Ann Morgan, Fennemore Craig Jones Vargas

Transcription

1 BOARD OF TRUSTEES Adam Mayberry, Chair Nat Carasali, Vice-Chair Rick Murdock, Secretary Dr. Kosta Arger, Treasurer Bill Eck Jerry Hall Steve Katzmann Bob Larkin Andy Wirth PRESIDENT/CEO Marily M. Mora, A.A.E. EXECUTIVE VICE-PRESIDENT/COO Dean E. Schultz, A.A.E. GENERAL COUNSEL Ann Morgan, Fennemore Craig Jones Vargas CLERK OF THE BOARD Jessica Olives A G E N D A RENO-TAHOE AIRPORT AUTHORITY MEETING OF THE BOARD OF TRUSTEES December 12, :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. III. IV. ROLL CALL PRESENTATIONS AND AWARDS A. Employee, Tenant and Special Recognition B. Introduction of New, Promoted and Retired Employees C. Tenant Communication PUBLIC COMMENT if any Limited to three minutes per person V. APPROVAL OF MINUTES November 21, 2013 Board Meeting VI. VII. APPROVAL OF AGENDA 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 G. Reno-Tahoe Air Service Task Force

2 Board Agenda December 12, 2013 Board Meeting Page 2 H. The Chamber Reno Sparks Northern Nevada I. Reno-Tahoe International Airport Users Committee VIII. CONSENT ITEMS FOR BOARD ACTION A. None. IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION A. #13(12)-61 Authorization for the President/CEO to execute Amendment No. 1 to the three-year Special Event License with the Reno Air Racing Association at the Reno-Stead Airport B. #13(12)-62 Authorization for the President/CEO to negotiate the final terms and execute Amendment No. 2 to the Lease Agreement with Dassault Aircraft Services Corporation for the first option to extend the Corporate Aviation Lease Agreement at the Reno-Tahoe International Airport X. ITEMS FOR BOARD INFORMATION AND DISCUSSION A. Presentation a. Staff update on Smarter Regions Activities B. Board Meeting Schedule 1. December 12, :00 a.m. Special Board of Trustees Meeting Legal Firm RFQ 2. December 16, :30 p.m. Airport Noise Advisory Panel Meeting 3. January 14, :00 a.m. Finance & Business Development Committee Meeting 4. January 14, :00 a.m. Planning & Construction Committee Meeting 5. January 16, :00 a.m. Board of Trustees Meeting 6. February 11, :00 a.m. Finance & Business Development Committee Meeting 7. February 11, :00 a.m. Planning & Construction Committee Meeting 8. February 13, :00 a.m. Board of Trustees Meeting B. President/CEO s Report Special Event Dates 1. December 16, :00 a.m. Reno-Stead Airport Terminal Opening Ceremony C. General Board comments, questions, and items for future Board meetings XI. XII. PUBLIC COMMENT, if any Limited to three minutes per person 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 the Clerk of the Board, Jessica Olives, P.O. Box 12490, Reno, NV, or Supporting material is also available at the Reno-Tahoe Airport (Administrative Offices) and at the scheduled meeting.

3 Board Agenda December 12, 2013 Board Meeting Page 3 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 or by calling (775) 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

4 *** 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 November 21, :00 a.m. MEMBERS PRESENT Adam Mayberry, Chair Nat Carasali, Vice Chair Rick Murdock, Secretary Dr. Kosta Arger, Treasurer Bill Eck Steve Katzmann Bob Larkin arrived at 9:48 a.m. ALSO PRESENT Marily M. Mora, A.A.E. President/CEO Dean Schultz, A.A.E Executive Vice-President/COO Ann Morgan General Counsel Jessica Olives Clerk of the Board MEMBERS ABSENT/EXCUSED Jerry Hall Andy Wirth The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno- Tahoe International Airport, Reno, Nevada. Chair Adam Mayberry called the meeting to order. The Pledge of Allegiance was recited. Roll was called. III. PRESENTATIONS AND AWARDS A. Employee, Tenant and Special Recognition Marily Mora, President/CEO, recognized and congratulated Brian Kulpin, Vice President of Marketing and Public Affairs, on the Gold Spike Community of Excellence Award he received from the Public Relations Society of America, Sierra Nevada Chapter. Trish Tucker, Manager of Airport Noise Program, announced that as part of the annual Airport Noise Mitigation Program Conference, the Conference Committee along with the host airport (Reno-Tahoe Airport Authority) chooses a local non-for-profit organization to support and raise funds. Ms. Tucker stated that the Committee selected the Blue Star Mothers of Truckee Meadows/Blue Star Moms, made up of mothers who have or had active duty and honorably discharged service men and women. Ms. Tucker presented a donation in the total amount of $5,046 to the Blue Star Mothers of Truckee Meadows on behalf of the Conference Committee. B. Introduction of New, Promoted and Retired Employees Dean Schultz, Executive Vice President/COO, introduced and welcomed Rebbeca Maddux as a new Accountant, Casey Micone and Jeff Ward as new Airport Firefighters; Rebecca Ormsby and Marisela Esquivel as new Airport Communications Specialists; and Martha Pace as well as Robert Barber as new Facilities Custodians.

