Airport Authority - October 24, 2018 Minutes
The Regular Meeting of the Municipal Airport Authority of the City of Fargo, North Dakota, was held Wednesday, October 24, 2018, at 8:00 a.m. in the Airport Boardroom.
The members present or absent were as follows:
Present: Linn, Blazek, Lind, Haugen
Absent: Clark
Others: Bossart, Piepkorn
Vice Chairman Haugen presiding.
Approved the Minutes of the Regular Meeting of the Municipal Airport Authority Held October 9, 2018:
The minutes of the Regular Meeting of the Municipal Airport Authority held October 9, 2018, were approved without objection.
Approved the Airport Vouchers Totaling $77,633.15:
Mr. Blazek moved to approve the airport vouchers totaling $77,633.15.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen voted aye.
Absent and not voting: Clark
The motion was declared carried.
Approved the Individual Voucher to Foreign-Trade Zone Corporation:
Mr. Blazek moved to approve the individual voucher in the amount of $81.25 to Foreign-Trade Corporation for payment request for review of Federal Register notice.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen voted aye.
Absent and not voting: Clark
The motion was declared carried.
Approved the Individual Voucher to Sixel LLC:
Mr. Blazek moved to approve the individual voucher in the amount of $2,500.00 to Sixel LLC for the airline data subscription, second quarter 2018.
Second by Ms. Linn.
On the call of the roll, members Linn, Blazek, Lind, Haugen voted aye.
Absent and not voting: Clark
The motion was declared carried.
Authorized Purchase of International Truck and Accessories Per State Bid/Contract, Nelson International/Bert's Truck Equipment (Replaces 1988 International Truck/Plow/Sander):
Mr. Dobberstein stated we need to replace a 1988 International truck with a plow and sander with a new unit. He stated the 1988 has a cracked frame and the NDDOT will no longer certify the unit. He stated we are looking at purchasing a 2019 International Truck under the ND State Bid, as well as a front end plow, side wing plow and sander. He stated the bids for the truck and the accessories total $225,834 and then with radio equipment we are looking at about $228,000. He stated delivery time will be late winter or early spring.
Mr. Dobberstein stated in the meantime the current unit can be used. He stated we may have to lease a truck in the interim if necessary.
Mr. Blazek moved to approve the capital expenditure for the 2019 International truck with plow and sander through the ND state bid, and that the Executive Director be authorized to lease any equipment needed to fulfill the requirements of this truck should it not be functional.
Second by Mr. Lind.
All members present voted aye and the motion was declared carried.
Received Communication from Mr. Rick Berg Regarding Hangar 19 Tenant:
The communication dated October 22, 2018, from Mr. Rick Berg, Hangar 19, was received and filed without objection.
Mr. Dobberstein stated as required in our lease with Hangar 19, any subleases must be approved by the board. He stated Mr. Berg is requesting approval of a sublease to a portion of their building as office space to Blazing Wings Properties. He stated they are also planning to be an aircraft partner.
Mr. Lind moved to approve the request from Hangar 19 for a sublease to Blazing Wings Properties.
Second by Ms. Linn.
All members present voted aye and the motion was declared carried.
Authorized Attendance at the International Council of Airshows Convention, December 2-6, 2018, Las Vegas, NV:
Mr. Dobberstein stated the Thunderbirds will be in Fargo in July 2019. He stated he will be attending the ICAS Conference along with Mr. Blazek. He stated Gen. Haugen will be attending on behalf of the Fargo Airsho Committee.
Ms. Linn moved to authorize attendance at the International Council of Airshows Convention, December 2-6, 2018, Las Vegas, NV.
Second by Mr. Lind.
All members present voted aye and the motion was declared carried.
Mr. Blazek abstained.
Reviewed Parking Concession Proposals and Awarded Contract:
Mr. Dobberstein stated the parking concession proposals were received at the last meeting and each board member was given a set of proposals along with an evaluation sheet. He stated Chairman Clark is not here today but submitted her evaluation sheet. He stated the three firms submitting proposals were SP Plus, Republic Parking, and Interflight.
Vice Chairman Haugen stated Chairman Clark ranked the three firms as follows:
#1 SP Plus
#2 Republic Parking
#3 Interflight
Ms. Linn, Mr. Lind and Mr. Blazek indicated their rankings were the same.
