board of trustees president/ceo · 2018-03-29 · board agenda october 8, 2015 board meeting page 2...

BOARD OF TRUSTEES PRESIDENT/CEO Andy Wirth, Chair Marily M. Mora, A.A.E. Rick Murdock, Vice Chair EXECUTIVE VICE-PRESIDENT/COO Nat Carasali, Secretary Dean E. Schultz, A.A.E. Jerry Hall, Treasurer GENERAL COUNSEL Bill Eck Ann Morgan, Fennemore Craig Lisa Gianoli CLERK OF THE BOARD Adam Mayberry Claire Johnson Jenifer Rose Jessica Sferrazza

RENO-TAHOE AIRPORT AUTHORITY

MEETING OF THE BOARD OF TRUSTEES October 8, 2015

9:00 a.m. Board Room, Administrative Offices

Second Floor, Main Terminal Building Reno-Tahoe International Airport

Reno, Nevada

Items V, VI, VIII, IX and XII are action items for the Board to consider. The Board may discuss a matter when it is brought up, but no action may be taken on it unless it has been specifically included on an agenda as an action item. Public comment at the Board meeting will be allowed on agenda items as well as non-agenda items. Persons are invited to submit comments in writing on agenda items and/or attend and make comment on that item at the Board meeting. Requests to speak on a particular item should be submitted to the Clerk of the Board before the item is called by the Chairman. I. PLEDGE OF ALLEGIANCE II. ROLL CALL

III. PRESENTATIONS AND AWARDS

A. Employee, Tenant and Special Recognition B. Introduction of New, Promoted and Retired Employees C. Tenant Communication

IV. PUBLIC COMMENT, if any – Limited to three minutes per person V. APPROVAL OF MINUTES – September 10, 2015 Board Meeting Minutes VI. APPROVAL OF AGENDA

VII. COMMITTEE AND LIAISON REPORTS

A. Finance and Business Development Committee B. Planning and Construction Committee C. Airport Noise Advisory Panel (ANAP) D. Community Outreach Committee (COC) E. Stead Liaison F. RSCVA Board

Board Agenda October 8, 2015 Board Meeting of 3

G. Air Service Liaison H. The Chamber Reno Sparks Northern Nevada I. Reno-Tahoe International Airport Users Committee

VIII. CONSENT ITEMS FOR BOARD ACTION

A. #15(10)-37 Award of Bid #15/16-02 for the Purchase of One Dual Engine Four-Wheel Steer

5,000 Ton Per Hour Snow Blower, to J.A. Larue, Incorporated, in the Amount of $499,948

B. #15(10)-38 Award of Bid 14/15-04 for the Purchase of One 3,000 Gallon Panther 6x6 High Reach Extendable Turret (HRET) Aircraft Rescue and Fire Fighting Vehicle, to Rosenbauer Minnesota, LLC, in the Amount of $863,103

IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION

A. #15(10)-39 Authorization for the President/CEO to Execute a One-Year Contract for Reno-Tahoe Airport Authority Employee Medical and Prescription Insurance with Prominence Health Plan for Calendar Year 2016 in the Amount of $2,154,500; Fund Employee Health Savings Accounts in the Amount of $38,000; and Continue to Self Insure Dental and Vision Coverage

B. #15(10)-40 Authorization for the President/CEO to Negotiate Final Terms and Execute a New 5-Year Agreement with Aviation Classics, Ltd to Lease Two Reno-Tahoe Airport Authority Owned Commercial Box Hangars, Outside Storage Area, Ramp Space and Fuel Storage Tanks for the Purpose of Operating a Non-Exclusive Fixed Base Operation at the Reno-Stead Airport

C. #15(10)-41 Approval of the Proposed Changes to the Reno-Tahoe Airport Authority

Community Outreach Committee By-Laws

X. ITEMS FOR BOARD INFORMATION AND DISCUSSION

A. Presentation 1. Geographic Information System Project Update

B. Board Meeting Schedule

1. November 3, 2015 8:30 am Board of Trustees Retreat - Meeting Room at Squaw Valley

2. November 10, 2015 9:00 am Finance & Business Development Committee Meeting 3. November 10, 2015 10:00 am Planning & Construction Committee Meeting 4. November 12, 2015 9:00 am Board of Trustees Meeting 5. December 8, 2015 9:00 am Finance & Business Development Committee Meeting 6. December 8, 2015 10:00 am Planning & Construction Committee Meeting 7. December 10, 2015 9:00 am Board of Trustees Meeting

C. President/CEO’s Report

Board Agenda October 8, 2015 Board Meeting of 3

D. General Board comments, questions, and items for future Board meetings

XI. PUBLIC COMMENT, if any – Limited to three minutes per person XII. ADJOURNMENT Items will not necessarily be considered in the sequence listed. This meeting may be continued if all of the items are not covered in the time allowed. If the meeting is to be continued, the time and place will be announced at the end of the portion of the meeting to be continued. SUPPORTING MATERIAL: The designated contact to obtain supporting material is Claire Johnson, Clerk of the Board, P.O. Box 12490, Reno, NV, 89510 or 775-328-6410. Supporting material is also available at the Reno-Tahoe Airport (Administrative Offices) and at the scheduled meeting. Members of the public who are disabled and require special accommodations or assistance at the meeting are requested to notify the Clerk of the Board in writing at P.O. Box 12490, Reno, Nevada 89510 or by calling (775) 328-6410 prior to the meeting date. THIS AGENDA HAS BEEN POSTED AT THE FOLLOWING LOCATIONS: 1. Airport Authority Administrative Offices – 2001 E. Plumb Lane, Reno 3. Reno City Hall – One East First Street, Reno 2. Washoe County Administrative Offices – 1001 E. 9th Street, Reno 4. Sparks City Hall – 431 Prater Way, Sparks

*** These draft minutes have not yet been approved and are subject to revision at the next

regularly scheduled meeting. ***

RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES

MEETING OF THE BOARD OF TRUSTEES September 10, 2015

9:00 a.m.

MEMBERS PRESENT ALSO PRESENT Andy Wirth, Chair Marily M. Mora, A.A.E. Rick Murdock, Vice Chair President/CEO Jerry Hall, Treasurer Dean Schultz, A.A.E. Nat Carasali, Secretary Executive Vice President/COO Bill Eck Ann Morgan Lisa Gianoli General Counsel Adam Mayberry Claire Johnson Jenifer Rose Clerk of the Board Jessica Sferrazza MEMBERS ABSENT/EXCUSED None The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno-Tahoe International Airport, Reno, Nevada. Chair Andy Wirth called the meeting to order. The Pledge of Allegiance was recited.

III. PRESENTATIONS AND AWARDS A. Employee, Tenant and Special Recognitions

Mike Scott, Vice President of Operations & Public Safety, briefly described the components of the 2015 Part 139 Inspection that was recently conducted on August 3 – 6, 2015. He announced that the Airport passed the annual inspection with flying colors, and retained its Part 139 Certification, which allows it to continue to operate as a commercial air carrier airport. Mr. Scott recognized the key departments involved in the inspection, specifically the Airport Rescue and Firefighting team, Airfield Maintenance team and Airfield Operations team. Mr. Scott ended by thanking Reno-Tahoe Airport Authority (RTAA) staff from all departments, as in some way, all staff contribute to the mission of the Airport and play a role in supporting the Part 139 certification for this airfield.

B. Introduction of New, Promoted and Retired Employees Dean Schultz, Executive Vice President/COO, introduced the new RTAA K9 team – canine Bruno and his handler Officer Shannon Edison. Next, Mr. Schultz introduced three new employees who recently joined the RTAA – Joshua Stagliano, Airport Police Officer, Vinnie Vasquez, Airfield Maintenance Worker, and Ana Chacon, Airport Communications Specialist.

Meeting of the Board of Trustees September 10, 2015 Brief of Minutes Page 2 of 7

Lastly, Mr. Schultz congratulated Rebecca Venis on her promotion to Manager of Air Service Development and Marketing.

At this point, Chair Wirth acknowledged City of Reno Councilwoman Naomi Duerr, as being present in the audience.

C. Tenant Communication

Tina Iftiger, Vice President of Airport Economic Development, introduced Knute Knudson, Vice President of Business Development for International Game Technology (IGT). Mr. Knudson who is locally based in Reno, is the senior executive that the Airport works with at IGT. Ms. Iftiger mentioned that Mr. Knudson is a former member of the Community Outreach Committee (COC), and therefore very familiar with the Airport. Mr. Knudson provided a brief overview of the “new” IGT, referencing their recent merger with GTECH, the largest global lottery business. The merger results in the formation of a worldwide organization with 13,000 employees. He stated that IGT is a topline revenue company of approximately $6.3B annually and is now organized into four (4) divisions – North America Division, International Division, Lottery Division North America, and Italy Division. IGT is headquartered in London, England with major offices in Reno and Las Vegas, Nevada, Providence, RI, and Rome, Italy. Mr. Knudson said the operation in Reno is growing and improving with significant investments being made. Some of IGT’s manufacturing operations are being relocated here, and there will be substantial improvements made in terms of the numbers of people and functions occurring in Reno. Trustee Carasali asked how many new jobs will be created over the next five (5) years. Mr. Knudson responded that there is capacity within IGT’s production capability here in Reno, and therefore much of the work will be absorbed within the existing production capability. He further stated that the specific number of new jobs will evolve over time.

IV. PUBLIC COMMENT (limited to 3 minutes) Naomi Duerr, City of Reno Councilwoman representing Ward 2, and an alternate liaison to the Airport Authority, asked to speak under the public comment section of the agenda. She indicated she is also the liaison to the Arts and Culture Commission and the Art Town Board for the City of Reno. In that capacity, Ms. Duerr had the opportunity to attend Burning Man. She commented on the kickoff at the Airport with the Burning Man art exhibit, and indicated she has been recruiting other art displays for the Airport. She specifically referenced the Pinhole Camera project, which is where photographs of the art and people on the playa are taken through a pinhole in a round cylinder using photographic paper. Ms. Duerr said the results are amazing and those spearheading the project are looking for new venues, so she suggested the Airport. Next, Ms. Duerr mentioned Burning Man’s economic impact to the region and said she plans to hone in on what the economic impact actually is by working with the Airport, the Economic Development Authority of Western Nevada (EDAWN), and others in the community. Next, Ms. Duerr discussed the Reno City Council meeting held the previous evening. A portion of the council meeting was concerning an issue surrounding the Meadow Wood Mall expansion and the lighted sign that is to be erected for the new cinema being built as part of the expansion. The sign height originally approved by the City Planning Commission was to be 60 feet. Members of the General Aviation (GA) community appealed the height of the sign and were found to have standing on this issue. The conclusion at the end of the meeting is that the City Council set a requirement for


the sign be lowered to 46 feet, which is the height of the parapet of the building, and the lighting intensity of the sign will have to be approved by the Federal Aviation Administration (FAA). Finally, Ms. Duerr mentioned Virginia Lake, which is one of 86 parks in Reno, and one that has a large bird population. Among other issues, the City Council has received concerns about potential bird strikes with aircraft, specifically from the Virginia Lake bird population. Ms. Duerr met with RTAA staff to discuss this issue. She stated that there are many ponds and bodies of water located to the east and west of the Airport, and that the challenges with strikes occur from birds flying across the Airport in both directions. Chair Wirth thanked Ms. Duerr for her update. Trustee Sferrazza thanked RTAA staff for attending the City Council meeting.

