2018-06-14 Special Meeting
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34
SPECIAL MEETING, JUNE 14, 2018 PAGE 144
ASSEMBLY
The New Hanover County Board of Commissioners met for a Special Meeting with the New Hanover County
Airport Authority on Thursday, June 14, 2018, at 8:00 a.m. in the Conference Room of the Wilmington International
Airport, 1740 Airport Boulevard, Wilmington, North Carolina.
Members present: Chairman Woody White; Vice-Chairman Skip Watkins; Commissioner Jonathan Barfield,
Jr.; Commissioner Patricia Kusek; and Commissioner Rob Zapple.
Staff present: County Manager Chris Coudriet; County Attorney Wanda Copley; and Clerk to the Board
Kymberleigh G. Crowell.
New Hanover County Airport Authority members present: Chairman Carter T. Lambeth; Thomas C. Barber,
II; Donna Girardot; Dan Hickman; Harry Stovall; and Thomas Wolfe. Member W. Lee Williams was absent.
Wilmington International Airport staff present: Julie Wilsey, Airport Director; Gary Broughton, Deputy
Director; Robert Campbell, Finance Director; Whitney Prease, Facilities Director; Carol LeTellier, Business
Development Director; Gary Taylor, Chief of Public Safety; Erin McNally, Marketing and Public Relations; and Rose
Davis, Executive Assistant.
Chairman White and Chairman Lambeth called their respective Boards to order for the Special Meeting
reporting that the purpose of the meeting is to hear the Annual Report of the Wilmington International Airport.
Airport Director Julie Wilsey and Deputy Director Gary Broughton presented the annual report highlighting
the following information on the operations, maintenance, development and existing projects of the airport:
Wilmington International (ILM) Employees:
Full time employees: 49
Employees hired this fiscal year: 18
Volunteers: 50 with 5,957 hours of service in 2017
Turnover in FY2017: 23.66%
Years of service: two with twenty-eight years; six with sixteen+ years; and fourteen with ten years
or more
Rebranding:
New logo which has been added to all marketing materials
New tag line: “Coast on In. Coast on Out.”
Growth in Air Service:
Three network airlines: eight non-stop destinations; seven hubs; and six international gateways
Air Service Development:
ILM has 62% of the passengers per day each way (PDEW) primary catchment
38% or 650 PDEW from the primary catchment use an alternate airport:
Raleigh-Durham International (RDU): 26%
Charlotte Douglas International Airport (CLT): 5%
Myrtle Beach International Airport (MYR): 4%
Albert J. Ellis Airport (OAJ): 2%
Fayetteville Regional Airport: 1%
Economic Impact Study:
All North Carolina airports (2015): $31.1 billion and 122,000 jobs
ILM (2015): $1.6 billion and 4,910 jobs
New economic impact study update to be released at the end of 2018
2017 Aviation Statistics:
836,589 passengers: + 2.3%
57,814 operations: - .07%
103 aircraft based on the field
Military operations grew by 22% and aircraft with over 60 seats were up 3.8%. This offset declines
in air taxi and general aviation.
