BOARD MEMBERS PRESENT: Jonathan Savage; Russell Hahn; Deborah Thomas; Heather Tow-Yick; Michael Traficante; Christopher Little

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1 MINUTES OF MEETING RHODE ISLAND AIRPORT CORPORATION BOARD OF DIRECTORS THURSDAY, MARCH 8, 2018 AT 4:00 PM IN THE MARY BRENNAN BOARD ROOM T. F. GREEN AIRPORT 2000 POST ROAD, WARWICK, RHODE ISLAND The meeting of the Rhode Island Airport Corporation () Board of Directors was called to order by Chair, Jonathan Savage at 4:00 p.m., in the Mary Brennan Board Room at 2000 Post Road, Warwick, Rhode Island, in accordance with the notice duly posted pursuant to the Open Meetings Act (R.I.G.L et seq.). BOARD MEMBERS PRESENT: Jonathan Savage; Russell Hahn; Deborah Thomas; Heather Tow-Yick; Michael Traficante; Christopher Little BOARD MEMBERS ABSENT: Gregory Pizzuti ALSO PRESENT: Iftikhar Ahmad, President and CEO, and those members listed on the attendance sheet attached hereto. 1. Approval of the Minutes: A motion was made by Mr. Little to approve the minutes of the Board of Director s Meeting of February 8, The motion was seconded by Mr. Hahn. The motion was passed unanimously. 2. Open Forum: Mr. Savage asked if anyone present wanted to speak in Open Forum. No one came forward. 3. Report from the President and CEO: Mr. Ahmad presented the President and CEO Report and reported on the following: Mr. Ahmad stated the January 2018 passenger enplanements are up by 17.9%. This brings the January FYTD enplanements to 15.3%. Mr. Ahmad stated for the month of December, the airlines costs is down by 0.42%. Mr. Ahmad stated that the airline cost, excluding the cargo landing fees from new service, are down 8.6% and the non-airline revenue is up by 30.9%. This is in line with our business strategy. Mr. Ahmad stated the FYTD Passenger Facility Charges are also up by more than $600,000, which makes for a 19.5% increase. 1

2 Mr. Ahmad stated s marketing operating expenses are up significantly due to ongoing efforts. Within this calendar year, we are going to be engaged in robust marketing with significant expenditures and those investments will need to be made every year at that level. Mr. Ahmad stated staff met with Peter Pan Bus Lines and discussed additional service at PVD. They have agreed to expand the PVD schedule, including a 10 pm trip from PVD to Boston. Mr. Ahmad noted the discussions are progressing to better increase the awareness of the service offered and promote this service for international travelers. Mr. Ahmad stated a community meeting was held at North Central Airport on February 15. All attendees were pilots, and the discussion focused on airport development and costs. Mr. Ahmad noted requests were made for to hire a lobbyist to advocate for general aviation development incentives, build more hangar facilities to attract new aircraft owners, rehabilitate the upper roadway to the old terminal and tear down the old terminal to make the area site ready for future development. Mr. Ahmad noted we identified the fact that we will be separating airport operations from FBO services at the airport. Operational concerns were raised and AvPorts management was there to respond and take notes to address the concerns. Mr. Ahmad stated staff held the pre-proposal meeting for the management and operations of Public Parking Facilities at T. F. Green RFP on February 27. There were representatives from multiple parking operators in attendance to learn more about the opportunity. Mr. Ahmad stated Frontier Airlines announced Myrtle Beach, South Carolina as a new non-stop destination from PVD on February 28. Service will start on May 20. Mr. Ahmad stated the closing for the InterLink Refunding was completed on February 28. was able to secure approximately $4,950,000 of present value savings (approximately 11% of the refunded bonds). Mr. Ahmad noted the estimated Commerce Corporation fees on this bond issue are approximately $533,000 over the life of the refunding bond (through 2036), which is a calculated present value of approximately $427,000. Netting out the present value of the Commerce Corporate fees, the present value savings is approximately $4,500,000 or 10% of the refunded bonds. Mr. Ahmad stated staff met with corporate representatives from and Paradies on February 28 and March 5, respectively, to discuss operations and opportunities to enhance the airport concession programs at T. F. Green. Mr. Ahmad noted representatives are here today and will provide an operations update to the Board. Mr. Ahmad stated a GA working group meeting is scheduled on March 14 in the Board Room at 6 pm. The purpose of this group is to discuss general aviation activity within the State and share ideas to identify opportunities for improvement. 2

