THE METROPOLITAN AIRPORTS COMMISSION 2016 STRATEGIC PLAN

THE METROPOLITAN AIRPORTS COMMISSION 2016 STRATEGIC PLAN 6 0 4 0 2 8 T H AV E N U E S O U T H, M I N N E A P O L I S, M N 5 5 4 5 0-2 7 9 9 M E T R O A I R P O R T S. O R G

LETTER TO THE PUBLIC To the Public: We are pleased to present the Metropolitan Airports Commission s 2016-2017 Strategic Plan. Our airports are key economic generators for the regional economy and link the Twin Cities metropolitan area to the world. We are committed to developing and operating the Commission s seven airports in a financially, environmentally and socially sustainable manner. Toward that end and in fulfillment of the Commission s mission, our 2016-2017 Strategic Plan focuses on seven key strategies: Provide a safe and secure environment Assure financial viability Provide a great customer experience Develop employee talent Enhance air service at Minneapolis-St. Paul International Airport Leverage resources and technology Strengthen partnerships and relationships Integrate sustainability into our culture The plan presents dozens of key initiatives designed to fulfill those strategies over the three-year period covered by the plan, with particular emphasis on 2016 initiatives. In addition, the plan depicts the three Wildly Important Goals on which the organization will focus over the next three years: Maintain MSP s Overall Satisfaction with the Airport Airport Service Quality score at 4.28 or better as we redesign and enhance the MSP customer experience through 2017 Use implementation of Microsoft SharePoint to improve internal MAC communications and collaboration and foster a single-enterprise culture by December 2017 Support the long-term financial viability of the reliever airports system by increasing new tenant aeronautical and non-aeronautical investments a minimum of $6 million by December 2017 Through these actions, we hope to advance toward our vision of giving our customers the best airport experience in North America. Sincerely, Sincerely, Dan Boivin MAC Chairman Jeff Hamiel Executive Director/CEO 2

THE MAC S VISION AND MISSION The MAC s Vision To give our customers the best airport experience in North America. The MAC s vision guides its priorities, decision-making and actions as the organization strives to provide exemplary service to all its customers. The MAC s Mission To provide and promote safe, convenient, environmentally sound and cost-competitive aviation services for our customers To gain a better understanding of the mission statement, the MAC breaks it down into its component parts: Provide Provide and maintain airport facilities and services that meet the needs of the community Promote Promote the use of airport facilities and services in ways that drive regional economic development Safe Maintain a safe, secure environment throughout the MAC s system of airports Convenient Ensure MAC facilities are accessible and convenient for all Environmentally Sound Serve as a responsible environmental steward of public assets under the MAC s control Cost-competitive Provide products and services at competitive prices, including encouraging competition for air service as a means of keeping airfares in check Aviation Services Provide and maintain airport infrastructure that supports the needs of the MAC s customers and the greater community and that enhances the national air transportation system Customers Balance the often competing interests of the MAC s customers: The traveling public The airline industry Airport tenants and concessionaires General aviation Regional businesses Residents of the region 3

THE MAC S CORE VALUES Employees We value our employees for their skills and abilities, ethical behavior, diversity, creativity, innovation and sound judgment. We provide our employees with rewarding work, opportunities for professional growth and an appreciative work environment based on trust, respect for each other and open communication. Commitment to the Community and the Environment We are responsive to the environmental concerns of the community. We demonstrate leadership in sound environmental management. We promote open and honest communication about environmental concerns. Fiscal Responsibility We make sound financial decisions that balance the interests of the organization, community, partners, stakeholders and customers. We make decisions that help drive the region s economic vitality. We maintain policies that provide adequate revenues to operate without general tax support or exercising our authority to levy taxes. Innovation and Excellence We seek creative and innovative solutions to complex challenges. We set high standards in all aspects of our organization and focus on continuous improvement. Integrity We do business in an honest, fair, open and respectful manner. We live up to our responsibilities, meet our objectives and fulfill our commitments. We maintain our credibility through timely communication with customers, employees and stakeholders. We consistently display the highest moral and ethical standards. Teamwork We reach common goals through strong relationships based on trust. We commit ourselves to open and respectful communication. 4

