AGENDA Addendum 1 Special Meeting of the Board of City Commissioners June 6, :30 pm City Hall Williston, North Dakota

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Baldwin Abraham Hines
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1 AGENDA Addendum 1 Special Meeting of the Board of City Commissioners June 6, :30 pm City Hall Williston, North Dakota 1. Roll Call of Commissioners 2. Farm Plan Group 1 Bid Award 3. Farm Plan Group 2 Bid Award 4. Farm Plan Group 3 Bid Award 5. Request to Advertise RFP for Fixed Based Operators at XWA 6. Northwest Transit / Williston Senior Center 7. Adjourn

2 DATE: Wednesday, June 6 th, 2018 TO: City Commission FROM: Anthony Dudas, Airport Director RE: Report of Commissioners Water Works, Sewer, Airport, Building and Planning Commissioner 2: XWA Farm Plan Group 1 Bid Award The project team has identified three areas that can be farmed or grazed moving forward as these areas will not be further disturbed and will not interrupt airport construction. Area 1 consists of 201 tillable acres. All agreements are subject to FAA approval. We anticipate this to be a one-year lease with an option for a one year extension as some areas may change slightly throughout construction seasons. After the airport opens, we will advertise for a term of 5 years and may have crop type stipulations depending on location to ensure there are no wildlife attractants that may impact the airport. These stipulations will be determined through a wildlife hazard study and approval by the Bismarck FAA office. I recommend award of XWA Farm Plan Group 1 to BIDDER NAME in the amount of $XXX.XX 3: XWA Farm Plan Group 2 Bid Award The project team has identified three areas that can be farmed or grazed moving forward as these areas will not be further disturbed and will not interrupt airport construction. Area 2 consists of 185 tillable acres. All agreements are subject to FAA approval. We anticipate this to be a one-year lease with an option for a one year extension as some areas may change slightly throughout construction seasons. After the airport opens, we will advertise for a term of 5 years and may have crop type stipulations depending on location to ensure there are no wildlife attractants that may impact the airport. These stipulations will be determined through a wildlife hazard study and approval by the Bismarck FAA office. I recommend award of XWA Farm Plan Group 2 to BIDDER NAME in the amount of $XXX.XX 4: XWA Farm Plan Group 3 Bid Award The project team has identified three areas that can be farmed or grazed moving forward as these areas will not be further disturbed and will not interrupt airport construction. Area 3

3 consists of 124 pasture acres. All agreements are subject to FAA approval. We anticipate this to be a one-year lease with an option for a one year extension as some areas may change slightly throughout construction seasons. After the airport opens, we will advertise for a term of 5 years and may have crop type stipulations depending on location to ensure there are no wildlife attractants that may impact the airport. These stipulations will be determined through a wildlife hazard study and approval by the Bismarck FAA office. I recommend award of XWA Farm Plan Group 3 to BIDDER NAME in the amount of $XXX.XX 5: Request to Advertise RFP for Fixed Based Operators at XWA The current Fixed Based Operator (FBO) contract at ISN will terminate with the move to XWA. There have been initial conversations with the incumbent FBO and a local operator who has shown interest in establishing an FBO at XWA. The FBO will need to comply with the newly created Minimum Standards and will be responsible for funding and developing the appropriate facilities at the level defined in the Minimum Standards which will include an arrivals/departure building, a fuel farm and dispensing facility, training facilities, aircraft charter, and an aircraft hangar. Additionally, there will be a request to develop a Customs and Border Protection facility in the General Aviation (GA) area to meet the requirements for a Port of Entry. In order to coincide with the planned opening of XWA, financing commitments, design and development, and executing a contract with the selected FBO will need to be completed. Their needs and schedule will need to be coordinated with the construction of the GA related facilities that will be developed as part of the project. To allow our project team and the City of Williston to fully understand the commitments of any potential FBO operator, and to ensure these potential operators fully understand our minimum requirements, an RFP for these services should be advertised. I recommend approval to advertise an RFP for Fixed Based Operators at XWA Attachments A2: XWA Farming Plan Group 1 A3: XWA Farming Plan Group 2 A4: XWA Farming Plan Group 3 A5: White Paper Explanation of RFP

