Airport Authority - July 10, 2018 Minutes
The Regular Meeting of the Municipal Airport Authority of the City of Fargo, North Dakota, was held Tuesday, July 10, 2018, at 8:00 a.m. in the Airport Boardroom.
The members present or absent were as follows:
Present: Linn, Blazek, Lind, Haugen, Clark
Absent: None
Others: Piepkorn
Chairman Clark presiding.
Approved the Minutes of the Regular Meeting of the Municipal Airport Authority Held June 26, 2018:
The minutes of the Regular Meeting of the Municipal Airport Authority held June 26, 2018, were approved without objection.
Approved the Airport Vouchers Totaling $38,813.44:
Gen. Haugen moved to approve the airport vouchers totaling $38,813.44.
Second by Mr. Blazek.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Approved the Individual Voucher to Northern Improvement Company:
Mr. Blazek moved to approve the individual voucher in the amount of $5,939.00 to Northern Improvement company for partial payment request to remove and replace Taxiway H Radius Pavement.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Approved the Individual Voucher to Northern Improvement Company:
Mr. Blazek moved to approve the individual voucher in the amount of $1,031.25 to Northern Improvement Company for partial payment request for repairs to Taxiway H.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Approved the Individual Voucher to Flint Group:
Mr. Blazek moved to approve the individual voucher in the amount of $11,683.31 to Flint Group for partial payment request for 2018 Airport Marketing Program.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Approved the Individual Voucher to TL Stroh Architects:
Mr. Blazek moved to approve the individual voucher in the amount of $59,950.00 to TL Stroh Architects for partial payment request for architectural and engineering services in connection with the Elevated Walkway.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Approved the Individual Voucher to Sixel LLC:
Mr. Blazek moved to approve the individual voucher in the amount of $3,242.00 to Sixel LLC for Frontier passenger enplanement fees for June 2018.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen, Clark voted aye.
No member being absent and none voting nay the motion was declared carried.
Chairman Clark stated we will delay agenda item #4 for a few minutes.
Authorized Attendance at the National Association of Foreign Trade Zones Annual Conference, September 16-19, 2018, Atlanta, GA:
Ms. Linn moved to authorize attendance at the National Association of Foreign Trade Zones Annual Conference, September 16-19, 2018, Atlanta, GA.
Second by Gen. Haugen.
All members present voted aye and the motion was declared carried.
Received Proposed Contracts from Mead & Hunt for Access Road Pavement Rehabilitation and Access Road Lighting Upgrade, AIP48:
The proposed contracts with Mead & Hunt for the Dakota Drive Pavement Rehabilitation Dakota Drive and Dakota Drive Street Lighting Improvements were received and filed without objection.
Mr. Dobberstein stated the reason we decided to move this project up on our list of capital improvements is because of our boarding classification. He stated right now we are at a non-hub but our boardings are increasing and when we move back into a small hub this project would not be eligible for federal funding. He stated we met with the FAA a couple of weeks ago and they are supporting this project. He stated this would be the entire rehabilitation of Dakota Drive from Old 81 north. He stated we would also be rehabilitation the street lighting. He stated the pavement has not been touched since it was installed in 1985. He stated the project would include joint sealing, painting, spall repair, replace cracked panels, etc. on Dakota Drive and associated connecting roads, maintenance building apron, car rental apron, pay parking entrances/exits, employee parking lot road, etc. He stated the lighting rehabilitation will consist of replacing the light fixtures with an LED unit. He stated we would like to get this project out for bid as soon as possible.
Mr. Klein stated the grant application was due today but the FAA in Bismarck has allowed an extension until September in order to be able to get this project together and under grant this year. He stated we will probably have a September bid opening with the work to actually be done in 2019.
Mr. Dobberstein stated if the board approves these contracts today, the next step is to submit them to an engineer for an independent fee review, as required by the FAA. He stated we have been using Mr. Wes Schon for those independent fee review services.