Seeing a recovery with customs activity, clearing 1,158 planes which is best year since 2013 (1,542)
New Aviation Partners:
United: flights started April 9, 2018 with non-stop flights to O'Hare International Airport (ORD)
and Washington Dulles International Airport (IAD):
Added 18 new jobs and four flights per day
Air Wilmington: Fixed-Base Operator (FBO) ownership transferred to Modern Aviation, Inc. on
February 22, 2018
Air Wilmington entered into an agreement with All American Aviation Services to open a flight
school on June 15, 2018
Supporting Business Aviation:
Live Oak Bank moved into its $6.2 million hangar in May 2017 with annual ground rent over
$32,000
Property tax is about $35,000 annually
Live Oak Bank’s flight activity: In 12 months, Live Oak Bank’s fuel consumption has increased
from 27,000 to over 40,000 gallons per month
Supporting the Professional Golfers Association (PGA) Event:
NEW HANOVER COUNTY BOARD OF COMMISSIONERS BOOK 34
SPECIAL MEETING, JUNE 14, 2018 PAGE 145
87 aircraft carrying players and caddies
Wells Fargo had two corporate jets stay all week
Four of the players had their privately owned jets stay all week
Fuel flowage – 30,000 gallons
Financial Highlights for Fiscal Year Ended June 30, 2017:
Operating Revenue of $10,016,074 (5.2% increase over FY 2016):
Aviation: 15.3% (all aviation)
Parking lot: 39.3% (greatest revenue producer for ILM)
Rent: 21.5% (business park)
Commissions: 13.9% (rental cars and concessions; pay commission rather than square foot rent)
Security: 6.9% (fee paid by airlines for security checkpoints and security services provided by
ILM)
Other: 3.1%
All sections are operating at a profit
Unqualified audit option on all reports:
Financial Statements
Internal Control Over Financial Reporting and Compliance and Other Matters
Compliance on the Major Federal Program and the Passenger Facility Charge Program
Compliance on the Major State Program
Funding Our Growth:
User fee based system
ILM will not ask New Hanover County government for funding unless for a loan and will pay back
the loan amount with interest
FY 2017 Actual Cash Inflows:
Operating Revenues: 57.6%
Federal Grants: 18%
State Grants: 8.4%
Passenger Facility Charges: 9.9%
Contract Facility Charges: 6.1%
FY 2019 Projected Cash Inflows:
Operating Revenues: 38.3%
Federal Grants: 20.2%
State Grants: 30.4%
Passenger Facility Charges: 6.9%
Contract Facility Charges: 4.2%
Facility Development:
Two major funding sources for capital projects at ILM include the Federal Aviation Administration
(FAA) and State of North Carolina (NC):
FAA funding is typically $2.8 million per year in entitlement funding but discretionary funding
varies from year to year based on how a project is graded against FAA funding criteria.
NC funding is typically administered through the State Transportation Investments (STI)
program. Recently, ILM was legislatively appropriated $11.9 million through Senate Bill 257.
Current and Planned Projects:
FAA Funded Projects:
Wildlife Mitigation Phase 1: $ 1.5 million
Wildlife Mitigation Phase 2: $ 1.0 million
Security Fencing: $ 0.5 million
Runway Lighting Rehab: $ 1.7 million
Terminal Expansion 1B: $30.4 million
North Carolina Funded Projects:
Gate 1 Boarding Bridge: $ 1.0 million
North General Aviation Ramp Expansion: $ 1.5 million
North General Aviation Ramp Pipe Ditches: $ 0.5 million
Runway Lighting Rehab: $ 0.5 million
Terminal Expansion 1A: $10.9 million
Terminal Expansion:
Project Timeline:
Phase 1A for airline ticket offices, lobby and baggage system:
July 2018: Bid Opening
October 2018: Construction Notice to Proceed
February 2020: Construction Complete
Phase 1B for new concourse and gate areas:
July 2019: Bid opening
November 2019: Construction Notice to Proceed
May 2022: Construction complete
Project Funding:
Phase 1A for airline ticket offices, lobby and baggage system ($13.5 million):
NC legislative appropriations: $10.9 million (distributed over two-year period)
Passenger facility charges funds: $2 million
New Hanover County Airport Authority: $0.6 million
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SPECIAL MEETING, JUNE 14, 2018 PAGE 146
Phase 1B for New Concourse and Gate Areas ($40 million):
Airport Improvement Program (AIP) Entitlement and Discretionary funding of
$30.4 million:
Four years of AIP entitlements and discretionary split over two-year period
Passenger Facility Charges Funds: $5.0 million
New Hanover County Airport Authority: $4.6 million
Request additional NC Legislative appropriations
Growth in ILM Business Park:
AVIS Consolidated Rental Car Facility:
Brings maintenance of the AVIS Fleet to the consolidated Rental Car Facility
$2.3 million construction cost and completion expected August 2018
Storage for 174 Rental Vehicles
Fueling/ Vacuum Station
4,200 square feet of building space: office and reception; two maintenance bays; and
car wash bay
Social Bark:
Pet kennel and daycare
Family owned business with an existing store in Southern Pines, NC and a location in
development in Charleston, SC
2.4-acre land lease for a 17,000 square feet pet lodge with 66 kennels (20-year term
and $13,000 annual rent)
Owner constructing facility at own expense
Groundbreaking targeted for summer 2018
Accolades for ILM Partners:
KBT Realty and Shaw Real Estate, LLC:
30 associates (independent contractors and employees)
$43,041,070 in sales volume in 2017
Lease term: five years
$40,000 annual rent to ILM
Opened in October of 2017 in the flex building
Tailwind (Innovative Airport Concessions):
21 locations around the country
World headquarters in Wilmington with 71 local employees; 496 in the US
Tailwind Deli News and Gifts, Inc. moved to Wilmington in 2004 and opened ILM
concessions in 2005
rd
Opened first non-airport venues in Wilmington: Scratch on 23 in March 2017 in the
business park and Shark Bar and Kitchen opened in September 2017 in Wrightsville
Beach.
