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2012-03-28 Agenda Review New Hanover County Airport Authority March 28, 2012 Page 1 NEW HANOVER COUNTY AIRPORT AUTHORITY AGENDA REVIEW MEETING March 28, 2012 ASSEMBLY The New Hanover County Airport Authority met for Agenda Review on Wednesday, March 28, 2012, at 4:02 p.m., in the Executive Conference Room at Wilmington International Airport, 1740 Airport Boulevard, Wilmington, North Carolina. Airport Authority members present were John Lennon, Chairman; Charles Kays, Vice- Chairman; Robert Rippy, Secretary (via satellite); Tom Barber and Al Roseman. Also present were Jon Rosborough, Airport Director; Julie Wilsey, Deputy Airport Director; Jim Morton, Finance Director; Gary Broughton, Operations Director; Whitney Prease, Facilities Director; Sandra Routh, Executive Assistant; Wanda Copley, New Hanover County Attorney; and Amy McLane, Talbert & Bright, Inc. Chairman Lennon called the meeting to order and then called on staff members to discuss the 28, 2012 Regular Public Meeting. AGENDA ITEMS Special Events: Mr. Broughton discussed a request from Setup Eve said they have extended an invitation to any of the Airport Authority members who would like to participate. Authority members expressed no objections to holding the event on airport property and requested Mr. Broughton send an email to remind them of the exact place and time. Finance Report: Mr. Morton reviewed actual revenue and expenses for the month of February in relation to the year-to-date budget, stating it was a very good month. 3 budget and explained that Authority members would have 30 days to review the proposed budget and to submit any questions, -day review, a final draft will be presented to the Authority at the May meeting for approval to publish an announcement --day review, the budget will be presented to Authority members for final approval at the June meeting to go into effect beginning July 1, 2012. Mr. Morton further explained that proposed 2013 budget represents approximately a 5% increase over its 2012 budget, with increases in staffing, health insurance, etc. proposed in the 2013 budget stemmed from new federal guidelines called GASB (Governmental Accounting Standards Board) of their annual audit. Mr. Morton explained that when GASB went into effect five years ago, many airports hired additional personnel in order to segregate accounting duties to be compliant, whereas ILM has maintained its current staffing throughout the past five years. He went on to New Hanover County Airport Authority March 28, 2012 Page 2 say that in January 2012, the FAA inquired as to what ILM was going to do to become compliant under GASB guidelines in order not to potentially jeopardize future grant funding. Mr. Morton stated he has been working with the auditors on a work flow schedule, and it will be necessary to hire two full-time staff personnel in order to become compliant under GASB guidelines and to satisfy FAA requirements. He stated that funding for the two full-time staff positions was included in the proposed 2013 budget. There was a discussion among Authority members and staff about hiring new personnel versus outsourcing specific accounting functions. Mr. Morton reported that rental car revenue was up 32% in February, with year-to-date revenue up significantly over last year. with the County from the General Fund, and two were bond issues. Due to the favorable cash flow in the PFC fund, the loan financed with the County was paid off. The other loan will be paid off in March 2013, and the remaining loan will be paid off in 2020. Facilities: Mrs. Wilsey discuss contract for the Checkpoint Renovation Project, which she recommended approval of a not-to- exceed budget with final award of the contract by the Chairman, due to the tight schedule to complete the renovation prior to July 1st. design of the Rental Car Facility was not final yet; therefore, it will be removed from the Action Items list during the Regular Meeting. She recommended going forward with a Construction Management at Risk process versus the traditional method of the design/bid/build process, and described what the CM at Risk process entailed. There was a lengthy discussion among Authority members and staff concerning the pros and cons of the two construction process methods. At the conclusion of this discussion, Chairman Lennon stated he would like to hear from people on other boards who have made the decision to use the CM at Risk process for construction projects, and recommended Mrs. Wilsey provide to Authority members at the May meeting, a cost for the Rental Car Facility architect to start using both construction process methods CM at Risk and the traditional design/bid/build. Mrs. Wilsey co hangar door at Air Wilmington that was damaged in a wind storm. Dr. Roseman questioned Mr. Morton about how insurance was being figured in to the building leases. There was a brief discussion between Dr. Roseman, Mr. Barber, Mr. Morton and Mrs. Wilsey, which culminated with Dr. Roseman stating he would like to explore the issue further. Mrs. Wilsey discussed a contract to paint airfield markings airport certification inspection in June. Mrs. Wilsey discussed the status of several projects currently in progress including, the Runway 6-24 PAPI Project, the Taxiway A, D, H and F Rehabilitation Project, the Kerr Avenue Fence Project, and the Gate 7 Boarding Bridge. New Hanover County Airport Authority March 28, 2012 Page 3 Mrs. Wilsey reviewed the results of the energy conservation