1998-05-14 Special Meeting
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 468
ASSEMBLY
The New Hanover County Board of Commissioners held a joint meeting with the New
Hanover County Airport Authority on Thursday, May 14, 1998, at 7:30 a.m. in the Conference Room
of the Wilmington International Airport Terminal, 1740 Airport Boulevard, Wilmington, North
Carolina.
Members present were: Commissioners Buzz Birzenieks; Ted Davis, Jr.; Charles R. Howell;
Vice-Chairman Robert G. Greer; Chairman William A. Caster; County Manager, Allen O’Neal;
County Attorney, Wanda M. Copley; and Clerk to the Board, Lucie F. Harrell.
Members present from the Airport Authority were: Chairman I. A. Roseman; Vice-Chairman
Parks L. Griffin; and members John M. Coble; Carter T. Lambeth; E. L. Mathews, Jr.; Airport
Director, Willard G. Plentl, Jr.; and Administrative Assistant, Janie James.
Chairman Caster called the New Hanover County Board of Commissioners to order and
stated that the purpose of the Work Session was to hear a status report on the Wilmington
International Airport.
Chairman Roseman expressed appreciation to the Commissioners for an opportunity to
present a status report on the activities of the Wilmington International Airport. He explained the
Airport Authority was divided into the following committees and stated the chairman of each
committee would present a brief report:
Development & Public Relations-Parks L. Griffin
Finance-John M. Coble
Human Resources & Public Safety-Carter T. Lambeth
Government-E. L. Mathews, Jr.
Facilities & Equipment-I. A. Roseman
Report from the Development & Public Relations Committee
Mr. Parks Griffin, Chairman of the Development & Public Relations Committee, reported that
during the last year, the Airport Authority was successful in securing passage of the Airport
Economic Development Zone Act through the North Carolina General Assembly. Under this
legislation, the Airport cannot be annexed by any municipality in the future. This will greatly enhance
marketing and development efforts by the Airport.
Another accomplishment during the past year was obtaining United Express air service. This
will allow the Airport to enter into joint marketing with United Express and other airlines to
encourage more carriers to use the Wilmington International Airport.
Report from the Finance Committee
Mr. John Coble, Chairman of the Finance Committee, reported the Airport was in a sound
financial condition. The 1998 budget was $2,300,000, and it is anticipated that revenues will exceed
the projected figure by $305,000. The additional revenue will provide funding for future projects.
Another marketing and revenue producing event is the Air Show, which has traditionally been
held every other year during the Azalea Festival. The show was not held this year because the
Airport Authority felt time was needed to study how to hold a more successful aviation event. After
research and study, the Authority decided the Air Show should not be held in conjunction with the
Azalea Festival. The next Air Show is scheduled for September 18-19, 1999, which is the date that
Manteo will be holding activities in commemoration of the “First Flight” by the Wright Brothers. The
Airport has just received notice that the Experimental Aircraft Association is planning to make the
commemoration an east coast event. As more information is received, the Board of County
Commissioners will be informed.
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 469
Report from Human Resources and Public Safety
Mr. Carter Lambeth, Chairman of the Human Resources and Public Safety Committee,
reported the Airport has a good Public Safety/Fire Department. Also, the committee is working with
the Airport Director in reviewing benefits, pay, and other issues involving employees.
Director Plentl stressed the importance of the Airport being known as an outstanding
governmental employer, and noted this was a major goal of the Authority. Focus will be placed on
having satisfied employees, increased productivity, and a low turnover rate.
Discussion followed on the number of current employees and the percentage of turnover.
Director Plentl responded there are currently 33 employees; however, he has not determined the exact
turnover rate since becoming Director of the Airport. It appears the turnover rate was high in the
past, and it is imperative for the Airport to create a working environment that will recruit well-
qualified employees and retain good employees.
Further discussion was held on contracted services. Director Plentl reported that all lounges,
concessions, and some maintenance are contracted services. Currently, the Airport Authority is in
the process of studying whether more services can be privatized.
