would be his intent, since the Council had taken it as far as they had, that he would authorize a transfer to the contingency which meant that they could virtually begin as soon as possible. He asked Lehman if that was what they wanted. Lehman said he thought that was what they wanted. Kanner said to partially answer Champion's question, O'Neil met with Atkins and the other staff weekly during a staff meeting. Champion asked if they agreed that the funds would come out of Council money. Lehman and Atkins said they would come out of contingency account, that was why they had an emergency account. Lehman said that that was coming out of this fiscal year and they were talking about Minutes • City Council & Airport Commission February 10, 2003 Page 15 of 20 next fiscal year. Atkins said in response to Vanderhoefs question, then the likelihood in the upcoming budget, they were over budgeted for the public power study, assuming it came in at the projected $34,000 figure. Atkins said they were in Fiscal '03, the AC wanted to start this thing and he wanted to be able to authorize release of the money so they could go get their contracts put together. MARKET AIRPORT SERVICES: Lehman said his personal feeling was this was part of the AC strategic plan. A question and personal observation that he had that related to a public relations, marketing, etc, was, he could not understand why the Airport Manager's office was not located in the terminal building. Lehman said they didn't put the City Manager's office in Public Works, at the water or sewer plant. Atkins thanked Lehman for that. Lehman said when someone flew in or someone from the public went to the airport, the Airport Manager was not accessible. Ellis said he absolutely agreed, but right now they were on a lease that gave all the property to the businesses there. He said it would be tough to go back and renegotiate. Lehman questioned, "All of it?" Ellis said in the terminal, other than the public spaces, the offices all belonged to the businesses and they used them all. Mascari said the public space right by the windows on the main floor belonged to the City. Mascari said it was generating revenue. Lehman asked if he could suggest that they talk to the people down there to see if they could work something out. He thought it was to their advantage as much as to the rest of the community that the Airport Manager be visible. Ellis said they were actually negotiating with them on some issues of that very nature. Lehman said he thought it was important and he didn't think they'd had the negative comments about the airport nearly in the last 3- or 4-years that they'd had previously. Ellis said they had put a beautiful facility out there. Lehman said for the AC's sake, the public's sake and for the persons who flew in and out, it would really be nice if they could walk in and see Manager over the door and they would have someone there. Ellis said marketing was one of the value added projects that would come out of strategic planning. Champion asked the AC to explain what their revenues were. O'Neil asked her if she wanted specifics or generally what an airport received? Ellis said airports got money from renting land and space. They either rented the concessions, rented the farms, rented the businesses. He said if it had commercial traffic it could charge a landing fee. If it had passenger terminal it could charge a passenger service fee which was where commercial airports made their profit. The Iowa City airport would rent the land, build buildings and rent hangar space in those buildings or rent land to farms or businesses. That was where the capital funds came from. The industry average for an airport was $10 of invested revenue gave a $1 return. Anderson asked O'Neil what was the airport's income on a monthly or annual basis for all those things. O'Neil said about $155,000 to $160,000 was what they budgeted. Ellis said $160,000 was the projected income for next year. Minutes City Council &Airport Commission February 10, 2003 Page 16 of 20 Vanderhoef asked how much of that was encumbered in paying back for the hangars, leases, etc. There were several fixed expenses that had to come out first. Lehman said 100%, they had subsidized them $180,000. He said it took $340,000 a year to operate the airport. Atkins said that was not correct. Master plan and some of those expenses were being financed by debt service, they were separate levies. Lehman said it took $340,000 to make the debts on the loans, Atkins said that was incorrect, it was not all the loans. They had loans that were being financed through the debt service fund. He said that is why he was bringing up that it was an aggregate. Anderson said he didn't think they could answer this question. Lehman said those were the types of questions that they needed to answer. Ellis said when they talked about airport self sufficiency, what they would probably only ever be able to do was come up with operating budget, the money it cost to turn on the lights and run an airport. When they went beyond that into debt servicing and capital improvements, Ellis said he doubted that the airport would ever become self sufficient regarding that side. Ellis said the goal for self-sufficiency would be that they would be able to turn on the lights, pay the employees and run the airport with the monies generated from within the confines of the airport. • PROJECT UPDATES: Atkins said improving internal controls were a result of the report they had done and things were doing very well. Lehman asked if they knew the timeframe for runway extension. Atkins said some of the items had been put on just to allow the Council to ask questions. Anderson said they were proceeding with the process of getting environmental impact statements done. He didn't know the exact schedule, but they were on track so far. Lehman asked if it was correct that the North/South runway would close only after the extension was completed. Anderson said that was correct. O'Neil said if they continued to get the federal funding it was projected for Fall '05, at the soonest. Champion said she would suggest only selling enough land to payoff the immediate debt. Ellis said that would be something that they would