September 2014 Meeting Minutes

Open­ing:

The Board Meet­ing of the Pana­ma City-Bay Coun­ty Air­port and Indus­tri­al Dis­trict was called to order at 9:00 a.m., Sep­tem­ber 24, 2014 in the Air­port Board Room by Chair­man Bruett.

The Invo­ca­tion was giv­en by Ms. Pat­ty Mitchell.

The Pledge of Alle­giance was led by Chair­man Bruett.

The Exec­u­tive Sec­re­tary called the roll and indi­cat­ed that all Board Mem­bers were present.

Pre­sen­ta­tion:

Mr. Har­ry Friends, Project Man­ag­er with RESPECT of Flori­da, pre­sent­ed the North­west Flori­da Beach­es Inter­na­tion­al Air­port a plaque in hon­or of being select­ed Cus­tomer of the Year.

Mr. Ian Crelling, Prin­ci­pal Plan­ner with Bay Coun­ty, pro­vid­ed a pre­sen­ta­tion to the Board regard­ing the recent updates to the West Bay Sec­tor Plan.

Approval of Minutes:

The August 27, 2014 Board Meet­ing Min­utes were approved as distributed.

Reports:

Mr. McClel­lan pre­sent­ed and reviewed the activ­i­ty report. Ms. Hen­der­son pre­sent­ed and reviewed the finan­cial report.

Con­sent Agenda:

a. T‑Hangar Lease Modifications

This item pro­vid­ed for Board approval of mod­i­fi­ca­tions made to the stan­dard T‑Hangar Lease at the North­west Flori­da Beach­es Inter­na­tion­al Air­port regard­ing the renew­al term and util­i­ty usage fees.

Fol­low­ing Board dis­cus­sion, Mr. Scott made a motion to approve the mod­i­fi­ca­tions to the T‑Hangar Lease, pend­ing sat­is­fac­to­ry review by legal coun­sel. Mr. Fore­hand sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

Busi­ness Items:

a. Air­port Insur­ance Program

This item pro­vid­ed for Board selec­tion of a com­pa­ny to pro­vide insur­ance cov­er­age for lia­bil­i­ty, workman’s com­pen­sa­tion, com­mer­cial fire (build­ings), vehi­cle, pub­lic offi­cials and employ­ment prac­tices lia­bil­i­ty and law enforce­ment lia­bil­i­ty insurance.

The var­i­ous insur­ance cov­er­ages asso­ci­at­ed with the Airport’s Insur­ance Pro­gram will expire on Octo­ber 1, 2014. As part of this year’s bud­get­ing process, Staff solicit­ed insur­ance quotes by pro­vid­ing local insur­ance agents with exist­ing cov­er­age lim­its and poli­cies, and as a result, received quotes from two local insur­ance agents. The two agents who sub­mit­ted pro­pos­als were Mr. Bob Bell, rep­re­sent­ing Brown & Brown Insur­ance for the car­ri­er Pre­ferred Gov­ern­men­tal Insur­ance Trust (PGIT), and Mr. Joseph Ash­brook, rep­re­sent­ing Fish­er Brown Bot­trell for the car­ri­er Pub­lic Risk Man­age­ment (PRM).

There were many dif­fer­ences between the two pro­pos­als received, includ­ing dif­fer­ences in pre­mi­ums, deductibles and cov­er­age amounts. Fish­er Brown Bot­trell, the agency which pro­vid­ed the PRM quote, did not pro­vide a quote for lia­bil­i­ty insur­ance. This is an essen­tial part of the airport’s required cov­er­age. The agent relayed that the air­port could either con­tin­ue to pur­chase the lia­bil­i­ty insur­ance from Brown & Brown, or sign a let­ter autho­riz­ing Fish­er Brown to pro­vide the cov­er­age quot­ed by Brown & Brown. Staff pre­pared a detailed review of the pro­pos­als sub­mit­ted for Board consideration.

Both Mr. Bob Bell and Mr. Joseph Ash­brook addressed the Board and answered ques­tions regard­ing their respec­tive proposals.