Mr. Blazek moved to approve the proposed contracts from Mead & Hunt for the Dakota Drive Pavement Rehabilitation and the Dakota Drive Lighting Improvements, subject to an independent fee review.
Second by Ms. Linn.
All members present voted aye and the motion was declared carried.
Presentation by ProResources:
Ms. Kriss Burns was recognized, gave a brief overview of the company and introduced the other members of the ProResources team. She stated ProResources was founded in 1991 in Detroit Lakes. She stated they currently have about 400 clients and about 6,400 employees that they service. She stated the ownership and board of directors include Mike Brodsho, Scott Busker, Matt Johnson and Paul Highness, who is the managing partner in Fargo. She stated they currently have employers in five states with employees in 36 states. Ms. Burns stated ProResources has solutions that make businesses grow.
Presentations were given in the following areas payroll processing, benefits administration, human resources management, Workers' Comp and risk management, safety and wellness company culture and cloud based employee solutions.
Mr. Highness stated on the benefits side of their services they shop the market for the best value for the dollar and they do not receive any commissions. He stated he feels that service is invaluable to customers.
Mr. Highness stated as a business owner, before coming on board with ProResources, he thought he was doing a great job in these areas of his business, but after seeing what ProResources can do he realized he was not doing a good job in those human resources areas.
Mr. Highness stated ProResources is a Professional Employer Organization (PEO). He stated they partner with employers and take that liability off their plate. He stated they are not a staffing agency and do not lease you employees. He stated the employees are your employees. He stated should the airport ever terminate its contract with ProResources they would put you back the way you were. He stated because of the core-shared employment they can bring you these benefits you can't get on your own. He stated they can bring you the efficiencies you cannot normally get. He stated they can deal with many of the human resources functions on your behalf and that is one of the advantages of a PEO.
Mr. Highness stated their proposal is based on a straight percentage of gross payroll so the fees are based on your actual gross payroll. He stated the percentage of gross payroll covers all payroll taxes, FICA (Social Security/Medicare), Workers' Compensation, Federal Unemployment plus state unemployment taxes. The airport would have two payroll factors: Fire Department employees and all other airport employees.
Mr. Dobberstein stated
Mr. Highness stated ProResources would become liable for all of the payroll taxes as well as other fiduciary responsibilities, such as their 401ks.
Mr. Dobberstein explained the Municipal Airport Authority's relationship with the City of Fargo is out of convenience, period. It is not due to necessity. He stated that is the way it has always been since 1969 when the Airport Authority was established. He stated we are at this stage today at the recommendation of the City Administrator. He asked that the Airport Authority go out and find a human resources opportunity and that is why we are here.
Commissioner Piepkorn asked how much the services of the City of Fargo cost the Airport Authority.
Mr. Dobberstein stated the Airport Authority currently pays $50,000 per year for services provided. He stated it was proposed by the City of Fargo about two years ago that the amount be increased to something over $90,000 and the Airport Authority agreed to that. However, that amount needs to be approved by the FAA and the information they need is sitting with the City's Finance Department. He stated the Finance Director needs to justify the amount of money they have proposed. He stated we would not need approval of the recommended change as they just look at this as a human resources function and a cost of operating. He stated there are other services provided by the City of Fargo, which we would look at continuing. He stated that would be addressed in the Memorandum of Understanding we have been negotiating with the City for a number of months.
Ms. Linn asked how many airports in North Dakota are operated by airport authorities.
Mr. Dobberstein stated there are 89 publicly funded airports in the state and 84 are operated by airport authorities.
Mr. Dobberstein stated as far as cost, we figured roughly $55,000-$60,000 based on gross payroll.
Mr. Dobberstein stated this proposal is for our information at this point.
Ms. Linn stated we could let Mr. Grubb know that we have followed through with his request and that we did as he suggested. She stated if she recalls correctly we went through the proposed MOU thoroughly in January and now that the election is over we should be getting that finalized and decide on those relationships.
Mr. Dobberstein stated even if we decide to go with ProResources for the human resources and payroll functions, we might retain the services of the City of Fargo for accounting and IT functions. He asked how much lead-time ProResources would need before a January 1 start time.