initiative, comparing costs to the previous year. Data show decreases in both consumption and costs. Mrs. Wilsey updated Authority members on the progress of the roof replacement on the Con- Way Trucking building, stating that quite of bit of rotted wood had been found. She stated she would keep the Authority informed as to the budget and contract price. Government: Mr. Rosborough discussed the FAAstrict Office) Realignment . In accordance with at the previous meeting, a letter to the FAA expressing fted for Chairman Lennon to sign, and a Talking Points paper has During a recent trip to Washington, DC, Mr. Rosborough indicated he met with staff members from Congress As a result of a two-hour meeting between the North Carolina legislative delegation and the FAA, the FAA has planned three regional ill meet here at ILM on April 12 with Southeastern North Carolina airport representatives. Mr. Rosborough invited Authority members to attend. A discussion ensued between Authority hat it means specifically for North Carolina airports. Marketing and Public Relations: Mr. Morton reported that over the course of one year, ILM has advertised on nine radio stations with 5,500 radio spots, on eight television stations with 8,200 spots, in approximately ten different magazines, numerous sporting events, major festivals, numerous websites, many organizations, and special promotions, like the ticket promotions with Allegiant Air and American Airlines. Even with this large marketing presence, Mr. Morton said ILM is weakest in social media marketing, and staff is preparing to move forward in this new realm of advertising. Planning and Development: Mr. Morton reported that final changes are being made to the Business Park layout, and he hopes to have a final draft ready to show Authority members at the next meeting in May. Mr. Morton reported that AAI Pharma had terminated it lease and would be vacating the building on airport property on September 28th. The 20,000 sq. ft. building will be available for lease at a very competitive rate. probability of obtaining financing for hotels on leased airport property, by describing what the airport in Biloxi, Mississippi did. He explained they obtained a 40-year prepaid ground lease with 1%-2% of gross revenue per month. Mr. Morton reported he also spoke with his counterpart at the Savannah, Georgia airport, who sent sample leases and information about its 13 hotels and the banks they are financed with. Operations Report: Using charts for illustration, Mr. Broughton reported airport statistics for the month of March, including fuel price comparisons, fuel flowage amounts, and airfare comparisons with MYR, RDU, FAY and OAJ. He estimated total passengers enplaned for March at 29,151, as final statistics are not available yet. He stated the load factor at this time for New Hanover County Airport Authority March 28, 2012 Page 4 March was 79.8%. Mr. Broughton stated statistics for aircraft and people cleared through Customs for the month of March were not available yet. Directors Report: Mr. Rosborough updated Authority members in reference to American they are hoping to come out of the bankruptcy reorganization process by the end of this calendar year. He commented hicago flight at ILM will terminate as of April 2nd. Mr. Rosborough stated Southwest had increased their airfares due to fuel costs, and he expected other airlines to do the same. Chairma Secondary Water Source issue. Mr. Rosborough of running the water line from Spring Road to Castle Hayne Road. The advantage of this option would be the capability Business Park can be developed. The second option Mr. Rosborough described would entail running the water line along Harnett Avenue to N. Kerr Avenue; however, this option would He described a third option that would entail option would necessitate obtaining several easements. Mr. Rosborough then reviewed the pros and cons of each of the different options to provide ILM a Secondary Water Source. There was a brief discussion among the Authority members present and staff about the three options and the funding to pay for it. Mr. Rosborough concluded by recommending approval of the Spring Road option during the Regular meeting. Chairman Lennon reentered the meeting following the Secondary Water Source discussion. Dr. Roseman suggested the minutes be provided to Authority members in a more timely manner so as to allow more time to review them and submit comments. Rosborough stated the Secretary of the NCDOT, Mr. Gene Conti, has written a letter to the FAA in opposition to its proposal, and Mr. Richard Walls, the Director of the NCDOT Aviation Division, has taken on a leadership role in opposing the ADO Realignment. Chairman Lennon described an initiative by a group of pilots in Eastern North Carolina, who were interested in bringing a static aircraft display to Wilmington, which would involve finding a safe place to keep it. Chairman Lennon stated one of the pilots suggested ILM host this static display, and he invited discussion of the idea. After some discussion, Chairman Lennon suggested one of the pilots could come to speak to Gary Broughton, Director of Operations, so that Authority members would have more information to make a decision. New Hanover County Airport Authority March 28, 2012 Page 5 ADJOURNMENT There being no further business to come before the Board, Chairman Lennon adjourned the meeting at 5:43 p.m. Prepared by: Respectfully Submitted: Sandy Routh _______________________________ Robert S. Rippy, Secretary