September 2015 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 23, 2015 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 except Mr. Chris Forehand.

Recog­ni­tion:

Mr. McClel­lan acknowl­edged team mem­bers from Delta Glob­al Ser­vices, which received the STAR (Start The Air­lines Right) Award at ECP for the month of August 2015. The ECP sta­tion com­pet­ed with 160 oth­er sta­tions nationwide.

Approval of Minutes:

The August 26, 2015 Board Meet­ing Min­utes were approved as distributed.

Reports:

Mr. McClel­lan pre­sent­ed and reviewed both the Activ­i­ty Report and the Finan­cial Report.

Con­sent Agenda:

a. Lease Agree­ment – HAE­CO Amer­i­c­as Line Ser­vices, LLC

This item pro­vides for Board approval of a Lease Agree­ment with HAE­CO Amer­i­c­as Line Ser­vices, LLC.

Fol­low­ing Board dis­cus­sion, Mr. Scott made a motion to approve the Lease Agree­ment with HAE­CO Amer­i­c­as Line Ser­vices, LLC and autho­riza­tion for the Board Chair­man or his designee to exe­cute the lease. Ms. Mead­ows sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

b. Space/​Use Agree­ment – Delta Glob­al Services

This item pro­vides for Board approval of a Space/​Use Agree­ment with Delta Glob­al Services.

Fol­low­ing Board dis­cus­sion, Mr. Math­is made a motion to approve the Space/​Use Agree­ment with Delta Glob­al Ser­vices and autho­riza­tion for the Exec­u­tive Direc­tor to exe­cute the agree­ment fol­low­ing sat­is­fac­to­ry legal review. Mr. Scott sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

c. Ser­vice Agree­ment – HVAC Sys­tem and Components

This item pro­vides for Board approval for the renew­al of an agree­ment with Trane Build­ing Ser­vices to pro­vide sched­uled main­te­nance ser­vices for the three com­mer­cial air and water cooled chillers and asso­ci­at­ed sys­tem components.

Fol­low­ing Board dis­cus­sion, Mr. Lee made a motion to approve renew­al of the Ser­vice Agree­ment with Trane Build­ing Ser­vices for main­te­nance on the HVAC sys­tem. Ms. Mead­ows sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

Busi­ness Items:

a. Air­line-Air­port Use and Lease Agreement

This item pro­vides for Board approval of a new Air­line-Air­port Use and Lease Agree­ment for the sig­na­to­ry air car­ri­ers serv­ing the air­port effec­tive Octo­ber 1, 2015.

The cur­rent Air­line-Air­port Use and Lease Agree­ment with the sig­na­to­ry air car­ri­ers was approved in 2011 and was good through Sep­tem­ber 30, 2015. Staff has final­ized nego­ti­a­tions with the pas­sen­ger air car­ri­ers and devel­oped a basic plan that allows for a charge of two basic rates, one for land­ing fees and one for ter­mi­nal rental. The land­ing fee rate rep­re­sents the total costs asso­ci­at­ed with oper­at­ing the air­field cost cen­ter and includes all oper­at­ing and main­te­nance costs, along with debt ser­vice costs for con­struct­ing the air­field. The ter­mi­nal rental rate includes both the debt ser­vice and O&M costs in the ter­mi­nal com­plex cost cen­ter and is charged on a rentable square foot calculation.

The agree­ment pro­vides for the con­tin­ued build­ing of cap­i­tal reserves and sets aside up to $2,800,000 over the term of the agree­ment, pri­or to any rev­enue shar­ing cal­cu­la­tion. The rev­enue shar­ing com­po­nent of the agree­ment is deter­mined by tak­ing all oper­at­ing rev­enues less oper­at­ing expens­es, cap­i­tal equip­ment, annu­al debt ser­vice and cap­i­tal reserve. The remain­ing rev­enues are then dis­trib­uted 50% to the sig­na­to­ry air carriers.

Approval of this agree­ment will pro­vide the basis in deter­min­ing air­line rates and charges on an annu­al basis for use in cal­cu­lat­ing the budget.

