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HomeMy WebLinkAbout2015-04-01 Meeting Minutes New Hanover County Airport Authority April 1, 2015 Page 1 NEW HANOVER COUNTY AIRPORT AUTHORITY REGULAR PUBLIC MEETING April 1, 2015 CALL TO ORDER The New Hanover County Airport Authority met on Wednesday, April 1, 2015, at Wilmington International Airport, 1740 Airport Boulevard, Wilmington, North Carolina. Chairman Perritt called the meeting to order at 5:02 p.m. Airport Authority members present were; John Perritt, Chairman, Jonathan Crane, Vice- Chairman; Tom Barber, Secretary; Donna Girardot, Dan Hickman, Carter Lambeth and Thomas Wolfe. Also present were Julie Wilsey, Airport Director; Gary Broughton, Operations Director; Jim Morton, Finance Director; Whitney Prease, Facilities Director; Rose Davis, Executive Assistant; and Wanda Copley, New Hanover County Attorney. Guests present included Amy McLane, Talbert & Bright, Inc.; Tracy Montross and James Bodnar, American Airlines; Chris Stephens; Yiannakis Ioannou; Hal Reichardt; Aldo Baldessari; Ryan Evans; Mike Adams; Thomas Goodwin; Butch Truelove; and Bill Cherry. APPROVAL OF MINUTES The Authority has reviewed the minutes of the Regular Public Meeting on March 4, 2015. Mr. Lambeth MOVED, SECONDED by Mr. Barber, to approve the minutes of the March 4, 2015 Regular Public Meeting as submitted. Upon vote, the MOTION WAS APPROVED UNANIMOUSLY. SPECIAL PRESENTATION Tracy Montross, Regional Director of Government Affairs of American Airlines, addressed the Authority with an update on the integration with US Airways and American Airlines. Ms. Montross reported that American has approximately 100,000 employees with 10,500 of those being at CLT (including catering, cargo and a major training center) and another 1,400 at reservation call centers in Winston-Salem and Cary. American also employs approximately 50 at nine NC commercial airports, with 35 employed at ILM. Ms. Montross stated that CLT is the second largest hub for the new American. Ms. Montross shared that the US Airways/American merger was a complimentary merger of two airlines with a very different presence across the country. Since the merger American has added 35 destinations to four new countries. American is the largest airline in the world based on daily departures and will continue to expand its presence internationally. Ms. Montross reports that American has added new aircraft and hopes to have the youngest, most modern fleet in the industry. On average 2 new planes arrive per week to the American fleet. Ms. Montross shared that of note to regional partners like ILM; American is phasing out the 50-seat regional jets and adding 90 of the new 76-seat regional jets as part of the merger. ILM should start seeing new CJR900s coming through ILM. Ms. Montross noted that during the integration so far, American has hired 7,200 full time employees; joined operations at 110 airports; launched the wor New Hanover County Airport Authority April 1, 2015 Page 2 OneWorld; taken delivery of 132 new aircrafts in 2014; integrated the cargo division; and, just recently merged the frequent flyer programs. Ms. Montross advised that on April 8, 2015, the FAA will award the Single Operating Certificate which allows American Airlines (AAL) to begin reporting to DOT as one carrier instead of two. Other milestones in the upcoming year include the single reservation system and the single website. Ms. Montross shared that American is investing in its employees, its equipment, and in airports and the customer experience while they have the capital and cash available and will continue to run the airline as though oil was $100/bbl because tomorrow it could be. American is also investing in onboard technology; new baggage handling technology and refreshing ground service equipment. Ms. Montross reported that American route planners are happy with the performance of the routes out of ILM. Flights out of ILM to CLT, PHL and LGA are performing very strong and American has added a second LGA RT starting in April. Ms. Montross stated the DCA-ILM service will be operated one time/week during the summer and the route planners are optimistic about the performance of that flight. Ms. Montross reported on the uniqueness of the CLT hub: the city of Charlotte/Mecklenburg County MSA has the lowest population of any hub city in the country, next to Salt Lake; Charlotte has the lowest per capita wealth of any hub city in the country, next to Salt Lake; Charlotte has the lowest concentration of originating local passengers of any hub in the country. Eighty% of people that go through CLT never leave the airport. Those 80% of connecting