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1996-10-28 Regular MeetingAirport Advisory Committee October 28, 1996 6:30 p.m. School District Conference Room MINUTES I. CALL TO ORDER The Airport Advisory Committee regular meeting of October 28, 1996, was called to order by Wayne Stevens, Chairman, at 6:34 p.m. in the school district conference room. II. ROLL CALL Present Absent Staff Guests Stosh Anderson Joe Brodman Rachael Miller Tony Clark Wesley Campbell John Chya Lt. Cmdr. Gilbert Teal Michael Machulsky Richard Waddell Cecil Ranney Wayne Stevens Barry Wilson A quorum was established. III. ACCEPTANCE OF AGENDA The agenda was accepted unanimously as submitted. IV. MINUTES OF PREVIOUS MEETING The August 12, 1996 meeting minutes were unanimously approved as submitted. V. ITEMS OF BUSINESS 1~ Update on license/lease negotiations between the Coast Guard and the State of Alaska Department of Transportation (DOT) Murph O'Brien, Chief of Leasing and Property Management for the State of Alaska DOT was connected to the meeting via telephone. Mr. O'Brien indicated that the first of two five-year extensions to the lease was on the books. He indicated that the State was working on language for the second five-year extension. Wayne Stevens asked if the second five-year extension included the Crash Basin. Mr. O'Brien stated that the Crash Basin was not currently included and needed to be addressed. He indicated that it was his understanding that the Crash Basin would remain Airport Advisory Committee Page 1 Of g October 28,1996 with the Coast Guard and the State would allow access. He noted that there was a reluctance on the part of the State to take on additional facilities. Michael Machulsky asked why the Crash Basin kept dropping through the cracks when the committee and State had been talking about it for two years. Mr. O'Brien stated that it was his fault because he had received Mayor Selby's letter regarding including Crash Basin and had not yet discussed it with John Horn. He stated that he would get with Mr. Horn to discuss the issue. Mr. O'Brien said that the State was working on the lease extension and ownership of the airport and stated that the two were interconnected. Mr. O'Brien stated that the current process was completion of the lease extension so that grant requirements could be met. He stated that he understood it would be five years before the transfer took place. He noted that there was a reluctance on the part of the State to accept ownership of the Crash Basin, but indicated that the State was not going to say people could not use the area. Mr. Machulsky asked why the Crash Basin was always missing out of the discussion. Mr. O'Brien stated that he had discussed the issue with Mr. Horn previously and Mr. Horn indicated the State did not want to take ownership of the area. Mr. Machulsky indicated that the State needed to let the Borough take an active role in upgrading the area. Mr. O'Brien stated he thought that would be fine. Stosh Anderson stated that if the Crash Basin was not part of the interim lease that the committee would like it to be part of the acquisition. He asked about the appeal process if Mr. Horn determined not to include the area. Mr. O'Brien stated that the appeal process would be to appeal to Mr. Horn. He stated that he would like the opportunity to discuss the issue with Mr. Horn first. Lieutenant Commander Gilbert Teal of the Coast Guard, stated that he had received word from Alameda that based on the recommendation of the Airport Advisory Committee, the Coast Guard had been preparing a revised amendment to Amendment 10 of the lease to include the Crash Basin area. He stated that the Coast Guard had no objections to having the Crash Basin area included in the lease boundary. Mr. O'Brien said that he understood the Coast Guard was not opposed to including the area. He stated that the concern was in taking on the launch ramp and breakwater which would mean a significant increase in the State's maintenance responsibility. Mr. Stevens asked when Mr. Horn would be back in town. Mr. O'Brien stated that he was meeting with him on October 31 and would discuss the issue with him then. Mr. Stevens asked if the committee could expect a response by the following week. He ~` also asked Mr. O'Brien to outline the appeal process if the decision was unfavorable. Airport Advisory Committee Page 2 Of 8 October 28,1996 Mr. O'Brien indicated that he would have a response to the committee by the following week. He stated that the appeal process would involve going to Mr. Horn and then to the Commissioner. Discussion of transfer of airport from the Coast Guard to the State Lt. Commander Teal provided the committee with an update on the airport transfer. He stated that things would be moving more quickly because the Coast Guard had assigned two additional officers, Leslie DeSena in Alameda and Lt. Chris Brewton in Kodiak, to work on the transfer. He stated the following items needed to be completed before the transfer could be finalized: 