RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES MEETING OF THE BOARD OF TRUSTEES January 17, :15 a.m.

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1 RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES MEETING OF THE BOARD OF TRUSTEES January 17, :15 a.m. MEMBERS PRESENT John Wagnon, Chair Lynn Atcheson Tom Gribbin Larry V. Harvey Joseph W. Mayer Brooks Mancini Bill Newberg Mary Simmons Randi Thompson ALSO PRESENT Marily M. Mora, A.A.E. Deputy Executive Director Ann Morgan Counsel/Jones Vargas Theresa Finley Clerk of the Board The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno- Tahoe International Airport, Reno, Nevada. Chairman Wagnon called the meeting to order. The Pledge of Allegiance was recited. Roll was called. PRESENTATIONS AND AWARDS Employee and Tenant Recognition Deputy Executive Director Marily Mora introduced Quentin Koch, United Airlines Station Manager, and Marylee Mansfield, Executive Assistant with United Airlines. Quentin and Marilee were recognized for their work on the annual Fantasy Flight. This event hosts special needs students from Marvin Piccolo School providing breakfast, activities and a special visit from Santa and Mrs. Claus. John Dujmovich, Maintenance Worker, was recognized as the Employee of the Quarter receiving a plaque and cash award from Chairman Wagnon. Introduction of New, Promoted and Retired Employees: Tim Squier, Facilities Supervisor introduced new employee Vicente Ong who was hired as a custodian. Tenant Communication: No Tenant Communication APPROVAL OF MINUTES On motion by Trustee Gribbin, second by Trustee Atcheson, which motion duly carried by unanimous vote, the Board approved the minutes of the Board Meeting of December 13, APPROVAL OF AGENDA The Agenda was revised to move Item VIII.C ahead of VIII A and B so XIII C could be voted on prior to convening to a closed session to discuss VIII A and B. 01/17/08 Page 1

2 On motion by Trustee Mayer, second by Trustee Mancini, which motion duly carried by unanimous vote, the Board approved the agenda as revised. CONSENT ITEMS FOR BOARD ACTION #08(01)-01 AUTHORIZATION FOR THE PRESIDENT/CEO TO EXECUTE AN AMENDMENT TO THE SIGNATORY AIRLINE-AIRPORT USE AND LEASE AGREEMENT FOR ABX AIR, INC., AMERICAN AIRLINES, ALASKA AIRLINES, ALOHA AIRLINES, CONTINENTAL AIRLINES, DELTA AIR LINES, EXPRESSJET AIRLINES, FEDERAL EXPRESS CORP., HORIZON AIR INDUSTRIE, SKYWEST AIRLINES, SOUTHWEST AIRLINES CO., UNITED AIRLINES, UNITED PARCEL SERVICE CO., AND US AIRWAYS, INC. 01 as follows: Authorized the President/CEO to execute the two year extension amendment to the signatory airline-airport use and lease agreement with 14 airlines mentioned above. #08(01)-02 AMENDMENT NO. 1 TO THE PROFESSSIONAL SERVICES AGREEMENT WITH RICONDO AND ASSOCIATES FOR THE DEVELOPMENT AND NEGOTIATION OF A NEW AIRLINE- AIRPORT USE AND LEASE AGREEMENT AT RENO-TAHOE INTERNATIONAL AIRPORT IN AN AMOUNT NOT TO EXCEED $84,000 FOR TOTAL OF $144, as follows: Authorized the President/CEO to execute Amendment No. to the professional services agreement with Ricondo and Associates for the development and negotiation of a new airline airport use and lease agreement at Reno-Tahoe International Airport in an amount not to exceed $84,000 for a total not to exceed $144,000 #08(01)-03 AUTHORIZATION FOR THE PRESIDENT/CEO TO AWARD A CONTRACT FOR PHASE 16 OF THE SOUND INSULATION PRGORAM GROUP 16.3 FOR 43 RESIDENTIAL HOMES LOCATED IN NEIGHBORHOODS NORTH OF THE AIRPORT WITH ALPINE ENERGY, INC. IN THE AMOUNT OF $575, as follows: 01/17/08 Page 2