WIGs (wildly important goals) The MAC will focus on three wildly important goals (WIGs). WIG 1 Maintain MSP s Overall Satisfaction with the Airport ASQ score at 4.28 or better as we redesign and enhance the MSP customer experience through the end of year 2017. The areas of the customer experience the MAC will focus on include: 1. The arrival experience 2. The post-security terminal experience 3. The baggage claim experience WIG 2 Use the implementation of Microsoft SharePoint to improve internal MAC communications and collaboration and foster a single-enterprise culture by December 2017. WIG 3 Support the long-term financial viability of the reliever airports system by increasing new tenant aeronautical and non-aeronautical investments a minimum of $6 million by December 2017. It s often said in business that What gets measured gets done. Establishing wildly important goals, or WIGs, for the organization and sub-wigs for departments helps ensure we not only measure change in ongoing activities but also progress in priority initiatives that help us fulfill our mission and vision in the broader sense, beyond the whirlwind of our everyday work lives. Jeff Hamiel, Executive Director/CEO 5

MSP SUPPORTS: $10.1 billion in total economic output 76,340 jobs equaling $3 billion in earnings $1.9 billion in visitor spending $611 million in govt. tax revenues Ongoing operations at MSP generate $9.9 billion in economic output, with capital expenditures creating another $220 MILLION in annual economic activity The airport s $10.1 billion in total economic output included: $2.3 billion in induced impact $2.2 billion in indirect impact $5.7 billion in direct impact 6

THE MAC S STRATEGIES The MAC will use the following strategies to move the organization forward. PROVIDE A SAFE AND SECURE ENVIRONMENT Ensure that all our employees and customers experience a safe and secure environment. ASSURE FINANCIAL VIABILITY Ensure MAC has the financial resources necessary to operate our airport system and meet all debt service obligations in any scenario as well as maintain our existing bond ratings. PROVIDE A GREAT CUSTOMER EXPERIENCE Ensure that all our customers have the best airport experience in North America. DEVELOP EMPLOYEE TALENT Make sure the right people with the right skills and experience are in the right place to fulfill MAC s mission and achieve our vision. ENHANCE AIR SERVICE AT MSP Provide airlines and the traveling public with expanded alternatives by enhancing domestic, regional and international air service at MSP. LEVERAGE RESOURCES AND TECHNOLOGY Take full advantage of resources and technology to improve performance, increase productivity and deliver cost-effective services. STRENGTHEN PARTNERSHIPS AND RELATIONSHIPS Expand effectiveness through internal teamwork and by strengthening external relationships and partnerships with our customers, neighboring communities and governmental agencies. INTEGRATE SUSTAINABILITY INTO OUR CULTURE Formally incorporate sustainability into the way we do business. 7