1) The Bureau of Land Management needed to declare the property excess to government needs; 2) A proper metes and bounds survey probably needed to be done; 3) A major environmental survey needed to be done to set down the baseline for contamination. Lt. Commander Teal indicated that the Coast Guard would own up to its portion of the contamination and would make sure there was a proper assessment completed that indicated who was responsible for cleanup in certain areas; 4) Historical preservation requirements would have to be investigated. Lt. Commander Teal indicated that several of the buildings were from World War II and were considered historic. He indicated that the Coast Guard was working with the Alaska State Historical preservation office regarding the buildings. Lt. Commander Teal indicated that the five-year timeline on the transfer was already ticking. He stated that the Coast Guard was dedicated to trying to make the transfer happen. Mr. O'Brien asked about the status of the cleanup of the AUW site. Lt. Commander Teal stated that the Coast Guard was devoted to getting the site closed as a solid waste site. He stated that the Coast Guard wanted to make sure they could get to a point where all the Coast Guard caused contamination was remediated. Mr. O'Brien asked if contamination dated back to before Coast Guard involvement if there would be a distinction made. Lt. Commander Teal said that the distinction would be made and stated that they would try to get on the Formerly Used Defense Sites (FUDS) list for funding to help with the remediation. Mr. O'Brien said that when the State signed on the dotted line for the transfer they would then become the potentially responsible party. Lt. Commander Teal indicated he thought there would be FUDS availability for that site. He stated it was in the Coast Guard's interest to get the Navy on line regarding their responsibility for some of the cleanup. Mr. Anderson asked what process the State would go through to make sure that environmental assessment by the Coast Guard was accurate. Airport Advisory Committee Page 3 Of S October 28,1996 Mr. O'Brien commented that the State had a good working relationship with the Department of Defense and the Department of Environmental Conservation and also had in-house environmental staff. He indicated that the process included an initial assessment, then a cleanup, then afollow-up assessment to ensure that the cleanup fell within regulatory guidelines. He stated that a lot could be done with the office review and said if there was a technique problem that it was usually evident in the documentation. Lt. Commander Teal stated that the agreement would contain language in regard to the transfer of potentially contaminated property and that there would be protections provided there. Mr. Machulsky asked if the peripheral property such as the wastewater treatment area and Deadman's Curve were included in the transfer discussions. Lt. Commander Teal indicated that those areas were separate and stated that it was easier to deal with the transfer of the airport separately and confined to the airport boundaries. Mr. O'Brien mentioned that HB 543 had passed and stated that it dealt with renewal of leases where there have been permanent improvements. He said the law was in place but there were not yet any regulations. He stated that the regulations would be out for public review sometime in November or December. Mr. Machulsky asked if Mr. O'Brien had any information on the Mark Air Terminal. Mr. O'Brien stated that AIDEA was still interested in any and all offers. Airport terminal acquisition discussion Mr. Stevens indicated that the packet included material provided by Mayor Selby that covered the original discussion regarding terminal acquisition. The committee reviewed the packet. Mr. Machulsky asked who paid for the updated Craig Campbell report in the packet. Mr. Stevens indicated that the Mayor's Office paid for the report. Mr. Machulsky stated that he had not been thrilled with the Borough's involvement at state airport during the past 8-9 years he had been involved with the airport committee. He said he noticed the Gaston report in the packet that estimated what was needed to repair the building did not address bringing the facility into compliance with the Americans with Disabilities Act (ADA). Mr. Stevens stated that Mayor Selby had not shown the committee the price that was suggested for negotiation but indicated that the ADA improvements would be deducted from that price. Mr. Machulsky indicated that the Airport Task Force had previously suggested that if the Borough wanted to be in the airport business, they could be the leaseholder first and prove themselves. He said he was not completely negative about the proposal. He suggested that it would be useful to see a spreadsheet that showed the reasonable fees to cover expenses to improve, maintain and operate the facility. Airport Advisory Committee Page 4 Of 8 October 28,1996 Mr. Stevens stated that the Mayor could be asked