Ms. Linn stated there were several things that really stood out in the SP Plus proposal. She stated one thing is the shuttle service they will be providing and that will be an exceptional benefit to our passengers. She stated she liked their "secret shopper" program, the parking website, the service oriented training to employees, the surveys they will continue to do, etc. She stated she felt the SP Plus proposal was above and beyond what the others provided. She stated the audit information provided was also extremely thorough. She stated it was hard to compare the financial soundness of all three organizations since one did not provide audit information due to the fact that it was newly acquired by another organization.
Mr. Blazek stated all three proposals were well written and all three met the needs spelled out in the request, but SP Plus, with the increased guarantee amount and the shuttle service (which we did not ask for) made them stand out. He stated the Airport Authority looked into operating a shuttle service so we know the expense involved so that would be a very significant benefit to our passengers.
Mr. Dobberstein stated SP Plus is the only proposal that guarantees $2.7 million annually. He stated SP Plus is also offering other amenities that the others did not. He stated SP Plus is going to spend $100,000 to set up a frequent parking loyalty program. He added that he estimates the shuttle service they are going to provide would cost at least $50,000 per year. He stated they are going to continue the passenger surveys twice a year, which cost at least $15,000 per study.
Ms. Linn moved to award the public parking concession to SP Plus.
Second by Mr. Lind.
On the call of the roll, members Linn, Blazek, Lind, Haugen voted aye.
Absent and not voting: Clark
The motion was declared carried.
It was noted that the proposals received are a matter of public record and the documents are available for review.
Discussed Compensation Review and Recommendation for the Executive Director:
Vice Chairman Haugen stated he and Ms. Linn had been assigned to review the compensation for our Executive Director and bring forth a recommendation for a pay increase. He stated that review has been completed and asked Ms. Linn to present their findings.
Ms. Linn stated about a year and a half ago she and board member Mr. Don Kilander started extensive research evaluating other airports in the country with enplanement numbers similar to Fargo. She stated they reviewed the studies done by ADK Consulting & Executive Search. She stated part of this evaluation process was to have interviews with stakeholders in the community and we have the results and comments from those interviews. She stated they reviewed the ND State Statute regarding airport authorities, which clearly states the Municipal Airport Authority is an independent and autonomous entity.
Ms. Linn stated after the deregulation of the airline industry, airports have gone to more of a business model for compensation of employees, since it is such a competitive environment. She stated the compensation studies based compensation packages on passenger enplanement data only. She stated the studies did not take into consideration other activity on an airport, such as cargo. She stated they feel we need to factor in the explosive growth of cargo activity on this airport and the increase in airport revenues from that activity.
Ms. Linn stated one of the previous evaluations done on Mr. Dobberstein stated was more of a review intended for a city employee position. She stated that evaluation did not review
Mr. Dobberstein on his actual responsibilities. She stated she and Mr. Kilander developed an evaluation for the Executive Director in October 2017 and copies of that were distributed. She stated in comparing job descriptions they reviewed for Executive Directors at other airports, they came to the conclusion that Mr. Dobberstein's responsibilities would be handled by three positions at other airports. She stated we have a valuable Executive Director and as a board we want to make certain he is compensated fairly and according to industry standards. She stated comparing current compensation to industry standards, we are not even in the ballpark.
Ms. Linn provided a summary of the current compensation package and also the recommendation she and Gen. Haugen are proposing to the board.
Mr. Blazek stated it is important to note that the compensation study was conducted by an independent third party, ADK Consulting & Executive Search.
Vice Chairman Haugen stated this airport is a complex operation and the Executive Director position is not just a terminal building manager and that is what enplanements measure. He stated this airport has two large military organizations, a large civilian aviation sector and now cargo activity is exploding and nowhere is that measured. He stated the growth of cargo at the airport is an enormous benefit to the city.
Ms. Linn added that cargo growth at the airport has created about 220 jobs and that is in great part to Mr. Dobberstein's work over the years to expand cargo operations at the airport.
Mr. Lind stated in his opinion we have to pay on performance and these figures do not reflect successes such as cargo operations, Frontier Airlines returning service to Fargo as well as the potential of another airline starting service. He stated he feels the proposed figures are even low in his estimation. He stated Mr. Dobberstein is doing a fantastic job and it is about time he is paid for it.
