MBS INTERNATIONAL AIRPORT COMMISSION

 

 

September 17, 2009

 

MINUTES

†††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††

The meeting was held in the Airport Commission Board Room, 8600 Garfield Road, Freeland, Michigan 48623.Chairman George Biltz 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††††††††††††††† Cathy Price, Midland Daily News

Bregitte Braddock†††††††† Brian K. Elder††††††††††††††† Andre R. Borrello††† Marty Wazbinski, City of Midland

Eugene F. Gwizdala††††††† Joyce J. Seals††††††††††††††† Ryan Riesinger††††††††

Ernie Krygier††††††††††††††††††††††††††††††††††††††††††††††††††††††† Debbie Meisel†††††††††

Jon Lynch†††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††

Hollis H. McKeag†††††††††††††††††††††††††††††††††††††††††††††††† Guests†††††††††††††††††††††

††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††† Aaron Aljets, RS&H

†††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††

PLEDGE OF ALLEGIANCE

 

MINUTES:Mr. Gwizdala made a motion to approve the minutes of the Regular Commission Meeting held on August 20, 2009.Mr. Krygier seconded the motion.The motion was unanimously approved by the Board.

 

AUGUST 2009 WARRANTS AND CASH & INVESTMENT SUMMARIES:Mr. Gwizdala made a motion to approve the Warrant Registers for the August Payroll Account Check Numbers 84856-84912; the August Operations and Maintenance Check Numbers 39666-39733; and the August Cash and Investment Summaries.Mr. Lynch seconded the motion and the Board unanimously approved it.

 

PUBLIC COMMENT:None.

 

WELCOME NEW COMMISSIONER:Mr. Nagel stated that the Saginaw City Council has appointed Bregitte Braddock to the MBS International Airport Commission.Ms. Braddock is a City of Saginaw resident and is the current Chair of the Saginaw County Board of Commissioners.Ms. Braddock stated that she has lived in the City of Saginaw for 25 years.She is looking forward to working with the Commission. ††

 

FORMER HOLIDAY INN DEBT:Mr. Nagel stated that the former Holiday Inn in Midland is now in receivership and known as Midland Resort.Upon the transfer from the previous owners to the receivership, there is a $200 debt to MBS for airport advertising.

 

Unsuccessful attempts have been made to collect through phone calls and letters.The Midland Resort is current on their advertising contract as is the new Holiday Inn in Midland.The $200 debt has been discussed with the airport attorney and with the Finance Committee.The most cost effective solution is to declare the $200 as bad debt to enable us to write it off airport books.Mr. Nagel stressed that the debt is in no way related to the new Holiday Inn in Midland.Mr. Gwizdala made a motion to regard the $200 debt from the former Holiday Inn in Midland as bad debt and direct airport management to eliminate the debt from financial records.Mr. Krygier seconded and the motion passed unanimously.

 

RADIO GRANT:Mr. Riesinger stated that the Airport has been selected to receive a Department of Homeland Security Public Safety Interoperability Communication (PSIC) grant.This grant will allow MBS to replace the existing radio equipment that is beyond its useful life with 800 mhz digital radios that can be utilized as part of a statewide emergency communications network.These new radios will provide much improved capabilities for both internal and inter-agency communications.They will enable the airport to effectively combine two of the existing radio systems into one and utilize existing antenna infrastructure that is owned, operated, and maintained by the Michigan State Police, therefore, the airport will no longer need to maintain expensive radio receivers, repeaters, and transmitters in-house.Using these radios on a daily basis will also help to better familiarize personnel to the Saginaw County Emergency Communications plan.

 

As part of this grant, MBS will receive 26 800 mhz digital radios, radio programming, and accessories.Based on information submitted during the grant process, the airport is authorized for a project total of up to $104,510.00 and the grant will pay for 80%, leaving a maximum local match of $20,902.00.The actual amount of the project will be dependent upon the final order and yet to be determined final state contract pricing for the multi-agency order.However, while working with the consultant who is administering the grant for this region, the amount is now closer to $17,000 for the airport share because of the downsizing of the program.Funds were budgeted for radio improvements in 2009 and are available in the capital budget for this project.

 

Mr. Gwizdala made a motion to authorize expenditure of capital funds to provide the required 20% local match for the radio project program, not to exceed $20,902.00, and authorize the Airport Manager to sign the necessary documents after review by the airport attorney.Mr. Krygier seconded the motion.Discussion took place in regards to the money that this system will save the airport.Mr. Riesinger stated that this will eliminate the airport from purchasing a repeater which was estimated three years ago at $20,000 but the airport would have continued to use the same radios.Radios still will need to be budgeted for replacements as needed.There being no further discussion, the motion passed unanimously.

 

FAA MEMORANDUM OF AGREEMENT:Mr. Nagel stated that the FAA has a Master Lease with MBS which allows for the FAA to install, operate and maintain certain communication and navigational equipment on MBS property.This equipment at MBS includes weather stations, instrument landing systems, the air traffic control tower as well as others.The current Master Lease expires at the end of September.To replace this lease, the FAA has drafted a new Memorandum of Agreement with airports nationwide.