THE MAC S KEY INITIATIVES BY STRATEGY The MAC will use the following strategies to move the organization forward. STRATEGY: PROVIDE A SAFE AND SECURE ENVIRONMENT Ensure that all our employees and customers experience a safe and secure environment. 2016 Key Initiative Increase in-terminal law enforcement presence at Terminal 2-Humphrey from 80 hours a week to 112 hours a week by the end of 2016. Improve ivisn system camera monitoring to improve security of our most vulnerable areas from no dedicated staff actively monitoring to two dedicated staff by the end of 2016. Conduct a benchmarking study of a minimum of four US and two non-us airports worldwide to review their use of technology, procedures, facilities, and personnel to improve safety and security by the end of 2016. STRATEGY: ASSURE FINANCIAL VIABILITY Ensure MAC has the financial resources necessary to operate our airport system and meet all debt service obligations in any scenario as well as maintain our existing bond ratings. 2016 Key Initiative Increase commercial real estate development at the reliever airports a minimum of $2 million by December 2016. (WIG 3 Sub-WIG) Increase on-airport tenant investments at the reliever airports a minimum of $300,000 by December 2016. (WIG 3 Sub-WIG) Develop and submit to the FAA PFC application 15 by December 2016 to enhance our cash flow position. Evaluate the possibility of refinancing the $638,345,000 General Airport Revenue Bonds Series 2007 A & B by December 2016. STRATEGY: PROVIDE A GREAT CUSTOMER EXPERIENCE Ensure that all our customers the traveling public, regional businesses, airport tenants and concessionaires, the airline industry, general aviation and citizens of the region have the best airport experience in North America. 2016 Key Initiative Improve passenger security screening throughput capacity by consolidating checkpoints and expanding Checkpoint 1 at Terminal 1-Lindbergh by February 2016. (WIG 1 Sub-WIG) Improve operational efficiency in the baggage claim area by launching the Bag Claim expansion program by July 2016. (WIG 1 Sub-WIG) Complete the first of two restroom remodels in the Terminal 1-Lindbergh mall by December 2016. (WIG 1 Sub-WIG) Implement a solution to manage Transportation Network Companies (TNCs) to ensure they are complying with MAC requirements by the end of 2016. 8

THE MAC S KEY INITIATIVES BY STRATEGY STRATEGY: DEVELOP EMPLOYEE TALENT Make sure the right people with the right skills and experience are in the right place to fulfill our mission and achieve our vision. 2016 Key Initiative Develop and implement a MAC-specific management training program by December 2016. Complete Phase II of departmental talent reviews by December 2016. Update the employee performance review process by December 2016. Evaluate all current training and mentoring programs and design new programs based on best practices by December 2016. STRATEGY: ENHANCE AIR SERVICE AT MSP Provide airlines and the traveling public with expanded alternatives by enhancing domestic, regional, and international air service at MSP. 2016 Key Initiative Provide capacity for increased air service by completing a multi-gate expansion of Terminal 2-Humphrey by December 2016. (WIG 1 Sub-WIG) STRATEGY: LEVERAGE RESOURCES AND TECHNOLOGY Take full advantage of resources and technology to improve performance, increase productivity and deliver cost-effective services. 2016 Key Initiative Build a robust data integration and messaging platform that will allow MAC to share information with our stakeholders across multiple mediums such as mobile, web, email, SMS/text and social media. To be completed by December 2016. Complete the construction of a new maintenance facility at FCM by the end of 2017. Develop and adopt a MSP Common Infrastructure program to improve the flexibility and utilization of our terminal facilities. Develop an organizational reporting platform that can provide at-a-glance dashboards and key performance indicators to assist in performance measurement and decision making. Significantly increase IT staffing and resources to meet organizational priorities. 9

THE MAC S KEY INITIATIVES BY STRATEGY STRATEGY: STRENGTHEN PARTNERSHIPS AND RELATIONSHIPS Expand effectiveness through internal teamwork and by strengthening external relationships and partnerships with our customers, tenants, concessionaires, airlines, neighboring communities, regional businesses and governmental agencies. 2016 Key Initiative Develop and implement a strategic communication plan for ongoing dialogs with the local community, citizens of Minnesota, business leaders, stakeholders, passengers and employees by December 2016. Conduct at minimum one progressive readiness training and drill built on the previous training and associated drills to ready all airport employees for emergencies by December 2016. STRATEGY: INTEGRATE SUSTAINABILITY INTO OUR CULTURE. Formally incorporate sustainability into the way we do business. 2016 Key Initiative Implement Phase 1 of our sustainability management plan by December 2016. Launch the sustainability framework implementation plan internally by June 2016. Publish MAC s first sustainability report by December 2016. Develop and implement a comprehensive informational campaign to raise awareness of the MAC s new sustainability plan internally and externally by December 2016. 10

