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1995-11-27 Regular MeetingAirport Advisory Committee November 27, 1995 6:30 p.m. School District Conference Room 1VIIIVUTES L CALL TO ORDER The Airport Advisory Committee regular meeting of November 27, 1995 was called to order by Wayne Stevens, Chairman, at 6:33 p.m. in the school district conference room. II. .ROLL CALL Present Stosh Anderson Joseph Brodman Michael Machulsky Scott Schleiffer Wayne Stevens Mke Waller Absent Staff' Guests Wesley Campbell Rachael Mller Wanetta Ayers, KICVB (for Cmdr. Nfiller) Edison Azizi, Alaska Airlines John Chya Fred Ball, PenAir Cecil Ranney Ron Denny, World Express Travel Richard Waddell Ruth Donahue, ERA Aviation Murphy Former, ERA Aviation Gary Peterson, Budget & Rent-a- heap rental cars Glenn Reed, World Express Travel A quorum was established. IIL ACCEPTANCE OF AGENDA The agenda was accepted unanimously as submitted. IV. MINUTES OF PREVIOUS MEETING The September 21, 1995 were accepted with an amendment to Page 5, Paragraph 3 regarding a misquote of Mr. Machulsky in reference to a comment about lighting for the Municipal Airport. V. ITEMS OF BUSINESS Discussion of Terminal Facility Wayne Stevens, Chairman, indicated that the bankruptcy of MarkAir had made their terminal available for purchase. He stated that Mayor Selby had written a memo to the committee requesting their recommendation on a possible purchase of the terminal facility. AitpoR Advi~aty CommiCee Page 1 of 7 November 27, 1995 Mr. Schleiffer moved to recommend the borough pursue purchase of the terminal. Mr. Anderson seconded the motion. Several members of the public were present and made the following comments regarding the terminal: Gary Peterson, the owner of Budget and Rent-a-heap rental caz businesses indicated that he had been told to vacate his space in the terminal. He stated he was interested in the borough buying both terminals. He noted that he had put in a bid to purchase building in order to make something happen. Glenn Reed of World Express Travel stated that from a personal standpoint he was in favor of the concept of a single facility owned by a separate entity besides the carrier. He stated that terminal development would benefit the community. He indicated that World Express had recently purchased Highliner Travel and explained the company was Alaska based with offices in Anchorage, Seattle, Dutch Harbor and Sewazd. Wanetta Ayers of the Kodiak Island Convention and Visitors Bureau joined the meeting Fred Ball of Peninsula Airways commented that it would be beneficial for the borough to own both buildings and queried if Alaska Airlines would ever consider selling their terminal. He stated that he preferred the borough purchase the terminal and indicated that Pen Air would like a good shaze of terminal for cazgo, freight and mail. He stated it was cramped in the current facility and it would be ideal to have both facilities under one roof. Edison Azizi of Alaska Airlines stated that one never new if Alaska Airlines would sell their terminal. Ruth Donahue of ERA Airlines, stated that she couldn't speak for ERA, but indicated that she personally agreed with the sentiments of Fred Ball and Gary Peterson towazd having borough ownership of the facilities with the terminal under one roof. Murphy Former of ERA Airlines stated he thought that the president of ERA had indicated that Era was in favor of combined terminals. Mr. Machulsky asked if there was a price tag for the terminal. Mr. Stevens stated that the Assessor would have to value the building if the committee decided to move ahead. He stated the committee could recommend to move ahead and then the Assessor would provide an evaluation. Mr. Machulsky stated that he had been well documented for 7 yeazs as against borough ownership of the terminal but stated that timing was everything and times change. He stated that this had softened his position of being vehemently opposed to borough involvement. His one concern was that private enterprise had made an offer to buy the property and he indicated that the committee had to look at if private enterprise was willing to join in and make an offer to develop the terminal. He stated that the committee had to be well prepazed to present the idea to the community in a positive light. Airport Advisory CommiKx Psge 2 of 7 November 27, 1993 Gary Peterson, the individual who had made a bid on the terminal building, stated that he was more than happy for the borough to buy the building and the Alaska Airlines terminal. He stated that he decided to make the offer just to try to do something about the terminal situation. Fred Ball stated that in the past the borough had been interested in purchasing the terminal and had been shot down. He noted that at that time Alaska Airlines had not been interested in selling the terminal. He stated this was the golden opportunity to look in to the option of purchasing the facilities. Mr. Peterson stated that he wanted something to happen because he didn't want to see the building deteriorate. Mr. Reed stated that in his personal opinion, the role of government was to display some leadership. He indicated that he had worked-for locaVstate government previously and stated that a lot of times the interests of private enterprise were different from the interests of the community. He pointed out that there were times where the government stepping forward made some sense. Mike Waller stated that his first inclination was not to see government do what a private party could do but indicated that the best way to