5 Meeting of the Board of Trustees November 21, 2013 Brief of Minutes Page 2 of 4 C. Employee First Class Award President/CEO, Marily Mora and Chair Mayberry announced Shawn Ohm and Shannon Edison as the recipients of the Employee First Class Award for their assistance with a stranded passenger with her young daughter. Ms. Mora and Chair Mayberry congratulated Mr. Ohm and Mr. Edison as well as presented them with a certificate of recognition and monetary award. D. Tenant Communications Tina Iftiger, Vice President of Airport Economic Development, introduced Lou Pepper, CEO of Atlantic Aviation a Reno-Tahoe International Airport (RNO) tenant. Mr. Pepper introduced Atlantic Aviation s RNO Management Team and provided an update on the Construction progress of their new Fixed Base Operations facility. IV. PUBLIC COMMENT None. V. APPROVAL OF MINUTES On motion by Trustee Eck, seconded by Trustee Katzmann, which motion duly carried by unanimous vote, the Board approved the minutes of the Board meeting of October 10, VI. APPROVAL OF AGENDA On motion by Trustee Katzmann, seconded by Trustee Arger, which motion duly carried by unanimous vote, the Board approved the November 21, 2013 Board of Trustees meeting agenda. VII. COMMITTEE/LIAISON REPORTS Committee/Liaison reports were given by: Finance/Business Development Committee Trustee Kosta Arger Planning/Construction Committee Trustee Bill Eck Airport Noise Advisory Panel Trustee Nat Carasali Community Outreach Committee Trustee Nat Carasali Stead Liaison Trustee Steve Katzmann RSCVA Board No report given Reno-Tahoe Air Service Task Force Trustee Rick Murdock The Chamber Reno Sparks Northern NV Tina Iftiger, V.P. Airport Economic Development RTIA User Committee Trustee Bill Eck VIII. CONSENT ITEMS FOR BOARD ACTION A. #13(11)-58 AUTHORIZATION FOR THE PRESIDENT/CEO TO AWARD A PROFESSIONAL SERVICES AGREEMENT FOR 2014 ANNUAL PROGRAM MANAGEMENT AND CONSTRUCTION MANAGEMENT SERVICES FOR THE AIRPORT CAPITAL IMPROVEMENT PLAN AT RENO-TAHOE INTERNATIONAL AIRPORT, IN THE AMOUNT OF $40,000 On motion by Trustee Katzmann, seconded by Trustee Larkin, which motion duly carried by unanimous vote, the Board approved Agenda Item #13(11)-58 as follows:

6 Meeting of the Board of Trustees November 21, 2013 Brief of Minutes Page 3 of 4 Authorized the President/CEO, or her designee, to award a Professional Services Agreement for 2014 annual Program Management and Construction Management services for the Airport Capital Improvement Plan at Reno-Tahoe International Airport, in the amount of $40,000. IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION A. #13(11)-59 AUTHORIZATION FOR THE PRESIDENT/CEO TO OPEN A PUBLIC COMMENT PERIOD FROM NOVEMBER 21, 2013 THROUGH DECEMBER 23, 2013 FOR COMMENTS ON THE 2013 REGIONAL PLAN GOALS AND POLICIES OF THE RENO-TAHOE INTERNATIONAL AIRPORT AND RENO-STEAD AIRPORT DOCUMENTS On motion by Trustee Larkin, seconded by Trustee Eck, which motion was duly carried by unanimous vote, the Board approved Agenda Item #13(11)-59 as follows: Authorized the President/CEO to open a public comment period from November 21, 2013 for comments on the Regional Plan Goals and Policies of the Reno- Tahoe International Airport and Reno-Stead Airport documents. B. #13(11)-60 APPROVAL OF RENO-TAHOE AIRPROT AUTHORITY CHAIRMAN S PERMANENT COMMITTEE APPOINTMENTS INCLUDING THE APPOINTMENT OF TWO ALTERNATES TO THE FINANCE AND BUSINESS DEVELOPMENT COMMITTEE AND PLANNING AND CONSTRUCTION COMMITTEE FOR FISCAL YEAR On motion by Trustee Larkin, seconded by Trustee Arger, which motion was duly carried by unanimous vote, the Board approved Agenda Item #13(11)-60 as follows: Approved the Reno-Tahoe Airport Authority Chairman s permanent Committee appointments including the appointment of two alternates to the Finance and Business Development Committee and the Planning and Construction Committee for FY X. ITEMS FOR BOARD INFORMATION AND DISCUSSION A. Presentation a. Update on Unmanned Aircraft System development in the State of Nevada and at the Reno-Stead Airport Dean Schultz, Executive Vice President/COO, provided an update on Unmanned Aircraft System (UAS) development in the State of Nevada and at the Reno-Stead Airport. Mr. Schultz highlighted staff s efforts and the selection process by the Federal Aviation Administration for UAS test sites.

7 Meeting of the Board of Trustees November 21, 2013 Brief of Minutes Page 4 of 4 B. Board Meeting Schedule Trustee Mayberry announced the dates of the upcoming Board and Committee meetings for December 2013 and January C. President/CEO s Report Marily Mora, President/CEO, stated that the President/CEO report was provided in the monthly Board packet in advance of the Board meeting. Ms. Mora mentioned that the Airport Authority celebrated the 5000 th home completed through the Sound Insulation Program and a wedding that took place at the Airport. Ms. Mora presented news coverage the Airport Authority received on both of these significant events. D. General Board Comments None. XI. PUBLIC COMMENT None. XII. ADJOURNMENT There being no further business, the meeting was adjourned at 11:00 a.m. ATTEST: Chair Adam Mayberry Secretary, Rick Murdock *** These draft minutes have not yet been approved and are subject to revision at the next regularly scheduled meeting. ***