PLANNING FOR THE FUTURE Minneapolis-St. Paul International Airport We anticipates making a number of capital improvements to Minneapolis-St. Paul International between 2016 and 2019: General MACNet Upgrades ivisn (CCTV) Enhancements/Expansion Parking Structure Rehabilitation Energy Savings/Alternative Energy Projects Airfield Pavement Rehabilitation Terminal 1-Lindbergh Security Checkpoint Consolidation Baggage Claim and Ticket Lobby Operational Improvements Facility Infrastructure Rehab (Electric, Roof, Lighting, OABA, Fiber Optic, Emergency Power) Restroom Upgrades Terminal Seating Improvements Concourse G Rehabilitation Parking Ramp Expansion Passenger Boarding Bridge Replacements Terminal 2-Humphrey Multi-Gate Expansion Restroom Addition Curbside Check-in Expansion 11

General Aviation Airports The 2016 to 2019 capital improvement program also includes a variety of upgrades to the MAC s six general aviation airports. Airlake South Hangar Area Alleyways Pavement Rehabilitation and Maintenance Anoka County-Blaine Pavement Rehabilitation and Maintenance Maintenance Building Improvements Crystal Complete Environmental Assessment for LTCP Convert Runway 14R-32L into a Taxiway Pavement Rehabilitation and Maintenance Flying Cloud Pavement Rehabilitation and Maintenance South Hangar Area Tenant Build-outs Equipment Storage Building Construction Lake Elmo Runway 14-32 Relocation/Replacement Pavement Rehabilitation and Maintenance St. Paul Downtown Storm Sewer Improvements Airfield Signage and Windcone Upgrades Pavement Rehabilitation and Maintenance Security Gate Upgrades Maintenance Building Improvements 12

ABOUT THE MAC The Metropolitan Airports Commission is a public corporation of the state of Minnesota. The Minnesota Legislature created the first-of-its-kind commission in 13 to promote aviation services in the region. The MAC can own and operate airports within a 35-mile radius of Minneapolis and St. Paul city halls. The MAC operates much like a municipality, with its own police, fire, emergency communications, public works and administrative departments. Unlike municipalities, the MAC is not funded by non-aviation tax revenues. Instead, the MAC generates the revenues it needs from users of its airports through such sources as ground and building rent, airline fees, vehicle parking, auto rental and a variety of food, retail and passenger services concessions. The MAC does have limited taxing authority but has not used it since the 1960s. Through its conservative financial approach and commitment to efficiency, the MAC maintains one of the highest bond ratings of any airport authority in the nation. In 2013, the Air Transport Research Society named Minneapolis-St. Paul International the most efficiently managed large airport in North America. 13

35 T H E M AC S A I R P O RT SYST E M 35 35 Oak Grove The MAC s airports include: East Bethel One major airport, Minneapolis-St. Paul International Elk River One intermediate-use airport (having a runway longer than 6,000 feet), St. Paul Downtown Airport Forest Lake Five minor-use airports (with runways of 5,000 feet or less) serving a variety of general aviation Otsego needs Airlake, Anoka County-Blaine, Crystal, Flying Cloud and Lake Elmo. Ham Lake 35 Ramsey Only Minneapolis-St. Paul InternationalAndover (MSP) accommodates scheduled airline service, while the others fulfill the area s corporate and leisure aviation needs. MSP ranks as the 16th largest airport in the United States for the number of passengers served and 14th for takeoffs and landings. Anoka 35 St Michael Champlin 35E 35W 35W Blaine Lino Lakes Hugo 35W Anoka CountyBlaine Coon Rapids Corcoran 4 Fridley Brooklyn Center 35W White Bear Lake Shoreview 6 New Brighton Plymouth Vadnais Heights Arden Hills New Hope Robbinsdale Crystal 4 35E Crystal Mahtomedi 35E 6 Stillwater 6 North St Paul 35W 35W Lake Elmo Golden Valley 4 Lake Elmo Oakdale Maplewood 3 Orono St Louis Park Mound 35E 35W Hudson 4 4 Hopkins Minnetonka Shorewood Edina Eden Prairie 4 MinneapolisSt. Paul International 35W 4 4 4 35E St. Paul Downtown Woodbury 4 4 4 35E Inver Grove Heights Flying Cloud St Paul Park Cottage Grove 35E 35W Eagan Chaska Shakopee Savage 35W 35E Burnsville Rosemount 35E Hastings Lakeville Prior Lake 35 Farmington Airlake 35 14