V. APPROVAL OF MINUTES On motion by Trustee Mayberry, seconded by Trustee Murdock, which motion duly carried by unanimous vote, the Board approved the minutes from the Board of Trustees meeting of August 13, 2015.

VI. APPROVAL OF AGENDA

On motion by Trustee Hall, seconded by Trustee Murdock, which motion duly carried by unanimous vote, the Board approved the September 10, 2015 Board of Trustees meeting agenda.

VII. COMMITTEE / LIAISON REPORTS Committee / Liaison reports were given by:

A. Finance and Business Development Committee – Trustee Jerry Hall B. Planning and Construction Committee – Trustee Adam Mayberry C. Airport Noise Advisory Panel – Trustee Jenifer Rose D. Community Outreach Committee (COC) – Trustee Jessica Sferrazza E. Stead Liaison – Trustee Bill Eck F. RSCVA Board – Trustee Nat Carasali G. Air Service Liaison – Trustee Rick Murdock H. The Chamber Reno Sparks Northern NV – Marily Mora (RTAA) I. Reno-Tahoe International Airport Users Committee – Trustee Adam Mayberry

Chair Wirth asked Ms. Mora to provide a brief update on the recent Boyd Aviation Conference held in Las Vegas. Ms. Mora indicated that this conference is attended by many CEOs of top airlines. Though there is not much opportunity to interact with the airline CEOs, there were a lot of insights gained on specific airlines’ plans for the future, what’s in the pipeline for manufacturing aircraft, and the changes in aircraft going forward. Ms. Mora stated that this is definitely a conference that the RTAA would like to bring to Reno and a good part of her effort was put into meeting with Mike and Marion Boyd to discuss this possibility. The conference brings high level airline executives in attendance at the event, and Ms. Mora feels hosting it in Reno would be a good opportunity to showcase the community. Staff will follow up on this idea, as well as on the intelligence gained with regard to where the various airlines are going in the future.


Trustee Carasali asked Ms. Mora if she feels there is any chance of the Chamber of Commerce becoming a financial supporter of the Regional Air Service Corporation (RASC). Ms. Mora responded that there is a meeting planned with The Abbi Agency who is the project manager for RASC to discuss next steps with the business community. Over the last couple of years, there have been conversations with the Chamber about a financial partnership in air service, but until now it has been a partnership primarily focused on communication about new air service. The next step with RASC is to involve the business community. Trustee Carasali further asked about the possibility of tacking a surcharge onto Chamber member fees that strictly goes to air service development. Ms. Mora said that the leadership on that would be through RASC, but all ideas should be put on the table and vetted through the Chamber. Chair Wirth expressed his agreement and support with Trustee Carasali’s thoughts on the need to gain more direct financial support from the business community.

VIII. CONSENT ITEMS FOR BOARD ACTION A. None.

IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION

A. #15(09)-35 Authorization for the President/CEO to Negotiate Final Terms and Execute a 5-Year Nonexclusive Gaming Concession License with International Game Technology PLC Commencing on December 1, 2015

Trustee Hall commented that a number of questions were asked during staff’s presentation of this item at the Finance & Business Development Committee meeting and that committee members were satisfied with the responses provided. Trustee Rose reiterated the importance of a formal RFP being advertised at the conclusion of this 5-year term.

On motion by Trustee Hall, seconded by Trustee Carasali, which motion was duly carried by unanimous vote, the Board approved Agenda Item #15(09)-35 as follows:

Authorized the President/CEO to Negotiate Final Terms and Execute a 5-Year Nonexclusive Gaming Concession License with International Game Technology PLC Commencing on December 1, 2015

B. #15(09)-36 Adoption of Resolution No. 526 to Authorize the Issuance of the Reno-Tahoe Airport Authority’s Airport Revenue Refunding Bond, Series 2015, not to Exceed the Aggregate Principal Amount of $22,000,000, Award the Purchase of the 2015 Bond to BBVA Compass Bank, and Authorize the President/CEO, or her Designee, to Negotiate and Execute any Documents Relating Thereto

Ms. Mora referenced the extensive presentation provided by staff at the Finance & Business Development Committee meeting. Several Trustees commented favorably on the selection process and complimented the staff on their work and efforts on this item. Chair Wirth inquired as to what the London Integrated Offer Rate (LIBOR) plus basis point spread is on the loan. Rick Gorman, Chief Financial Officer, responded it is 1.46 above 65% of LIBOR, and provided further explanation of how the Airport’s tax exempt status is figured into the rate. Mr. Gorman


also noted that should the Board adopt the resolution, the interest rate will be locked in at today’s rate which is approximately 2.71%. On motion by Trustee Carasali, seconded by Trustee Murdock, which motion was duly carried by unanimous vote, the Board approved Agenda Item #15(09)-36 as follows: Adopted Resolution No. 526 to Authorize the Issuance of the Reno-Tahoe Airport Authority’s Airport Revenue Refunding Bond, Series 2015, not to Exceed the Aggregate Principal Amount of $22,000,000, Award the Purchase of the 2015 Bond to BBVA Compass Bank, and Authorize the President/CEO, or her Designee, to Negotiate and Execute any Documents Relating Thereto

Ms. Mora acknowledged the fact that three Trustees participated on the selection committee,

they being Trustees Rose and Gianoli, and Trustee Hall, Board Treasurer.

X. ITEMS FOR BOARD INFORMATION AND DISCUSSION

A. Presentation 1. Brian Kulpin, Vice President of Marketing and Public Affairs, and Rebecca Venis, Manager of

Air Service Development and Marketing, presented an in depth update on the RTAA’s Community Outreach Campaign. Mr. Kulpin began the presentation by referring to the RTAA’s 5-year Strategic Plan which focuses on engaging the customers, community, business and tourism industry, and Airport stakeholders. He discussed changes in the airline industry over the past 4-5 years that have negatively impacted airports across the nation. Specifically at Reno-Tahoe International Airport (RTIA), industry mergers and consolidations resulted in a loss of 36% of passengers and nearly 38% of flights. Because of what happened with the economy, airlines went from a market share oriented business model to being all about profit. Flights were taken from airports in the west like Reno, Boise, San Jose, Tucson, and Oakland, and moved to the east coast where there is a higher profit margin. The change in the industry has transformed the way airports operate and today there is limited ability for an airport to influence air service growth. Mr. Kulpin stated that community outreach is the key for how to change this paradigm. Approximately one year ago in July 2014, the RTAA introduced a new approach to air service. The new approach focuses on developing community partnerships that can be leveraged to reduce the risk to airlines for investing in new service to the Reno-Tahoe region. A “Ski Lake Tahoe Summit” for air service was held, bringing together key representatives from the lake and the valley. RTAA staff gave a presentation at the summit, which focused on how the strength of community partnerships could change the air service paradigm and attract new air service to this region. Mr. Kulpin said the partnership between jetBlue and this community is a perfect example and demonstrates the power of the new approach.

Next, Ms. Venis stated that during the past year, the RTAA has created a network of partners that can be called upon in advertising new air service and supporting current routes. The network is currently made up of the Airport, RASC, the tourism industry, and the ski industry, as well as the business community through partnerships with EDAWN and the Chamber of Commerce. Ms. Venis continued by providing an overview of the creation, structure and membership of RASC, and she pointed out that RASC is an entity that no other community


has. In the past year, RASC has incorporated, developed bylaws, and changed their voting structure, allowing them to be a much more nimble organization in support of air service in the region. Recently, RASC underwent a strategic planning process, looking at how they could best align with the goals of the Airport and with what’s happening in the industry, and how to go forward to bring the community together even more. Three key things came out of the strategic planning process: 1). A mission statement to grow and sustain business and leisure air service for the Reno-Tahoe region, 2). That funds will be used to provide a “tool box” of resources for growing and maintaining air service, and 3). A focus will be placed on growing their membership and revenue base with business community outreach. Next, Ms. Venis described two examples during the last year that have pulled the community together utilizing the new approach to air service. The first is related to the new air service on jetBlue and the two phase approach that was put in place. The second is related to sustaining air service and how community partners came together to support and work with Alaska Airlines on a strategy to retime what was a struggling nonstop flight to San Jose. Mr. Kulpin continued the presentation by describing what next steps are needed to continue the momentum. It will require continued year-round support of new and current flights within the primary and secondary catchment areas of the RTIA from everybody including the City of Reno, the City of Sparks, the County, all the tourism partners, and business. The RTAA will be launching a year-round awareness and outreach program that will educate key influencers in business and tourism and civic partners on the importance of air service to the region. Ms. Venis brought the presentation to a close by outlining the components of the outreach program, including the expansion of the communications network of key influencers. She described the new STEPPS (S=Social Currency; T=Triggers; E=Emotion; P=Public; P=Practical; S=Stories) content strategy, which includes action steps aimed at deepening the involvement and loyalty of the network. Lastly, Ms. Venis introduced the new Air Service 101 training program that will launch in late September 2015 and will be delivered throughout the year. A discussion followed regarding air service, the new initiatives, and various other ideas and suggestions from the Trustees regarding additional ways to incentivize and encourage the use of air service in our region.

B. Board Meeting Schedule Chair Wirth referred to the schedule of upcoming meetings and made special mention of the upcoming 2015 Board Retreat, stating that he intends on hosting an outstanding retreat at Squaw Valley.

1. October 6, 2015 9:00 am Finance & Business Development Committee Meeting 2. October 6, 2015 10:00 am Planning & Construction Committee Meeting 3. October 8, 2015 9:00 am Board of Trustees Meeting 4. November 3, 2015 8:30 am Board of Trustees Retreat – Meeting Room at Squaw Valley 5. November 10, 2015 9:00 am Finance & Business Development Committee Meeting 6. November 10, 2015 10:00 am Planning & Construction Committee Meeting 7. November 12, 2015 9:00 am Board of Trustees Meeting


C. President/CEO’s Report Ms. Mora referred the Trustees to the written President/CEO’s Report included in their Board binders. She specifically referred to the announcement of a public workshop on General Aviation (GA) Minimum Standards which is scheduled for Thursday, October 28, 2015 at 5:00 pm in the RTAA River Room. Ms. Mora also stated that tomorrow being 9/11, it is the tradition of the Airport to announce a moment of silence throughout the Terminal at the time that the Twin Towers were hit and that a commemorative wreath will be displayed at the entrance to the Terminal.

D. General Board Comments, Questions, and Items for Future Board Meetings Chair Wirth asked each Trustee for any comments, questions or items for future Board meetings that they may have. Trustee Eck mentioned the tragic accident that occurred at the Air Races in 2011, and acknowledged the RTAA’s Aircraft Rescue and Fire Fighting (ARFF) team and the many lives that were saved due their quick response. There were no further comments.

