MBS INTERNATIONAL AIRPORT COMMISSION

 

April 16, 2009

 

MINUTES

                                                                           

The meeting was held in the Airport Commission Board Room, 8600 Garfield Road, Freeland, Michigan 48623.  Chairman Kenneth Distler called the meeting to order at 1:00 p.m.  Roll was called by Debbie Meisel.

 

COMMISSIONERS

 

Present                           Absent & Excused         Staff                         Other           

George J. Biltz               Darnell Earley                Jeff Nagel                Cheryl Wade, Midland Daily News

Kenneth W. Distler                                               Andre R. Borrello    Wilma Kasten, Citizen

Brian K. Elder                                                        Ryan Riesinger         Paul Wyche, Saginaw News

Eugene F. Gwizdala                                                                               Debbie Meisel          Ron Engel, Mead & Hunt

Ernie Krygier                                                                                        

Jon Lynch                                                             Guests                     

Hollis H. McKeag                                                 Mark Wilcer, RS&H

Joyce J. Seals                                                        Boris Yakima, Mohaghan, LoPrete,

                                                                                  McDonald, Yakima, Grenke & McCarthy

 

Chairman Distler stated that he appreciated the good attendance since everyone has busy schedules.

 

PLEDGE OF ALLEGIANCE 

 

MINUTES:  Mr. Gwizdala made a motion to approve the minutes of the Regular Commission Meeting held on March 19, 2009.  Mr. Krygier seconded the motion.  The motion was unanimously approved by the Board.   

 

MARCH 2009 WARRANTS AND CASH & INVESTMENT SUMMARIES:  Mr. Gwizdala made a motion to approve the Warrant Registers for the March Payroll Account Check Numbers 84541-84596; the March Operations and Maintenance Check Numbers 39258-39338; and the March Cash and Investment Summaries.  Mr. Biltz seconded the motion and the Board unanimously approved it.

 

PUBLIC COMMENT:  None

 

PROPERTY ACQUISITION UPDATE:  Chairman Distler explained that this item qualifies for closed session because the Board needs to consult with special counsel for the land acquisition regarding a settlement strategy.  This discussion in an open forum would cause a detrimental financial affect on the settlement position of the Commission.  Mr. Biltz made a motion to go into closed session for the purpose of consulting with the attorney regarding trial and/or settlement strategy for pending litigation.  Mr. Krygier seconded the motion.  Chairman Distler asked for a roll call vote.  Ms. Meisel took roll call as follows:  Mr. Biltz, yes; Dr. Distler, yes; Mr. Elder, yes; Mr. Gwizdala, yes; Mr. Krygier, yes; Mr. Lynch, yes; Mr. McKeag, yes; Ms. Seals, yes.  The motion carried.

 

Upon return from closed session Mr. Elder made a motion that the Commission follows the advice of counsel during the closed session.  Mr. Krygier seconded and the motion passed unanimously. 

 

SMARTE CARTE AGREEMENT:  Mr. Nagel stated that Smarte Carte has operated two luggage cart units at MBS for a number of years.  Smarte Carte maintains and services the units and MBS makes a small percentage of revenue.  The main purpose of having these units is a customer service feature.

 

MBS received a letter from Smarte Carte in January stating that the new airline fees regarding checked luggage has had a dramatic impact on their business nationwide.  Since the existing Smarte Carte agreement was in a month-to-month status, discussion took place regarding a variety of ways to keep the cart systems at MBS for passenger use.  The most effective way is to utilize an “airport-managed” system where MBS will maintain, service and manage the units.  Smarte Carte will provide training and supply parts.  MBS will receive a “concession fee” equal to 5% of gross proceeds.

 

The agreement is for a period of one year commencing May 1, 2009.  The agreement automatically extends for an additional year; however, each party has the option to cancel after the initial term.  This option has been discussed with the Finance Committee and they agree with the recommendation to enter the new agreement with Smarte Carte.