to make a presentation to the committee. Mr. O'Brien signed off from the meeting. Mr. Machulsky indicated that the proposal contained projected 1995 passenger figures and asked why the committee couldn't see the actuals. Mr. Machulsky said he was concerned because while there was a verbal commitment from aircarriers regarding the terminal there was no monetary commitment. He wondered if that was part of the proprietary information that the Mayor was holding. Mr. Machulsky stated that the packet of information showed that AIP funds were available but pointed out that those funds went into the general fund and were allocated throughout the state based on needs. He said the only AIP funds Kodiak had seen had gone to building fences at the airport. He said he would like to hear more on funding of the proposal and would like to see some figures showing the return on investment. He said that the packet talked about concessions and stated that abar/lounge would provide a good return on investment. He brought up the issue of security for passenger services and parking. He said the State Troopers didn't have funding to cover the area and noted that the airport was out of Coast Guard security jurisdiction. Mr. Stevens pointed out that the proposal was not an operating plan for the airport. He stated that Mr. Machulsky raised some good points that should be included in future discussions. He said that in February there had been the issue over semantics with the Assembly authorizing the Mayor to negotiate with AIDEA. He said until it was determined what AIDEA's bottom line was, it was a moot point. Mr. Machulsky noted that if the packet before the committee was going to be used to re- introduce the idea to the Assembly that more information was needed. Mr. Stevens stated that he thought there was more information out there and suggested that the committee ask the Mayor to present the other information to the committee. Mr. Machulsky commented on the issue of semantics regarding the committee's recommendation that the Mayor explore the idea of terminal acquisition. He stated that this recommendation turned into the Mayor negotiating with AIDEA for acquisition. He said he thought the semantics killed the idea and suggested that afull-blown financial plan was needed to resurrect the idea. Lt. Commander Teal commented that the military police had enforcement on Coast Guard land but pointed out that it was illegal for the U.S. government military police to support private industry. He said that law enforcement and fire protection was provided as a good neighbor courtesy when requested by the State Troopers or fire response service. He said the Coast Guard would be on thin ice if they agreed to enforcement and fire protection for private industry. The committee discussed the limited Alaska State Trooper resources on the island. Airport Advisory Committee Page 5 Of g October 28,1996 Mr. Anderson commented that he agreed that something was changed in the translation of what the committee recommended and what happened when the issue went before the Assembly. He indicated that he thought there was still interest in the committee to look into the terminal acquisition issue. He asked how the procedures for reconsideration in the packet fit with the new Assemblymembers and asked if a new ordinance would be needed to re-introduce the idea. Mr. Stevens said that the issue would be a revisitation at this point. He said this could be by way of abetter-crafted resolution that better-articulated the wishes of the committee. He stated the resolution could give the Mayor the authority to come back with the bottom line number without the same sense as before. Mr. Machulsky suggested it would be helpful for committee members to visit airports around the state to get a sense of how things worked for the different communities with city-owned and state-owned facilities. He suggested that doing this would bring more insight to the terminal acquisition question. Barry Wilson stated that the packet information was a good start to show the possibilities provided by terminal acquisition. He stated that there was still the issue of whether the terminal would be profitable vs. a liability. He suggested that if the Borough owned the facility they could rent it out to another airline to increase competition. He stated he also thought it would be helpful to explore what other Alaska communities were doing with their airports. Cecil Ranney pointed out that the question of terminal acquisition was asked at the candidates forum and all Assembly candidates indicated they were against it. Mr. Stevens stated that the terminal acquisition idea was less a sell situation and more an educational one. He stated he was frustrated with the response to the acquisition because it was not different than any other infrastructure issue in the community. He said there seemed to be a lack of understanding of transportation as infrastructure. He pointed out that flying was the main mode of transport in Kodiak. Mr. Machulsky