entice competition would be to get involved. Murphy Former indicated that the borough was talking about doing just the opposite of what Sitka was doing. He indicated that Sitka was now asking Alaska Airlines to buy the terminal because they were losing money. He stated that they had turned the airport back to the state. He suggested that before the borough pursued the purchase, they should look at the total big picture and find a revenue base. Mr. Schleiffer stated that he thought the committee could anticipate some of this when they went to look for revenues. He stated the committee had to agree if the idea was good/not good for Kodak's development and solve problems with the revenue base. Joseph Brodman stated that he would like to see the borough take over the terminal. Mike Waller stated that the purchase of the terminal may end up costing more in taxes but stated there would be a payback through having more carriers and competition. Mr. Ball stated that the public would probably be happy to pay the additional tax to have a convenient place and indicated that now was an excellent opportunity to at least look into it. Mr. Anderson stated that Homer had just built a new facility and currently had a negative cash flow. He commented that potential revenue sources needed to be identified. Mr. Anderson summed up the following list of items that would need to take place with the recommendation that the borough proceed to investigate the Mark Air terminal acquisition: 1) Appraisal 2) Contact AIDA -negotiations 3) Land status between building and ramp area including investigation of any environmental concerns. Ai~pott Advisory Cammipae Page 3 of 7 November 27, 1993 4) Communication with Alaska Airlines regarding inside passageway between buildings and possible acquisition of Alaska Airlines terminal. 5) Determine future land status with Coast Guard/State with their negotiations and find out how would that impact land lease 6) Prepare revenue projections/cash flow and how to pay for procurement Mr. Stevens stated that the committee could recommend the assembly investigate the acquisition. He stated that as a community Kodiak had the opportunity to invite carriers to provide service here. He indicated that government had the responsibility to provide infrastructure for private enterprise and pointed out that other communities owned they airport terminal facilities. Mr. Machulsky distinguished between the traveling vs. the general public and stated there were many people in the community who did not use the airport facility and shouldn't have to support it. He pointed out that the Mayor's letter stated that the facility had to pay for itself and also stated that environmental concerns should be considered. Mr. Schleiffer stated that the costs would be clearly defined before the borough is committed. The underground tanks at the airport were mentioned as a possible area of environmental concern. Mr. Stevens stated that an environmental assessment would be a critical part of the process. Mr. Machulsky urged that the group move ahead but with the utmost due caution. There was a motion to recommend to the borough assembly to proceed in investigating the acquisition of the Mark Air terminal. The motion was approved unanimously. 2~ Discussion of Port Authority Mr. Stevens stated that the state statute regarding port authority powers had been provided in the meeting packets. Mr. Machulsky stated that he had brought up the idea of a port authority in previous discussions as a way for Kodiak to look at transportation issues as a whole and also stated that a port authority might eliminate some of the compartmentalizing that went on. He stated that there had to be some sort of authority to be able to discuss transportation issues and pointed out that with each new assembly, the committee had to start over. He stated that the Planning & Zoning Commission got attention and indicated that what the airport advisory committee did was no less important. Mr. Machulsky stated that the efforts being made to merge the city/borough airport committees would be the first step in the scheme of a port authority. He urged that the committee have someone tallc to them about port authorities so that the issue could be discussed from a base of knowledge. He also indicated that in light of the foreign trade zone that Kodiak might become an international airport. He said he was tired of one group protecting their piece of pie without considering long range goals. Adviaay Cammillee Page 4 of 7 November 27, 1993 The committee discussed the idea of a port authority. It was noted that the port authority might meet with a lot of resistance around town The committee voted to find a couple of representatives of port authorities to address the committee regarding the pros and cons of port authorities. It was recommended that representatives from similar size communities to Kodiak be found. It was also suggested that key people in the community that would be affected by a potential port authority be invited to attend the presentation such as the City Manager, Harbormaster, .Ports/Harbors Committee Chairman as well as the City Airport Subcommittee Chairman. Mr. Machulsky suggest that the committee meet monthly due to its workload. Discussion of nrouosed language for consolidating the city and borough airaort committees (IeEal ooinionl Bob Stanford and Don Lawhead, members of the city airport subcommittee, joined the meeting at 7:30 p.m. to discuss possibility of combining the committees. Mr. Schleiffer stated that he was pleased with the