need to coordinate with the Council because of the way the agreement was written. It put the sale on the Council's shoulders, they were the sellers. Lehman said there was a much larger issue too. If they listed all the property with a commercial real estate agent and the agent thought it was alt for sale and suddenly there was a buyer and the Council said no.... Lehman said it all hinged on the strategic plan. The Plan might come back with a recommendation that only 40% be sold or it all be sold, no one knew yet. Robnett said they had talked about this issue with the realtor. They had told the realtor that they might not want to do an all or none type of deal. There were people who were approaching the AC who would potentially do leases first, for instance the Civil Air Patrol. Robnett said because they were a government agency, they would be much more interested in leasing than in buying and owning assets. Vanderhoef said if they were looking at the long term and the AC was looking at 2005 for the runway paving, did the Council know that they had 10% of that to come as a capital project. She said she would like to know what type of dollars they were looking at. Anderson said it was in the capital improvement budget submitted. Vanderhoef said she had not seen it. Minutes City Council &Airport Commission February 10, 2003 Page 17 of 20 Champion said she hated to keep nagging, but wanted to get an answer on this issue. Since the strategic plan might take a while and they had a realtor in charge of selling the land, what if the whole package was sold before the Plan was done? - Anderson and Robnett said it was a 90-day project. Ellis said he didn't think anything would happen that fast. With that area being fenced off already, it was less a part of the future plan of the airport than what they owned right now. There would be other development opportunities on the western side once Mormon Trek was finished. Ellis said what they were looking for from the consultant, especially on the airport side, was where were the aeronautical opportunities at the airport. They had brought in businesses and business aircraft to help pay the airport's way which would allow the businesses there to hire more mechanics, to pump more fuel, use more of the runway. Ellis said that was where they hoped to bring self sufficiency to the airport. Not by selling bit/pieces of land or doing other things non- aeronautical, that was the emerging concepts they hoped to bring forward. Ellis said when the consultant's report arrived, if they said don't sell that land, the AC would listen. Champion questioned what investor would invest if they want to buy all the land. Robnett said over the past six months their experience had shown that that was not the case. Lehman said they had also not been able to sell it. Robnett said she'd been referring to inquiries, they had paid attention to inquiries. Ellis said the Council had also placed some restrictions during the leasing as far as people buying or leasing the land. They had had a certain amount of time to start building. They just couldn't do a speculative purchase. Lehman said the Mormon Trek extension was out for bid but was a two construction season project. The completion of Mormon Trek would pretty much coincide with the completion of the runway extension, which would also coincide with the closing of the North/South runway. He said he guessed that there would be a significant amount of airport and non-airport property that would be available for development. Anderson said it would be no where near as large as the north section had been. Mascari said he thought now was a good time to ask if O'Neil had had time to check with the FAA regarding that. Lehman asked regarding what. Mascari said it appeared that the road would actually penetrate a portion of airport property. They needed to make sure that the FAA would allow that to become for non-aviation uses before they went forward. O'Neil said, where a road was put, as long as it met safety standards, the FAA would tell persons that was a local decision. Mascari requested they get it in writing, he thought that was important. O'Neil said he wanted to clear up what had caused some very puzzled looks on the Commissioner's faces about the 5.3 due. O'Neil said Atkins had included everything that the City had used bond money for. That included the fuel system, the renovation of the terminal building, some 10% matches, some of which the Council had looked at as a capital project and agreed to pay for. That was the number, the 5.3 was what was out there that they had used bonds to pay for. O'Neil said at the Commission level they were talking about the infrastructure for ACP and the hangars, that was why there was a big difference in the numbers. Minutes . City Council &Airport Commission February 10, 2003 Page 18 of 20 Mascari asked O'Neil if he would check on the prior referenced issue with the FAA. O'Neil said he already had. Lehman said at some point they needed to sit down and get the list of items that they agreed on that were capital. For example, the terminal building was to be remodeled as a municipal facility and there had never been any intention from the Council's perspective that that was to be repaid with airport monies. Lehman said he felt they needed a laundry list. Kanner said they had talked earlier about the sale of the property and the lease payments covering all capital debts except possibly the master plan, which they thought might be exempt. He asked if they were still going with that. He asked Atkins what was his understanding. Atkins said his understanding was ACP for sure. He had asked that a report be prepared that showed all other outstanding debt which was being financed by the debt service fund and or internal loans, knowing that the master plan piece of the list of projects might be encumbered in some fashion by the FAA. Atkins said they had not decided on how to split that out. Kanner asked if Atkins had the requested list. Atkins said he had just gotten/finished the list that afternoon and was going to prepare it in a fashion that was easier for the arithmetic and send it out to the Council. Kanner said so they as a Council had to again decide their