8 Board Memorandum Reno-Tahoe Airport Authority **REVISED** Date: December 11, 2013 Memo #13(12) 61 To: Chairman & Board Members For: December 12, 2013 From: Marily Mora, A.A.E, President/CEO Board Meeting Subject: AUTHORIZATION FOR THE PRESIDENT/CEO TO EXECUTE AMENDMENT NO. 1 TO THE THREE-YEAR SPECIAL EVENT LICENSE WITH THE RENO AIR RACING ASSOCIATION AT THE RENO-STEAD AIRPORT NOTE: The original Board Memorandum has been revised significantly following the discussion and recommendation made by the Finance and Business Development Committee members, at the last meeting on Tuesday, December 10, STAFF RECOMMENDATION Staff recommends that the Board authorize the President/CEO to execute Amendment No. 1 to the three-year Special Event License (License) with the Reno Air Racing Association (RARA) to hold the National Championship Air Race (NCAR) in 2013, 2014 and 2015, and the Pylon Racing Seminar (PRS) in 2014, 2015, and 2016 at the Reno-Stead Airport. PURPOSE The purpose of this action is to assist RARA in its financial restructuring efforts, while ensuring the Reno Tahoe Airport Authority (RTAA) receives appropriate compensation and maintains a rental rate structure in compliance with Federal Aviation Administration (FAA) grant assurances. This action is in support of the RTAA s FY Strategic Plan Priority 2 - General Aviation Operations and Services to support a vibrant community through optimizing the General Aviation customer experience and Priority 4 - Economic Development to maximize all non-airline revenue as well as optimizing and diversifying the Airport s revenue portfolio. BACKGROUND At the June 13, 2013 RTAA Board of Trustees meeting, the Board authorized the President/CEO to execute a new three-year Special Event License with the Reno Air Racing Association, Inc. to conduct the National Championship Air Races and Pylon Racing Seminar at the Reno-Stead Airport. The three-year term includes the 2013, 2014, 2015 NCAR and the 2014, 2015, 2016 PRS events. The annual License Fees for the three-year term are noted in the table below: YEAR 1 YEAR 2 YEAR 3 NCAR 2013/PRS 2014 NCAR 2014/PRS 2015 NCAR 2015/PRS 2016 $46,000 $47,000 $48,000

9 RARA Special Event License Amendment - Revised #13(12)-61 December 12, 2013 Board Meeting Page 2 The composition of the $46,000 License Fee reflects $42,800 for the NCAR event and $3,200 for the PRS event. The NCAR portion of the License Fee was designated to increase $1,000 in Year 2 and Year 3. In accordance with the Special Event License issued on August 27, 2013, RARA was obligated to provide RTAA the following prior to the 2013 NCAR event: 1) A License Fee in the amount of $46,000 (combined 2013 NCAR and 2014 PRS Events and certain areas to be designated as License Premises, including a 5 acre parcel west of Hangar 5 at the Reno-Stead Airport). 2) Reimbursement of any insurance premium increase incurred by RTAA as a result of including the Air Race or Air Show under RTAA s insurance coverage; and 3) Reimbursement to the RTAA for support services provided to RARA, including operational support. In addition, RARA has a lease agreement, dated July 27, 1989 ( 1989 Lease Agreement ), that provides on-going use of hangar facilities and land at the Reno-Stead Airport on a yearround basis. The table below provides the current status of the License and Operating Fees, Leased Premises Fees (ie - current monthly rent) and Insurance Premium invoiced under the agreements between RARA and RTAA: ITEM AMOUNT DUE PAID (as of 12/10/2013) OUTSTANDING (as of ) 2013 NCAR/2014 PRS License Fee $46, $46, NCAR/2014 PRS License RTAA Insurance Premium $33, $33, NCAR Vehicle Fuel $6, $6, NCAR Fire Emergency Response Support $5, $5, Stead Hangar 6 Temporary Use Permit $6, $6, Stead 1989 Lease Month to Month Premises include: Hangar 5 building and land, Buildings 4001 and 4002 buildings and land, RARA Hangar land and Bleacher land $13, $13, Utility Usage Reimbursement $1, $1, Total Due December 2013 $112, $54, $57, On November 19, 2013, RARA requested financial relief from amounts due to the RTAA associated with the 2013 NCAR and 2014 PRS events, as well as building, hangar, and ground rents due, beginning in December 2013 (See Attached Letter Request).

10 RARA Special Event License Amendment - Revised #13(12)-61 December 12, 2013 Board Meeting Page 3 As the RTAA is unable to permit use of airport property without receiving rent on leased facilities, RARA has the option to vacate some or all of its hangars, buildings, or leased ground. At this time, RARA has not indicated how they want to proceed with this issue. In response to the RARA letter, a proposed restructuring of the eligible items as identified in the table above was outlined in a Board Memo #13(12) 61 dated December 4, 2013 and presented to the Finance and Business Development Committee on December 10, This restructuring outlined three options that would convert the License Fee and certain reimbursable operating costs from a cash payment to an in-kind consideration in the form of a future NCAR event sponsorship package. The NCAR event sponsorship would have included a marketing package of chalet facilities and various forms of advertising to promote use of both airports that must have a documented minimum value consistent with other event sponsors of no less than the amount of the current and/or future License Fees and reimbursable costs. In the FY Budget, the RTAA included the License Fee in the amount of $46,000, reimbursement for emergency response services in the amount of $5,300 and fuel reimbursement in the amount of $5,100. The Air Service Marketing budget also includes an NCAR event sponsorship budget of $35,000. DISCUSSION This item was presented at the December 10, 2013 Finance and Business Development Committee meeting. Based on extensive discussion, the Committee and other Trustees in attendance provided significant feedback to staff requiring further evaluation and consideration. This feedback was primarily concentrated in the following areas: 1. On what basis was the License Fee originally established and can the annual fee be reduced to reflect lower event attendance since the 2011 tragic accident, the current financial challenges faced by RARA, and the importance of the event to the Northern Nevada community. 2. Why does the current License agreement include the 2016 Pylon Racing School, held in June of 2016, but not the 2016 National Championship Air Races, held in September The term of the current license agreement makes it difficult to restructure the agreement and makes the December 4 th options outlined above complicated. 3. The receipt of In-Kind marketing and sponsorship to the Authority, as compensation for the License Fee, does not provide a direct cash infusion to RARA when they critically need cash flow to meet their financial obligations. 4. RTAA wants to assist RARA in the short term; however, this action should not establish a precedent for the terms and condition of the business relationship in the long-term.