 

Mr. Gwizdala made a motion to approve the agreement with Smarte Carte for the “airport-managed” baggage cart systems at MBS Airport and authorize the Chairman to sign.  Mr. Biltz seconded and the motion passed unanimously.

 

AMERICAN RECOVERY AND REINVESTMENT ACT (ARRA) GRANT:  Mr. Nagel stated that MBS was notified on April 2, 2009 that the airport would receive $12.7 million in AIP discretionary money through the American Recovery and Reinvestment Act (ARRA), commonly referred to as the “stimulus package”.  This is very good news for the MBS project and was the culmination of a lot of hard work by numerous members of the Great Lakes Bay Region and elected officials.  Mr. Nagel stated that 256 stimulus grants have been issued through the FAA.  There have only been 13 stimulus grants issued over $12 million.  As of this date MBS is the only airport in the State of Michigan that has received one of these grants from the FAA though others are being worked on and will be issued. This speaks volumes of MBS for the work done and justification to get the project ready.    

 

Now that the grant has been announced, the hard work really begins.  RS&H has designed several bid packages which will incorporate the full $12.7 million.  The grant pre-application included the following items:

 

      -Foundation, steel and building systems                                                 $4.2 million

      -Site improvements, drainage, utilities and access road                          $7.7 million

      -Passenger boarding bridges and furnishings                                          $3.1 million

 

Mr. Nagel stated that there are a couple samples of some furniture next to the gift shop and food court.  They meet the Buy American clause and the intent of the grant.

 

Although the total of the pre-application is $15 million, the final grant amount will be based on actual bids received.  It should be noted that this is 100% federal money and no local or State match is required.  Therefore, the goal is to take full advantage of the $12.7 million.  In today’s bidding climate, it is not uncommon to see more competitive bids than what is normally seen.  In other words, if the FAA is offering $12.7 million, it is the intent to find qualified projects to get the full $12.7 million.

 

The Operations Committee has been involved in this process and has agreed that the goal is to maximize the value of this grant while keeping the project on schedule.  These projects are all quality projects that fit the efforts to develop the terminal as well as the goal set by the ARRA of job creation.  RS&H has done an excellent job of meeting the goals of the Act while doing their best to keep the terminal project moving forward.  Completing all of this work would be a benefit not only to the project, but the overall economy as well.  This scenario provides a win-win solution.

 

FAA has set very tight timeframes for the final grants to be issued.  Those deadlines are outlined below:

 

            Projects “on the street” advertised                                         Mid to late April

            Bids received                                                                          May 15th

            Firm numbers to the FAA                                                       June 1st

            Grant offer                                                                              June 17th

            Notice to Proceed                                                                   Mid-July

 

These deadlines will require that the process move forward in an expedited manner. 

 

If these deadlines remain as-is, the intent is to bring the bids to the full Commission for approval at the regular Commission Meeting scheduled for May 21, 2009.  However, because this process is new for all parties (MBS, FAA, State) MBS needs to remain flexible enough in case any deadlines were to change, or in case there would not be a quorum for the May meeting.  Therefore, in the event a contingency plan is needed, Mr. Nagel recommended the following motion be passed.

 

A motion to authorize the Operations Committee to review the bid tabulations and the RS&H recommendation and direct the airport manager to submit the bid tabulations to the FAA for the purpose of completing the final Grant Application.  This action will not formally approve the bids but will suffice to meet the FAA requirement for completion of the Grant Application.

 

Mr. Gwizdala made the above motion with Ms. Seals seconding.  Discussion took place as to what would happen if the bids came in over or under the $12.7 million.  Mr. Nagel stated that the airport wants to use the entire grant amount and has estimated $15 million with the hopes that the bids come in under at $12.7 million.  The project was designed to have various parcels or bid packages so the work to be done could be adjusted by removing a portion or if the bids come in at $15 million a decision would need to be made if it was a good price to pay the balance with local dollars.  Chairman Distler stated that the Operations Committee, comprised of Mr. Biltz, Mr. Gwizdala, and himself, feels that this is the direction to go.  He also thanked them for attending the meetings which were sometimes last minute.  There being no further discussion, the motion passed unanimously.