3 Approved the award of contract for sound insulation for phase 16 of the Sound Insulation Program Group 16.3 for 38 residential homes plus five alternates located in neighborhoods north of the airport with Alpine Energy, Inc., in the amount of $575,360 and authorized the President/CEO or her designee to sign. #08(01)-04 AUTHORIZATION FOR THE PRESIDENT/CEO TO AWARD A CONTRACT FOR PHASE 16 OF THE SOUND INSULATION PROGRAM GROUP 16.4 FOR 23 RESIDENTIAL HOMES LOCATED IN NEIGHBORHOODS SOUTH OF THE AIRPORT WITH ADVANCE INSTALLATIONS, INC. IN THE AMOUNT OF $581, as follows: Approved the award of contract for sound insulation for Phase 16 of the Sound Insulation Program Group 16.4 for 13 residential homes plus 10 alternates located in neighborhoods south of the Airport with Advance Installations, Inc., in the amount of $581,374 and authorized the President/CEO or her designee to sign. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION #08(01)-07 RESOLUTION NO. 478: A RESOLUTION AUTHORIZING THE PRESIDENT/CEO TO ESTABLISH NEW PARKING RATES AND RESOLUTION NO. 479: A RESOLUTION AMENDING RESOLUTION NO. 476, A MASTER FEE RESOLUTION SETTING FOR AIRPORT RATES AND CHARGES FOR FY ANNUAL BUDGET AND PARKING RATES AS AMENDED On motion by Trustee Atcheson, second by Trustee Mayer, which motion 07 as follows: Adopted Resolution No. 478 as follows: A Resolution authorizing the President/CEO to establish new parking rates. Specifically to: 1. Change the long term surface lot maximum rate from $8.00 to $10.00 effective April 1, Authorized the President/CEO to establish a grace period (no charge) up to 30 minutes effective March 1, Establish an oversize vehicle parking rate effective April 1, Trustee Mancini reiterated his disclosure made at Caucus of a conflict and that he would not be participating nor voting on this agenda item. 8:35 a.m. Convened to Closed Session 11:02 a.m. Reconvened Board Meeting 01/17/08 Page 3

4 #08(01)-05 AMENDMENT NO, 4 TO THE PROFESSIONAL SERVICES AGREEMENT FOR DESIGN SERVICES FOR THE INTEGRATED INLINE EXPLOSIVE DETECTION SYSTEM PROJECT WITH GRESHAM SMITH & PARTNERS IN THE AMENDED AMOUNT OF $190, FOR A TOTAL AMENDED CONTRACT AMOUNT OF $2,988,635 On motion by Trustee Gribbin, second by Trustee Mayer which motion duly carried by unanimous vote, Trustee Mancini having recused himself, the Board approved Agenda Item #08(01)-05 Amendment No. 4 to the professional services agreement for design services with Gresham Smith and Partners for the Integrated Inline Explosive Detection System project in the amended amount of $190, for a total amended contract amount of $2,988,635 and authorized the President/CEO or her designee to sign. Trustee Gribbin commented that the Board has gone a long way in a short amount of time and recommended that the contract be signed as soon as possible and begin moving forward. #08(01)-06 AUTHORIZATION TO AMEND THE PRESIDENT/CEO S AUTHORITY FROM $28 MILLION TO $53.2 MILLION TO NEGOTIATE AND AWARD A CONSTRUCTION CONTRACT FOR THE CONSTRUCTION OF AN INTEGRATED INLINE EXPLOSIVE DETECTION SYSTEM MANDATED BY THE TRANSPORTATION SECURITY ADMINISTRATION AND EXEMPT THIS CONTRACT FROM PROVISIONS OF NRS CHAPTERS 332, 338 AND 339 The Board asked Dave Lazo, Manager of Engineering and Construction, to recap the project cost breakdown. Dave Lazo stated that a cost verification study was conducted to review the contractor s cost proposal. The contract is a cost plus contract with a guaranteed maximum price. PBS&J has been retained to perform construction management and a cost verification. There is a variance of approximately 2 ½% between the contractor s proposal and market prices. This type of variance is reasonable. The construction contract is comprised of several cost plus items in which the contractor is compensated for time and materials plus a fee. Within the contract, there are some sub trades which are lump-sum or stipulated-sum contracts. The amount of the hard construction costs is $45,392,000. In addition to that, there are markups for builders risk insurance of $85,000, contractor s overhead of $1.8 million (approximately 4% of the construction amount). Contractor profit is $945,000 (approximately 2% of the construction value). The contractor is not marking up the profit on the equipment purchase for the Baggage Handling System equipment. That is shown as a credit of $351,000. The last item is a contractor performance and payment bond which is standard and is a percentage of the construction value at $225,000. There is also a $5 million contingency controlled by the Airport Authority that is for 01/17/08 Page 4