The pro­posed FY-15 Air­port Oper­at­ing and Cap­i­tal Improve­ment Bud­get includes suf­fi­cient funds to cov­er the amounts quot­ed by either agency.

Fol­low­ing dis­cus­sion by the Board, Mr. Fore­hand made a motion to select Fish­er Brown Bot­trell through their car­ri­er PRM to pro­vide the airport’s insur­ance cov­er­age. Ms. Mead­ows sec­ond­ed the motion. The vote was tak­en and the motion passed 6 to 1 with Mr. Lee opposing.

b. FY 2015 Oper­at­ing and Cap­i­tal Improve­ment Budget

This item pro­vides for Board approval of the FY 2015 Oper­at­ing and Cap­i­tal Improve­ment Budget.

A draft of the FY 2015 bud­get was pro­vid­ed to the Board and dis­cussed in detail at the Sep­tem­ber 16, 2014 Board Work­shop. Dur­ing the bud­get work­shop, the Board expressed con­cern over the esti­mat­ed cost per enplaned pas­sen­ger. After amend­ment to the draft bud­get, the cap­i­tal reserve was reduced to $100,000 in order to keep the cost per enplaned pas­sen­ger below the $8.00 lev­el. At the time of set­tle­ment, the cap­i­tal reserve can be adjust­ed to increase the reserve amount, based on pas­sen­ger activity.

The FY 2015 Oper­at­ing and Cap­i­tal Improve­ment Bud­get includes oper­at­ing rev­enues of

$12,243,957 with oper­at­ing expens­es of $7,971,379. The bud­get incor­po­rates the debt ser­vice require­ments for prin­ci­pal and inter­est pay­ments of 3,089,600 for the two SIB loans, along with pas­sen­ger facil­i­ty charges of $1,606,592 leav­ing a net require­ment from air­port rev­enues of $1,482,982. The remain­ing net rev­enues avail­able for the cap­i­tal pro­gram and reserve accounts are $1,130,081. The bud­get con­tains a .6% decrease in oper­at­ing expens­es over the esti­mat­ed FY 2015 expense bud­get, and a 4.3% increase in oper­at­ing rev­enues for the same period.

Fol­low­ing Board dis­cus­sion, Mr. Math­is made a motion to approve the FY 2015 Air­port Oper­at­ing and Cap­i­tal Improve­ment Bud­get, with the cap­i­tal reserve reduced to $100,000. Mr. Fore­hand sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

c. Rental Car Con­ces­sion Agreements

This item pro­vides for Board approval of the Rental Car Con­ces­sion Agree­ment that has been nego­ti­at­ed with the rental car com­pa­nies for the North­west Flori­da Beach­es Inter­na­tion­al Airport.

In Octo­ber 2011, the Dis­trict entered into a Rental Car Con­ces­sion Agree­ment with Avis/​Budget, Enter­prise, Hertz, Alamo/​National and Dollar/​Thrifty to oper­ate at the air­port. Those agree­ments allowed for each con­ces­sion­aire to pay a month­ly con­ces­sion fee of 10% of gross receipts and a $4.50 per rental day Cus­tomer Facil­i­ty Charge (CFC) in lieu of pay­ing rents for ser­vice sites, ready return areas and ter­mi­nal counter facilities.

At the end of each year, Staff then cal­cu­lates the annu­al rental cost for land val­ue, oper­at­ing and main­te­nance costs and debt ser­vice for the con­struc­tion of the rental car facil­i­ties, and com­pares that to the amount col­lect­ed in CFCs for the year. If there is a short­fall, the rental car com­pa­nies are assessed an addi­tion­al amount to cov­er the short­fall. If there is a sur­plus, that fund­ing is held for future reha­bil­i­ta­tion and expan­sion of the rental car facilities.

The cur­rent agree­ments are due to expire on Sep­tem­ber 30, 2014. The new term request­ed is for a three year peri­od begin­ning Octo­ber 1, 2014 and expir­ing on Sep­tem­ber 30, 2017. There are two one-year options which may be exer­cised at the dis­cre­tion of the District.