4 H Crop 2 Crop 2A Group 1 Crop Land XWA Williston International Airport Sections 1,2, &12 T155N, R102, 5th PM Area Description Area in Acres Crop Crop Crop 2A 52.6 Crop Crop Total Group 1 Acres = XWA Williston International Airport Revision Date Description By Crop 1 59th Street Crop 5 County Road 7 N Feet Drawn By: Checked By: Approved By: Farm Areas Layout Project Number: Date: Sheets: # 1 3/23/2018 # of ## G:\2016\ \Construction Management\ALP\Farm Plan.dwg-Group 1-3/23/ :58 AM

5 H Group 2 Crop Land XWA Williston International Airport Sections 11,13, &14, T155N, R102, 5th PM Area Description Area in Acres Crop Crop Crop Crop Crop Pasture 1Total Group 2 Acres = XWA Williston International Airport Revision Date Description By 59th Street Crop 3 Crop 4 Crop 6 County Road 7 N Crop Feet Crop 8 Drawn By: Checked By: Approved By: Farm Areas Layout Project Number: Date: Sheets: # 1 3/23/2018 # of ## G:\2016\ \Construction Management\ALP\Farm Plan.dwg-Group 2-3/23/ :59 AM

6 H Group 3 Pasture Land XWA Williston International Airport Sections 11,13, &14, T155N, R102, 5th PM Pasture Area Description Area in Acres Pasture Crop Pasture Crop 9, 2019 Total Group 2 Acres = XWA Williston International Airport Revision Date Description By 59th Street Pasture 3 County Road 7 N Feet Pasture 2 Drawn By: Checked By: Approved By: Farm Areas Layout Project Number: Date: Sheets: # 1 3/23/2018 # of ## G:\2016\ \Construction Management\ALP\Farm Plan.dwg-Group 3 Pasture-3/23/ :01 AM

7 FBO Solicitation Process Williston Basin International Airport Issue: The current Fixed Based Operator (FBO) contract at ISN will terminate with the move to XWA. There have been initial conversations with the incumbent FBO and a local operator who has shown interest in establishing an FBO at XWA. The FBO will need to comply with the newly created Minimum Standards and will be responsible for funding and developing the appropriate facilities at the level defined in the Minimum Standards which will include an arrivals/departure building, a fuel farm and dispensing facility, training facilities, aircraft charter, and an aircraft hangar. Additionally, there will be a request to develop a Customs and Border Protection facility in the General Aviation (GA) area to meet the requirements for a Port of Entry. In order to coincide with the planned opening of XWA, financing commitments, design and development, and executing a contract with the selected FBO will need to be completed. Their needs and schedule will need to be coordinated with the construction of the GA related facilities that will be developed as part of the project. Both parties have indicated interest, but to date, have not made firm proposals or commitments. A concern with a direct negotiation for the FBO contract with an airport that will have the potential that XWA holds is that others may claim that would have proposed if the opportunity was advertised publicly. In this situation, the City could be faced with either a challenge to the award which would certainly delay the execution of an agreement in a timely manner, or the filing of an FAA Part 16 formal complaint by a potential FBO operator. An FAA Part 16 complaint is a tool for a party to utilize should they feel they were substantially affected by noncompliance of a federal requirement. The ALP provides for multiple FBO development pads; however, the current level of fueling, the most profitable component of any FBO, is not sufficient to support multiple FBO s profitably at this time, although the City needs to maintain the ability for any operator to provide the services stated in the minimum standards. The City needs to implement a process to bring this decision to closure without delay and select the operator that provides the most added value for XWA and the Williston region. Background: To date, discussions have taken place with the incumbent FBO and a local new entrant operator under the premise that the City would negotiate an agreement with the new FBO for XWA and not go to market to seek broader industry interest. Both parties have indicated interest in establishing an operation at the new airport. Concepts have been developed and the talk thus far, has been positive with both parties, but no firm commitments have been extended by either party. The FBO industry is extremely competitive, particularly where fuel sales are near or exceed 1MM gallons per year, which is the case at the current airport. With the growth potential that XWA presents, the FBO(s) opportunity at XWA will be attractive to potential operators. The FBO services, specifically fueling, Airframe & Powerplant mechanic services, and de-icing services are essential for an airport to operate commercial service and general aviation activity and must be completed prior to the opening in October Each FBO will have its own view of what it wants to invest in based on its expected return on investment. The adopted core services required to be provided by the FBO are broader than most traditional services but do represent what is the more current expectations. For XWA to eliminate a critical path risk, the ability to provide the core FBO services to support commercial service and general aviation activity, a selection of an FBO needs to be made very soon in order to allow for the negotiation/execution of the contract, the design of the required facilities, financing, 1