stated that letters of commitment from aircarriers might make the process easier. He said the aircarriers could come and go as they pleased when they did not own the facilities. He pointed out the need for a business plan and analysis of return on investment for the facility. He stated he was against the Borough owning the airport and indicated there was a small user group of the airport. He noted there were a lot of taxpayers who might never use the facilities but who would carry the tax burden on their shoulders if the plan didn't work. Mr. Wilson stated that was also his reason for caution. He stated he saw terminal acquisition as a liability and did not see the return on investment. Mr. Stevens pointed out that government did not make money on infrastructure. Airport Advisory Committee Page 6 Of 8 October 28,1996 Mr. Anderson stated that he did not think $1 million was a big investment when the terminal acquisition had the potential to save everyone a lot of money. He noted the high cost of air freight. He stated that the big argument was not the actual purchase but the operational costs. He suggested that if operations were privatized the idea might be a lot more palatable to the public. He said this might change the balance politically and financially. Mr. Machulsky stated he was still against the idea until more solid information was available. He stated that currently people did not have a good taste in their mouths regarding the hospital. He stated that the Borough should see if Pen Air would commit to a dollar figure the Borough came up with to make the idea more viable. He asked if the Borough had been talking to any other carriers. Mr. Stevens said no other carriers had been contacted because the community decided they did not want the terminal acquisition. Mr. Machulsky stated that the report presumed Kodiak was operating at or over capacity and stated he didn't know if that was true. Mr. Stevens said that he thought the report was referring to the utilization of space that exists. He said it was an uncomfortable terminal situation when full flights came in. Mr. Anderson stated he thought the committee could revisit the issue for hours. He made a motion to approach the Mayor with the concerns of the committee and ask him to come back to the committee with his insights and finances related to the issue. Mr. Ranney seconded the motion. The motion passed unanimously. Vl. COMMENTS The committee came up with November 25th and December 2nd as possible dates for the next meeting. Ms. Miller indicated she would check with Mayor Selby regarding his availability to attend on one of the dates indicated. Mr. Anderson pointed out that if the committee was going to gather information on other airports that it wouldn't be necessary to send anyone offthe island. He stated that most of the information the committee needed could be gathered by Borough staff. Mr. Stevens suggested that the committee develop a set of questions to ask other communities. He stated that committee members could bring their questions to the next meeting. Tony Clark stated that he appreciated listening to the discussion. Mr. Ranney asked if Mr. Steven's status as an Assemblymember changed his status on the committee. Mr. Stevens indicated that this would not change his status unless he desired to step down from the committee. He indicated that he was willing to serve if he thought the committee could accomplish something. He stated that he had considered stepping down at the end of the year due to frustration with the process. Airport Advisory Committee Page 7 Of 8 October 28,1996 Mr. Machulsky stated that the committee needed to think about how effectual it was and needed to consider the amount of personal and staff time used for the committee. He said it was obvious that the State didn't give the committee much consideration and indicated that the Assembly was not involved in what the committee was doing. He questioned the validity of the committee in the Borough scheme of things. He said he had thought of retiring from the committee and suggested that the group discuss if they should continue. Mr. Anderson mentioned that the Ports and Harbors Board was instigating aten-year plan for harbor development. He stated that there would be a meeting on November 19 where the public would be invited to comment on their vision for Trident Basin. Mr. Stevens stated that ten years had been spent bouncing around the idea of Borough ownership at the airport. He commented that he was frustrated because people did not understand why infrastructure could be good for the community. He stated that he was running out of steam. He stated that the airport had a lot of potential and that he had a vision for the airport that included an active airfield, operators and the idea of Kodiak as a regional hub. VII. ADJOURNMENT The meeting was adjourned at 7:50 p.m. Respectfully submitted by: ~~ ~` -~~ ~, Rachael V. Miller Wayne Stevens, Chairman Secretary Airport Advisory Committee Page g Of 8 October 28,1996