In addi­tion to updat­ing the rental rates reflect­ed in the agree­ment, a clause has been added that will real­lo­cate the ready return spots, if there is a 10% change in mar­ket share.

Approval of the updat­ed Rental Car Con­ces­sion Agree­ment will have a pos­i­tive effect on the FY15 Oper­at­ing and Cap­i­tal Budget.

Fol­low­ing Board dis­cus­sion, Mr. Scott made a motion to approve the Rental Car Con­ces­sion Agree­ment and autho­riza­tion for the Board Chair­man to exe­cute the nec­es­sary doc­u­ments. Mr. Pilch­er sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

d. Lease Amend­ment – Sheltair Aviation

This item pro­vides for Board approval of an amend­ment to the Lease Agree­ment between the Dis­trict and Sheltair Aviation.

Sheltair Avi­a­tion has pro­vid­ed FBO sup­port ser­vices to gen­er­al avi­a­tion trav­el since the open­ing of the air­port in 2010. In opti­mistic view of the growth pro­ject­ed for the air­port, Sheltair exe­cut­ed Amend­ment 1 to the orig­i­nal Lease Agree­ment in August of 2010 request­ing their premis­es be expand­ed to 20.12 acres with the rent com­menc­ing two (2) years fol­low­ing the orig­i­nal lease com­mence­ment date of June 29, 2010. In 2012, Sheltair exe­cut­ed Amend­ment 2, which cre­at­ed Option Parcels, and added a small par­cel to address admin­is­tra­tive issues.

Sheltair has request­ed to mod­i­fy their lease and devel­op Amend­ment 3. Amend­ment 3 would include; mod­i­fy­ing the Option Par­cel in Amend­ment 2 by remov­ing approx­i­mate­ly 5 acres, which will be devel­oped as an air­craft park­ing ramp; adding Option Par­cel 3 and; a mod­i­fi­ca­tion of the effec­tive date of the Lease Agree­ment for rent cal­cu­la­tions only.

The finan­cial impacts would be as follows:

• Option Par­cel 2 would con­tin­ue as defined in Amend­ment 2 and would be mod­i­fied upon sub­stan­tial com­ple­tion of the addi­tion­al ramp space. The ramp and the areas required as part of the ramp would be added to the lease at $.33 per square foot.

• Option Par­cel 3 would begin as a new Option Par­cel under the same cost struc­ture as defined in Amend­ment 2.

Approval of Amend­ment 3 would be addi­tion­al rev­enue esti­mat­ed to be $77,625 annually.

Fol­low­ing Board dis­cus­sion, Ms. Mead­ows made a motion to approve Amend­ment 3 to the Sheltair Lease Agree­ment and autho­riza­tion for the Board Chair­man or his designee to exe­cute the Amend­ment fol­low­ing sat­is­fac­to­ry legal review. Mr. Pilch­er sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

Exec­u­tive Direc­tor Reports:

FEMA: Mr. McClel­lan updat­ed the Board regard­ing the FEMA claim and the repair sta­tus. He stat­ed that two small projects would be going out for bid with­in the next two months.

Chair­man Bruett addressed Ms. Mead­ows about the recent arti­cle regard­ing the expi­ra­tion of the Wal­ton Coun­ty bed tax. Ms. Mead­ows stat­ed that the issue would be going back before the Wal­ton Coun­ty Board of Coun­ty Com­mis­sion­ers and stat­ed that she would coor­di­nate a meet­ing with Mr. McClel­lan and the staff from Wal­ton Coun­ty to dis­cuss the issue.

Mr. Pilch­er asked that Staff con­tin­ue to mon­i­tor the bud­get very close­ly to ensure that the air­port is receiv­ing the most in return for the mon­ey bud­get­ed through the var­i­ous line items.

Pub­lic Comments:

There were no pub­lic comments.

Adjourn­ment:

The reg­u­lar meet­ing was adjourned at approx­i­mate­ly 10:15 a.m. (CST).

Pat­ty Mitchell, Exec­u­tive Sec­re­tary Till Bruett, Chairman