Report from the Governmental Affairs Committee
Mr. E. L. Mathews, Jr., Chairman of the Governmental Affairs Committee, reported on the
importance of the Airport Authority effectively communicating with governmental agencies and their
elected officials. Emphasis was placed on the importance of maintaining a cooperative relationship
with the FAA because this is the major source of revenue for the Airport. Also, a strong relationship
must be maintained with the County. An example of this cooperation, is the current renovation of
old terminal building.
In closing, Mr. Mathews stated the committee focuses on developing good communication
and cooperation with all governmental entities.
Report on Facilities & Equipment
Authority Chairman Roseman, reported that long-term goals of the Facilities and Equipment
Committee are to expand the runways to better handle larger aircraft and to expand the airport
terminal to accommodate all airlines operating at the Airport. These expansions would greatly
enhance the Airport.
A maintenance facility is currently under construction that should be completed in September
1998.
Vice-Chairman Greer requested an explanation of why the maintenance building had to be
expanded.
Chairman Roseman responded a larger building was needed to house the necessary equipment
for lighting, air-conditioning, and maintenance of the entire terminal.
In further discussion of long-term goals, Mr. Griffin noted as the Airport moves forward,
other sources of revenue must be found because of the uncertainty regarding future state and federal
funding. Some airports have developed industrial parks and constructed golf courses as a revenue
source. The Development and Public Relations Committee will continue to focus on continued
development of the Airport Industrial Park and explore the idea of a golf course, particularly since
the Municipal Golf Course has reached its limit. The golf course in Savannah, Georgia, has been
quite successful. Also, a Travel Advisory Board comprised of local travel agents has been established
to discuss ideas for improving services. The recommendations from this group have been quite
helpful.
Discussion was held on marketing of the area by the airlines. Mr. Griffin advised the airlines
are beginning to market the area; however, a goal of the Airport Authority is for the Wilmington
International Airport to become the regional terminal. Within the past few months,
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 470
discussion has been held on the possibility of constructing a regional airport between Wilmington and
Myrtle Beach. Once the outer loop is completed, which will provide direct access to the Airport, the
Wilmington International Airport will be the ideal terminal to serve the entire region.
Chairman Roseman commented on the need to market the Airport in order to remain
competitive, and he stated that several trips were made to Washington, D. C. to obtain United
Express. Since the Airport is not a hub, the facility has been placed in a very competitive position.
The leakage factor is a problem that must be addressed. When a person drives to Raleigh to catch
a plane, this is one less customer for the local airport.
Commissioner Birzenieks asked if any figures have been established regarding the impact of
the Airport on the local economy?
Chairman Roseman responded he was not aware of any figures.
Director Plentl stated a statewide study was performed a few years ago that showed the net
annual impact of aviation to North Carolina was approximately $9 billion. He spoke in favor of
reviewing specific figures for the Wilmington International Airport.
Commissioner Birzenieks spoke on the need for the community to understand the economic
importance of the Airport to the region and advised that Dr. Woody Hall, an Economist at UNCW,
would be an ideal person to perform a study.
Director Plentl presented a graph reflecting the increased number of enplaned passengers,
international aircraft cleared, and international individuals cleared. The international traffic increased
35% in April 1998 over March 1998. The Wilmington International Airport is known throughout
the industry to be a good place to clear aircraft, particularly with the location of the State Port in
Wilmington. Last year, 4,500 passengers and 1,000 aircraft were cleared through the facility. To
date, the figures show that 700 aircraft have been cleared through the facility, which far exceeds this
figure last year at this time. If this trend continues, the International Terminal will have to be
improved. Surprisingly, many heads of state from other countries are cleared through the Airport.
Also, a large number of corporate aircraft use the facility, and this traffic continues to increase.
Vice-Chairman Greer reported on hearing that because of increased international traffic, the
Custom personnel were being stretched too thin. He asked if this has become a problem?