XI. PUBLIC COMMENT None.

XII. ADJOURNMENT There being no further business, the meeting was adjourned at 10:47 am. ____________________________________ Chair Andy Wirth ATTEST: ____________________________________ Secretary Nat Carasali

*** These draft minutes have not yet been approved and are subject to revision at the next regularly scheduled meeting. ***

Board Memorandum Reno-Tahoe Airport Authority

Date: September 30, 2015 Memo: #15(10)-37 To: Chairman & Board Members For: October 8, 2015 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: AWARD OF BID #15/16-02 FOR THE PURCHASE OF ONE DUAL ENGINE

FOUR-WHEEL STEER 5,000 TON PER HOUR SNOW BLOWER, TO J.A. LARUE, INCORPORATED, IN THE AMOUNT OF $499,948

STAFF RECOMMENDATION Staff recommends that the Board approve the award of Bid #15/16-02 for the purchase of one dual engine, four-wheel steer, 5,000 ton per hour Snow Blower, to J.A. Larue, Incorporated, in the amount of 499,948. PURPOSE This action requests approval to award Bid #15/16-02 to J. A. Larue, Incorporated, for the purchase of one dual engine, four-wheel drive, 5,000 ton per hour snow blower. The snow blower will be utilized for snow removal operations at the Reno-Tahoe International Airport (RTIA). This action is in support of the Reno-Tahoe Airport Authority (RTAA) Guiding Principles of Safety and Security, Customer Service, and Environmental Responsibility, as adopted in the RTAA Fiscal Year (FY) 2014-2018 Comprehensive Strategic Plan. BACKGROUND In September 2005, the Federal Aviation Administration (FAA) Certification Inspector recommended that certain snow removal equipment be replaced because of age and condition. Based on actual fleet condition and the FAA’s recommendation, the RTAA applied and was approved for Passenger Facility Charge (PFC) collections for snow removal equipment replacement. The equipment recommended was included for procurement in the approved PFC #10 application. Seven pieces of snow removal equipment were scheduled to be replaced and/or added to the current snow removal fleet as part of PFC #10, approved by the FAA on May 11, 2007, for a total replacement amount of $3,358,000. The purchase of this dual engine, four-wheel drive snow blower will be the seventh and final piece of equipment to be purchased on the PFC #10 authorization. The other pieces of snow equipment previously purchased are: • 2009 Dodge Model 5500 two-ton dump truck in the amount of $53,335 • 2011 22-foot, self-propelled rotary runway sweeper in the amount of $558,129 • 2012 All-wheel drive snow plow in the amount of $525,000 • 2014 Front End Loader with box plow in the amount of $408,901 • 2015 Two (2) Snow Plow trucks with sander/spreader in the amount of $998,000

Snow Blower #15(10)-37 October 8, 2015 Board Meeting Page 2 of 4 The 2015 snow plow trucks with sander/spreader were awarded by the Board of Trustees on February 11, 2015 and are scheduled for delivery this November 2015. DISCUSSION The equipment recommended for procurement is a state-of-the-art four-wheel drive, four-wheel steer snow blower. The snow blower has a cutting width of 102 inches with a casting distance of over 75 feet, and is powered by two diesel engines with a combined horsepower rating of 1220. The primary function for this highly specialized piece of equipment will be snow removal on the Airport Operations Area (AOA), specifically the runways, taxiways, and terminal ramp areas at RTIA. Snow removal on AOA surfaces is critical for safe aircraft operation, as the presence of snow, ice, slush, and standing water degrade the coefficient of friction, reduce braking and directional control, and impede aircraft acceleration. This equipment is specifically designed for the rigors of airport snow removal and will be a key component of airside snow removal operations. It will be designated as a primary response plow. The snow blower has the ability to remove snow from the AOA at rates of up to 100% faster than the snow blower that it will replace. The equipment being replaced is a 1993 Oshkosh snow blower. Replacement of this equipment is recommended at this time based upon the following criteria: • The equipment has long met the 10-20 year criteria for replacement being 22 years old. • The equipment has been evaluated by both the airfield mechanics and airfield

maintenance management staff who have determined and recommended that the 1993 snow blower be replaced due to its age, condition, and lack of reliability during snow removal operations.

Upon delivery of the four-wheel drive, four-wheel steer snow blower, the 1993 Oshkosh snow blower will be utilized as a backup snow blower for a period of one year, and then disposed of through the statutorily-mandated surplus property process. As a result of significant advancements in airfield snow removal equipment technology, modern airport snow removal equipment has the capability to move more than double the quantity of snow at a much higher rate of speed. This increased capability will allow more efficient snow removal operations on the AOA. Modern airport snow removal equipment is also much more environmentally friendly as a result of their having the latest emissions technology integrated in current diesel engines. The Invitation to Bid was issued on July 24, 2015 and advertised on August 5, 2015 in the Reno Gazette-Journal. To supplement legal advertising, staff posted the bid document on the RTAA’s website, as well as emailed the solicitation directly to four prospective bidders for this type of equipment.

Snow Blower #15(10)-37 October 8, 2015 Board Meeting Page 3 of 4 Four bids were received in good order and opened on August 24, 2015 as follows:

Bidder Bid Amount J. A. Larue, Incorporated $499,948 Kodiak America $516,400 M-B Companies $624,296 Jack Doheny Companies $771,000

Staff evaluated the bids received for conformance to terms, conditions, and specifications. Following this review, staff recommends the award of Bid #15/16-02 in the amount of $499,948 to J.A. Larue, Inc. as the low, responsive, and responsible bidder. A three year warranty applies to the snow blower. The powertrain components are covered by a five year warranty. The purchase price includes freight costs to the Reno-Tahoe International Airport. Delivery of this equipment is expected 330 calendar days after order placement. COMPANY BACKGROUND J.A. Larue was incorporated in 1973 and is a manufacturer of snow blowers and a distributor of paving equipment. They are based in Quebec, Canada. The company was founded by Andre Larue and is currently operated by his sons. They specialize in manufacturing snow blowers and have in excess of 40 years’ experience in the field. FISCAL IMPACT This equipment is funded by Passenger Facility Charge Program (PFC) #10 approved by the FAA on May 11, 2007. The PFC program amount budgeted for snow removal equipment is in the amount of $3,358,000. The equipment authorized by the FAA to be purchased is as follows:

Equipment to be replaced/added with PFC 10 Funds

Quantity

Purchase Amount

Approved for Purchase

2-Ton Dump Truck 1 $53,335 2/10/09 Self-Propelled Rotary Runway Snow Sweeper 1 $558,129 2/10/11 Multi-function Snow Plow Truck with sander/grader 1 $525,000 12/8/11 Front End Loader with Box Snow Plow 1 $408,901 3/13/14 Multi-function Snow Plow Truck with sander/spreader 1 $499,000 2/12/15 Multi-function Snow Plow Truck with sander/spreader 1 $499,000 2/12/15 High-Speed Runway Rotary Snow Blower * 1 $499,948 Funds Expended to Date $3,043,313 Total PFC #10 Budget Amount 7 $3,358,000 PFC #10 Savings $314,687 * Recommended for procurement approval herein

Snow Blower #15(10)-37 October 8, 2015 Board Meeting Page 4 of 4 If the Board of Trustees approves this purchase, this is the last piece of equipment to be procured under this PFC application. With the use of PFC funding, this purchase will have no impact on airline rates and charges. COMMITTEE COORDINATION This item is scheduled to be presented at the October 6, 2015 Finance and Business Development Committee Meeting. RECOMMENDATION It is hereby recommended that the Board adopt the following motion: “It is hereby moved that the Board approve the award of bid #15/16-02 for the purchase of one dual engine, four-wheel steer, 5,000 ton per hour Snow Blower, to J.A. Larue, Incorporated, in the amount of 499,948, and authorize the President/CEO, or her designee, to sign.”

MMM/jah/cj


Date: September 30, 2015 Memo: #15(10)-38 To: Chairman & Board Members For: October 8, 2015 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: AWARD OF BID 14/15-04 FOR THE PURCHASE OF ONE 3,000 GALLON

PANTHER 6X6 HIGH REACH EXTENDABLE TURRET (HRET) AIRCRAFT RESCUE AND FIRE FIGHTING VEHICLE, TO ROSENBAUER MINNESOTA, LLC, IN THE AMOUNT OF $863,103

STAFF RECOMMENDATION Staff recommends that the Board approve the award of bid 14/15-04 for the purchase of one 3,000 gallon Panther 6x6 High Reach Extendable Turret (HRET) Aircraft Rescue and Fire Fighting (ARFF) Vehicle, to Rosenbauer Minnesota, LLC, in the amount of $863,103. The purchase of this vehicle is being funded by Airport Improvement Program (AIP) Grant 3-32-0017-099-2014. PURPOSE Procurement of the vehicle recommended herein will allow the Airport Authority to upgrade, improve and supplement its Aircraft Rescue and Fire Fighting Vehicle arsenal to provide the highest degree of safety to the flying public and Airport Authority employees. This action is in support of the Reno-Tahoe Airport Authority (RTAA) Guiding Principles of Safety and Security and Customer Service, as adopted in the RTAA Fiscal Year (FY) 2014-2018 Comprehensive Strategic Plan. BACKGROUND Reno-Tahoe International Airport (RTIA) was awarded a discretionary Airport Improvement Program (AIP) Grant for $1,153,125 to purchase a new 3,000 gallon Aircraft Rescue and Fire Fighting Vehicle and associated ancillary equipment. This Board item addresses the purchase of the 3,000 gallon Aircraft Rescue and Fire Fighting Vehicle. Purchase of ancillary equipment will be awarded via separate action following approval by the Federal Aviation Administration (FAA). Federal Aviation Regulation (FAR) Part 139 establishes indexes for the number and type of Aircraft Rescue and Fire Fighting (ARFF) vehicles required, based on a combination of length of air carrier aircraft serving the airport and average daily departures. Reno-Tahoe International Airport is an Index “C” airport. RTIA meets the minimum ARFF vehicle requirements with two vehicles – the 1994 Fire Ban Quick Response Vehicle and the 2004 E-One Titan 8x8 ARFF Vehicle. In addition, RTIA maintains in front-line service the 1999 E-One Titan ARFF Vehicle and in reserve status the 1989 Oshkosh T-3000 ARFF Vehicle.

3,000 Gallon Aircraft Rescue and Firefighting Vehicle #15(10)-38 October 8, 2015 Board Meeting Page 2 of 4 The equipment recommended herein for procurement is a Panther 6x6 High Reach Extendable Turret (HRET) 3,000 gallon Aircraft Rescue and Fire Fighting (ARFF) Vehicle. The vehicle recommended for procurement herein will:

1) Allow for an upgrade of existing equipment to permit expanded capability in providing fire protection for aircraft with increasing passenger capacity and fire loading at Reno-Tahoe International Airport.

2) Permit the Airport Authority to meet the new FAA Advisory Circular 150/5220-10C

response performance standards and environmental concerns. The Rosenbauer Panther will carry 3,000 gallons of water, 400 gallons of foam, and 450 lbs. of dry chemical extinguishing agent, plus rescue tools. Studies have shown that application of both foam and dry chemical agent simultaneously are more effective at extinguishing petroleum fires than using either one or the other.

