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HomeMy WebLinkAboutMinutes Airport Board - 11/14/2007 )REGULAR MEETING MINUTES CORPUS CHRISTI INTERNATIONAL AIRPORT B 1000 INTERNATIONAL DRIVE EIVED AVIATION BOARD ROOM CORPUS CHRISTI,TEXAS FEB 10 2010 CORPYIS l YNTRRNATIONA L NOVEMBER 14, 2007,2:30 P.M. TIONA AIRPORT BOARD MEMBERS Jerry Kane, Chairman Don Feferman,Member Frank"Rocco"Montesano,Vice-Chair William Dodge, Member I.C. Ayala,Member Jesse Olivares,Member Glenn E.Lyons,Member Jay Wise,Member Sylvia Whitmore,Member Sam Susser,Member Ed Hicks, Sr., Advisory Member AIRPORT STAFF Fred Segundo, Director of Aviation Adelle Ives,Management Assistant Roy Rodriguez,Facilities Manager Mario Tapia,Finance&Admin Manager Carl Gross, Operations Manager John Hyland,Chief of Public Safety I. Call to Order The meeting was called to order by Chair Kane at 2:34 p.m. A quorum was present. II. Approval of the minutes for the August 8th,2007, regular meeting of the Airport Board. Chair Kane called for approval of the minutes of the August Board meeting. Vice-Chair Montesano moved to approve the minutes as read. Board member Susser seconded and the motion carried. III. Approval of Board member absences Chair Kane called for excusing Board members Whitmore, Olivares and Susser from the August 2007 Airport Board meeting. Vice-Chair Montesano moved to excuse Board members Whitmore, Olivams and Susser. Board member Feferman seconded and the motion carried. IV. Introduction of new Director of Aviation,Fred Segundo, by City Manager, Skip Noe City Manager, Skip Noe, introduced Mr. Fred Segundo, the new Direction of Aviation, to the Board. Mr. Segundo gave a brief history of his experience and education along with his goals for the Airport under his direction. Board members welcomed Director Segundo to the Airport. (Chair Kane changed the order of business to allow Keith Arnold, with the CVB, to address the Board under Director's Report, General Update.) Mr. Keith Arnold, with the Convention Visitor's Bureau, addressed the Airport Board to seek their support to attract the US Bowling Congress in choosing Corpus Christi to host their event in 2011. He reported that Corpus Christ is the second most attended bowling tournament within the United States. The tournament selection committee for the USBC felt that Corpus Christi would have been in first place had there been sufficient flights at the beginning of the tournament. He felt that it was very important to have the Airport Board support the CVB's efforts in influencing the airlines in increasing flights throughout the tournament. He added the Mayor asked he report to the Board that he has already begun communicating with American. Airlines regarding the bowling tournament. He also stated the Mayor would like to join efforts with the Board in increasing nights. On behalf of the CVB,Mr.Arnold requested a letter from the Airport Board Chair,with the support Corpus(,nristi International Airport Board Agenda November 14, 2007 Page 1 of 5 of the entire Board, to the Airlines asking to secure additional flights from February, 2011 to July, 2011 for this tournament. Mr. Arnold reminded the Board there were 67,000 bowlers attending the last bowling tournament held in Corpus Christi. Chair Kane stated that the consensus of the Board was to support efforts to increase flights for this tournament. He also stated that he would generate a letter stating the Board's support of these efforts. Chair Kane and Board member Susser had questions for Mr. Arnold regarding statistics from the Baton Rouge bowling tournament. Mr. Arnold informed the Board that a new service was started called the Bowling Ball Express which ships bowling balls to tournaments instead of having the bowlers carry them on their flights. This service will be very beneficial for the airlines. Mr. Arnold concluded by stating that a formal presentation to the Bowling Congress would be done on November 30`h in Milwaukee,Wisconsin. V. Action Item: a. Motion to recommend that the City Council authorize the City Manager or designee to execute a leasehold termination agreement with Semtech Corpus Christi Corporation for property located at the Corpus Christi international Airport Mario Tapia, Finance Manager, reported that the Semtech Corp., on the first of October, 2007, made an offer of$200,000 to terminate the .leasehold agreement along with responsibility of demolition of the building and environmental clean-up. Upon conferring with City staff, a counter-offer proposal was presented to Semteeh which included $225,000 for the lease buy- out,payment of CEP adjustment for$36,000 and the responsibility to cleanup of the area around the electrical transformers. He reported the Airport would benefit from this termination in that the contract terminates in 2010; and the revenue generated from the lease, as it stands at this point in time, would be $518,000. At that time, the responsibility of the building demolition and environmental clean-up would revert back to the Airport. Along with this information and including estimates on the cost of demolition and environmental clean-up, staff recommends the Board approve this item to terminate this lease. Director Segundo added that it would be a financially beneficial due to the cost of cnvironmental clean-up. Vice-Chair Montesano questioned whether the Airport was ever responsible for environmental clean-up on this property. He felt that Semtech would have been responsible for the environmental clean-up whenever the contract expired. Mr. Tapia explained that the original 30-year agreement which consisted of three 10-year terms. The agreement started in 1991 and in 2001, Semtech was given the opportunity to opt out. He added that if they had taken the option, the Airport would have assumed the responsibility of environmental clean-up. Board member Lyons questioned what the time frame involved in completing the demolition and environmental clean-up. Mr. Tapia responded that this would take from 30 to 90 days upon receipt of payment and including the TCBQ's inspection. Board member Lyons also questioned whether there were any stipulations for extended delay by TCEQ for remediation. Mr. Tapia responded that there were no stipulations of this type. He added that based on concerns regarding the length of time to complete the negotiations of this lease, the Airport's ''w 1 Corpus Gnristi International Airport Board Agenda November I4,2007 Page 3 of 5 proposed agreement includes a stipulation should there be a delay beyond