Director Plentl stated that he discussed this issue with the head of the U. S. Customs, and the
agency appeared to be pleased with the increase in traffic and positive about increased activity.
Approximately 450,000 passengers, incoming and out-going, pass through the Airport
annually. When United Express came, the first month was exceptional, and the Airport experienced
a 20% growth in enplanements over the same month of the previous year. The month of April
reflected a 21% growth, which means enplanements are increasing. As the Airport Authority brings
in new services, the enplanements will continue to grow. Traffic is being diverted from Raleigh and
Myrtle Beach.
County Manager O’Neal commented on the possibility of a cruise line coming into the State
Port and asked if there was a potential for a partnership to develop between the Airport and State
Ports Authority?
Director Plentl responded there was a potential for a partnership because most people fly to
the origination of the cruise line.
Vice-Chairman Greer asked if the Passenger Facility Charge was still in existence?
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 471
Director Plentl responded the Passenger Facility Charge is $3.00 per person. The legislation
enacted to authorize implementing the charge expires September 30, 1998. The airport industry is
working on renewal of a bill with an increase in the charge; however, the airlines want a “no growth”
rate. With limited resources of local communities, the monies from the Passenger Facility Charge
enables areas to provide and maintain quality airports. Larger airports have the ability to generate
funds, therefore, the Passenger Facility Charge is not as important. Currently, the aviation industry
is in the most profitable stage in its history. Fuel prices are down, fares are better structured, and
computer technology allows the airlines to secure the maximum revenue on an aircraft.
A map was presented of the Airport Development Plan. Director Plentl advised areas marked
in yellow were properties that need to be acquired in the intermediate time frame. The major
development will be an extension of RW 624 from 2,000 feet to 10,000 feet. This could be difficult
to justify with the FAA; however, it is important to have the potential to protect the international
traffic.
Also, there is a problem with RW 1735 regarding extended runway safety areas, which was
required by the FAA five years ago. The Airport must comply to this requirement in order to avoid
having the runway shortened for air carrier operations.
Currently, the property located at the intersection of 23rd Street and Blue Clay Road should
be purchased to control all activities within the natural boundaries of the Airport. The Authority is
interested in acquiring these properties to protect the future growth of the Airport.
Mr. Griffin commented on the Master Plan and reported the Airport Authority does not have
the power of eminent domain. In the past, there have been no problems with land acquisition;
however, this may not be true with future acquisitions.
Regarding the issue of the Airport applying for enabling legislation to condemn property in
the past, County Attorney Copley advised that Harry Payne and Thomas Wright were not supportive
of this request in the past. Mr. Payne did not feel that non-elected officials should have the power
of eminent domain.
Vice-Chairman Greer advised he agreed with Mr. Payne.
Airport Chairman Roseman stated the Airport Authority may have to call on the Board of
County Commissioners for condemnation of property if enabling legislation cannot be obtained. Also,
the 25-year lease with the Airport expires in fifteen years. As the Airport begins to lease more
facilities, there will be a need for the Authority to have authorization to provide longer terms. For
example, the development of a golf course, hotel and convention center will require at least a 30-year
term.
Attorney Copley advised if the Board of County Commissioners and Airport Authority agree
on an extended lease, this request can be placed on an agenda and approved by the Commissioners
at the next meeting.
Vice-Chairman Greer suggested waiting until a situation of this type arises before granting
authorization to the Airport Authority.
In closing, Director Plentl stated the Airport Authority cannot control the actions of the
airlines; however, the Authority can control the type of facility presented to its users. The County
did a good job in constructing the original terminal, but the time has come to replace the carpet, and
complete the finger with amenities for the passengers. Once these renovations are completed,
hopefully the passengers will consider Wilmington International Airport as one of the nicest facilities
to use in North Carolina and surrounding states.
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 472
Currently, a unique device is being developed at the Airport to place on the end of the jetway.
Most devices are a fixed set of stairs that do not move. The Airport is trying to invent a device that
moves the jetway to regional carriers without having to walk long distances or climb flights of steps.