3 Mr. Ahmad noted in addition to this meeting, we are scheduled to hold individual GA airport community meetings at each of the GA airports to discuss activities and concerns at each of the specific airports. The community meetings are scheduled on a quarterly basis and it started with North Central on February 15. Mr. Ahmad stated the next phase of the marketing and advertising campaign has launched and will run from March through April. This phase of the campaign promotes T. F. Green highlighting new air service including Norwegian s European service, Frontier, Allegiant and Air Canada. Mr. Ahmad noted the campaign includes outbound and inbound components of digital and social media, along with radio and OOH (digital billboards). Mr. Ahmad stated staff is working with the University of Rhode Island MBA students on a Business Case Competition Project. The students are working to identify opportunities to increase usage at T. F. Green. Mr. Ahmad noted this is an interactive project and will receive fresh perspectives and recommendations from the group. The process will continue through May Mr. Ahmad stated the Quonset Air Show will be held on the weekend of June 9 and 10 this year and will host the Blue Angels. RIDOT intends to have an MBTA commuter train shuttle passengers from T. F. Green and Wickford to the event again this year. Mr. Ahmad noted this service was very successful in relieving highway and parking congestion for the event. Mr. Ahmad stated welcomed our new Graphics Designer, Jaye Del Rosario on February 15. Mr. Del Rosario is here with us today. Department Updates: (a) Airport operations report update Mr. Andrade noted that there were increases in both daily carrier seats and daily departures in January Mr. Andrade stated that all categories in the airline passenger activity were up noting a double-digit increase. (b) Airport financial update Mr. Schattle noted there was a reduction in airline costs with operating revenues down slightly by 0.42% in the month of December, which includes the additional cargo landing fees. This is in line with the trend of reducing airline costs for airlines to operate at T. F. Green Airport. Mr. Schattle noted food and beverage was up 2.50% due to the increase in the minimum annual guarantee (MAG) and news and gifts was up 31.42%. The total operating revenue for the month was up by 15.25%. Mr. Schattle noted the advertising concession RFP has been issued which included financial expectations and terminal enhancements. Mr. Schattle noted the automobile parking was up by 50.85%. This amount reflects a full month of Garage C being operated as an off airport parking location. 3

4 Mr. Schattle noted the total operating expenses were up 16.15% for the month of December. The primary drivers include advertising, printing, and marketing expenses as we are in the midst a major campaign and there will be significant expenses in the coming months. Mr. Schattle noted the federal government services section includes costs related to Customs and Border Protection staffing of the FIS facility. Mr. Schattle reviewed the general aviation revenue and expenses for the month of December noting the reduced revenues with the primary driver being less jet fuel sales specifically at Quonset airport. Mr. Schattle noted in the non-operating revenues, the passenger facility income was up by 34.96% and this is related to enplanement growth. The grant income and expense related to the noise program was down by %. Mr. Schattle noted the Interlink facility shows positive trends based on the increase in enplanements and the amendments to the rental car agreement. The benefits on the refunding will show in future month s numbers. Mr. Schattle noted the year to date trends continue and further discussed the revenues and expenses. Fiscal year to date airline revenue was down 4.80% and nonairline revenue was up 27.17% as compared to the prior year. Mr. Schattle noted that the year to date operating expenses were up approximately 5.68% and the driving factors for this are the federal government services and the marketing. Mr. Schattle noted the general aviation airports operating income increased by 35.98%. Mr. Schattle noted the air service marketing item will continue and is expected to increase later in the year with the current ongoing campaigns. Mr. Schattle discussed non-operating revenues including the passenger facility charge income and the amortization line items. The Interlink shows similar trends as the month results. Mr. Schattle noted that we are performing well as compared to our budget. (c) Overtime update Mr. Andrade noted there was an increase in overtime for the month of January mostly due to the snow removal activity this year as compared to last year but a decrease in overtime year to date. Mr. Andrade provided a department break down of overtime. (d) CUTE space expansion update Mr. Costa reviewed the current shared space for airlines noting these enable airlines and their handling agents to access their own applications using a shared IT environment. Mr. Costa explained the history of our ticket counters and airlines since 2015 and the upgrades performed and expansion and upgrades in progress. (e) PVD master plan update Mr. Porter provided an update on the status of the master plan with diagrams of the element process with milestones and forecasts. Mr. Porter noted the process is now in the forecast for aviation phase and a draft forecast is due in approximately two weeks for internal review and he reviewed the issues and next steps. Mr. Porter stated this is one of the two elements that needs Federal Aviation Administration (FAA) approval. Mr. Porter noted will continue to meet with the FAA and Customs and Border Protection (CBP) staff on a monthly basis. Mr. Porter noted the Task Order 4 item is on the agenda for approval today. Mr. Hahn asked if the VOR issue is due to the location. Mr. Porter 4