11 RARA Special Event License Amendment - Revised #13(12)-61 December 12, 2013 Board Meeting Page 4 In addition, Mike Houghton, President/CEO of RARA expressed concern regarding the $33,153 insurance premium paid by the Authority for the special event rider, which is required by the license to be reimbursed by RARA. With the insurance coverage costs paid by RARA going down after the significant increase immediately following the 2011 tragic accident, he anticipated that the RTAA s insurance rider should also have shown a significant decrease. Based on this feedback, staff has reevaluated the proposed restructuring options and the following reflects a revised approach to address the situation: 1. To address the disconnected nature of the 2016 PRS event and the 2016 NCAR event not being covered under the same license, the proposed amendment would shorten the term of the current license from August 31, 2016 to May 31, While this step would require execution of a new License to include the 2016 PRS event, it would allow both parties to negotiate a new License for both events as a package in 2016 based on conditions and circumstances at that time. In addition, this change will facilitate the proposed lower License Fee and payment due date outlined in item #2 below. 2. The fixed 2013, 2014, and 2015 License Fee was negotiated and contractually agreed upon by RARA based on concession revenues earned by the RTAA in the three years prior to the current agreement. The following table outlines the concession revenue earned that provided the basis for the current agreement: Year Concession Fee Earned 2009 NCAR $42, NCAR $37, NCAR $25,291 The lower concession fee of $25,291 in FY 2011 reflects the Saturday and Sunday closure of the National Championship Air Races due to the tragic accident and a partial refund of tickets sold for the two largest days of attendance. a. Recognizing RARA currently faces lower attendance than was assumed when the current License Fee was established, staff is recommending the License Fee be reduced to $25,000 which would include the recently completed 2013 event and the upcoming 2014 and 2015 events. This step sets a License Fee based on the worse case scenario. Recognizing that current RARA attendance and revenues are lower than 2009 and 2010, the proposed fee is based on revenue earned during the tragic 2011 event.

12 RARA Special Event License Amendment - Revised #13(12)-61 December 12, 2013 Board Meeting Page 5 b. The reduced License Fee would also include the fire emergency response services that are currently being billed separately. For the balance of this Special Event License, RTAA will not invoice RARA for the Emergency Services Response Support of $5, However, RTAA and RARA will need to work closely together to coordinate the level of resources needed to reduce the impact to RTAA. These two steps outlined above in a and b would result in the following savings: CURRENT AGREEMENT YEAR 1 NCAR 2013 YEAR 2 PRS & NCAR 2014 YEAR 3 PRS & NCAR 2015 License Fee $46,000 $47,000 $48,000 NCAR Fire Emergency Response $5,106 $5,100 Est. $5,100 Est. Support NCAR Vehicle Fuel $6,521 $6,500 Est. $6,500 Est. Total Fees under current agreements $57,627 $58,600 $59,600 PROPOSED AGREEMENT YEAR 1 NCAR 2013 Proposed Restructuring - License Fee and NCAR Fire Emergency Response Support YEAR 2 PRS & NCAR 2014 YEAR 3 PRS & NCAR 2015 $25,000 $25,000 $25,000 NCAR Vehicle Fuel $6,521 $6,500 Est. $6,500 Est. Total Fees under proposed $31,521 $31,500 $31,500 Total Estimated Savings $26,106 $27,100 $28,100 Combined Savings $81,306 c. RARA would be given until May 1, 2014 to remit payment of the lower License Fee of $25,000 for the 2013 event and payment for the 2014 and 2015 License Fee would be due on May 1 st of the following year after the event. These proposed dates, which provide almost eight months of cash flow relief (September to May), is based on the current requirement that RARA provide proof of insurance for the current year Pylon Racing Seminar thirty days prior to its June date.

13 RARA Special Event License Amendment - Revised #13(12)-61 December 12, 2013 Board Meeting Page 6 d. Instead of receiving In-Kind sponsorship at future NCAR events as proposed in the December 4, 2013 Board Memo, RTAA will include funding in its proposed FY and FY Budget, subject to Board approval, for a NCAR marketing package and will submit cash payments to RARA in advance of the event similar to current practice. 3. While staff cannot recommend changes to the requirement that RARA reimburse RTAA for incremental insurance costs associated with its Special Events, staff is willing to work in conjunction with RARA and use its best efforts to reduce the costs of the insurance going forward. 4. Staff cannot recommend changes to the requirement that RARA reimburse RTAA for fuel purchases used in its vehicles and carts associated with the NCAR event. However, if RARA wishes to purchase and supply its own fuel going forward, staff will coordinate with RARA to allow it to bring a fuel truck on site. With the exception of the above proposed changes to the existing License, staff recommends that no additional modifications to the terms and conditions be considered at this time. The Board of Trustees and staff recognize that the PRS and NCAR has significant social and economic importance to northern Nevada, including but not limited to the benefits of the NCAR to tourism in Reno, Sparks and Washoe County in general, benefits to local charitable organizations, and benefits to taxpayers from NCAR revenues. Based on these benefits, the proposed changes reflect a concerted effort by RTAA to help RARA remain financially viable. RECOMMENDATION It is hereby recommended that the Board adopt the following motion: It is hereby moved that the Board authorize the President/CEO to execute Amendment No. 1, as revised, to the three-year Special Event License with the Reno Air Racing Association at the Reno-Stead Airport as outlined in the attached memo. MMM/rgg/jo