 

The Memorandum of Agreement supplied by the FAA was included in the Commission packet.Upon review by staff and legal counsel, there was a question regarding Section 9, Non-Restoration.Follow-up conversations were held with the FAA; however, they were firm with this language.It is very infrequent that the FAA vacates any equipment located at an airport and in some cases, it is due to an upgrade to the equipment which benefits the airport.This was the scenario several years ago when the new ASR-11 radar was installed at MBS.Mr. Nagel stated that the airport does not receive any rent based on the grant assurances; however the FAA totally maintains the equipment.

 

Overall, MBS receives a great benefit by having the FAA equipment and facilities located at the airport.Mr. Gwizdala made a motion to approve the FAA Memorandum of Agreement and authorize the Chairman, or in his absence the Vice-Chairman, to sign the document.Mr. Krygier seconded and the motion passed unanimously.

 

PASSENGER FACILITY CHARGE APPLICATION #7:Mr. Nagel stated that the Passenger Facility Charge (PFC) is a fee placed on airline tickets which is collected by the airline and sent back to the airport.It is a federal program with restrictions and limitations.The purpose of the program is to enable airports to fund eligible capital improvement projects.Applications need to be submitted to the FAA for their review and approval.The airlines also have the ability to provide comment on a proposed application.

 

The last application for MBS was submitted in August, 2007 and had two items related to construction of the new terminal.Most of that work however was included in the federal stimulus grant we received in 2009.Therefore, a new PFC application needs to be completed which includes additional terminal costs.In addition, there has been discussion in Washington regarding raising the cap on PFC charges from $4.50 per passenger to potentially $7.00.Therefore the application needs to be as flexible as possible.A motion approving the application is the first step in this process.

 

Mr. Nagel stated that he has been working with RS&H and the FAA to develop items for this application.Projects will include the following:

 

††††† -††† Phase IV terminal construction (local share only) Project #4109

††††††††††† (Connector taxiway and bid alternatives)

††††† -††† Airfield paint marking (local share only) Project #4109

††††† -††† PFC administrative expenses for prior work††

††††† -††† All phases of terminal construction including building furnishings and related airfield improvements.†† Excludes site work and utilities as well as concrete foundation and steel.

 

This application will approve the collection of an estimated $10,500,000.

 

Although the Commission has consistently pledged about 7% of the terminal project costs with PFC, increasing that amount in this PFC application provides MBS with the most flexibility as possible.This flexibility will also provide some level of contingency funding if needed.This application will not guarantee increased PFC contribution nor will it lower the amount of the FAA discretionary money that has been requested.

 

Mr. Nagel stated that this is a very lengthy process of six to eight months which involves letters and meetings with all the carriers.The proposed PFC application was discussed with the Operations Committee and they concurred with the recommendation to provide as much flexibility as possible.Mr. Gwizdala made a motion to approve the projects listed in PFC Application #7 and authorize the Airport Manager to submit the required application to the FAA with Mr. Krygier seconding.Discussion took place regarding the amount of tax and PFC on a ticket.Mr. Nagel said that the FAA required MBS to maximize every revenue stream possible if it was going to ask for discretionary money for the terminal project.That is when MBS raised the PFC from $3.00 to $4.50, the maximum allowed.PFCs are collected by the airlines and remitted back to the airport less a handling fee which is different than the aviation tax that is kept in the trust fund.

 

Mr. McKeag asked how long it takes for MBS to get PFCs from the airlines.Mr. Nagel had Ms. Meisel explain the procedure and timeframe.Ms. Meisel explained that the majority of the airlines submit within 30 days.However, MBS does receive PFCs from international airlines and some of those take longer to receive.Mr. Nagel added that a passenger is charged a PFC for the first two airports each way of a trip.Ms. Braddock asked how the airport knows how much revenue the PFCs will generate.The airport does not know until it receives the check and report.However, the airport has a good estimate based on passenger traffic.There being no further discussion, the motion passed unanimously.

 

PERSONNELL COMMITTEE UPDATE:Mr. Lynch stated that as part of the annual performance evaluation process, Mr. Nagel has the option to request his performance review be discussed in Closed Session under the Michigan Open Meetings Act.Mr. Nagel has made that request.Mr. Lynch recommended that this item be moved to the bottom of the agenda since there is other business to attend to.At that time the Board will take action to go into Closed Session to discuss the job performance review.The Board will return to Open Session to vote on the recommendation from the Personnel Committee.Chairman Biltz stated that the agenda is changed so the last order of business will be Mr. Nagelís review. ††††††††

 

FAA DISCRETIONARY GRANT:Mr. Nagel stated that the FAA notified him on Monday that MBS was in line for a 2009 Airport Improvement Program (AIP) Discretionary Grant in the amount of $3,000,079 total dollars at 95% Federal, 2.5% State and 2.5% local.