3) Place the 1999 E-One Titan in reserve status as it has exceeded its frontline

serviceability in accordance with industry standards.

4) Surplus the 1989 Oshkosh T-3000, which has exceeded its industry standard total life expectancy (NFPA414). The 1989 Oshkosh T-3000 will be disposed of through the statutorily-mandated surplus property process.

DISCUSSION The Invitation to Bid was issued on April 21, 2015. The bid was advertised on April 23, 2015 in the Reno Gazette-Journal and in the searchable classified database at Aviation News and the American Association of Airport Executives. Additionally, the ad ran in editions of Airport Report Today and Aviation News Today email publications. To supplement legal advertising, staff mailed solicitations directly to two manufacturers. Two companies attended the pre-bid conference held on May 18, 2015. Two bids were received in good order and opened on July 8, 2015 as follows:

Bidder Oshkosh Rosenbauer ARFF Vehicle with DEVS* $856,049 $868,653 Labor to install ancillary equipment No Bid $1,950 Other Costs None None TOTAL BID $856,049 $870,603 *Driver Enhanced Vision System

Based upon a comprehensive evaluation of both bids, staff has determined that the bid received from Oshkosh Corporation was non-responsive and that Rosenbauer Minnesota, LLC is the low, responsive, and responsible bidder. The basis for staffs’ determination that the bid from Oshkosh was non-responsive is as follows: Addendum #1, approved by the Federal Aviation Administration (FAA) on May 29, 2015, was issued subsequent to the pre-bid conference. In accordance with the revised terms and conditions of

3,000 Gallon Aircraft Rescue and Firefighting Vehicle #15(10)-38 October 8, 2015 Board Meeting Page 3 of 4 the recently updated AIP Handbook, the RTAA intends to purchase the ancillary equipment for the vehicle separately. However, it was determined that a portion of the ancillary equipment to be purchased is required to be mounted by the manufacturer during the construction of the vehicle. The specific equipment was outlined in Addendum #1, Question 29 and the solicitation’s Bid Schedule was revised to include Item 2 to enable the bidders to provide a quotation for labor to install auxiliary equipment provided by the RTAA. It was clearly stated that “for the gear and tools listed below, the Authority has elected to add a line item in the ARFF vehicle procurement for mounting necessary ARFF tools and gear to the vehicle. Such gear shall be procured separately by the Authority. All other tools and gear not included on the list below will be mounted by the Authority.” Oshkosh declined to bid this line item indicating a “no bid” response. With significant concerns by the RTAA regarding a manufacturer honoring its warranty of the vehicle without the company directly mounting the necessary ARFF tools and gear, the RTAA considers this item to be an integral part of the bid response. Oshkosh’s election to “no bid” this item renders their bid non-responsive. Affirming our recommendation for award to Rosenbauer are two additional items noted by the RTAA during our review of bids received. First, the warranty on the water and foam tanks offered by Rosenbauer is more robust than that bid by Oshkosh; second, Rosenbauer has solicited and will be utilizing a total of three Disadvantaged Business Enterprises (DBE) during production and manufacturing of the vehicle, whereas Oshkosh has indicated no DBE participation. Although no specific DBE participation goals were set for this procurement, Rosenbauer does intend to utilize DBEs in the performance of this contract, if awarded. As a final note, the RTAA investigated the components of the Driver Enhanced Vision System (DEVS) included in the two bidders’ responses. This investigation disclosed that Rosenbauer’s base vehicle bid of $868,853 contained the Command and Control component for the DEVS and that Oshkosh’s base vehicle bid of $856,049 did not. The RTAA requested FAA guidance and a determination as to whether the Command and Control component was eligible for AIP grant funding. As the final determination received from the FAA was that it is not eligible, the award amount reflects the removal of the cost of $7,500 for this module from their base vehicle bid amount, rendering a final base vehicle cost of $861,153. This had the effect of reducing their total bid amount from $870,603 to $863,103. From a pure pricing perspective, an “apples to apples” comparison of the two bids, which excludes Rosenbauer’s bid to mount tools and gear of $1,950 and the DEVS Command and Control module cost of $7,500, result in a responsive bid from Rosenbauer of $861,153 ($870,603 - $1,950 - $7,500), as compared to the non-responsive bid of $856,049 from Oshkosh, an increase of $5,104 or 0.6%. FAA approval for award of this equipment was granted on September 30, 2015. Vehicle delivery via flatbed truck is expected 300 days following award.

3,000 Gallon Aircraft Rescue and Firefighting Vehicle #15(10)-38 October 8, 2015 Board Meeting Page 4 of 4 FISCAL IMPACT Funding for this equipment is as follows: 93.75% or $809,159 will be paid by the FAA Airport Improvement Project Grant Number 3-32-0017-099-2014 with the remaining Airport Authority portion of 6.25% or $53,944 paid for by the General Purpose Fund. COMPANY INFORMATION With more than 140 years of manufacturing experience, Rosenbauer is a global leader in firefighting technology and resources. They are the world’s largest manufacturer of fire equipment with eleven manufacturing locations worldwide. A family-owned business that was founded in 1866, Rosenbauer America is a 50-50 partnership between North American and European families with family members controlling the majority of its stock. COMMITTEE COORDINATION This item is scheduled to be presented at the October 6, 2015 Finance and Business Development Committee Meeting. RECOMMENDATION It is hereby recommended that the Board adopt the following motion: “It is hereby moved that the Board approve the award of Bid 14/15-04 for the purchase of one 3,000 gallon Panther 6x6 High Reach Extendable Turret (HRET) Aircraft Rescue and Fire Fighting Vehicle, to Rosenbauer Minnesota, LLC, in the amount of $863,103, and authorize the President/CEO, or her designee, to sign.” MMM/jah/cj


***REVISED***

Date: September 30, 2015 Memo: #15(10)–39 To: Chairman & Board Members For: October 8, 2015 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: AUTHORIZATION FOR THE PRESIDENT/CEO TO EXECUTE A ONE-

YEAR CONTRACT FOR RENO-TAHOE AIRPORT AUTHORITY EMPLOYEE MEDICAL AND PRESCRIPTION INSURANCE WITH PROMINENCE HEALTH PLAN FOR CALENDAR YEAR 2016 IN THE AMOUNT OF $2,154,500; FUND EMPLOYEE HEALTH SAVINGS ACCOUNTS IN THE AMOUNT OF $38,000; AND CONTINUE TO SELF INSURE DENTAL AND VISION COVERAGE

STAFF RECOMMENDATION Staff recommends that the Board authorize the President/CEO to Execute a One-Year Contract for Reno-Tahoe Airport Authority (RTAA) Employee Medical and Prescription Insurance with Prominence Health Plan for Calendar Year 2016 in the Amount of $2,154,500; Fund Employee Health Savings Accounts in the Amount of $38,000; and Continue to Self Insure Dental and Vision Coverage. PURPOSE The purpose of this action is to obtain Board of Trustees approval and authorization for the President/CEO to take the following actions regarding the employee group health insurance: 1) execute a one-year contract for RTAA employee medical and prescription insurance with Prominence Health Plan for Calendar Year (CY) 2016; 2) fund employee Health Savings Accounts (HSAs), designed to be used for employee out of pocket medical and related expenses, at the recommended levels; and 3) continue to self-insure dental and vision coverage utilizing CDS Group Health and Vision Service Plan, respectively, for claims administration and provider network access. This action is in support of RTAA Strategic Priority # 5 – Provide a Positive Environment and Experience for All, and the Guiding Principle of Financial Integrity, to ensure financial stability of the Airports, as adopted in the RTAA Fiscal Year (FY) 2014-2018 Comprehensive Strategic Plan. BACKGROUND Insurance benefits are mandatory subjects of bargaining under Nevada Revised Statutes (NRS) 288.150. The RTAA, the Teamsters Union Local 533 (Teamsters) and the Airport Authority Police Officers’ Protective Association (AAPOPA) have negotiated into the Collective Bargaining Agreements, a working group called the Insurance Committee. The Insurance Committee is comprised of individuals represented by the Teamsters and AAPOPA, and the non-represented groups of the Civil Service Plan and Management Guidelines. The Insurance Committee considers the renewal of employee group health insurance each year with the

RTAA Employee Group Health Insurance for CY 2016 #15(10)-39 October 8, 2015 Board Meeting Page 2 of 5 objective to make recommendations to the President/CEO. This year’s Insurance Committee recommendation was only partially accepted by the President/CEO. The remaining collectively bargained group at the RTAA, the Reno Airport Fire Fighters Association (RAFFA), elected to participate in the Clark County Firefighters insurance trust for all their health insurance coverage in the mid-1990s. The RTAA pays towards the cost of this coverage as negotiated into the collective bargaining agreement between the RTAA and RAFFA. The RTAA’s group health insurance broker of record, L/P Insurance Services, Inc. (L/P), works with the Insurance Committee to conduct the bidding process and to monitor the customer service and claims administration of the RTAA’s insurance carriers and third party claims administrators. DISCUSSION The RTAA’s medical and prescription benefits are currently fully insured through Prominence Health Plan and include both a “Hybrid” Preferred Provider Organization (PPO) plan option and a High Deductible PPO plan option. This contract is due to expire on 12/31/15. In August 2015, the RTAA’s insurance Broker of Record, L/P Insurance Services Inc. (L/P), placed the RTAA’s employee medical and prescription insurance program out to bid for calendar year 2016. In September 2015, L/P completed its bid process and provided the RTAA with the following responses received:

As of the end of July 2015, the RTAA’s 12 month combined loss ratio was at 90%. Insurance carriers prefer to see the loss ratio at approximately 85%, which covers the insurer’s administrative costs needed to process claims, administer the program and earn a profit. Given the RTAA’s 90% loss ratio, the 5.5% premium increase quoted by Prominence Health Plan is reasonable and much more competitive than any other quote received. The High Deductible PPO plan has actually experienced a much lower individual loss ratio (50% as of April 2015). This plan requires members to pay 100% of their costs until they reach the annual deductible amount ($3,000 individual / $6,000 family). To pay for these out of pocket costs, the plan is paired with a tax-advantaged Health Savings Account (HSA). Given the lower

CY 2016 Medical/Prescription Plan Quote Comparison CY 2015

Premium CY 2016

Premium Quote Dollar / Percentage

Difference Prominence Health Plan $2,042,200 $2,154,500 +$112,255 / +5.5% Hometown Health Plan N/A $2,386,150 +$343,950 / +16.8% Anthem N/A $2,402,950 +$360,750 / +17.7% Sierra Health and Life N/A $2,607,100 +$564,900 / +27.7% AETNA N/A $2,734,220 +$692,020 / +33.9% CIGNA N/A $3,434,500 +$1,392,300 / +68.2% Humana N/A Declined to quote N/A