passengers generated the majority of $30M in sales tax revenue to the state and local governments in 2014 from concessions, retail, and liquor sales. Since 2005, American has seen exponential growth in enplanements out of CLT. Ms. Montross reported it is believed that what helped CLT maintain its competitiveness among other hubs is its low cost operations; and the fact that since 2005, there has been a cap on the amount of sales tax that airlines pay on fuel. Ms. Montross stated that USAirways/American flies 83% of all passengers to and from NC and that they are the primary carrier in North Carolina from a commercial air service. In New Bern and Greenville, they are the only carrier and the largest purchaser of fuel. Ninety-six% of all fuel purchased in NC is purchased in Charlotte and Raleigh and because of the cap that has been in place, it has allowed the airlines to invest in air service, employees and training facility assets in the CLT hub because it has been financially competitive compared to other hubs across the country. Ms. Montross explained that the cap is expiring th January 1, 2016 and if the cap expires and nothing is done, NC will go from being the 20 most th expensive state to buy jet fuel to the 5 state and that will be pretty traumatic for hub operations in CLT. Ms. Montross reported this sales tax cap is American Airlines number one legislative priority in NC. Ms. Montross shared that third party validators, like the Tax Foundation and Council on State Taxation and Americans for Tax Reform, support the notion that jet fuel is a business input and part of the vision of tax reform in 2013 by the NC General Assembly was to exempt business inputs from tax treatment. It was part of the goal of tax reform to exempt business inputs and New Hanover County Airport Authority April 1, 2015 Page 3 e to the legislators is to exempt jet fuel all together as a result of tax reform and to insure that CLT and air service diesel because diesel is a business input for them; cruise ships, ferries, and maritime businesses extends the $2.5 M cap for 4 years, until 2020, to bring stability to our decision making and Senator Rabon, introduced SB 187 which would exempt jet fuel all together, so we have two legislative options, right now, under consideration. Ms. Montross asked the Authority to be an advocate for commercial aviation; to help them on this issue in Raleigh and to help make the case that air service in Wilmington is dependent on an issue like this being addressed in Raleigh. Air service decisions are made based on where fuel prices are most competitive. Air service decisions in NC will be impacted if the sales tax on fuel changes in this state. hope is that the Authority will reach out to its elected officials locally and American is sharing this same presentation with community groups across the state because this is not a Charlotte/Mecklenburg County issue; this is not about dehubbing; this is about the competitiveness of air service in the state and the message that the state wants to send to commercial airlines that NC is open for business. ted that the rebanking of the DFW hub thth started March 30 and the Chicago rebanking should happen the week of April 6. Mr. Barber stated that ILM has an abiding interest in trying to get Chicago back. Ms. Montross responded that everyone in route planning is well aware of the ask from ILM regarding Chicago service and commented that ILM has done a great job with focus groups and local company representation but stated that ILM needs to demonstrate that it has the market to fill that flight and that the Chicago market has to do the same. Ms. Montross said she is happy to be an advocate for ILM in DFW too. Ms. Montross commented that it was a good sign that DCA was added back. Chairman Perritt thanked Ms. Montross for her time and presentation. PUBLIC COMMENTS None. SPECIAL EVENTS Mr. Broughton reminded the Authority that the Circus will be onsite as part of the Azalea Festival starting April 9 April 12. Mr. Broughton updated the Authority on the next Autism Takes Flight which is scheduled for th April 11, 2015. Currently there are 24 families signed up with about 24-26 children. FINANCE REPORT Mr. Morton reported to the Authority on the closing on 2503 and 2507 Old Wrightsboro Road indicating that one of the lots had a mobile home on it with a tenant. Mr. Morton recommended a month to month lease for $500 a month with the current tenant to provide her transition time to relocate. After some discussion, Mr. Lambeth MOVED, SECONDED by Mr. Barber to approve the Finance action item discussed above. The MOTION WAS APPROVED UNANIMOUSLY. New Hanover County