Mr. Highness stated six weeks would be ideal.
Mr. Dobberstein stated he would advise the City Administrator that we have taken this step. He added that in his research on ProResources and contacting others that use their services he did not hear one negative comment.
Gen. Haugen stated during his time at the Guard they had just one person in Human Resources and there was no way that person was able to handle all of that and they had to outsource some of it. He stated for the airport and 30 employees this proposal seems to offer an immense amount of expertise.
Commissioner Piepkorn asked if there is some dissatisfaction with the City or non-performance. He stated we are on the same team, the City and the Airport, and we should always be on the same team and we should work together. He stated especially economic development wise. He stated the airport is a critical part of our city and so it is a big deal. He stated to him it is symbolic and so it is not a good sign.
Ms. Linn asked what was not a good sign?
Commissioner Piepkorn stated the airport is working with the City now and you are looking at probably spending more money and if there was some dissatisfaction or if it was less money that would be interesting, but to him, this being his first meeting, that is what he is looking at.
Gen. Haugen stated the City of Fargo is looking at doubling the fee to the airport so it is not going to be more money.
Commissioner Piepkorn asked if there was dissatisfaction or non-performance or some issues because he deals with Human Resources a lot and they seem to be doing a very good job.
Mr. Dobberstein stated there has been some frustration with board members over the years on compensation issues and some of the politics and the hoops. He stated it has not appeared that Human Resources nor the City understands and recognizes the independent autonomous entity that is the Airport Authority, and under state statute, it is very very clear that this organization sets compensation. Period. He stated that is where things have gone awry.
Commissioner Piepkorn stated he has sat on the personnel evaluation thing so he has been in on the meetings so he gets that part of it. He stated he wants to get back to the Human Resources. He said we already have all of this and we have an excellent Human Resources staff who do an excellent job. He stated this is symbolic and this is not a good symbolism.
Mr. Dobberstein agreed the City of Fargo Human Resources Office staff does an excellent job but suggested Commissioner Piepkorn have a conversation with City Administrator Bruce Grubb as it was because of his recommendation that we are here today.
Ms. Linn stated she does not think she understands Mr. Piepkorn's statement that it seems symbolic. She stated we are all part of the City of Fargo and service our constituents.
Commissioner Piepkorn stated we should be but we should be working together but that definitely is not the vibe he is getting. He stated maybe Ms. Linn's vibe is different than the vibe he is getting. He stated he is getting this "stay out of our business" kind of thing. He stated he thinks the airport is a huge part of our economic development so we need to work together. He stated we need to be on the same team.
Mr. Dobberstein stated we are on the same team.
Ms. Linn stated we are on the same team but looking at it as a business owner would, she feels it is prudent to look at other options that are going to be more valuable and cost effective and that is what we are doing, and that is nothing against the City.
Commissioner Piepkorn stated we have the same boss and that is the citizens of Fargo.
General Haugen stated that is exactly the point. He stated if we can do it better and cheaper that is what we ought to do.
Commissioner Piepkorn stated there is more to this story. He stated we need to work together and we need to be on the same page, and if we are not then he thinks we need to make some changes.
Mr. Blazek asked what changes?
Commissioner Piepkorn stated we do not need to get into that today but he is saying it is critical that we have to be on the same page. He gets the vibe that the airport does not want to be that and that is not good.
All Airport Authority members voiced the opinion that Commissioner Piepkorn's statement was not true.
Commissioner Piepkorn stated if that is not true that is good and he is going to be here for four years and is looking forward to working with the Airport Authority.
Airport Construction and Security Update:
Mr. Jeff Klein, Mead & Hunt, was recognized and stated the Employee Parking Lot Reconstruction and Expansion Project is complete with the exception of some punch list items.
The meeting of the Municipal Airport Authority was adjourned until the next Regular Meeting to be held Thursday, July 26, 2018 at 10:00 a.m.
Time at adjournment was 8:58 a.m.