RTAA Employee Group Health Insurance for CY 2016 #15(10)-39 October 8, 2015 Board Meeting Page 3 of 5 premium rates on this plan, the RTAA would like to continue to offer a financial incentive to employees choosing to assume this greater financial responsibility and decision-making, by again funding a portion of the premium differential into the employee HSAs. The chart below provides details regarding the current year funding levels (in CY 2015 both a Health Reimbursement Account [HRA] and a Health Savings Account [HSA] were funded), recommended CY 2016 HSA funding levels, and the financial impact and comparison:

An additional incentive to encourage employees to change from the “Hybrid” PPO plan to the High Deductible PPO plan is being recommended. This incentive would allow the account balance in an employee’s HRA as of the end of December 2015 to be given to them in a lump sum payment on the first check in January 2016. These employees will be encouraged to roll that money into their new HSA, but they can choose not to do so. This incentive would have no financial impact as these monies were already allocated in FY 2014-15. Dental Benefits The RTAA’s dental benefits are currently self-insured utilizing CDS Group Health for third party claims administration and preferred provider network access. CY 2015 dental program expenses are estimated to finish $4,700 under budget at $213,500. Based on dental cost trends, claim expenses for CY 2016 are estimated to increase eight percent (8%) in the next plan year, resulting in projected expenses of $230,580 for CY 2016. Vision Benefits The RTAA’s vision benefits are currently self-insured utilizing Vision Service Plan (VSP) for third party claims administration and preferred provider network access. CY 2015 vision program expenses are estimated to finish $5,700 under budget at $29,800. Based on vision cost trends, claim expenses for CY 2016 are estimated to increase four percent (4%) in the next plan year, resulting in projected expenses of $30,990 for CY 2016. Life, Accidental Death and Dismemberment (AD&D) and Long Term Disability (LTD) In May 2013, the Board of Trustees approved entering into a three-year agreement with Symetra Financial to provide employee group Life/Accidental Death and Dismemberment/LTD coverage. FY 2015-16 will represent the third year of this agreement. Although there will be no rate increase, projected premium costs for CY 2016 are $131,420 compared to $127,250 in CY 2015 due to estimated increases in salaries, which in turn increase select life and long term disability benefits and related premium costs.

CY 2015 RTAA HRA &

HSA Funding

Cost

CY 2015 Prominence Health Plan

Premium

Total CY 2015

Cost

CY 2016 RTAA HSA

Funding Levels

CY 2016 RTAA Total HSA

Funding Cost

CY 2016 Premium

Quote

Total CY 2016

Cost

Dollar / Percent

Difference

$384,750 $2,042,200 $2,426,950 Emp Only: $750 E+S or E+C: $1,000 Family: $1,250

$38,000 $2,154,500 $2,192,500 -$234,450 (-9.7%)

RTAA Employee Group Health Insurance for CY 2016 #15(10)-39 October 8, 2015 Board Meeting Page 4 of 5 COMPANY BACKGROUND Prominence Health Plan was established in Reno, Nevada in 1993 and was originally known as Saint Mary’s Health Plans. In 2014, a subsidiary of Universal Health Services, Inc. (UHS) acquired the company and renamed it Prominence Health Plan. UHS was founded in 1978 and is one of the nation’s largest healthcare management companies, operating through its subsidiaries’ acute care hospitals, behavioral health facilities, and ambulatory centers nationwide. UHS’ philosophy is based on integrity, competence and compassion, and through a responsive management style. FISCAL IMPACT The following chart summarizes total estimated CY 2016 expenses at $2,585,490. These expenses represent a $212,010 (7.6%) decrease over current CY 2015 expenses for medical, prescription, dental, vision, life and long term disability coverage, and are well under the amount budgeted in the FY 2015-16 budget. The FY 2016-17 budget will include an amount for the last six months of the 2016 calendar year.

Insurance Program RTAA

Insurance Cost CY 2015

RTAA Insurance Cost

CY 2016

$ Increase

% Change

Medical/Prescription Insurance – Prominence Health Plan $2,426,9501

$2,192,5002 -$234,450 -9.7%

Life/AD&D/LTD Insurance – Symetra Financial $127,250 $131,420 +$4,170 +3.3%

Dental Coverage – RTAA Self Insured/CDS $213,500 $230,580 +$17,080 +8.0%

Vision Coverage – RTAA Self Insured/VSP $29,800 $30,990 +$1,190 +4.0%

Total $2,797,500 $2,585,4903 -$212,010 -7.6%

1. This amount includes the cost of RTAA HRA and HSA funding 2. This amount includes the cost of RTAA HSA funding 3. Approximately $150,000 (5.8%) of these costs will be paid through employee premium contributions

COMMITTEE COORDINATION This item is scheduled to be presented at the October 6, 2015 Finance and Business Development Committee meeting. RECOMMENDATION It is hereby recommended that the Board adopt the following motion: “It is hereby moved that the Board of Trustees authorize the President/CEO to execute a one-year contract for RTAA employee medical and prescription insurance with Prominence Health Plan for CY 2016 in the amount of $2,154,500; fund employee Health Savings Accounts for CY

http://www.uhsinc.com/

RTAA Employee Group Health Insurance for CY 2016 #15(10)-39 October 8, 2015 Board Meeting Page 5 of 5 2016 in the amount of $38,000; and continue to self-insure dental and vision coverage, utilizing CDS Group Health and Vision Service Plan, respectively, for claims administration and provider network access”. MMM/js/cj


Date: September 30, 2015 Memo: #15(10)-40 To: Chairman & Board Members For: October 8, 2015 Board Meeting From: Marily Mora, A.A.E., President/CEO Subject: AUTHORIZATION FOR THE PRESIDENT/CEO TO NEGOTIATE

FINAL TERMS AND EXECUTE A NEW 5-YEAR AGREEMENT WITH AVIATION CLASSICS, LTD TO LEASE TWO RENO-TAHOE AIRPORT AUTHORITY OWNED COMMERCIAL BOX HANGARS, OUTSIDE STORAGE AREA, RAMP SPACE, AND FUEL STORAGE TANKS FOR THE PURPOSE OF OPERATING A NON-EXCLUSIVE FIXED BASE OPERATION AT THE RENO-STEAD AIRPORT

STAFF RECOMMENDATION Staff recommends that the Board authorize the President/CEO to negotiate final terms and execute a new 5-year agreement with Aviation Classics, Ltd. (ACL) to lease two Reno-Tahoe Airport Authority (RTAA) owned commercial box hangars, outside storage area, ramp space, and fuel storage tanks for the purpose of operating a non-exclusive Fixed Base Operation (FBO) at the Reno-Stead Airport. PURPOSE This action is in support of the RTAA Strategic Priority # 4 – Facilitate Economic Development at Both Airports, as adopted in the RTAA Fiscal Year (FY) 2014-2018 Comprehensive Strategic Plan, to ensure its financial growth and stability as a self-sustaining entity by maximizing non-airline revenue. BACKGROUND Aviation Classics Ltd., previously known as CIA Aviation, has been owned and operated by the Redick family at Reno-Stead Airport since 1985. Over the last 30 years, ACL has provided FBO services to the tenants and users of Reno-Stead Airport, while leasing and maintaining the RTAA owned hangars. In addition to FBO fueling services, ACL assists with the successful conduct of the National Championship Air Races each September, and provides fueling support to the Bureau of Land Management (BLM) during fire season. The current FBO agreement which expired May 31, 2015, included two RTAA owned Hangars: Buildings 7003 & 8003; 120,000 square feet of ramp tie-down area; and four (4) RTAA owned fuel tanks including a self-serve fuel island owned and managed by ACL (Refer to Exhibit A – Current Leased Premises). DISCUSSION Priority # 4 of the Board adopted Strategic Plan advocates for continued economic development to ensure the financial growth and stability of the RTAA as a self-sustaining

Aviation Classics FBO Agreement #15(10)-40 October 8, 2015 Board Meeting Page 2 of 4 entity by maximizing non-airline revenue. In order to encourage non-airline revenue, at the August 23, 2013 Board of Trustees Retreat, the Board directed staff to create a Land Development program that would include a public competitive process for development of Airport owned properties at both the Reno-Tahoe International Airport and Reno-Stead Airport. As a result of the Land Development program, in March 2014, the RTAA issued a Request for Qualification (RFQ) for real estate development of approximately 3,500 acres of vacant land at the Reno-Stead Airport. The anticipated outcome of the RFQ is a long range development plan that will allow for a mix of aeronautical, industrial, and technology related office and commercial development. A long range development plan requires significant flexibility to maximize the economic potential of the available land. In February 2015, the RTAA Board of Trustees authorized Dermody Properties (DP) to complete Phase 2 and Phase 3 of the RFQ. Completion of Phases 2 and 3 will culminate with proposed business terms in the form of a Development Proposal. At this time, DP is finalizing a plan of finance and staff anticipates proposed business terms for Board consideration in early 2016. As a result of the real estate development RFQ in process, initiating a public competitive process for an FBO before understanding the full value of the land could limit a responders understanding of the market potential and land optimizing revenue opportunities. It is anticipated that as a result of the RFQ, business opportunities will increase and drive demand for new facilities and/or services. Given the need for flexibility to accommodate future potential growth and effectively advertise the FBO market opportunity, staff recommends a new short-term 5-year lease agreement with the current FBO, ACL. This will allow the RTAA adequate time to complete the real estate development RFQ, and better understand the business opportunities, capital investment, and revenue potential, before initiating a public competitive process. Since the FBO opportunity has not been brought to market in 30 years, staff will take the Reno-Stead Airport FBO opportunity to market through a public competitive process prior to the end of the proposed new short-term ACL agreement. If approved, the new ACL FBO agreement would begin November 1, 2015 and terminate September 31, 2020 for a total of five (5) years. The new 5-year agreement will include the following leased premises (Refer to Exhibit B – New Leased Premises):

• Building 7003/Parcel 9 (≈ 14,880 sf) • Outside Storage Area (≈ 15,874 sf) • Building 8003 (≈ 15,168 sf) • Ramp Tie-Down Area (≈ 120,000 square feet) • 4 fuel storage tanks (1 tank self-serve Fuel Island)