5 answered yes, the radius is too close to the taxiway and it hinders our ability to do any expansion. Mr. Hahn asked if there was anything more compact. Mr. Porter replied that there is no more ground technology and it is becoming next generation. will work through these challenges with the FAA. (f) operations update Mr. Schattle introduced representatives who are back to update on action plans for the third month. Mr. Schattle introduced Mr. Rich Kinley, the Vice President, Operations and Ms. Cindy Endicott, the Senior Director, Guest Experience. Mr. Kinley thanked the Board for inviting HMS back to the March meeting and noted there were a couple of things added since last month including the ordering of new, larger condiment stations and implementation of a timer system to remind the employees to check the stations to be sure they are cleaned and refilled. Mr. Kinley noted the larger condiment stations will allow for more workspace for the customers to prepare their food and drinks. Mr. Kinley noted they have reworked the lines and they have a new register system that allows them to handle a higher customer demand and he reviewed transaction details. Mr. Kinley went over comparison numbers at both Dunkin Donut locations to show the percent in change transactions, percent in change sales and percent in change hours in the last month. Mr. Kinley noted the change in hours is labor hours. Mr. Traficante asked about the labor hours and with employees coming in earlier and staying later, how is compensating these employees. Mr. Kinley explained the employees start at a certain rate and they get paid in additional money for the extra hours worked which they hope will encourage the employees to come in early and stay late. With delayed flights, they also give gift cards on top of the extra pay to thank them for staying. Mr. Savage thanked and noted appreciates how serious they are taking the issues and all of the responsiveness. Mr. Savage noted the food and beverage is still under the news and gift but hopefully with committed efforts will continue its trajectory up. Mr. Savage noted there was a day this week where a picture was received in the am from a board member flying out and there was a very long line. Mr. Kinley explained this issue was due to a system failure and it was a onetime thing that has not occurred since. Mr. Savage explained that encourages if there is a one off crisis, provide the customers with their coffee and bagels at no charge. Mr. Kinley introduced Ms. Cindy Endicott, the Senior Director, Guest Experience. Ms. Endicott noted she was on site to help associates deliver and explained the new level of training that is ongoing. Ms. Endicott noted the training starts with hospitality training to help with how changes the behavior in employees in situations like mentioned above and having them make a commitment to the team, to and to the customers. The training is 50% done. Ms. Endicott explained that she monitors all media and customer service s/complaints that come through. Ms. Endicott explained the new program that they would like to establish at T. F. Green called the Shout Out Program. This program gives employees and associates the ability to give recognition to anyone during help in any situations. The employee would fill out the back of a card and post a 5