8 and construction to meet the October 2019 timeline. Any delays related to negotiation of the contract, claims of economic discrimination by either the incumbent or a proposed new operator and a resulting challenge of the award of the contract, or the filing of a Part 16 complaint and the ultimate dismissal of the complaint will jeopardize the opening. Because of the highly political nature of FBO s and their history of using all means possible to secure a target market, which may be the case in XWA, airports have tended to be more structured in their approach toward selecting an FBO by issuing an Request for Proposals ( RFP ) and let the industry respond. The advantages of this successful approach include: 1. It levels the playing field so that all proposers have the ability to respond, greatly reducing the risk of a serious challenge or complaint to the FAA. 2. It allows the airport to present consistent terms and conditions for response since bi-lateral negotiations tend to focus on what each proposer wants to offer to meet their business plan and may differ between the different interested parties. Again, this significantly reduces the opportunity for challenge or claims of unfair advantages being offered. 3. The airport has a one-time shot, in a new situation like this, to define the facility investment that will be required so there is no ability for a successful proposer to come back after the fact and say I didn t understand I needed to do that. FBO s like to make investment based on demand. XWA is unique in that it being a new airport, there is no guaranteed increased demand day 1 so doing it after the fact based on committed demand could delay the investment to support general aviation traffic. XWA differs from most other airports by not having a current infrastructure (i.e. hangars, fueling facilities, hangars, etc.) to provide as a start-up for the FBO. 4. Since the Minimum Standards call for base services a little broader than traditional levels, there needs to be a way to eliminate the FBO from picking and choosing what they want to do up front. Once they have the submitted a proposal and committed to the full services by doing so, there is no wiggle room for them to back out. 5. The RFP would include the proposed contract which would include all terms and conditions and financial terms. The RFP would state that absent them submitting exceptions and proposed positions in their RFP response, the terms contained in the sample contract are non-negotiable. This greatly expedites the contract execution phase of the process. This process has proven effective in shifting the leverage from the FBO to the airport operator. In a unique situation like XWA, which represents a whole new airport, this puts the City in a position to maximize that leverage. There are two risks that could be foreseen for this approach: 1. No proposer responds. If that happens, that would allow the City the ability to conduct bi-lateral negotiations with a preferred party and stand little risk because the City would have followed due process in the public solicitation to insulate itself from claims provided the basic business terms from the RFP are followed and the FBO meets the Minimum Standards. 2. All proposers respond but carve out some investment associated with facilities for the base services. This can be mitigated by having a category in the evaluation criteria to reward proposers meeting the base service requirement. The FBO business is extremely competitive and companies become very aggressive on trying to protect their interests. Because of the general aviation business and the potential for growth as the Bakken begins growing again, XWA will be on the radar for interest. Because of the potential impact on the overall project if FBO services are not available upon opening, ensuring an orderly expedited process that 2

9 provides the services, facilities, and investment required along with the revenues and terms and conditions between the City and the operator is essential. Recommendation: Develop a performance based specification to include required services, corresponding facility requirements, and a baseline contract including the required business terms and issue an RFP for FBO selection. Select the highest ranked responder based on the proposals received and their ranking from pre-determined scoring criteria. If accepted, the timeline would be to develop and issue the RFP in June with a July due date and action by the Council in August. 3

City of Lafayette. Request for Proposals Municipal Airport Fixed Based Operator

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