position and then work with the AC on whether they wanted to Include all of it or not and make a policy statement. Atkins said the debts had already been incurred, bills were already being paid. It had become a matter of how did they wish to use ACP resources, that was the policy decision that they as a council had to make. They had not made that decision yet. Anderson said looking down through the list, the decision to go ahead with things had been made based on discussions with the Council. To them as a Commission, for example it had been clear that they did not need to pay back the terminal. Champion said it had been a very conscious decision on the part of the Council. The building was an outstanding building and was being allowed to deteriorate. They had felt it was a City asset, they tried to keep all their buildings very well maintained. This one was being allowed to totally fall apart. Champion said the other issue was it was an entrance to the City. They tried to protect and keep them in good shape. Champion said she agreed with Lehman, there had been an obligation on the airport's part. It had been a Council decision to redo the building, not an AC. Anderson and Champion agreed that it had been a much bigger issue. Vanderhoef requested Atkins to copy the AC when he had the list ready. Atkins said they were actively involved in putting together an annexation plan for all the properties in and around the airport, particularly as a consequence of Mormon Trek extended. They also had a sewer project that was listed in the capital improvement budget. Atkins said the clear intent was that the airport was not going any where, it was where it was going to be. The traffic system around it was being designed in a fashion to accommodate their interest as well as general economic development policy interest. Lehman said at some point in the Mormon Trek process, they would get some idea how much airport commercial property would be available and how much the road added to the inventory of the property that the airport would be able to sell. At some point he believed, if the road Minutes City Council &Airport Commission February 10, 2003 Page 19 of 20 went adjacent to the airport, part of the cost of the road might be assessed to parcels that it served. Vanderhoef requested persons to keep their ears open for any clean fill to place in the south- west area. ROLE OF COMMISSION AND ITS RELATIONSHIP TO COUNCIL AND CITY MANAGER: Lehman said from his perspective as a council person, and he suspicioned the same was true for Atkins, he felt someone needed to speak for the Airport Commission. Someone needed to be in charge, the buck had to stop someplace. Lehman asked, "Who is that person?" Ellis said in total, it would be the Chair of the Commission, but they used the Airport Manager as their conduit for information. Lehman said who should the Council and who should the City Manager talk to? Mascari said to the Airport Manager. Thrower and Anderson shook their heads in affirmation. Lehman said for example when they requested copies of the FAA regulations relative to revenues from the leasing and sale of airport property, they could expect that to come from O'Neil. Several Commissions said yes. Anderson said with regard to policy, that would come from the Airport Commission. With regard to management and day-to-day, that would come from O'Neil. Lehman said most of the information that Council and the City Manager needed were not in regard to policy, they were in regard to day-to-day operational issues. Anderson said that would come from O'Neil as he knew that stuff better. Lehman asked if Atkins needed something from the airport, he should be able to call O'Neil. Anderson said that was correct, he thought that was already happening. Kanner said to Lehman he didn't understand where Lehman's question was coming from. They received that information already. Lehman said over the years there had been lots of spokes persons for the airport. He said there really needed to be one person who was the final authority, who received that authority from "you". He said he assumed that person would be and should be the Airport Manager, but that was something that needed to be clear. OTHER BUSINESS: Lehman requested other business for the evening. He said, to recap: • They had agreed that the sale of the commercial property, the proceeds would go to retired debt. ' Lehman said a lot of this was precipitated by what probably would be characterized by the public as a bit of a surprise. Lehman said he would ask that although the AC had the authority to sign leases, if there were going to be negative surprises for the Council and for the general fund, that those sorts of things be communicated to at least the City Manager before they happened. He said nothing might change, but there would not be any surprises. Minutes City Council &Airport Commission February 10, 2003 • Page 20 of 20 • They were going to do the master plan. • They did have an agreement that self sufficiency was the goal for the airport. • The marketing was something that they would expect from the master plan. • They hoped that the Airport Manager's office became located into the terminal building. • O'Neil would be the spokesperson for the airport when it came to the City Council and to the City Manager. • They would get copies of FAA regulations relative to the sale and/or lease of the property so they could be kept on file. Mascari asked how would they determine about the payback regarding the numbers Atkins had versus the numbers that the AC had? Lehman said they'd get the numbers first then go over them. He suspicioned that there probably would be very little disagreement as to which ones. Those that they did not agree on they would sit down and talk about. Anderson said he appreciated how quickly the meeting had been put together. Lehman said he apologized for not having addressed this earlier than what they did. Lehman said he believed in the airport, it was a real asset to the community. He thought it could be better and liked the idea that they needed a roadmap to know where they were going, so as not to be flying by the seat of their pants. ADJOURNMENT: 8:00 p.m. Minutes submitted by Candy Barnhill