Fol­low­ing Board dis­cus­sion, Mr. Scott made a motion to approve the Air­line-Air­port Use and Lease Agree­ment and autho­riza­tion for the Board Chair­man to exe­cute any nec­es­sary doc­u­ments upon review and approval by air­port legal coun­sel. Mr. Math­is sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

b. FY 2016 Air­port Oper­at­ing and Cap­i­tal Improve­ment Budget

This item pro­vides for Board approval of the Fis­cal Year 2016 Air­port Oper­at­ing and Cap­i­tal Improve­ment Budget.

A draft of the FY 2016 bud­get was pro­vid­ed to the Board and dis­cussed in detail at the Sep­tem­ber 9, 2015 Board Work­shop. As a result of the Work­shop, salaries and ben­e­fits were reduced by $40,000, reflect­ing decreas­es in the mer­it pool and goal incen­tive pool, and insur­ance costs were reduced by $5,000, reflect­ing sav­ings as a result of guar­an­teed pric­ing by PRM, the airport’s cur­rent insur­ance provider.

The FY 2016 Oper­at­ing and Cap­i­tal Improve­ment Bud­get includes oper­at­ing rev­enues of

$13,346,098 with oper­at­ing expens­es of $8,203,900. The bud­get incor­po­rates the debt ser­vice require­ments for prin­ci­pal and inter­est pay­ments of $3,089,574 for the two SIB loans, along with pas­sen­ger facil­i­ty charges of $1,606,578 leav­ing a net require­ment from air­port rev­enues of $1,482,996.

The remain­ing net rev­enues avail­able for the cap­i­tal pro­gram and reserve accounts are $1,533,845. The bud­get con­tains a 3.8% increase in oper­at­ing expens­es over the esti­mat­ed FY 2016 expense bud­get, and an 8.4% increase in oper­at­ing rev­enues for the same period.

Fol­low­ing Board dis­cus­sion, Mr. Scott made a motion to approve the FY 2016 Air­port Oper­at­ing and Cap­i­tal Improve­ment Bud­get. Ms. Mead­ows sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

c. Exten­sion of Adver­tis­ing Con­ces­sion Agree­ment – Clear Chan­nel Airports

This item pro­vides for Board approval to extend the Adver­tis­ing Con­ces­sion Agree­ment with Clear Chan­nel Inter­space Air­ports (Clear Chanel).

In June, 2005, the Board award­ed the Adver­tis­ing Con­ces­sion to Inter­space Air­port Adver­tis­ing, now Clear Chan­nel, and an agree­ment between the Dis­trict and Clear Chan­nel was executed.

The Agree­ment allowed for an exten­sion of the ini­tial term if the Con­ces­sion­aire met twelve enu­mer­at­ed stan­dards detailed in the Agree­ment. In June 2009, before the relo­ca­tion of the air­port, the Board agreed that Clear Chan­nel had met or exceed­ed all of the stan­dards, and an exten­sion of the term was grant­ed through Sep­tem­ber, 2015.

The Agree­ment also allows for one or more addi­tion­al five-year exten­sions with mutu­al agree­ment of the par­ties. Clear Chan­nel has con­tact­ed Staff about exer­cis­ing an exten­sion option, and Staff has been work­ing with Clear Chan­nel to reach accept­able terms. In con­sid­er­a­tion of the exten­sion, Clear Chan­nel has agreed to:

• Increase the tech per­cent­age pay­ment to the Dis­trict from 23% to 30%.
• Install a dig­i­tal dis­play in the area of the main ter­mi­nal doors that could be used by the air­port to wel­come pas­sen­gers and high­light area events.

The bud­getary impacts will be min­i­mal as the Dis­trict would be pro­vid­ing util­i­ties to the dig­i­tal dis­play. Addi­tion­al­ly, the increase in the tech per­cent­age pay­ment will increase revenues.

Fol­low­ing Board dis­cus­sion, Mr. Math­is made a motion to approve the exten­sion of the Adver­tis­ing Con­ces­sion Agree­ment with Clear Chan­nel for the five-year option peri­od, and autho­riza­tion for the Board Chair­man or his designee to exe­cute any required doc­u­ments fol­low­ing sat­is­fac­to­ry legal review. Mr. Pilch­er sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

d. Group Insur­ance Par­tic­i­pa­tion by Retired Employees

This item pro­vides for Board approval of a pol­i­cy regard­ing health insur­ance for retirees in accor­dance with Flori­da Statutes.