Metropolitan Airports Commission BOARD MEMBERS District A Carl Crimmins District B Rick King District C Lisa Peilen District D Steve Cramer District E James Deal District F Michael Madigan District G Jim Hamilton District H Ibrahim Mohamed City of Minneapolis Erica Prosser City of St. Paul Pat Harris Outstate St. Cloud Patti Gartland Commission Chair Daniel Boivin PHOTO NOT AVAILABLE Outstate Duluth Donald Monaco Outstate Thief River Falls Dixie Hoard Outstate Rochester Timothy R. Geisler A 15-member board of commissioner sets policies for the MAC. The governor appoints the chairman, eight commissioners serving metropolitan districts, and four outstate commissioners. The mayors of Minneapolis and St. Paul each appoint one commissioner to represent their respective municipal interests. The executive director/ceo and the executive vice president oversee day-to-day operation of the MAC. 15

THE MAC S ORGANIZATIONAL STRUCTURE The Metropolitan Airports Commission employs approximately 580 staff members headed by an executive director/ceo and an executive vice president. The executive director/ceo oversees the Executive Division, while the executive vice president oversees the day to day operations of the Finance & Administration, Planning, Development & Environment, and Management & Operations divisions. Each of these three is headed by a vice president. Minnesota Legislature Metropolitan Airports Commission Board F & A Committee P, D & E Committee M & O Committee Executive Jeff Hamiel, Executive Director/CEO General Counsel Governmental Affairs Internal Audit Human Resources & Labor Relations Public Affairs & Marketing Tom Anderson, General Counsel Mitch Killian, Director Mike Willis, Director Jim Laurent, Director Patrick Hogan, Director Executive Dennis Probst, Chief Operating Officer Commercial Management & Airline Affairs Sustainability & Strategic Planning Information Technology Planning, Development & Environment Management & Operations Finance & Administration Open Position, Chief Information Officer Gary Warren, Vice President Roy Fuhrmann, Vice President Steve Busch, Vice President Airport Development Airport Fire Finance Building Official Airport Police Risk Management Environment MSP Operations & Administration Airside Operations & Field Maintenance Emergency Management Landside Operations Terminal 1 Facilities Terminal 2 Facilities Reliever Operations 16

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES! Safety & Security Reportable Crimes MSP Runway Incursions OSHA Recordable Injuries Reliever Runway Incursions Security Breaches that Impact Passenger Traffic and/or Airport Operations Overall strong performance Increases in vehicle incursions at Reliever Airports and reports of portable devices being stolen. 17

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES Financial Debt Service Coverage Ratio Non-Airline Operating Revenue per Enplaned Passengers Reliever Airport Net Operations Revenue NA General Aviation Management Model Amount Airline Cost per Enplaned Passenger Overall strong performance Maintained solid financial performance and a positive trend line for general aviation management. 18

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES Employee Engagement Employee Engagement NA Employee Turnover Overall strong performance The employee engagement survey was not conducted in 2015 due to a retirement. Our ASQ score went down slightly from our all time high in 2014. Customer Experience Airport Service Performance Rating (ASQ) Compliments to Complaints Ratio 19

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES Development CIP Implementation Pay-As-You-Go PFC Availability Environment Environmental Stewardship Index Overall strong performance Overall strong performance CIP implementation performance remains strong, with a continued usage of PFC funds. The Environmental Stewardship Index performance reached an all-time high in 2015. 20