Aviation Classics FBO Agreement #15(10)-40 October 8, 2015 Board Meeting Page 3 of 4 As a part of the new agreement, Aviation Classics Ltd. proposes, at its sole cost, a minimum capital investment of $25,000 to replace the central heating system in both buildings. Additionally, as part of an ongoing maintenance program, the RTAA will replace the existing roof on Building 7003 at an estimated cost of $160,000 as approved in FY 2015-2016 budget in April 2015. The new roof combined with the new central heating system maintains the buildings as viable assets when the lease expires. Due to the size of Buildings 7003 and 8003, ACL will be allowed to sublease space within either building pending RTAA approval prior to move in. ACL understands that prior to subleasing space to any third party intending to provide commercial, for profit services, an operating agreement with RTAA will be required. ACL will also be responsible for repair and maintenance of the buildings, clean up, and/or screening of outside storage areas. The RTAA will be responsible for ramp maintenance. COMPANY BACKGROUND Aviation Classics Ltd. is a Nevada incorporated, minority-owned small business based in Reno, Nevada. The business was started in 1979 by Al Redick, Sr. who came to Reno from Southern California to restore Bill Harrah’s Lockheed P-38 Lighting. At that time, Mr. Redick started the Reno-Stead Warbird Restoration Shop named CIA Aviation. In 1987, Aviation Classics Ltd. was formed by the purchase of CIA Aviation. In 1989, the family run business was reorganized, and son Alby Redick began operating the business as the sole owner. ACL is a Federal Aviation Administration (FAA) Approved Repair Station providing general aviation maintenance, top line avionics, instrument and autopilot installation, and avionics sales and repair, and became an approved Phillips 66 Dealer and installed a Self-Serve 100LL Fuel Island at Reno-Stead in 2000. FISCAL IMPACT The proposed lease term is 5-years effective November 1, 2015. In order to meet the requirements of Grant Assurance 24, the current rent for the leased premises was adjusted pursuant to an appraisal to ensure that fair market value was being received and that the capital investment was commensurate with the lease term. The value established by the appraisal was used to establish rental rates for the two buildings and the outside storage area. The lease rates for the ramp tie down, the fuel flowage fee, and fuel storage are consistent with the RTAA Master Fees for FY 2015-2016. Based on the completed appraisal and the RTAA Master Fee Schedule, the minimum Year 1 rental revenue will be $105,630. The following table outlines the estimated revenues over the term of the agreement:

Aviation Classics FBO Agreement #15(10)-40 October 8, 2015 Board Meeting Page 4 of 4

The minimum contract value for the 5-year agreement is estimated to be $528,150. The rent rate is proposed to be adjusted annually beginning June 1, 2016 based on the Bureau of Labor Statistics, Consumer Price Index for All Urban Consumers (CPI-U) with an annual increase not to exceed three percent (3%). Over the term of the lease, ACL will also be responsible for all utility expenses as well as maintenance and repair of the premises. COMMITTEE COORDINATION This item is scheduled to be presented at the October 6, 2015 Finance and Business Development Committee meeting. RECOMMENDED MOTION It is hereby recommended that the Board adopt the following motion: “It is hereby moved that the Board of Trustees authorize the President/CEO to negotiate final terms and execute a new 5-year lease with Aviation Classics, Ltd to lease two Reno-Tahoe Airport Authority owned commercial box hangars, outside storage area, ramp space, and fuel storage tanks for the purpose of operating a non-exclusive Fixed Base Operation at the Reno-Stead Airport”. MMM/sh/cj

1-Year 5-Years

Building 7003 14,880 $0.156 $2,448 $0.25 $3,720 $44,640 $223,200 Outside Storage Area 15,874 $0 $0.0183 $290 $3,486 $17,430 Building 8003 15,168 $0.211 $3,200 $0.25 $3,792 $45,504 $227,520 Ramp Tie-Down Area 120,000 FLAT FEE $688 FLAT FEE $1,000 $12,000 $60,000 Fuel Tank Use Fee* $0.01/gal $0.01/gal Fuel Flowage Fee* $0.05/gal $0.05/gal Concession Fee* $0.02/dollar $0.02/dollar

TOTAL $6,336 $8,802 $105,630 $528,150 * Fees are non-standard and vary month to month based on information provided to the RTAA from ACL.

Proposed Price per

Square Foot

Proposed Monthly Revenue

New Lease Revenue Facility Square

Footage

Current Price per Square

Foot

Current Monthly Revenue

Bldg 7003 Bldg 8003

Exhibit A Current Leased Premises

Self-Serve Fuel Island

120,000 sf Ramp

N #15(10)-40

Bldg 7003 Bldg 8003

Exhibit B New Leased Premises

Self-Serve Fuel Island

120,000 sf Ramp

N

Outside Storage Area

#15(10)-40

Date: September 30, 2015 Memo: #15(10)–41 To: Chairman & Board Members For: October 8, 2015 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: APPROVAL OF THE PROPOSED CHANGES TO THE RENO-TAHOE

AIRPORT AUTHORITY COMMUNITY OUTREACH COMMITTEE BY-LAWS STAFF RECOMMENDATION Staff recommends that the Board of Trustees approve the proposed changes to the Reno-Tahoe Airport Authority (RTAA) Community Outreach Committee by-laws. The proposed changes were presented to the Community Outreach Committee on September 24, 2015, and all current members were encouraged to reapply to be members of the revamped committee. PURPOSE The purpose of this action is to obtain Board of Trustees approval to modify the existing RTAA Community Outreach Committee by-laws. This action is in support of the RTAA Strategic Priority # 5 – Provide a Positive Environment and Experience for All, and the Guiding Principle of Customer Service, as adopted in the RTAA Fiscal Year (FY) 2014-2018 Comprehensive Strategic Plan. BACKGROUND The Community Outreach Committee (COC) was formed in 1998. It is a Board committee currently chaired by Trustee Jessica Sferrazza. With meetings held on a quarterly basis, the general goals of the committee are to promote greater community input, awareness, and outreach regarding the Reno-Tahoe International Airport and the Reno-Stead Airport (RTS). Appointments to the committee are made by approval of the full RTAA Board of Trustees in accordance with COC by-laws. The committee by-laws were last amended in 2009 to increase the membership from 25 to 30 individuals. DISCUSSION The airline industry has changed dramatically since the last recession. Community support for current air service routes and the efforts to gain more service are essential for Airport success and economic prosperity for the community. The way the current COC is structured, it does not reach many aspects of the community that are essential for successful air service development. Embarking on a new application process for current and potential members will allow the Board of Trustees to form up to a 17-member committee that spans business, industry, tourism, government, and the general public throughout the catchment area served by the Reno-Tahoe International Airport. Modifying the by-laws to allow members to vote on recommending issues to the full Board of Trustees should increase discussion and participation on the COC. The proposed new COC by-laws are attached to this board memo. Changes to the existing by-laws are noted in red.


Community Outreach Committee By-laws Modification #15(10)-41 October 8, 2015 Board Meeting Page 2 of 2 FISCAL IMPACT There is no anticipated fiscal impact associated with this item. COMMITTEE COORDINATION This item was presented and discussed at the September 24, 2015 Community Outreach Committee meeting and all current members were encouraged to reapply to join the modified COC. RECOMMENDATION It is hereby recommended that the Board adopt the following motion: “It is hereby moved that the Board of Trustees approve the proposed changes to the Reno-Tahoe Airport Authority (RTAA) Community Outreach Committee by-laws.” MMM/bk/cj

of 3

Revised 11/09

RENO-TAHOE AIRPORT AUTHORITY (RTAA)

COMMUNITY OUTREACH COMMITTEE (COC) GUIDELINES

Purpose

The Community Outreach Committee (COC) exists to provide essential community input and feedback on RTAA issues and initiatives. The rules contained in the current edition of Robert’s Rules of Order Newly Revised shall guide the COC in all cases to which they are applicable and in which they are not inconsistent with any special rules of order the COC may adopt. Goals and objectives of the COC include:

- To represent the views and concerns of citizens in the airport region service area. - To promote greater community input and feedback on Airport Authority plans and

initiatives. - To disseminate information to the public. - To promote and assist in greater community awareness of RTAA plans and initiatives. - To make recommendations to the RTAA Board of Trustees on airport plans and

initiatives. Membership 1. There will be a total of not more than 17 members on the COC:

a. The COC will consist of a minimum of 9 members. 2. The Airport’s Board of Trustees will appoint members for a term of two years.

a. Those interested will submit an application to the Chairman of the COC for consideration pursuant to a notice of vacancy.

b. All members will be at-large. c. Members should have a genuine interest in the operation and future of both the Reno-

Tahoe International and Reno-Stead Airports and their impact upon the communities they serve.

d. Members should have a desire to learn more about the RTAA, its responsibilities, and a willingness to share that knowledge with the community.

e. The Board will seek to appoint members representing diverse geographical and interest perspectives. Voting members should not include elected officials or senior management officials from any government agency or body.

of 3

Revised 11/09

f. The City of Reno, City of Sparks and Washoe County may each appoint one non-voting liaison to the COC who is an elected official or member of their senior management team.

g. A new application must be submitted by COC members every two or three years depending on the term they are appointed for by the Board of Trustees. The Board will appoint 9 members to three year terms and eight to two year terms. Terms commence July 1 of each year.

3. Duties of COC members will include:

a. Regular attendance at meetings. b. Sharing of information and knowledge with other residents and the community. c. Sharing with the public the plans and initiatives of the RTAA. d. Sharing, through the Chair, public input to the Airport Authority Board of Trustees. e. Making recommendations to the RTAA Board of Trustees on airport plans and

initiatives. 4. Removal from COC:

a. The RTAA Board of Trustees may remove a COC member for what it views as inappropriate or disruptive conduct.

b. Any COC member who fails to participate or demonstrates lack of interest will be recommended for removal of their membership by the COC Chair.

Meetings 1. The COC will meet quarterly at a date and time set by the COC Chair. 2. Meetings will normally be held at the Reno-Tahoe International Airport but can be scheduled

with proper public notice at other locations. 3. All meetings will be subject to the Nevada Open Meeting Law (NOML) and will be legally

posted pursuant to NOML requirements. 4. The general public will be duly notified of meetings on the RTAA website and will be

encouraged to attend. All COC members will be mailed meeting notices. 5. The Chair may call special meetings of the COC. Any special meeting must comply with

requirements of the NOML. 6. COC members are expected to attend all regular meetings. The Chair can excuse members

who are unable to attend a regular or special COC meeting. Attendance will be recorded and included with each meeting’s minutes.

Agenda The tentative agenda for each meeting will be publicly posted pursuant to requirements of the Nevada Open Meeting Law and shall adhere to the following format: I. Call to Order/Roll Call II. Approval of Minutes of Last Meeting III. Chair’s Report IV. Input from RTAA V. Input from COC

of 3

Revised 11/09

VI. Public Comments VII. Adjournment Chairperson 1. The Chair and Vice Chair of the COC shall be Airport Trustees appointed by the Chair of the

RTAA Board of Trustees and shall serve at his/her pleasure.

2. The Chair is responsible for the following duties: a. The conduct of all meetings. b. The calling of special meetings as appropriate. c. Excusing any members from attendance at a COC meeting. d. Maintaining decorum during meetings. e. Ensuring compliance with the NOML. f. Ensuring that minutes and related documentation are produced in a timely manner. g. Assisting in the drafting of any reports or recommendations of the COC. h. Preparing each agenda. i. Directing the RTAA staff liaison. j. Notification of meetings to all members, alternates and applicants.

Air Service • Reno-Tahoe International Airport (RNO) served 333,017 passengers in August 2015, which is up

4.4% versus August 2014. All airlines except United Airlines reported a year-over-year increase in passenger traffic at RNO for the month of August 2015. During the month of August 2015, new flights on JetBlue Airways and Volaris Airlines carried 3.1% of the total passenger traffic at RNO. Without these flights, the year-over-year August 2015 passenger traffic would have been up 1.1%. In addition, the increased seat capacity on American Airlines and Delta Air Lines, in certain markets, also contributed to the year-over-year passenger increase at RNO. During the first eight months of 2015, RNO served 2,295,752 passengers, representing an increase of 1.4% when compared to the same period last year.