Under Flori­da Statute 112.081, any Spe­cial Dis­trict that pro­vides health insur­ance for its employ­ees and their depen­dents under a group insur­ance plan or self-insur­ance plan shall allow all for­mer per­son­nel who retired before Octo­ber 1, 1987, as well as those who retire on or after such date, and their eli­gi­ble depen­dents, the option of con­tin­u­ing to par­tic­i­pate in the group insur­ance plan or self-insur­ance plan. Retirees and their eli­gi­ble depen­dents shall be offered the same health and hos­pi­tal­iza­tion insur­ance cov­er­age as is offered to active employ­ees at a pre­mi­um cost of no more than the pre­mi­um cost applic­a­ble to active employ­ees. The cost of these pre­mi­ums would be borne by the retiree or his/​her dependents.

The City of Pana­ma City, which admin­is­ters the District’s health insur­ance, has agreed to allow Dis­trict retirees to par­tic­i­pate in the health insur­ance plan. Approval of this pol­i­cy would not impact the bud­get, as the cost of any retiree pre­mi­ums would be borne by the retiree and not by the District.

Fol­low­ing Board dis­cus­sion, Mr. Lee made a motion to approve a pol­i­cy allow­ing Group Insur­ance par­tic­i­pa­tion for retired employ­ees. Mr. Pilch­er sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

e. Trans­fer of Prop­er­ty to the City of Lynn Haven

This item pro­vides for Board approval of the trans­fer of prop­er­ty from the Dis­trict to the City of Lynn Haven.

In July 2005, the Board approved the sale of prop­er­ty locat­ed in the Hugh Nel­son Indus­tri­al Park to Blue Water Prop­er­ty, LLC. This land sale exclud­ed canal prop­er­ty along the south­ern bor­der of the Indus­tri­al Park and per­haps oth­er ease­ments and minor prop­er­ty inter­ests in the adja­cent areas.

Staff request­ed that legal coun­sel per­form a title search and it was dis­cov­ered that the canal was not includ­ed in the land sale at that time. The search was incon­clu­sive regard­ing ease­ments and oth­er minor prop­er­ty inter­ests. It would not be cost effec­tive, how­ev­er, to defin­i­tive­ly deter­mine the District’s own­er­ship of all inter­ests in the area, since it is clear that the Dis­trict does not own any plat­ted parcels or oth­er sig­nif­i­cant land nearby.

Based on the Dis­trict hav­ing no reg­u­lar pres­ence near this canal or the Hugh Nel­son Indus­tri­al Park and the poten­tial for premis­es lia­bil­i­ty and main­te­nance costs asso­ci­at­ed with own­er­ship, staff and legal coun­sel rec­om­mend that the Dis­trict trans­fer the own­er­ship of the canals and any oth­er near­by prop­er­ty inter­ests to the City of Lynn Haven. Staff from the City of Lynn Haven are in agree­ment and would rec­om­mend that the City accept the prop­er­ty as part of the Indus­tri­al Park.

Fol­low­ing Board dis­cus­sion, Mr. Pilch­er made a motion to adopt a Res­o­lu­tion for the trans­fer of the prop­er­ty to the City of Lynn Haven, and autho­riza­tion for the Board Chair­man or his designee to exe­cute the nec­es­sary trans­fer doc­u­men­ta­tion, fol­low­ing legal review. Ms. Mead­ows sec­ond­ed the motion. The vote was tak­en and the motion passed unanimously.

Exec­u­tive Direc­tor Reports:

Mr. McClel­lan advised the Board that the Dis­trict also owns one remain­ing par­cel of land locat­ed on Lisen­by Avenue, near the for­mer air­port site. Mr. McClel­lan will work with the air­port attor­ney regard­ing issues relat­ed to final set­tle­ment of this property.

Mr. McClel­lan informed the Board that Sheltair Avi­a­tion had expe­ri­enced a strong sum­mer and had an increase of approx­i­mate­ly 20,000 gal­lons in fuel flowage.

Pub­lic Comments:

No pub­lic comments.

Adjourn­ment:

The reg­u­lar meet­ing was adjourned at approx­i­mate­ly 9:35 a.m.

Pat­ty Mitchell, Exec­u­tive Sec­re­tary Till Bruett, Chairman