 

This grant will be used for Phase V of the terminal construction which will include the building shell and associated systems.Mr. Nagel is working with RS&H to develop a funding program for the completion of the terminal which will most-likely include a combination of 2010 AIP entitlement dollars, Passenger Facility Charges (PFC), local contribution and AIP discretionary money.Receiving this 2009 discretionary grant greatly assists the airport with this process and also continues the cooperative effort between MBS, the FAA, the State and the elected officials.

 

Since this is a 2009 grant, the grant application is due by tomorrow and the grant is expected to be signed sometime next week.Mr. Nagel met with the State on Tuesday and they have already filed their portion of the grant application.He is working with RS&H to complete the remaining supporting documentation.Unlike previous grants, this grant is not required to be based on actual bids.Work will most likely begin in late spring or early summer 2010, following the construction of the concrete foundation and steel which is ongoing.

 

Mr. Nagel stressed that this grant has not received complete and final clearance.If it does, the timing will be very short to get the Chairmanís and attorneyís signature on behalf of the Commission. That is why it was placed on the agenda.Mr. Krygier made a motion to approve the attached Resolution for Grant #4209 with Ms. Braddock seconding.

 

RESOLUTION

(AIP Grant #4209)

 

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. 3-26-0083-4209.

 

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 3-26-0083-4209.

 

The Board agreed that it was good news getting this additional funding.Chairman Biltz, speaking on behalf of the Operations Committee, stated that Mr. Nagel and RS&H have been proactive in thinking and planning ahead for what can be done to take advantage of opportunities like this if they arise.There being no further discussion, the motion passed unanimously.

 

OLD BUSINESS:

 

Ground Breaking:Mr. Nagel appreciated those who were able to attend the ground breaking ceremony.The event went very well and the airport received some good press.Mr. Nagel is attending the MAAE Conference this week and received very good comments on the project not only from the manager of the FAA Airport District Office, which is the office where the funding goes through, but also from the State Aeronautics Director. He highlighted the MBS project at the monthly Aeronautics Commission Meeting held at the conference.The project is well respected throughout the state and with the FAA.

 

Construction Update: Mr. Nagel stated that Aaron Aljets from RS&H is in attendance.He visits at least once a week.There is also a full-time on site person.The ASOS has been relocated and the RCAG is in process.

 

 

FAA Reauthorization:Mr. Nagel stated that at the Michigan Airport Conference there was an update on the FAA multi-year reauthorization.The last two years the funding has been authorized in pieces.It appears that 2010 could be another year of continuing resolution for airport funding.The House has passed a resolution for reauthorization but it would change the Federal share from 95% to 90% with the State and local at 5%.That is the House version and the Senate has not acted yet.According to the FAA at the conference, Congress is looking at potentially a three month extension of the existing bill to give the House and the Senate time to agree on a multi-year bill.†† †††

 

NEW BUSINESS:Mr. Nagel stated that at the conference he was elected as the First Vice President of the MAAE Board.He appreciates the support of the Airport Commission.The MAAE Board meets about every two months and there are two conferences a year.It is a great organization.About 170 airport people and 16 vendors with displays attended the conference.Chairman Biltz thanked Mr. Nagel for his representation on the MAAE Board.††

 

ADMINISTRATIVE MATTERS:Mr. Krygier requested that Mr. Riesinger point out for Ms. Braddock where the new terminal will be located.Mr. Riesinger also pointed out the old and new locations of the ASOS and the RCAG.Mr. Krygier also asked about the overlay for the map of the new terminal.Mr. Nagel stated that Martin Wander and Mark Wilcer of RS&H are working on the overlay.

Ms. Braddock asked what the plans are for the old terminal.Mr. Nagel stated that it has not been decided yet however, RS&H is working on several options that will be brought to the Operations Committee before being presented the Board.

 

Next regular meeting is scheduled for October 15, 2009.Mr. Biltz will not be able to attend that meeting.

 

There being no further business, Mr. Lynch made a motion to go into Closed Session for the purpose of reviewing the job performance evaluation of the airport manager.Mr. Gwizdala seconded the motion.Chairman Biltz asked for a roll call vote.Ms. Meisel called roll; George Biltz, yes; Bregitte Braddock, yes; Eugene Gwizdala, yes; Ernie Krygier, yes; Jon Lynch, yes; and Hollis McKeag, yes.Motion carried.The board took a short break and went into closed session.

 

AIRPORT MANAGERíS EVALUATION:Upon return from closed session, Mr. Lynch made a motion stating that based on the review of the airport managerís job performance evaluation, the recommendation of the personnel committee is a 3% increase in salary effective January 1, 2008 with no adjustment for 2009.Also future reviews of the airport manager should be timed to better coordinate with the airportís fiscal year.Mr. Krygier seconded and the motion passed unanimously.

 

ADJOURNMENT:There being no further business, Mr. Gwizdala made a motion to adjourn.Mr. Krygier seconded and the Board unanimously passed the motion.The meeting adjourned at 1:59 p.m.

 

 

†††† †††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††† ††††††††††††††††††††††††††††††††††††††††††††††††††††††††††† Eugene F. Gwizdala, Vice-Chairman