6 picture on social media. This program is a huge success at other airports and will be rolled out at this airport soon. Mr. Ahmad noted that part of our major goals was to get the advertising concessions RFP out on the street. is working with and Paradies to update the look and brands as well as merchandise here at the airport. Mr. Ahmad explained that part of this change is we issue a survey to find out what people expect here, the type of restaurants, the merchandise they want to buy, so we are aware. Mr. Ahmad noted we are also updating the terminal on the inside with restroom updates, ladies restroom expansion and more amenities, so in a whole the experience is good for travelers. We are also working on the water bottle project. Mr. Ahmad explained we want there to be a sense of place so when a traveler is at our airport, they can tell they are in Rhode Island and it is the first impression for domestic and international travelers. (g) Concessions update Mr. Schattle provided an update on concessions and our focus on customer service. Both concessions are working on new ideas and concepts to submit. Mr. Schattle noted there is a big focus on food choices and merchandising. Conversations have been initiated and we are expecting to bring back a recommendation to the Board to review at the May Board meeting. Mr. Schattle noted we need to develop a formal policy for the concession program and make significant improvements. Mr. Schattle noted there was an RFP issued for a business lounge as well as an RFP for the advertising concession. The goal of the advertising concessions RFP is to increase revenue and declutter the facility. Mr. Ahmad explained the walls in the terminal need upgrading and there is a lot of opportunity to upgrade the esthetics with new gadgets such as digital equipment to increase revenue as well as larger structures at each end of the terminal with open space entrances to news and gifts and food and beverage. Mr. Hahn asked if there was a consideration for to run its own business lounge. Mr. Ahmad answered that we are looking to create a lounge with food, alcohol and the passenger would pay a fee. put an RFP out and there was a lot of attendees at the pre-proposal meeting. The location is on the ground level and this was a request from customers and it is a push towards a better market share. Mr. Hahn noted that usually you would affiliate with an airline for a business lounge. Mr. Ahmad noted has talked with the airlines present and nobody has a large enough to service here to do one. 4. Finance and Audit Committee Update. Ms. Thomas reported there was a Finance and Audit Committee meeting prior to the Board meeting where they reviewed financial reports and approved the minutes of the prior meeting. 5. Action Items: (a) Approval to execute a consultant PVD Master Plan Task Order 4 with C&S Companies in the amount of $207,398, which includes ground transportation counts and facility requirements. 6

7 Mr. Porter explained the Task Order 4 facility requirements and noted we need to quantify alternatives where we have deficiencies. Mr. Porter explained the four primary elements and noted we need to determine what is needed and when. Mr. Porter went over the data collection locations and a financial summary review. Ms. Thomas asked with the timing of completing, some of the studies are missing peak periods, are you comfortable we will get the right information not using the peak times. Mr. Porter answered we will extrapolate on past experiences. Ms. Thomas noted we should make sure the time info is the best results. A motion was made by Mr. Traficante and seconded by Mr. Little to approve the recommendation. The motion was passed unanimously. (b) Approval to execute a professional services agreement with Siemens in the amount of $368,380 for the maintenance and support of HVAC system controls. Mr. Andrade provided an update on the HVAC facility equipment currently on campus and in addition to the maintenance and support service we will replace several components that are no longer supported by the manufacturer due to the age of the equipment. Mr. Andrade provided budget information for the replacement. Mr. Hahn inquired about only receiving one response. Mr. Andrade noted there are only a few companies that provide this type of service. A motion was made by Mr. Traficante and seconded by Mr. Little to approve the recommendation. The motion was passed unanimously. (c) Approval to execute engagement of legal counsel with Joseph J. Rodio, Esq. of Rodio & Ursillo, Ltd. for legal services related to Board of Directors Meetings pursuant to 8.7 of the Procurement Rules. Mr. Ahmad explained that we are reviewing our legal and procurement workload with approximately 200 items that need legal review and looking at the option to give responsibilities to different law firms. Mr. Ahmad noted we need to divide the current Chief Legal Counsel roles between the contracts administrator and the corporate attorney. Mr. Savage asked if Mr. Rodio will be the board meeting representative. Mr. Ahmad confirmed yes. Mr. Little asked what the annual cost is of Mr. Rodio s service. Mr. Ahmad answered that the charge will be $175 per hour, which is a fair price. We will utilize his services a few hours a month for 12 months. Mr. Savage confirmed that the in-house counsel has enough work to do. Mr. Ahmad confirmed yes and that part of it is addressing contracts that we were behind on and to address these items in a timely fashion. Mr. Traficante asked if the firm was selected by RFQ or a pool of attorneys at the state level. Mr. Ahmad answered that they were chosen by input received. 7