Airport Authority April 1, 2015 Page 4 Mr. Morton reported to the Authority that new tenant, Dynasty Motors, would be open for thth business April 6 with an open house on April 16. y of accounts. Mr. Morton shared a presentation regarding the proposed FY2016 budget. Discussion followed. Mr. Morton summarized the budget process indicating that the budget is presented for Authority review for 30 days. Feedback and changes should be provided by the Authority before the May 6 th Authority meeting so that the budget can be approved for public comment on May 6. The rd Authority will officially approve the final budget at the June 3 Authority meeting. Mr. Barber requested a spreadsheet comparing actuals for the last 2 years compared to the proposed budget for any with a difference greater than $30,000. FACILITIES Mr. Prease recommended the approval of a contract with Johnson Controls to upgrade the CCTV and Access Control in an amount not to exceed $496,450.00. This contract also includes renovations to the PSO communications office. The project is funded by Passenger Facility Charge (PFC). After some discussion, Mr. Lambeth MOVED, SECONDED by Mr. Wolfe to approve the contract with Johnson Controls. The MOTION WAS APPROVED UNANIMOUSLY. Mr. Prease recommended the approval of a contract with Davis Fence for replacement of existing airfield perimeter contract will rfence on the airfield. The project is funded by Passenger Facility Charge (PFC). After some discussion, Mr. Barber MOVED, SECONDED by Mr. Hickman to approve the contract with Davis Fence. The MOTION WAS APPROVED UNANIMOUSLY. Mr. Prease provided a status update on the improvements to the observation area. Chairman Perritt pointed out that the RWY 24 ditch project would only close the RWY for approximately 8 days which is good news for the GA community and airfield operations. GOVERNMENT Mrs. Girardot updated the Authority on legislative priorities for the state and ACI-NA and AAAE and a discussion with Senator Burr regarding the same. Senator Burr encouraged a conversation with Transportation Secretary Andrew Fox based on the fact that Fox has about 1 ½ years in his term and is familiar with CLT and the airlines. Mrs. Girardot reported on the NCAA Conference recently attended by Authority members Girardot and Perritt and on the great presentation by Bill Swelbar, InterVISTAS Consulting, pointing out some highlights of his presentation to the Authority. NCAA Conference. New Hanover County Airport Authority April 1, 2015 Page 5 Chairman Perritt reported on the Chamber breakfast with Congressman Rouzer that was attended by Mr. Perritt, Mr. Wolfe and Mrs. Wilsey and noted that Rouzer is one of the few freshman to ever be seated on the transportation infrastructure committee that is heavily involved in FAA re- funding and authorization. Mrs. Wilsey was able to speak with Mr. Rouzer briefly at the end of the event regarding the need to increase the PFC cap. Mrs. Girardot reported on a Special Use Permit meeting hosted by the North Carolina Coastal Federation recently attended by her and Mr. Morton. This committee is trying to rewrite the Special Use Permit as it pertains to industry and will be very important to the business community. ty regarding proposed dates for this breakfast meeting. Chairman GA projections came out at the same time as the FAA and to remind everyone of those projections; turbo prop and up they are projecting GA growth; piston down, Swelbar is projecting negative growth and the FAA is projecting 0 - .4% growth for the next 20 years. Discussion followed about ways to enhance GA and get young kids involved in flying. MARKETING AND PUBLIC RELATIONS Mr. Morton updated the Authority on the recent Wilmington Business Expo which had over 100 booths where staff promoted the Business Park and terminal advertising. Mr. Morton reviewed other agenda items for marketing and public relations. Chairman Perritt shared with the Authority his experience at the TSA Media Event at ILM. He also took the opportunity to address two shifts of the TSA employees on behalf of the Authority and expressed thanks to them for doing their jobs well but also for being pleasant and personable to the customers. PLANNING & DEVELOPMENT Mr. Morton recommended that the Authority support the approval of changes proposed by the New Hanover County Planning and Zoning Department to the Airport Industrial (A-1) zoning in order to move forward with seeking approval from New Hanover County Planning and the Board of Commissioners to allow other permitted uses under the current ordinance. After some discussion, Mr. Lambeth MOVED, SECONDED by Dr. Crane to move forward with the proposed