Mr. Blazek stated we are currently paying to use the City of Fargo's administration for Human Resources and they have established pay grades. He asked if we have to use the City's pay grades or do we have to look at using another human resources provider in order to have the flexibility to make these changes.
Vice Chairman Haugen stated we have run into that problem in the past. He suggested the board take action on a compensation amount today and then work with City Administrator Bruce Grubb to see how to proceed. He stated he agrees with Mr. Lind that we have to pay on performance and the complexity of the operation at this airport.
Mr. Blazek stated he tells people that we are the biggest little airport in the country. He stated it is fun to serve on this board because it is such a high performing airport.
Ms. Linn stated if any of the board members want to offer other recommendations we can hear those because the money is in the budget. She stated we also felt the three year scaled method would be best.
Mr. Lind stated he has no other recommendation and stated he felt this presentation and study were well put together. He stated he feels the numbers are still low but has no problem with the recommendation.
Vice Chairman Haugen stated he would entertain a motion and after the board votes we can then consult with the City Administrator on implementing the change.
Mr. Lind moved to accept and approve the recommendation for compensation of the Executive Director using the three steps for Year 1, Year 2 and Year 3, as presented.
Second by Ms. Linn.
Mr. Blazek asked for clarification that Year 1 is retroactive to January 1, 2018.
Ms. Linn stated that is correct and that was the consensus of the board members.
Ms. Linn stated having served as a council member in city government in Arizona and also working in state government for the governor of Arizona, she stated making this discussion public, even though these are not tax dollars, is a difficult thing but it is a wise thing as it is very transparent.
On the call of the roll, members Linn, Blazek, Lind and Haugen voted aye.
Absent and not voting: Clark
The motion was declared carried.
It was noted that the compensation research documents are a matter of public record and available for review.
Airport Construction and Security Update:
Mr. Terry Stroh, TL Stroh Architects, was recognized and stated we will be getting started on the ceiling project at the security checkpoint. He stated we had planned to start the project in September but the delay was due to a delay in arrival of materials.
Other Business:
Mr. Dobberstein stated we recently had our annual FAA Part 139 Certification Inspection, which takes about three days, and we received a perfect report with no discrepancies. He stated credit for this goes to Darren Anderson, Henry Swedberg, Chief Bush and Jordan Dahl for what they do each day. He stated the inspector was extremely impressed with what Chief Bush and the staff have done at the ARFF station and wants to use that as a model for the region.
Mr. Blazek stated while attending a past AAAE Annual Conference he stated one of the hot topics among other airport board members throughout the country was how we could pass a Part 139 inspection with no exceptions. He stated it is very rare for an airport our size and our diverse operations to have a Part 139 inspection with no exceptions.
Mr. Dobberstein stated the inspector did have some recommendations and one was to install stop signs at points along the perimeter road. He stated we will also remove all of the markings on the primary runway, as well as rubber removal, and repaint the markings. He stated that will be in our cargo apron expansion project next year.
Mr. Dobberstein stated he and Mr. Jeff Klein, Mead & Hunt, met with regional FAA officials at the AAAE conference in Chicago, and we have until October 31 to submit an application for the additional $1 billion in supplemental federal funding for airports. He stated Bismarck was the first airport in the state to receive funding and they were awarded $9.7 million for their runway project. He stated we will submit our $10 million cargo expansion project. He stated we will include an economic impact analysis for the project, which is a determining factor on this funding. He stated we also considered including runway centerline lighting and approach upgrades but the FAA recommends putting those in a separate project as that is a significant undertaking. He stated they had also advised us to look at what we can do with our existing ILS if we install centerline lighting to get us to a modified approach. He stated we will continue to work with the local and regional FAA representatives.
Mr. Dobberstein stated UPS will be having a ribbon cutting event on November 5 at 10:30 am at their hangar in the south general aviation area. He stated they are working with Flint Communications on that announcement.
Mr. Dobberstein stated he, Darren Anderson and Jeff Klein, Mead & Hunt, met with City of Fargo Engineering to discuss the upcoming North University Drive project. He stated North University will be reconstructed from 32nd Avenue North to 40th Avenue North (County 20) in 2020. He stated as the plans develop they will have the City of Fargo Engineering make a presentation at one of our meetings.
The meeting of the Municipal Airport Authority was adjourned until the next Regular Meeting to be held Tuesday, November 13, 2018 at 8:00 a.m.
Time at adjournment was 8:49 a.m.