language from the lawyer and indicated that it covered everything. Mr. Anderson stated that he found the language to be very complete. He indicated that it was the city airport subcommittees' recommendation to have cross representation for now on both committees with the goal of combining the committees in about a year. The. city airport subcommittee expressed the following concerns/comments about consolidating: D Lack of understanding about what the airport advisory committee does ~ The akeady large number of steps to take to get things approved and the view that the combining of the committees would create an additional step in the process. ~ The need for a timeline to get comfortable with the idea 0 How the budget would be coordinated if Trident Basin was taken away from the Ports and Harbors board ~ Members on both committees were very busy and both committees had a plateful 0 Desire to keep each group focused on group problems and work the consolidation in over time. Suggested a year transition as a minimum to target for combining the committees 0 The need to educate the rest of the city airport subcommittee about the proposal and the functions of the airport advisory committee. ~ The idea that change will take time. Cross representation on both committees was suggested in the meantime D Confusion about how things would work. Questions about if the group would still be a subcommittee working with the city and if so, the importance of staying within that framework was stressed ~ The city committee wasn't ready to jump in and burn bridges behind them 0 There were only x number of people to go to the meetings Airport Advisory Committee Page S of 7 November 27, 1993 0 The thought that the ports and harbors board probably doesn't want to let go of Trident Basin and the harbor ^ The subcommittee doesn't just want to be let loose and needs to participate with the harbormaster and the city ^ The city committee hadn't seen any of the lawyers language for proposing the committees so it was too early to make a decision. ^ Confusion over what would happen to the city airport subcommittee 0 Unawareness of how far the proposal had already gone -the fact it was already a resolution was a little scary. ^ The subcommittees would end up reporting to two places - to the airport committee and then to , the borough Mr. Schleiffer stated that with the combined committee idea, subcommittees would be set up to focus on different issues but would report back to the larger airport committee and feed information up to the city and the borough.. He indicated that the combining of the committees would allow the larger committee a broader view and would foster everybody working towards the same goal instead of the city vs. the borough. 1VIr. Schleiffer stated that he envisioned that the city airport subcommittee would be disconnected from the ports and harbors committee and would go through the larger airport committee. He suggested that the existing subcommittee could become a trident basin subcommittee. He indicated that there would then be other focus committees for state airport, terminal issues, and port authority discussions. Mr. Stevens suggested that the item be tabled until January so that the city airport subcommittee members could relay information back to their committee. He suggested that he and Mr. Schleiffer draft a flow chart of how the committees would interlock with the borough and city. He stated he understood that the city subcommittee had worked hard to get where they were and noted that the combining concept acknowledged that all of aviation parts needed to be integrated into a seamless system. It was noted that Don Lawhead had been selected as the city committee member to attend airport advisory committee meetings. Mr. Stevens volunteered to be the airport advisory committee member designated to attend city airport subcommittee meetings. Bob Stanford asked the airport advisory committee to bear with the city airport subcommittee because they had not seen the consolidation language until that night. He indicated it was difficult to vote on an item if they hadn't seen it yet. Mr. Schleiffer moved to table the discussion of this item to the January meeting where there would be a vote in favor or against the proposed language. Stosh Anderson seconded the motion. Mr. Machulsky abstained. Mr. Anderson noted that a lot of hard work had gone into the idea of consolidation and stated he supported it. He suggested that a flowchart of how information would flow with the committee would be very helpful. He also noted that if the borough was going to pursue the Mark Air terminal time was of the essence. He suggested Don Lawhead be included in developing the flowchart. Airport Advisory Committee Page 6 of 7 November 27, 1995 Mr. Stanford stated that he thought everyone was in agreemern with the concept and asked that the airport advisory committee give the city committee some patience, pointing out that he had yet to see anything go through the city committee on one reading. He recommended that the language be copied to the city board. He indicated that it was important that the ties that had been created didn't just get snipped. VL CObIIVIENTS Mr. Stevens thanked the members of the city airport subcommittee as well as the other members of the community who had attended the meeting. The next meeting date was set for Tuesday, January 9, 1995 at 6:30 p.m. VII. ADJOURNMENT The meeting was adjourned at p.m. Respectfully submitted by: Rachael V. Miller, Secretary Wa ~ e Stevens, Chairman Page 7 of 7 November 27, 1995