14 November 19, 2013 Marily Mora Reno Tahoe Airport Authority Post Office Box Reno, NV Dear Marily: Thank you very much for your time yesterday. I regret that the topic of the meeting was to present the dire position the Air Races is facing today and to make this request. In our 50 year history, we have always focused on delivering a great event for the world and especially this community we call home. While we have never wanted to ask anyone for help, the challenges we have faced over these past two years had forced us to seek financial partners within the community in That support, especially from the tourism sector, aided us in meeting part of the financial burden of the new $2 million dollar insurance premium. Although, we met the challenge and produced the event in 2012 and accomplished the completion of the 50 th Race this year; we now find ourselves facing a dire financial situation. We are asking all of our partners to help wherever they can, to reduce the current receivable and to restructure our relationships for the future. If we are unsuccessful in a total restructure now and for the future, we will be forced to close the races. We are taking steps within our control, to reduce overhead through terminations, furloughs, the reduction and elimination of employee benefits. As well, we are undergoing a restructure of our Board and business practices to develop new sources of financial growth outside our local community to insure future sustainability. Our current position with the Airport Authority reflects the following 2013 payables: Event Operating Permit $ 45,000 Insurance Premium $ 33,153 Dec. Rent $ 13,643 Race Week Fuel $ 6,521 Hangar 6 Event Use $ 6,544 Fire Crash Rig Support (est.) $ 5,000 Total $ 109,861 Relief from any or all of the items will help us survive thru the end of Moving forward to plan for 2014, we will need some form of abatement for all or a significant portion of the $13,643 monthly rent. Sincerely; MIKE Michael J Houghton President/CEO CC: Executive Committee

15 Board Memorandum Reno-Tahoe Airport Authority Date: December 4, 2013 Memo #13(12)-62 To: Chairman & Board Members For: December 12, 2013 From: Marily M. Mora, A.A.E., President/CEO Board Meeting Subject: AUTHORIZATION FOR THE PRESIDENT/CEO TO NEGOTIATE THE FINAL TERMS AND EXECUTE AMENDMENT NO. 2 TO THE LEASE AGREEMENT WITH DASSAULT AIRCRAFT SERVICES CORPORATION FOR THE FIRST OPTION TO EXTEND THE CORPORATE AVIATION LEASE AGREEMENT AT THE RENO- TAHOE INTERNATIONAL AIRPORT STAFF RECOMMENDATION Staff recommends that the Board authorize the President/CEO to negotiate the final terms and execute a second amendment between Dassault Aircraft Services Corporation (Dassault) and the Reno-Tahoe Airport Authority (RTAA) for the first Option to Extend the Corporate Aviation Lease Agreement (Agreement). PURPOSE The purpose of this action would approve the first five-year Option to Extend the Dassault Agreement with the provision to cancel the Agreement extension after two years, if the state tax environment has not improved; or if general aviation land at the Reno-Tahoe International Airport (RNO) is unavailable for expansion development of facilities. This action is in support of the Strategic Priority 2. General Aviation Operations and Services as well as Priority 4. Economic Development at RNO as identified in the FY Reno-Tahoe Airport Authority Strategic Plan. BACKGROUND In December 2008, Dassault entered into an Agreement with RTAA for a West Coast Service Center to support Falcon Jet aircraft maintenance and repair for its primarily transient customer base. Dassault s service facility at RNO is the newest Dassault facility and serves as a major service center with 38,950 sq. ft. of hangar space and 5.84 acres of land (see attached Exhibit A). Dassault is able to accommodate up to five Falcon Jet aircraft at one time. The RNO facility is the third company-owned service center, along with facilities located in Teterboro, NJ and Paris Le Bourget. The facility is a full-service Falcon Jet Maintenance Repair and Overhaul (MRO) and the location is capable of performing troubleshooting, scheduled and unscheduled maintenance and inspections. The key business terms negotiated as part of the initial Dassault Agreement are as follows: A five-year Agreement term commencing on December 15, 2008 and expiring on December 14, 2013, plus two five-year Options to Extend the Agreement.

16 Dassault Aircraft Services Amendment No. 2 #13(12)-62 December 12, 2008 Board Meeting Page 2 A three-year Option to develop the adjacent parcel for a new hangar facility for an annual fee in the amount of $49,733 to renew the option; which expired on December 14, As an incentive to enter into the Agreement, RTAA waived building rent for 12 months ($194,750) to December 15, Land rent commenced on December 15, 2009 upon execution of the Agreement. Land rent is $0.56 per square foot annually or $142, and building rent is $5 per square foot or $194,750 annually. Upon exercising of the first Option to Extend the Lease, land and building rent will be adjusted by the cumulative change in the Consumer Price Index (CPI-U) with rate subject to annual adjustment based upon the percentage of change in the CPI-U for the preceding year, which is 9.046%. RTAA to make a good faith effort to seek a sponsor, educate lawmakers, and support legislation to change the law in the State of Nevada for the tax exemption of aviation related services, labor and materials. In addition, in 2009 the Nevada Commission on Economic Development approved several state tax abatements as incentives for Dassault to locate the west coast service facility at RNO. The Board approved Amendment No. 1 to the Dassault Agreement at the December 3, 2009 Board Meeting, to substantially reduce the RTAA s capital improvement obligation at the Dassault hangar, and in return defer Dassault s building rent commencement date from December 15, 2009 to April 2, DISCUSSION Dassault has requested to exercise the first five-year Option to Extend the Agreement with the provision to cancel the Option to Extend after two years, if the state tax environment has not improved, or if RNO general aviation land is not available for expanded development facilities. Should the Board approve the first five-year Option to Extend the Agreement, Dassault would then have one additional five-year Option to Extend provision, providing for a potential total contract term of 15 years as outlined in the following table: Initial Term Agreement Period Length of Term First Option to Extend (pending Board approval) December 15, 2008 through December 14, 2013 December 15, 2013 through December 14, years 2 years Automatic unless declined by Dassault Second Option to Extend December 15, 2015 through December 14, 2018 December 15, 2018 through December 14, 2023 Potential Contract Term 3 years 5 years 15 years