5 unforeseen conditions, owner-directed changes or changes in the scope of work. There is $6.5 million for soft costs which include design contract administration, construction management and administration and overhead for the Airport. The estimated total project costs are $59,617,407. The contract contains a value engineering provision that allows the contractor to propose cost savings that would be split between the Airport Authority and the contractor on a 50/50 basis if agreed to by the Airport Authority. In addition, there is a shared savings clause whereby the contractor and Airport Authority would share in any efficiencies and savings of actual cost, 25% to the contractor and 75% to the Airport Authority up to maximum of $300,000. The schedule from start to completion is 687 calendar days. The point of substantial completion, which is beneficial occupancy of the new facility by the Airport, is 600 days. At that point, liquidated damages would be incurred by the contractor in the amount of $2,500 per day. Chairman Wagnon added that the Board also looked at the funding mechanism and funding options as set forth in the PFC Amendment for Baggage Handling Systems documents, as well as looking at the various use of passenger facility charges and how those funds would be used to cover the additional costs associated with the project. The Board also was provided information regarding the concession being offered by Gresham Smith to reduce the amount of fees they were seeking.. The Board was advised of TSA s security analysis and requirements as they would have affected any other options that were considered or looked at in this project. Trustee Harvey indicated that the dollar amounts for the project had changed significantly and that change generated much discussion. The detailed discussions clarified many areas of the project. There were also discussions in closed session on how best to keep the committees informed of expenditures to hopefully avoid any large changes in the future. Trustee Newberg also indicated that detailed discussions were helpful. Trustee Atcheson stated that she was excited about project and the integration of processes it will offer. Trustee Simmons indicated that this was a good project for the Airport and passengers. Trustee Newberg thanked Trustee Gribbin for all his hard work on the project. Trustee Gribbin thanked staff for their hard work and cooperation on furthering understanding of the project. On motion by Trustee Gribbin, seconded by Trustee Mayer, which motion duly carried by unanimous vote, the Board authorized an amendment to the President/CEO s authority or her designee to negotiate and award a construction contract from $28 million to $53.2 million for the Integrated Inline Explosive Detection System mandated by the TSA and exempt this contract from provisions of Chapters 332, 338 and 339 of NRS 01/17/08 Page 5

6 Trustee Harvey indicated that the contingency fund has been increased from $500,000 to $5 million. He would like any use of contingency funds to go through the Finance Committee before going to the Board with any amount over $1.5 million requiring Board approval. Trustee Newberg clarified that this would be a cumulative effect. Trustee Harvey confirmed this. Trustee Mayer added that the Planning and Construction Committee should have the same information. On motion by Trustee Harvey, second by Trustee Thompson, Trustee Mancini having recused himself, which motion duly carried by unanimous vote, the Board imposed the requirement that any use of contingency funds beyond $1.5 million must be presented to the Finance Committee and the Planning and Construction Committee and be approved by the Board. ITEMS FOR BOARD INFORMATION AND DISCUSSION Presentations No presentations President/CEO s Report Deputy Executive Director Marily Mora informed the Board that they had received the President/CEO s report in the Board Packets and asked for questions. There were none. General Board Comments, Questions, and Items for Future Board Meetings No comments. PUBLIC COMMENT No public comments. ADJOURNMENT There being no further business, the meeting was adjourned at 11:24 a.m. ATTEST: Chairman John Wagnon Secretary, Bill Newberg 01/17/08 Page 6