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES Reliever Operations Reliever Operations Reliever Tenants Reliever Based Aircraft Overall strong performance The reliever airport system increased operations and tenants in 2015, and saw a slight dip in based aircraft. 21

2015 STRATEGIC PLAN YEAR-END PERFORMANCE MEASURES MSP Operations MSP Operations Non-Stop Domestic Destinations Competitive Destinations Enplaned Passengers Non-Stop International Destinations Overall strong performance As projected, operations continue to drop as passenger counts grow. Destination numbers hovered around 2014 levels with some slight ups and downs. 22

RESULTS INDICATORS DEFINITIONS Reportable Crimes Per Enplaned Passenger Crimes that are mandated reportable to the state under Minnesota State Statute and include crimes against a person and/or property, i.e., can include everything from murder and aggravated assault to vandalism and disorderly conduct. Security Breaches That Impact Passenger Traffic and/or Airport Operations A security breach that is not able to be cleared after CCTV and a security review without impacting passenger traffic and/or flight operations. OSHA Recordable Injuries Any injury or illness that meets the following criteria: death, days away from work, restricted work or transfer to another job, medical treatment beyond first aid, or loss of consciousness. A significant injury or illness diagnosed by a physician or other licensed health care professional. MSP Runway Incursions The entering of any open runway including the associated safety area without positive clearance from the air traffic control tower. Reliever Runway Incursions Unauthorized access to an airport operations area by a vehicle or pedestrian. Debt Service Coverage Ratio Revenues available to pay debt service divided by debt service payments. Airline Cost Per Enplaned Passenger Airline rates and charges as defined in the airline operating agreement divided by enplaned passengers. Non-Airline Operating Revenue Per Enplaned Passenger Revenue to MAC from Concessions as shown in MAC s financial statements divided by enplanements. General Aviation Management Model Amount Management tool used as a factor in determining the adequacy of general aviation rates and charges, and how much funding can be allocated to future capital improvements and capital equipment necessary to properly maintain the Reliever Airport system. Employee Engagement Index Results from internal employee survey on: Employee Involvement, Work Environment, Performance Leadership, and Overall Job Satisfaction Employee Turnover The number of voluntary and involuntary separations in a calendar year, calculated as a percentage of the total workforce of regular status employees. Environmental Stewardship Index Benchmarks the following eight variables: Greenhouse Gas Emissions, Deicing Material diverted from Minnesota River, Solid Waste Generated, Solid Waste Recycled, Percent of Homes Mitigated within MSP 65 DNL, Energy Savings per Energy Conservation Program Building Efficiency, and Reduction in use of Petroleum Fuel. ACI/ASQ Survey Overall Passenger Satisfaction MSP s rating from passenger rating on a 5 point scale. Compliment To Complaint Ratio A comparative calculation of compliments to complaints. CIP (Capital Improvement Program) Implementation Completed project value as a percentage of programmed project value. Pay-As-You-Go PFC Availability The number of years into the future MAC has committed its available Pay-as-you-go PFC funds. Annual MSP Operations The number of aircraft takeoffs and landings at MSP. Enplaned Passengers (EPAX) The number of passengers boarding an aircraft, including originating and stopover or on-line transfer passengers. Non-stop Domestic Destinations 5 weekly departures or 260 total departures per year. Non-stop International Destinations 1 weekly departure or 52 departures per year. Competitive Destinations Destinations served by more than one airline Annual Reliever Operations The number of aircraft takeoffs and landings at the Reliever Airports. Reliever Airport Tenants The number of airport tenants at the Reliever Airports. Reliever Based Aircraft The number of aircraft based at the Reliever Airports. 23

6040 28TH AVENUE SOUTH, MINNEAPOLIS, MN 55450-2799 METROAIRPORTS.ORG