ILM in the News:
Events welcoming new air service (United launch):
New airline press announcement, inaugural flight, and ribbon cutting
Reception for Grant Whitney
Keynote at Chamber of Commerce annual event
Meeting with ILM Business Traveler Group
GENERAL DISCUSSION
In response to questions about the change in the customs designation and the impact to ILM, Director Wilsey
stated ILM continues to be a landing rights airport. Corporate flyers can apply for overflight exemption and if the
exemption status is granted they do not have to land in the US and can go to their final destination. Not everyone
receives the exemption status. This is where ILM is seeing some reduction in traffic at the customs facility. ILM
continues to work with customs partners to provide a top notch facility. Air Wilmington providing quick refueling and
turnaround time for these flights has put ILM on the map for ease to get in to get fuel and get out to the final destination.
Regarding what ILM is doing in response to losing customers to RDU, Director Wilsey stated that RDU is
doing an incredible job in air service development in Raleigh. ILM is also working on air service development.
Strengths RDU has that ILM does not is that RDU has a larger population and ILM is losing some travelers to RDU
because of the low fare carriers. The other challenge ILM has is that RDU is gaining ground on non-stop flights to
Europe and Asia. RDU recently secured a Paris non-stop on Delta and a Heathrow non-stop on American Airlines.
Due to this community’s size and market and load demand, that will probably not happen here for a long time. There
may be a loss of some customers who chose to fly non-stop. A business case has to be made when approaching the
airlines. Airlines have constrained resources in planes and staff and they have to make a profit in order to fly. ILM
only proposes destinations, flights, and routes that will make money for an airline and does hope to have a low-fare
carrier again in the future.
Regarding the new security requirements, Director Wilsey stated that the new program people are familiar
with is enhanced personal property screening (EPPS). If a person is a not a pre-check customer, then any electronic
device larger than a cell phone has to be removed from the bag and items larger than eight ounces get an additional
screening with a trace machine. EPPS is happening across the country and the best way to combat it is to obtain pre-
check status clearance. With pre-check status clearance, a person can go into the pre-check lane, leave jacket and
shoes on and the lane moves much quicker. Those who do have not pre-check status are being reminded to arrive at
ILM two hours in advance. During the Phase 1B project, there will be a total of three lanes in the form of two standard
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SPECIAL MEETING, JUNE 14, 2018 PAGE 147
and one pre-check with built-in space for users. While she would like to say the Transportation Security
Administration (TSA) will have technology to deal with the challenges, the reality is that as TSA is doing this the
terrorists are developing ways to get around it. It’s an ever changing risk threat environment. She truly believes TSA
is working hard to stop all threats. There are upwards of 50% of the travelers Monday – Friday going through pre-
check lanes. The weekends and holidays see more non-business travelers.
Chairman White stated as ILM starts developing the new terminals and expansions, on a personal level, he
would like the personality of ILM to be retained such as the southern columns, rocking chairs, and basically the things
that people esthetically come to expect. While he knows its minor, over the years it has been seen where architecture
in the government area ascribing to the latest trends, such as the old jail, hasn’t blended well with the area. This is a
small southern airport, that’s a good thing and it’s recognized. Director Wilsey said she hears that all the time and it
is what ILM is known for. Chairman Lambeth stated when he started on the board, Parks Griffin was the chairman. A
lot of the amenities enjoyed by everyone are due to the vision and suggestions of Mr. Griffin.
ADJOURNMENT
Hearing no further discussion, Chairman White thanked the Airport Authority members and staff for the
report. Chairman White and Chairman Lambeth adjourned the meeting at 8:46 a.m.
Respectfully submitted,
Kymberleigh G. Crowell
Clerk to the Board
Please note that the above minutes are not a verbatim record of the Special Meeting
of the New Hanover County Board of Commissioners.