TOTAL PASSENGERS

2013 2014

JAN 264,265 241,181 -8.7% 2.2%

FEB 259,299 228,035 -12.1% 3.0%

MAR 306,139 278,172 -9.1% -0.2%

1st Quarter 829,703 747,388 -9.9% 1.5%

APR 279,418 266,800 -4.5% -3.7%

MAY 295,494 282,277 -4.5% -1.9%

JUN 328,755 316,720 -3.7% 0.8%

2nd Quarter 903,667 865,797 -4.2% -1.5%

JUL 333,321 332,242 -0.3% 5.6%

AUG 322,083 318,965 -1.0% 4.4%

SEP 283,800 284,931 0.4%

3rd Quarter 939,204 936,138 -0.3%

OCT 262,473 266,701 1.6%

NOV 227,213 225,384 -0.8%

DEC 270,051 263,682 -2.4%

4th Quarter 759,737 749,592 -1.3%TOTAL 3,432,311 3,298,915 -3.9%YTD Total 2,264,392 1.4%2,295,752

Total Passengers

August-15

246,571

234,763

277,477

758,811

256,823

276,969

319,309

853,101

350,823

333,017

Passengers% Diff.

Passengers% Diff.

2015

President/CEO’s Report September 2015

Marily M. Mora, A.A.E., President/CEO____________________________

President/CEO’s Report – September 2015 October 8, 2015 Page 2 of 10 • In August 2015, RNO was served by nine airlines providing 62 peak daily departures to 17 non-stop

destinations. Total departures at RNO were down (5.3%), but seat capacity increased 5.2% when compared to August 2014 due to utilization of a larger aircraft.

• Starting November 5, 2015, Alaska Airlines will begin non-stop daily flights between RNO and

Boise Airport. The airline will fly the route with a 76-seat Bombardier Q400 aircraft. The flight will depart Reno at 4:35 p.m. and arrive in Boise at 6:55 p.m. The return flight will depart Boise at 6:15 p.m. and arrive in Reno at 6:44 p.m. The Boise route also offers connectivity into another popular market, Spokane, Washington, with only a half hour connect time.

• Recent and Upcoming Schedule Changes

Alaska Airlines o Starting July 1, 2015, the new schedule for non-stop flights between Reno and San Jose are

as follows: San Jose to Reno:

• AS2250 7:30 AM - 8:28 AM • AS2500 6:00 PM - 6:56 PM

Reno to San Jose: • AS2183 6:00 AM - 6:57 AM • AS2253 4:30 PM - 5:28 PM

o Starting October 5, 2015, Alaska Airlines will reduce the number of daily flights between Reno and Seattle from five flights a day to four flights a day

o Starting November 1, 2015, the airline will increase the number of daily flights between Reno and Portland from two flights a day to three flights a day.

JetBlue Airways (Seasonal Reduction) o The upcoming schedule for non-stop flights between Reno and New York City is as follows: September 13, 2015 to October 25, 2015 - Four days a week schedule; Sunday, Monday,

Thursday and Friday (no flight on the October 12th) October 26, 2015 to January 4, 2016 - Daily flight January 5, 2016 to February 11th - Four days a week schedule; Sunday, Monday,

Thursday and Friday February 12 to February 22 - Daily flight February 25 to March 20 - Four days a week schedule; Sunday, Monday, Thursday and

Friday

Southwest Airlines (Seasonal Reduction) o The non-stop flights between Reno and Chicago Midway will operate until October 31, 2015.

The flight returns to daily schedule on March 10, 2016. Volaris

o Starting Monday, November 2, 2015, Volaris is scheduled to add a third weekly flight between Reno and Guadalajara, pending approval from Customs and Border Protection. This flight was initially scheduled to be a Sunday flight.

President/CEO’s Report – September 2015 October 8, 2015 Page 3 of 10 • In regard to cargo tonnage, RNO handled 11,031,470 pounds of cargo in August 2015, an increase of

1.6% when compared to August 2014. RNO handled 84,191,289 pounds of air cargo during the first eight months of 2015, an increase of 3.8% when compared to the same period last year.

TOTAL CARGO

2013 2014Pounds Metric

JAN 10,269,546 10,303,380 0.3% 10,113,421 4,587 -1.8%

FEB 8,635,807 9,486,697 9.9% 9,418,781 4,272 -0.7%

MAR 9,457,376 9,758,391 3.2% 10,381,009 4,708 6.4%

1st Quarter 28,362,729 29,548,468 4.2% 29,913,211 13,566 1.2%

APR 8,639,232 9,876,465 14.3% 10,416,248 4,724 5.5%

MAY 9,398,212 10,269,963 9.3% 10,459,643 4,744 1.8%

JUN 9,001,339 9,679,744 7.5% 10,595,645 4,805 9.5%

2nd Quarter 27,038,783 29,826,172 10.3% 31,471,536 14,273 5.5%

JUL 10,149,807 10,863,843 7.0% 11,775,072 5,340 8.4%

AUG 10,859,694 10,853,726 -0.1% 11,031,470 5,003 1.6%

SEP 9,689,115 10,127,014 4.5%

3rd Quarter 30,698,616 31,844,583 3.7%

OCT 10,834,930 11,429,538 5.5%

NOV 10,099,499 10,664,398 5.6%

DEC 13,998,438 15,776,073 12.7%

4th Quarter 34,932,867 37,870,009 8.4%

TOTAL 121,032,995 129,089,232 6.7%

YTD Total 81,092,209 84,191,289 38,182 3.8%

Total CargoAugust-15

% Diff.2015

% Diff.Cargo in Pounds

• Recent and Upcoming Schedule Changes

United Parcel Service (UPS) o Starting September 15, 2015, UPS added eight weekly flights to their current schedule at

RNO. The additional flights consist of six Boeing 757s and two Airbus A300s.

President/CEO’s Report – September 2015 October 8, 2015 Page 4 of 10 DHL

o Starting November 1, 2015, Southern Air will begin cargo flights on behalf of DHL at RNO. Currently, Ameriflight operates two flights per day on behalf of DHL, utilizing Beechcraft 1900 aircraft. Southern Air will replace one of the Beechcraft 1900 flights with a Boeing 737-400 aircraft, a larger aircraft than Beechcraft 1900.

Parking Comparison

Business Development Reno-Stead Airport Economic Development (AED)

• UAS (Unmanned Aircraft Systems) The 2015 American Society for Photogrammetry and Remote Sensing (ASPRS) Symposium was held in the Reno Ballroom on September 29 & 30, 2015. The two-day Symposium brought together academia, UAS developers, survey and mapping companies, government agencies, and UAS enthusiasts, to share information and showcase new technologies, and included test flights, UAS data processing, and workshops.

President/CEO’s Report – September 2015 October 8, 2015 Page 5 of 10 • Reno-Stead Airport Real Estate Development Opportunity Request for Qualifications (RFQ)

At the February 12, 2015 Board of Trustees meeting, Dermody Properties was authorized to represent the RTAA in order to complete Phase 2 and Phase 3 of the Reno-Stead Airport Real Estate Development Opportunity RFQ. Completion of Phases 2 and 3 will allow Dermody Properties to identify market opportunities and financing strategies necessary to prepare a business plan and final agreement terms. Dermody Properties (DP) continues to finish Phases 2 & 3, which includes pursuing financial resources and investment partners. DP has done considerable due diligence resulting in the selection of a preferred investment partner. DP submitted an updated due diligence packet on May 22, 2015. Following this submittal, and review by staff and RTAA Legal Counsel, the CEO’s Land Development Working Group was convened on June 4, 2015 to allow DP to present their updated due diligence packet. Pursuant to the schedule in DP’s presentation to the CEO’s Land Development Working Group on June 4th, and in accordance with the RFQ’s Phase 3, DP is to submit a Development Proposal including proposed business terms to the RTAA within 90 days. DP was advised that until the Phase 3 Development Proposal is presented to and approved by the Board of Trustees, no steps should be taken with respect to easements, railroad crossings, or permits. On September 4, 2015, staff contacted DP regarding submittal of a Development Proposal to include proposed business terms and financial engineering for the project. Staff reminded DP that the Phase 3 Development Proposal needs to be submitted to the RTAA for review. Staff continues to anticipate receiving proposed business terms from DP before the end of 2015.

Reno-Tahoe International Airport (RNO) General Aviation

• CEO Advisory Group on GA Minimum Standards The CEO’s Advisory Group continues to meet every two weeks and is making progress on the various tasks identified to complete the General Aviation Minimum Standards (GAMS) revision process. The RTAA will host, and the CEO Advisory Group will facilitate, a public workshop to discuss the survey results and proposed GAMS revisions for public comment on Wednesday, December 2, 2015 at 5:00 pm in the RTAA River Room. In addition to reviewing the revised GAMS, the Economic Development Authority of Western Nevada (EDAWN) will be in attendance to discuss aviation tax abatement qualifications and processes. The Nevada Department of Taxation will also have a representative at the workshop with information on revised tax reporting and invoicing that resulted from the passage of Assembly Bill (AB) 161.

• Atlantic Aviation is in the process of reconstructing 705,000 square feet of aircraft ramp and installing a fuel storage facility on its leasehold. The fuel storage facility portion of the project requires the preparation and approval of an Environmental Assessment before construction may begin. Granite Construction Company is the contractor for both the RTAA Taxiway C and Atlantic ramp reconstruction projects, and will minimize impacts to tenants through construction phasing and tenant communications. The anticipated completion date of the ramp reconstruction portion of the project is November 30, 2015.

President/CEO’s Report – September 2015 October 8, 2015 Page 6 of 10 Outside Commercial Properties • Airport Mini Warehouse

ATR Aviation, LLC dba STS Line Maintenance A 5-year commercial lease agreement renewal was executed with ATR Aviation, LLC dba STS Line Maintenance for 1,000 square feet of commercial warehouse space at 2890 Vassar Street. ATR Aviation, LLC provides emergency aircraft maintenance and repair services, and has been a tenant at the Mini Warehouse property since July 2010. ATR Aviation, LLC primarily utilizes the space for storage of their equipment, tools, and parts, as they perform the emergency maintenance and repairs on the airfield. The total contract value is $27,000.00. Northern Nevada Silk Screen, LLC A new twelve-month commercial lease agreement was executed with Northern Nevada Silk Screen, LLC for 1,170 square feet of commercial warehouse space at 2890 Vassar Street. Northern Nevada Silk Screen, LLC is a start-up screen printing company and is utilizing the space as a workshop to fulfill customer orders. The total contract value is $6,598.80.