 

In addition, the Commission usually passes a Resolution in the early stages of the Grant process to allow the Chairman to sign all related paperwork for the grant.  The paperwork for this grant will be more involved than a regular grant.  Mr. Nagel recommended that the attached Resolution be passed at this time.  This too, will insure that the grant process stays on course and MBS will be able to meet the FAA timetables.  Mr. Gwizdala made a motion to approve the attached Resolution.

 

RESOLUTION

(ARRA Grant #4009)

 

RESOLUTION ADOPTING AND APPROVING THE EXECUTION OF THE GRANT APPLICATION, GRANT AND ALL RELATED DOCUMENTS BY THE MBS AIRPORT COMMISSION, A SPECIAL STATUTORY BODY, ACTING AS SPONSOR FOR THE CITY OF MIDLAND, CITY OF SAGINAW, AND COUNTY OF BAY, MICHIGAN, AND THE UNITED STATES OF AMERICA, FEDERAL AVIATION ADMINISTRATION, FOR THE PURPOSE OF OBTAINING FEDERAL AID FOR THE DEVELOPMENT OF THE MBS INTERNATIONAL AIRPORT, UNDER PROJECT NO. 3-26-0083-4009.

 

BE IT RESOLVED by the members of the MBS International Airport Commission,

Freeland, Michigan:

 

Section I.  That MBS International Airport Commission, on behalf of the City of Midland, the City of Saginaw and the County of Bay, Michigan, shall submit a Grant Application and enter into a Grant Agreement for the development of the MBS International Airport, and that such Grant Documents shall be set forth hereinbelow:

 

Section II.  That the Chairman or Vice-Chairman of the MBS International Airport Commission, is hereby authorized and directed to execute said Grant Application, Grant Agreement, and all other related documents in (4) copies on behalf of the City of Midland, City of Saginaw, and County of Bay, Michigan, and the Airport Manager is hereby authorized and directed to impress the official seal and to attest said execution:

 

Section III.  That the Grant Application/Agreement referred to as Project 3-26-0083-4009.

 

Mr. Biltz seconded and the motion passed unanimously.

 

OLD BUSINESS:  

 

Terminal Enhancement:  Mr. Nagel asked Mr. Riesinger to update the Commission on the Terminal Enhancement.  Mr. Riesinger stated that the work is in progress.  The interior painting and ticket counter improvements are complete with the vinyl flooring in front of the ticket counters 90% complete.  Entrance tiles have also been replaced.  Removal and replacement of the carpeting will start tonight or tomorrow night.  The work is on schedule and is expected to be complete mid-May.  Positive comments have been received.

 

Terminal Phase II Construction Report:  Mr. Riesinger stated that Phase II is installation of a temporary perimeter fence, construction of an access road to be used throughout the terminal project, tree removal, structure demolition, and pavement removal.  The preconstruction meeting was last Tuesday.  The work is expected to take approximately 60 calendar days to complete.  This work is preparation for Phase III.      

 

NEW BUSINESS:  None 

 

Mr. McKeag stated that the airport is far enough along that serious thought should be given to what should be done with the current passenger terminal.  Mr. Nagel stated that the grant has expedited this process.  He stated that he will look at a couple ways to evaluate the building and determine what the potentials are.  He will present to the Operations Committee and then bring it back to the Board. 

 

ADMINISTRATIVE MATTERS:  Chairman Distler thanked the board members for any contacts that were made while waiting for approval of the airport grant.  He stated that the board members are diverse and add to the success of the airport.   

 

Next regular meeting is scheduled for May 21, 2009. 

 

ADJOURNMENT:  There being no further business, Mr. Gwizdala made a motion to adjourn.  Ms. Seals seconded and the Board unanimously passed the motion.  The meeting adjourned at 1:48 p.m.

 

 

                                                                                                                                                            Eugene F. Gwizdala, Secretary