8 A motion was made by Mr. Hahn and seconded by Ms. Thomas to approve the recommendation. The motion was passed unanimously. 6. Executive Session: At approximately 5:10 p.m., a motion was made by Ms. Tow-Yick and seconded by Mr. Hahn to go into Executive Session for the purpose of discussing the following items: The Board will seek to go into Executive Session for the following stated purposes: (a) (b) (c) Motion to approve the minutes of the executive session held February 8, (a), (2) and (7); and Investment of public funds where premature disclosure would be detrimental to the public interest (Air Service Development and Marketing) (a)(7); and Motion to Return to Open Session. By the following roll call vote, the motion was passed unanimously. YEAS: NAYS: ABSTAIN: Christopher Little Deb Thomas Jon Savage Russell Hahn Heather Tow-Yick Michael Traficante None None Mr. Traficante left the meeting at 5:30 pm. At approximately 5:42 pm, a motion was made by Ms. Thomas and seconded by Mr. Little to return to Open Session. The motion passed unanimously. 7. Post Executive Session Actions and Announcements: (a) Motion to Seal the Minutes of the Executive Session Held on March 8, A motion was made by Ms. Tow-Yick and seconded by Ms. Thomas to seal the minutes of the Executive Session in accordance with R.I.G.L

9 By the following roll call vote, the motion was passed unanimously. YEAS: NAYS: ABSTAIN: Christopher Little Deb Thomas Jon Savage Russell Hahn Heather Tow-Yick None None (b) Report on Actions Taken in Executive Session. During the Executive Session, a motion was made by Ms. Thomas and seconded by Mr. Little to approve the sealed minutes of the Executive Session held on February 8, The motion was passed unanimously. 8. Future Meetings: The next Board Meeting will be held on Thursday, April 12, 2018 at 4:00 pm in the Mary Brennan Board Room, T. F. Green Airport, Warwick, Rhode Island. 9. Adjournment: Ms. Thomas moved to adjourn at approximately 5:46 pm. Mr. Little seconded the motion. The motion was passed unanimously. Respectfully submitted, Jon Savage, Chair Rhode Island Airport Corporation 9

10 PUBLIC ATTENDANCE SHEET RHODE ISLAND AIRPORT CORPORATION MEETING OF THE BOARD OF DIRECTORS THURSDAY, MARCH 8, 2018 NAME Brian Schattle Alan Andrade Alicia Seabury Donna Melone Sherri Ann Penta Timothy Pimental Annette Jacques Dan Porter David Cloutier Eric Seabury Doug Dansereau Jeff Wiggin Steve Cahill Randy Costa Jeff Goulart Nicole Williams Jaye Del Rosario Joseph Rodio, Jr. Woody Creswell AFFILIATION Rodio & Ursillo Paradies Nancy Iadeluca Local 26 Rich Kinley 10

11 PUBLIC ATTENDANCE SHEET RHODE ISLAND AIRPORT CORPORATION MEETING OF THE BOARD OF DIRECTORS THURSDAY, MARCH 8, 2018 NAME Bryan Loden Younces Abuirmeleh Joanne Jackson Cindy Endicott Giselle Vicente Connie Rodrigues Martin Calel AFFILIATION 11

12 The minutes of the Executive Session of the Board Meeting March 8, 2018 have been sealed in accordance with R.I.G.L (c). 12

BOARD MEMBERS PRESENT: Jon Savage; Russell Hahn; Deborah Thomas; Heather Tow-Yick; Christopher Little; Gregory Pizzuti; Michael Traficante

BOARD MEMBERS PRESENT: Jon Savage; Russell Hahn; Deborah Thomas; Heather Tow-Yick; Christopher Little; Gregory Pizzuti; Michael Traficante MINUTES OF MEETING RHODE ISLAND AIRPORT CORPORATION BOARD OF DIRECTORS WEDNESDAY, SEPTEMBER 27, 2017 AT 4:30 PM IN THE MARY BRENNAN BOARD ROOM T. F. GREEN AIRPORT 2000 POST ROAD, WARWICK, RHODE ISLAND