17 Dassault Aircraft Services Amendment No. 2 #13(12)-62 December 12, 2008 Board Meeting Page 3 Dassault has a new leadership structure and strategic plan, which includes a west coast expansion. During the next two years, Dassault will implement elements of its strategic plan. RNO will be a key part of the Dassault strategic plan as the west coast expansion site and Dassault will exercise the additional three year Option to Extend, if: 1. Aircraft and aircraft parts sales and use tax abatement, with the inclusion of a pass-through abatement to customers, is approved by the State of Nevada. 2. General aviation land is available at RNO to accommodate new facility construction COMPANY BACKGROUND Dassault Aviation is the French parent company of 18 multi-national companies. There are 12 wholly owned and 6 partially owned subsidiaries in the aviation sector located in France, Brazil and the U.S. Dassault is a wholly owned subsidiary based in Wilmington, Delaware. There are currently 750 Falcon Jet aircraft permanently located within North America, with 200 aircraft on the West Coast. Dassault Aviation is a world leader in the integration of complex, advanced and innovative airborne systems. They have delivered over 2,100 jets since 1963 and have a presence in over 80 countries across five continents. Dassault employs approximately 12,000 people at assembly and production plants in France and the United States and service facilities on multiple continents. COMMITTEE COORDINATION This item is scheduled to be presented at the December 10, 2013 Finance and Business Development Committee Meeting. FISCAL IMPACT The Land and Building rent payments for the extension period, outlined in the table below, reflect the Consumer Price Index (CPI-U) increase of 9.046% as outlined in the Option to Extend provision in the original Dassault Agreement. Future CPI adjustments will be calculated annually beginning year two. Lease Extension Year Building Annual Land Rent Rent Revenue One $212,278 $155,476 $367,754 Two $212,278 $155,476 $367,754 2-year Extension Total $424,556 $310,952 $735,508 Three $212,278 $155,476 $367,754 Four $212,278 $155,476 $367,754 Five $212,278 $155,476 $367,754 3-year Extension Total $636,834 $466,428 $1,103,262 Potential 5-Year Contract Value $1,838,770

18 Dassault Aircraft Services Amendment No. 2 #13(12)-62 December 12, 2008 Board Meeting Page 4 RECOMMENDATION It is hereby recommended that the Board adopt the following motion: Authorize the President/CEO to negotiate the final terms and execute Amendment No. 2 to the Agreement with Dassault Aircraft Services for the first five-year Option to Extend including the provision to cancel the Option to Extend after two years, if the state tax environment has not improved or if RNO land is unavailable for expansion development. MMM/taf/jo

19 Exhibit A Dassault Aircraft Services 365 Rock Boulevard Dassault Aircraft Services Swissport GA East T-Hangars

20 President/CEO s Report November 2013 Marily M. Mora, A.A.E., President/CEO Financial Summary The following table summarizes the operating statement information for October 31, 2013: FY FY Dollar Percent Actual Budget Variance Change Landing Fees $ 2,306,824 $ 2,185,282 $ 121,543 6% Terminal Building Rentals 2,593,179 2,524,600 68,579 3% Total Airline Revenues 4,900,003 4,709, ,122 4% Concession Revenue 1,564,890 1,592,633 (27,743) -2% Auto Rental 2,454,554 1,958, ,087 25% Parking & Ground Transportation 3,064,998 2,728, ,265 12% RTIA Building/Land Rents 1,908,831 1,941,467 (32,635) -2% Other 1,476,534 1,333, ,286 11% Total Non-Airline Revenues 10,469,807 9,554, ,259 10% Total Operating Revenue $ 15,369,811 $ 14,264,430 $ 1,105,381 8% Due to higher enplaned passenger levels and operating expenses being 6.9% below budget, the airline cost per signatory enplaned passenger based on actual activity for the four month period ending October 31, 2013, is estimated to be $6.16 as compared to budgeted cost per enplaned passenger of $7.85. Parking Comparison NOVEMBER PUBLIC PARKING STATISTICS MONTHLY COMPARISON BETWEEN FY 2011/12, FY 2012/13, AND FY 2013/2014 COMPARISON $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS MONTHS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) NOVEMBER 11/12 $698, ,198 $ ,408 $ ,790 $ NOVEMBER 12/13 NOVEMBER 13/14 $726, ,092 $ ,855 $ ,237 $ $657, ,690 $ ,143 $ ,547 $ DIFFERENCE BETWEEN NOVEMBER 2011/12 AND NOVEMBER 2012/13 $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) $28, (106) $ $ (553) $ DIFFERENCE BETWEEN NOVEMBER 2012/13 AND NOVEMBER 2013/14 $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) ($68,676.00) (6,402) $1.41 (2,712) $ (3,690) $ REVENUE TRANSACTIONS , ,000 35,000 30,000 $ Nov. 11/12 25,000 Nov. 11/ Nov. 12/13 Nov. 13/14 20,000 Nov. 12/13 Nov. 13/ , , TOTAL (DIV BY 10,000) $ PER TRANS L/T AVG $. S/T AVG.$ 5,000 0 TOTAL TRANS. SHORT TERM LONG TERM

21 President/CEO s Report November 2013 December 12, 2013 Page 2 Air Service Reno-Tahoe International Airport (RNO) served 262,473 passengers in October 2013, a decrease of 5.3% versus October A challenging third quarter resulted in a 1.0% Calendar Year To Date (CYTD) decrease in total passengers compared to January-October However, the relatively flat year-to-date passenger numbers are in spite of a 7.0% CYTD decrease in scheduled capacity.