RNO Land Development

• Airport West Reno Commercial Properties, a local real estate brokerage firm, submitted a Letter of Interest (LOI) on behalf of Skyline Holdings, LLC for development of a Recreational Vehicle (RV) storage facility on a 5.18 acre parcel owned by the RTAA on the west side of Airway Drive between McCarran Boulevard and Peckham Lane. Staff responded to the LOI with initial proposed business terms outlining the RTAA’s terms for development of the property. Skyline Holdings, LLC accepted the initially proposed business terms on April 16, 2015, and on May 29, 2015, Skyline Holdings LLC entered into a Right of Entry & Hold Harmless Agreement providing a 90-day due diligence period. Staff met with Skyline Holdings, LLC on September 25, 2015 to discuss the due diligence findings. Skyline Holdings, LLC continues to gather information regarding the suitability of the site for a proposed RV Storage development. If Skyline Holdings, LLC finds the site viable, staff will bring this item to a future Board of Trustees meeting.

RNO Concessions • Rental Cars

In accordance with the new lease agreement with the rental car companies approved by the Board in June 2015, improvements have begun to provide a more efficient and safer operation for rental car customers, as well as additional Airport revenue. This project includes a reconfiguration of the first level of the parking structure to provide a dedicated rental car return area. The new dedicated return area will be located immediately south of, and adjacent to, the current rental car Ready/Return area. Handicap and public parking will continue to be available on all levels of the parking structure. Approximately 140 parking spaces in the center of the first level will be removed from public access in order to accommodate this new design. These spaces will be converted to vehicle return lanes and will be allocated according to rental car market share. The new configuration will provide additional revenue of approximately $177,000 annually to the current rental car program.

President/CEO’s Report – September 2015 October 8, 2015 Page 7 of 10 Organizational Training & Development • Human Resources (HR) staff presented two different computer training courses: First, “Outlook for

Managers” is a program designed to help improve productivity and efficiency by using the tool to manage people, time, and information. Second, “Excel Basics” allowed beginners the opportunity to create and edit worksheets, learning basic formatting and formulas.

• HR staff presented “So You Want a Promotion?”, a foundational class in the Airport Authority University career development series. This course teaches participants how to put their best foot forward and get ready now for future promotional opportunities.

• HR staff coordinated a series of “Confined Space” classes for maintenance employees. Taught by

Airport Firefighters, this training is an Occupational Safety and Health Administration (OSHA) requirement for any employee who enters a permit required, confined space (such as electrical vaults) in the course of doing their job.

• The RTAA Holiday Party will be held at the Eldorado Hotel and Casino on Saturday, December 5,

2015.

Miscellaneous Information • The Airport’s social media strategy continues to be a success. Facebook followers are at 9,674 with a

monthly post reach of 1.45 million and Twitter is now at 4,599. Social media posts focused on promoting airline partners and fare sales, information about the Reno-Tahoe region, travel tips, #kindnesstakesflight, partner promotions, Airport job postings, and the monthly employee photo contest.

• The Airport Authority sponsored the 2015 National Championship Air Races with a VIP flightline chalet. The purpose of the chalet is to provide an opportunity for staff and Trustees to have meaningful conversations with airlines, economic development partners, and community leaders who have an impact on business at Reno-Tahoe International and Reno-Stead Airports. Attendance at the chalet included; staff from 12 different airlines, regional, state and city political influencers, and many potential business partners including representatives from Switch, Panasonic, and Tesla.

• Staff is working with Alaska Airlines, the Reno-Sparks Convention and Visitors Authority

(RSCVA), the Regional Air Service Corporation (RASC), and the Boise Airport on a marketing campaign to launch the new non-stop service to Boise, Idaho that begins on November 5th. The campaign is being funded by all entities listed above and will utilize a combination of traditional and electronic media to promote the flight. The campaign begins in early October and will run through April of 2016.

• The RTAA hosted the 3rd annual employee/tenant appreciation luncheon on Thursday, October 1st at 11:30 am in the parking lot just south of the terminal building. This free event offers Airport staff and tenants an opportunity to mingle while enjoying food from various local food trucks, winning raffle prizes, and learning more about their co-workers.

• RNO has hosted a number of Military Charters this month, with service men and women traveling to

and from the region. Working with the Civil Air Patrol (CAP) and Atlantic Aviation, many of the

President/CEO’s Report – September 2015 October 8, 2015 Page 8 of 10

military members were treated to hospitality, snacks, and even a visit from the Paws 4 Passengers therapy dogs.

• On October 2nd, staff participated in the Biggest Little City FAM/Golf Tournament that is hosted

annually by the RSCVA in conjunction with local tourism partners. The Airport Authority sponsors both breakfasts during the tournament and a golf hole sponsorship. This year’s theme for the Authority’s sponsorship is “Putting the International Back into Reno-Tahoe International Airport” with a focus on the new Volaris service to Guadalajara. The sponsorship provides an opportunity for staff to communicate the importance of air service to tourism partners and professionals throughout the region.

• This fall will bring three different Honor Flights through RNO, with veterans of WWII, Korea, and

Vietnam, all of whom are sent to Washington D.C. free of charge to be recognized for their service. The Airport partners with local military supporters to offer the veterans a warm send off and a grand welcome home. Trustees are invited to join the RTAA at the homecoming on October 2nd at 3:30 p.m., October 16th at 3:30 p.m., and November 5th at 1:30 p.m.

• Staff conducted interviews with the news media regarding topics such as air service, seasonal flights for the upcoming winter season, and airport preparedness in case of an aircraft fire.

• The RTAA successfully reduced the interest rate on its outstanding senior lien debt from 5.00% to

2.75% on September 30, 2015. With the successful closing of the loan transaction with BBVA Compass Bank, the RTAA has reduced its annual debt service by $206,313 in FY 2015-2016 as compared to the prior year, and will save approximately $270,000 annually going forward for the next 10 years. The present value savings is $2.519 million, or more than 12.00% of the refunded bonds outstanding. While the rate of 2.75% is between 0.04% to 0.06% higher than the rate outlined in the Board Memo and presentation to the Board of Trustees, the RTAA was able to lock-in the rate prior to the September meeting of the Federal Reserve. Although the Federal Reserve decided to take no action in September, all indications are that a rate increase is likely before the end of 2015. The RTAA can rest comfortably knowing that it completed this refinancing effort at or near historic low rates.

• Annual Environmental Inspections

As required by the State of Nevada Storm Water General Permit NVR050000, annual assessments of environmental and regulatory compliance inspections were completed by staff in August 2015. These annual site visits are conducted to help identify potential environmental and regulatory compliance issues with Airport Authority and tenant operations occurring at the Reno-Tahoe International and Reno-Stead Airports. No major environmental compliance issues were identified.

• Aircraft Rescue and Firefighting Facility (ARFF) Solar System

The 135-kilowatt solar system installed at the Reno-Tahoe Airport Authority’s Aircraft Rescue and Firefighting Facility (ARFF) has been fully operational since March 2011. Solar power generation results are provided below. Banked credits have been used during those months when not enough power is generated to cover the monthly use. As indicated in the table below, approximately $6,942 in electrical costs were saved as a result of the solar system during the current 2015-2016 fiscal year period.


Power Generation August 2015 FY 2015-2016

Energy Offset from Monthly Bill $3,069 $6,701 Energy Credits Banked $241 $241 Banked Credits Applied ($0) ($10) Total Earned $3,310 $6,942 Banked Credits Remaining NA $11,114

• Recycling at Reno-Tahoe International Airport

Beginning July 2015, Airport staff has successfully collected approximately 13.70 tons of recyclable material during the FY 2015-2016 period. These recyclables equate to a 7.60 percent diversion rate of the Airport’s total waste volume. An annual recycling objective remains set at 10 percent.

Due to recently implemented hauling cost-reduction measures, collected recyclables will no longer be transported monthly to local recycling centers. Staff will accumulate recyclables for longer periods of time before transportation, thereby decreasing the number of annual trips. As a result, during some months there will be no reportable quantities for certain materials, as illustrated in the table below.

Material September 2015 (Tons)

FY15-16 (Total Tons)

Cardboard 4.17 4.17 Mixed Paper 2.30 2.30 Glass 0 0 Batteries 0 0.10 Beverage Containers 7.13 7.13 Total 13.60 13.70

Quarterly Strategic Plan Update

Next Quarterly Strategic Plan Update – October 2015 Report

Legislative/Government Affairs Update • In support of the RTAA, the McDonald·Carano·Wilson (MCW) Government Affairs Group engaged

in the following meetings and activities through September 23, 2015:

Attended the September 14th Reno-Sparks Convention and Visitors Authority (RSCVA) Marketing Committee meeting and provided a report to RTAA administration: o A presentation was made by EMC Research Services on Bay Area Millennial perception of

Reno. The conclusions of the focus group indicated that this demographic most often sees Reno as cheap or dirty.

o Christopher Baum (RSCVA President) proposed the issuance of a Request for Proposal (RFP) for Professional Advertising and Public Relations Representation. The RSCVA executive staff would like to hire a large national firm, while the Committee would like to see a local firm do the job.

o It was also noted during the meeting that JetBlue’s next payment from the mitigation fund will be its last.

Attended the September 15th Nevada Transportation Authority (NTA) board meeting:


o The meeting resulted in the unanimous contingent approval of both Lyft and Uber to operate in Nevada. The conditions: Ensuring compliance with insurance policies Receipt of full driver lists A requirement to change the terms of use agreements to remove hold harmless language

protecting Transportation Network Companies (TNCs) from liability should the driver commit identity fraud

On September 20th, hosted President/CEO Marily Mora and Executive Vice President/COO Dean Schultz, at the MCW annual appreciation celebration for clients and friends. RTAA Trustees Jessica Sferrazza and Jenifer Rose also attended.

Attended the RTAA Board of Trustees meeting on September 10, 2015.

Hosted an event for Congresswoman Dina Titus in Las Vegas. o During her remarks, the Congresswoman mentioned her recent aviation symposium and her

involvement in aviation-related legislation to help keep Nevada’s airports appropriately funded so that they have the best technology possible for efficiency and passenger safety.

o Clark County Commissioner Chris Giunchigliani and two new Assembly candidates were among those in attendance.

Attended a number of political fundraising events, including: o Assembly Majority Leader Paul Anderson, who referenced the aviation tax abatement as a

major accomplishment of the 2015 session and mentioned his recent visit to a major company at Reno-Tahoe International Airport

o Speaker John Hambrick (Reno and Las Vegas) o Secretary of State Barbara Cegavske

Coordinated a follow up meeting between RTAA Vice President of Airport Economic

Development Tina Iftiger, and an international company that facilitates investment in major development deals.

Presentations • Staff gave a presentation to the Checkered Flag Club during the Reno Air Races for Pathways to

Aviation, providing an update on air service, economic development efforts, and an overview of Reno-Stead Airport and general aviation.

• An overview of the RTAA and air service was presented to David Bobzien, City of Reno Councilman.

• The Airport Authority, in partnership with the RSCVA, hosted an Air Service 101 training session

during the Convention Industry Council’s CMP Conclave on Sunday September 27th. The Convention Industry Council represents over 100,000 professionals in the meetings and convention industry. The CMP Conclave is an annual training and certification program for these professionals. The Air Service 101 session focused on changes in the airline industry that are affecting business travel, an overview of the industry as a whole, and tips for working with airports and airlines when planning meetings and conventions. Forty meeting professionals attended the training and tour held at the Airport.