changes to the Airport Industrial (A-1) zoning. The MOTION WAS APPROVED UNANIMOUSLY. Mr. Morton recommended approval of the conceptual drawings for the flex space building to authorize the design process. Mr. Lambeth MOVED, SECONDED by Mr. Barber to approve the conceptual drawings for the flex space building. The MOTION WAS APPROVED UNANIMOUSLY. New Hanover County Airport Authority April 1, 2015 Page 6 OPERATIONS REPORT Using charts for illustration, Mr. Broughton reported total passengers handled and seats available for March 2015. referenced by Ms. Montross earlier will increase available seats with an equal number of flights. Ms. Montross responded that the goal is to phase out the 50 seat jets within the next year and a half. of film incentives on traffic stating that ILM has not seen any impact yet. Mrs. Wilsey reported that she spoke to Joseph Pickering, Mead & Hunt, today and he said it is still too early because DOT data lags by 8 months. Mr. Pickering is watching that statistic for ILM. Mrs. Wilsey recommended the approval of continuing with Mead & Hunt for Air Service Consultant with a one year contract NTE $70,000, which includes quarterly reports, focus groups twice a year, Jump Start meetings and three headquarters visits. After some discussion, Mr. Barber MOVED, SECONDED by Mr. Hickman to approve the contract with Mead & Hunt. The MOTION WAS APPROVED UNANIMOUSLY. Mrs. Wilsey reported that Michael Landguth from RDU is recommending all North Carolina commercial airports form an alliance. The purpose would be to advocate for the commercial service airports in the state; to track key proposed legislation that would affect commercial service airports in the state; to communicate to both federal and state elected officials on the economic impact of commercial service airports in the state; to advocate for the development of a State of North Carolina Aviation Trust Fund that would achieve two goals: 1) help pay for critical airport infrastructure; and 2) to develop an investment fund targeted at providing funds for critical airport economic development opportunities. Discussion followed and the Authority members expressed their general approval to continue participating in the conversation regarding a proposed NC Commercial Airport Alliance. Mrs. Wilsey reported that Deputy FSD Koshetz with TSA indicated at the recent media event that the TSA is developing a new policy that if a group is traveling together and their tickets were purchased together, if one of the people in that group is pre-check qualified, they will make all in the group pre-check qualified for that particular trip only. Mrs. Wilsey updated the Authority on the General Aviation Survey which will continue for the next 2 weeks. Mrs. Wilsey advised that staff was moving forward, based on Authority direction, regarding the current FBO tenant. Staff will continue with that charge based on the current contract and will have an update on April 10th. Staff knows the next step and is ready to proceed with the next step which is the 30 days notice to vacate. From there the staff has a plan in place to take care of those tenants and make sure they have access to their aircraft on a month to month basis. New Hanover County Airport Authority April 1, 2015 Page 7 Mrs. Wilsey stated in the meantime staff will review the GA surveys to see what the GA community at ILM, approximately 102 planes, needs and what ILM can do. Mrs. Wilsey suggested the Authority may want to consult with Mark Chambers or Bill Swelbar to review survey results and see what our GA community needs and what is a viable option for the future. We want to have GA of all types and we want it to be viable for the long term. As quickly as feasible, staff will recommend a long term plan, but at this time we are planning for the next several months. th Chairman Perritt wished a happy birthday to Mr. Hickman whose birthday is April 25. UNFINISHED BUSINESS None. NEW BUSINESS Chairman Perritt proposed the formation of an ad hoc committee to plan for the 2017 PGA Tournament to work with staff and volunteered for one slot on the committee. Discussion followed about the timing of the North Ramp project and the hopes that it will be completed before this event. Chairman Perritt also proposed a human resources committee. ADJOURNMENT There being no further business to come before the Board, Mr. Lambeth MOVED, SECONDED by Mr. Hickman to adjourn. Upon vote, the MOTION WAS APPROVED UNANIMOUSLY. Chairman Perritt adjourned the meeting at 6:57 p.m. Prepared by: Respectfully Submitted: Rose M. Davis _______________________________ Thomas C. Barber, II, Secretary Date of Approval: May 6, 2015