22 President/CEO s Report November 2013 December 12, 2013 Page 3 With respect to air cargo, RNO handled 10,834,930 pounds of cargo in October 2013, showing an increase of 12.0% over October Year-to-date, RNO handled 96,935,058 pounds of cargo, leading to a 5.0% increase compared to the prior year.

23 President/CEO s Report November 2013 December 12, 2013 Page 4 Business Development Delta Air Lines will begin seasonal service from Reno-Tahoe International Airport to Minneapolis starting on June 7, These flights are currently scheduled for Saturdays only. However, we are confident in the markets ability to support additional frequency in the future. This service comes after meetings with Delta Air Lines at their headquarters in Atlanta on October 28, In November 2013, staff traveled to Shanghai to take part in the 2013 China Air Cargo Summit. This event is attended by airports, airlines, freight forwarders, and shippers from around the world. Staff focused on awareness, generating contacts, and gaining insight into airlines U.S. growth plans. Allegiant Air will discontinue service to Bellingham on January 19, This twice weekly service started on June 6, Reno-Tahoe International Airport tenant, Smarte Carte s last option to extend its term through December 31, 2014, was approved administratively under the same terms and conditions established in the Agreement, including a Minimum Guarantee of $20,000 and a Concession Fee of 12.5%. The Concession Fee will be based on revenue from all three lines of business that Smarte Carte currently operates at the Airport, including rental of luggage carts, massage chairs and cell phone charging stations. Also, Smarte Carte s use fee for luggage carts will increase from $4.00 per cart to $5.00 per cart. The price increase will be effective during the first quarter of 2014, which reflects the current cart use fee in about 30% of Smarte Carte s airports with more airports scheduled to go to $5.00 in Project Status In Progress Reno-Stead Airport Terminal / Emergency Operations Center Project The Guaranteed Maximum Price contract with Q&D Construction, in the amount of $4,407,856, was approved at the January 2013 Board meeting. The Pre-Construction meeting was held on March 21, 2013 and the Notice to Proceed was issued on April 15, The final site work consisting of asphalt parking lot pavement, concrete curb and gutter, sidewalks, light poles and flag poles have been completed. The contractor has recently finished glass installation, interior painting, counter tops, plumbing fixtures, signage, carpeting, and flooring. The City of Reno issued a Certificate of Occupancy for the building on December 4, The audio/visual equipment is currently being installed and tested with a project completion date of December 14, Taxiway C Reconstruction Project (Design) The project consists of reconstruction of approximately 25,000 square yards of asphaltic concrete (AC) pavement of the existing taxiway between Runways 8-26 and The work consists of demolition, excavation, stabilizing fill and base material placement, utility relocation, asphalt pavement, drainage, and taxiway edge lighting system installation. The AIP grant offer for design services was issued by the Federal Aviation Administration (FAA) on August 8, A Request For Qualifications (RFQ) was solicited in October 2013 for the selection of a Consultant for design services. Statement of Qualifications (SOQ) were received from submitting firms on October 30, The Professional Services Agreement for design work will be presented for Board approval in January. A separate construction contract will be issued for bids and Board approval in late spring Construction is tentatively scheduled for the summer of 2014, contingent upon a subsequent AIP grant offer from the FAA.

24 President/CEO s Report November 2013 December 12, 2013 Page 5 A 30-day public comment period for the draft Regional Plan Goals & Policies of the Reno-Stead Airport 2013 document began on Sunday, November 24, A tenant bulletin announcing the public comment period was ed on Friday, November 22, An initial display advertisement was placed in the Sunday, November 24, 2013 edition of the Reno-Gazette Journal and a second display advertisement in the Wednesday, November 27, 2013 edition. The December 2013 RTAA E-Newsletter, which has a distribution of approximately 3,800 addresses will also include an announcement of the public comment period. The document is available in a PDF format for review or to download at the website and hardcopies of the document are also available upon request. The public comment period will close on Monday, December 23, Public comment received will be shared with the Board of Trustees during the January 2014 meeting. Reno-Tahoe International Airport Terminal Refurbishment (GMP #1) Q&D Construction completed Phase 1 on January 24, 2012, Phase 2 on March 5, 2012, Phase 3 on April 9, 2012, and Phase 4 on May 18, The final item, the new Bag Claim Meeting Space, was completed on July 13, 2012, bringing the project to substantial completion. Records have been reconciled and the project has been closed out. Information Technology (IT) Reconfiguration (GMP #2) Work started on December 19, Completed work consists of duct bank relocation and installation of new fiber optic and copper cables. System cutovers started on April 5, 2012 and are complete. The work was substantially complete on May 4, Records have been reconciled and the project has been closed-out. Gateway Project (GMP #3) Work started on March 12, Completed work consists of new building construction, including installation of mechanical, electrical and plumbing utilities; central lobby refurbishment; and concourse refurbishment. The new first floor centralized security checkpoint and second floor tenant improvements (with the exception of Timber Ridge restaurant) opened to the public on March 21, Timber Ridge restaurant opened to the public on April 14, Refurbishment of the vacated B and C concourse checkpoints was completed on May 1, Records are being reconciled in preparation of closing-out the project. Apron Reconstruction (Phase 17) Project The AIP grant offer was issued by the FAA on September 17, The construction contract with Q&D Construction, approved by the Board in April 2013 for $2,782,052, was subsequently issued for award and will be scheduled for construction starting spring A Pre-Construction meeting and Notice To Proceed for construction will be scheduled for April The project consists of reconstruction of approximately 13,320 square yards of concrete pavement in the air cargo ramp area. The work consists of demolition, excavation, asphalt treated base placement, formwork, and concrete placement. Runway 16L-34R Touchdown Areas Rehabilitation Project The bid opening was conducted on May 7, The award of the construction contract to the low bidder, Granite Construction Company, in the amount of $2,162,693 was approved at the July 2013 Board meeting. The project consists of the demolition and reconstruction of portions of runway concrete pavement, requiring closure of Runway 16L-34R during construction. Due to AIP grant funding constraints known at the time, this contract approved in July 2013 consisted of the base bid and bid