another month, Semtech would continue to make monthly payments which are$14,000 per month. Roy Rodriguez, Facilities Manager, interjected that there currently is an environmental assessment on this site. He reported that the only area that had contamination of chromium products was an area of 14'X167 area by the transformers. They are willing to clean-up the area and the only other remediation involved with this property would be the asbestos abatement within the building. Mr. Tapia also added that costs of asbestos remediation could potentially be$1 million. Board member Susser questioned whether staff had researched Semtech's financial stability. Mr. Tapia reported he would provide that information to the Board at the next meeting. Board member Wise moved to approve this item. Board member Lyons seconded and the motion carried. V 1. Financial Report Presentation Mr. Tapia reported on the year-end financials for the Airport. He reported that the Airport ended the year with an increase of $335,000. The revenues were higher in the Oil & Gas accounts and the Parking Revenue account. He added that revenue at the Parking Lot continues to increase. Mr.Tapia continued by reporting that$8.4 million in total revenues compared to $8.1 million in total expenditures. He reviewed each Cost Center including Administration costs which were over $99,000 due primarily to cost involved in marketing Express7et in their inaugural launch. Mr. Tapia also added that this increase also included environmental assessments which were not anticipated. Mr. Tapia also reported that under Building Maintenance, expenses were $150,000 less due primarily to the new chillers. He added that since the end of last fiscal, the Airport has been operating on only one chiller because of their high efficiency. Mr. Tapia began reporting on the Airport revenues. He stated that Oil and Gas revenues were less than anticipated. He added that the next budget estimated less in revenue as it is unclear what EOG will be undertaking. Chair Kane questioned whether cellular repeaters were on Airport property. Mr. Rodriguez responded that Verizon has the only repeater on Airport property. Mr. Tapia continued by reporting that this new fiscal shows that the Airport is at 26% of the revcnuc budgeted and 23%of the expenditures budgeted. This figure should reflect a quarter of expenditures budgeted which he felt was on track. Board member Susser questioned what the status of the FBO rental adjustments. Mr. Tapia responded that this was completed and he would provide that information to the Board. Board member Susser also questioned the status of negotiations with Mercury. Mr. Tapia responded that Mercury has not responded and their legal staff is reviewing the issue. Board member Susser suggested that the Airport should move forward on putting out an RFP. Mr. Tapia Corpus Ln isti 1'ntemational Airport Board Agenda November 14, 2007 Page 4 of 5 deferred to Director Segundo who stated that based upon the history regarding this matter, it would be a good move for the Airport to proceed with an RFP. He also added that he would look into this matter. He gave the Board the manner in which he would be handling all leases and in changes of the lease terms and conditions. Mr. Tapia reported on the increases of the farm leases located on Airport property. He reported these leases generate approximately$55,000. He continued to report that the farmers have been paying $25 per acre which is below market rate. For this reason, the Airport informed the farmers that a rate change of$50 per acre would be made. Director Segundo interjected that future leases would include guidelines to the type of crops that could be farmed on these properties. VII. Proposed CIP Budget Presentation Mr. Tapia reported on the CIP referring to a PowerPoint presentation to the Board. He began by explaining the City's CIP process begins today with a meeting of the Planning Commission with the final approval of the City's CEP plan by City Council in mid-December. This presentation would give an overview of the Airport's CIP funding, project and long-range projects. Mr. Tapia stated that the City's CIP program consists of a 10 year plan. The first, second and third years are the short-range plan and the fourth through tenth years are the long-range plan. The short-range should be fully funded or at least funding should be identified which the Airport has accomplished. The Airport CIP short-range projects are drainage, taxiway and lighting rehab, ARFF (Fire Station), building and apron modifications. He reported that the long-range CIP projects, which were identified on the Master Plan, include the acquisition of a noise buffer area consisting of 425 acres south and east of the Airport, the Runway 13131 extension from 7,500 to 9,000 feet, perimeter road project, land acquisition for the parallel runway, replacement of the covered parking cover due to wear, replacement of ARFF (Fire Station) equipment,Runway 17135 extension, airfield pavement rehabilitation, expansion of the long-term parking,and Airport perimeter fence including a concrete base. Mr. Tapia continued by detailing each categories projects including funding amounts. General discussion and questions were heard by the Board. VIII. Director's Report a. Construction Update Director Segundo reported he would have a full construction update at the December. b. General Updates Chair Kane called for concerted efforts by the Board to increase flights. Board member Susser felt that flights for the west coast should be considered. Director Segundo stated that scheduling by the airlines is usually done 90 days out. With the smaller lag time regarding scheduling,there would be more opportunities to have them change schedules to possibly increase flights. Vice-Chair Montesano questioned the status of the Coast Guard project. Mr. Tapia reported that the Coast Guard are coordinating with FAA regarding the environmental assessment. Mr. Corpus Lnristi International Airport Board Agenda November 14,2007 Page S of 5 Rodriguez interjected that he has been in contact with the Coast Guard who stated they are still moving on this project and they are joining with Customs Border Protection on this effort. They are working on the environmental assessment requirements with the FAA. rx. Adjournment As there was no further business, Chair Kane call to adjourn the meeting. Board member Wise moved to adjourn and Board member Lyons seconded. The motion passed and the meeting adjourned at 3:44 p.m.