If this device is successful, the Airport may be marketing the product to other airports throughout
the country.
Financial Report:
Anticipated revenue for FY 1999 is $12,141,200. This figure is comprised of the
following components:
N. C. Department of Transportation 1.6%
FAA38.2%
GS -160 A-20 Financing30.5%
Fees, Charges Miscellaneous21.2%
WIA Capital Contributions 3.9%
WIA Operating Contributions 0.5%
Passenger Facility Charge 4.1%
Operating revenues are approximately $2,600,000 per year.
Operating expenses are projected in the amount of $2,635,500. A contribution of $78,000
has been included from the reserves. It appears that reserves will be increased by $400,000. Also,
the projected reserves are very conservative.
Discussion followed on the amount of current reserves. Airport Director Plentl responded
the current reserves are approximately $3,000,000; however, land acquisitions will cost at least
$18,000,000.
A chart was presented reflecting the capital budget for 1999. The following projects were
presented:
T/W “J” Construction
Hangar Development
Terminal Building
Outbound Baggage Conveyor
GA Ramp Expansion
Old Tower Demolition
Disabled Passenger Lift
Security System Upgrade
Closed T/W “K” Rehabilitation
Drainage System Rehabilitation Phase
Land-PFC Funded
Capital Equipment
Seating
Hi Lift
The operating budget was presented. Airport Director Plentl advised that the Airport
Authority plans to focus on marketing during 1999 and noted the budget for this line item was
increased from $35,000 to $95,000.
In closing, Airport Director Plentl advised he would be glad to answer any questions.
Commissioner Birzenieks inquired as to the possibility of a direct flight from Wilmington to
New York?
Director Plentl advised that when the contact is made, he feels there is a 75% chance of
obtaining a direct flight. A key factor will be how Continental handles the merger with Northwest
Airlines. Continental Express is converting to all jet service, and the length of the trip is ideal for this
aircraft. New York is the largest market. Also, Continental is not a low or high cost carrier, they
remain in the middle and are very competitive. The Airport currently has service to five hubs, which
is adequate for a community of this size.
NEW HANOVER COUNTY BOARD OF COMMISSIONERSBOOK 26
WORK SESSION WITH AIRPORT AUTHORITY, MAY 14, 1998PAGE 473
County Manager O’Neal inquired as to whether the direct flight would go directly into New
York or Newark, New Jersey?
Director Plentl responded the flight would terminate at Newark, which is a New York airport.
Commissioner Birzenieks asked where the Airport will be in five years?
Director Plentl responded the Airport will have carriers to five hubs and the international side
will become so impressive, it will be difficult to believe. Also, the retail side should grow with a golf
course, hotel or convention center. The Airport is close to the City of Wilmington, has space to
expand, and with completion of Smith Creek Parkway will have excellent access.
Further discussion ensued on the Air Show. Director Plentl advised the centennial
commission has discussed a fly-by of every flyable aircraft in the world starting in the morning at 7:00
a.m. and continuing through the day. In 2003, focus will be placed on an Air Show, which cannot be
located on the outer banks. Currently, the Commission is focusing on the Wilmington or Winston-
Salem airports. The Commission is meeting with Experimental Aircraft Association to see if they can
participate. In 1999, the groundwork will be laid and hopefully by 2003, this will be a major event
along the eastern coast.
Mr. Coble advised that Air Shows are now rated number 2 or 3 in spectator activities. This
event continues to grow.
Vice-Chairman Greer asked if the change in the name of the Airport had been well received?
Mr. Griffin responded the name change has been well accepted and quite beneficial with
marketing of the Airport.
ADJOURNMENT
Chairman Caster, on behalf of the Board, expressed appreciation to the Airport Authority for
calling the meeting and suggested future meetings of this type.
Commissioner Birzenieks expressed appreciation to the Airport Authority for the excellent
job being performed in overseeing the Airport and hiring the new Airport Director.
Respectfully submitted,
Lucie F. Harrell
Clerk to the Board