25 President/CEO s Report November 2013 December 12, 2013 Page 6 alternate #1 only. The overall program consists of the base bid and bid alternates 1 through 11, for a total program estimate of $7,300,000. The remaining work areas would be implemented as additional AIP funding became available on a multi-year basis. An AIP grant offer in the amount of $5,756,250 was issued by the FAA on September 24, The construction contract with Granite Construction, approved by the Board in July 2013 for $2,162,693, was subsequently issued for award and will be scheduled for construction starting in spring Commensurate with the additional grant funding provided by the FAA, bid alternates 2 through 11 were awarded as Change Order No. 1 at the October Board meeting, in the amount of $3,033,570, for a total of $5,196,263. Work area alternates 2 through 11 will require an additional 60 days of construction, for a total of 175 days of runway closure. A Pre- Construction meeting and Notice To Proceed for construction will be scheduled for March Construction is scheduled for March through August Project coordination meetings were conducted with RTAA, Airline, FBO, FAA, TSA, US Customs, and RTIA Users Group stakeholders on November 7, 12, and 18, These initial meetings presented the tentative schedule, work areas, and airfield impacts associated with the RTIA 2014 construction program. Stakeholder input and coordination of issues will be documented in the meeting summary to be distributed to stakeholders. Additional follow up meetings will be scheduled to finalize the program prior to construction starting in March Central Disposal Facility (CDF) Upgrade The project consists of improvements to the existing Central Disposal Facility consisting of structural modifications, roof refurbishment, overhead door retrofit, upgrade of the sand / water separator, plumbing modifications, electrical modifications, water service modifications, equipment replacement and site improvements. The facility consists of three separate bays for waste water and glycol disposal, vehicle wash down, high pressure water and steam cleaning equipment. The facility provides disposal services for most of the airline Ground Service Equipment (GSE) and aircraft deicing glycol. A Request For Qualifications (RFQ) was solicited in August 2013 for the selection of a Consultant for design services. Statement of Qualifications (SOQ) were received from submitting firms on September 12, The Professional Services Agreement for an initial Program Study with H+K Architects was issued by administrative award in November. The project scope will be defined in the initial Program Study and the subsequent design fee will be negotiated and subject to Board approval in January or February This process was discussed at the November 19, 2013 Planning and Construction Committee meeting. Specific project requirements and design features for the facility upgrade will be determined in collaboration with project stakeholders, as part of the program study. Alternate locations for the facility will also be evaluated prior to initiation of the design phase. The estimated budget for this program (including soft costs), is $1,500,000. The 30-day public comment period for the draft Regional Plan Goals & Policies of the Reno-Tahoe International Airport 2013 document began on Sunday, November 24, A tenant bulletin announcing the public comment period was ed on Friday, November 22, An initial display advertisement in the Sunday, November 24 edition of the Reno-Gazette Journal and a second display advertisement in the Wednesday, November 27 edition. The December 2013 RTAA E-Newsletter, which has a distribution of approximately 3,800 addresses, also included an announcement of the public comment period. The document a available in a PDF format for review or to download at the website. Hardcopies of the document are also available upon a request. The public comment period will close on Monday, December 23, Public comment received will be shared with the Board of Trustees in January 2014.

26 President/CEO s Report November 2013 December 12, 2013 Page 7 Sound Insulation Program There are currently three active phases (phases 20, 21 and 22) in the residential Sound Insulation Program. All construction for 2013, which included 465 residences in Reno, Sparks and Washoe County, is substantially complete. Project close-out activities have begun for both Group 20.4 and 21.4/22.1 and include such items as certification of final payroll records, analysis of returned surveys, post-construction acoustical testing and release of final retention. There are 105 residences in design for the 2014 final residential construction season as shown in the table below. City of Sparks City of Reno Washoe County Phase Single/Multi Single/Multi Single/Multi Total Total Phase 20: Grant Close-Out for Phase 20 is anticipated to begin in Phase 21: Group 21.5 and Group 21.6 have been consolidated into Group Group 21.5 now consists of a total of 105 single, multi-family and condominium residences in Reno, Sparks and Washoe County. On-site design work was completed in late October Property owner floor plan reviews are scheduled for January 21, 22 and 23, with public bid advertisement to take place on February 11, This final phase of residential construction is scheduled for summer / fall Phase 22: The RTAA is currently working with the Federal Aviation Administration (FAA) to determine the necessary steps to verify noise mitigation eligibility of two schools located south of the airport. Staff has been informed that, at a minimum, pre-construction acoustical tests will need to be performed. Organizational Issues The Airport s organizational wellness initiative, designed for employees, called Passport to Wellness, continues to experience great reviews and attendance since implementation. The year-long program focuses on monthly destinations to promote overall Wellness, and included November s Social Wellness destination where employees were able to participate in an on-site blood drive and were encouraged to contribute to the Airport Authority s partner in education, Swope Middle School, canned food drive. The Wellness Destination for December is titled Spiritual Wellness and will focus on encouraging employees to strive for a state of harmony with oneself and others. Since October 2013, the Airport Authority Management staff has been meeting to review the Police, Fire and Teamster collective bargaining agreements. These reviews are being conducted to identify potential bargaining priorities in preparation to enter into successor agreement negotiations beginning in February OSHA is instituting a step approach to the implementation of new requirements in the Hazard Communication Standard. This requirement is based on the United Nations Globally Harmonized System of classification and labeling of chemicals (GHS). Phase one of this implementation process is to provide employees with training on the new labels by December 1, To address this requirement, staff coordinated a series of classes for all employees who work with or around chemicals.