06/10/2008

Meeting Minutes for:
Monthly Board Meeting
Yuma International Airport, Conference Room
Tuesday, June 10, 2008 at 04:00 PM

Call to Order:

CALL TO ORDER
The Yuma County Airport Authority, Inc. (YCAA) Regular Board of the Board of Directors was called to order at 4:00 PM on Jun 10, 2008 in the Yuma International Airport Conference Room, 2191 E. 32nd Street, Suite 218, Yuma, Arizona 85365. The Presiding officer was Karl Moedl, President.

YCAA MEMBERS PRESENT WERE:
Karl Moedl President
Mark Pancrazi 1st Vice President
William Gresser Treasurer
Dunbar Norton, Director
Harry Hengl, Director
Waldo Israel, Director
Gary Magrino, Director
Albert Gardner, Director
Robert Ingold, Director
Robert McLendon, Director attended electronically
James Carruthers, Director attended electronically

ALSO PRESENT WERE:
Mr. Williams, Airport Director
Gerald Hinkle, Jr., Chief Financial Officer
Matt Smith, Airport Operations Director
Lynn Hall, Director of Maintenance
Andrea Lopez, Executive Assistant
Tim Berger
Wayne Benesch
Greg McShane
Paul Rachels
David Egeberg, 1st Bank Yuma
George Ehrich, Nicklaus
Rick Burton, Lux Air
Robert Banovac, Lux Air
Danny Hendon, Lux Air
Sean Elton, Lux Air
William Popp, YCAA
Marissa Snow, Sky West attended electronically



APPROVAL OF MINUTES
The President called for a motion to approve the minutes of the Previous Board Meeting. Mr. Hengl so moved. Mr. Norton seconded the motion. Motion passed unanimously.


COMMITTEE REPORTS

1) Monthly report by Chief Financial Officer on current financial status and recent activities.

Mr. Williams briefed that overall, revenues and expenses are within acceptable parameters as compared to our budget.

2) Discussion and Possible Action to authorize the YCAA President to sign a commitment letter and all associated documents with 1st Bank Yuma to refinance existing airport debt of approximately $2.4M, to finance the construction of up to two aircraft maintenance hangars for a combined price of $3M for a total taxable and/or tax-exempt debt not to exceed $5.4M and to establish a $1 million line of taxable and/or tax-exempt credit. (1st Presentation to the Public)

Mr. Gresser discussed the evaluation of the banking proposals and the analysis completed by Mr. Hinkle. He stated that during the review process it became clear that the most favorable offer was from 1st Bank Yuma and that the other two banks attending the review both remarked that it was a fair evaluation and stated that they were satisfied the results were reasonable. He asked Mr. Williams to present the results for the Board.

Mr. Williams reviewed the procedures of the evaluation process, the banks contacted, and the results. He explained that the airport staff had prepared a Request for Proposals and delivered it to the following ten banks:

Chase Bank Sandra Navarrete
Chase Bank David Benson /Mark Jensen
National Bank of Arizona Mary Porchas
Wells Fargo Bank Edurado Diaz
Wells Fargo Bank Kevin D. O’Connor
Yuma Community Bank Keith Simmonds
1st Bank Yuma Edward J. Kerwin
Bank Of America Chris Rudolph
Sun Bank Tim Connealy
Mohave State Bank Brian Geren
Compass Bank Blake Cockrell
Foothills Bank Dale I. Sandahl

Bank of America, Sun Bank and Compass Bank did not respond to the proposals or to follow up phone calls. Chase initially called with questions but then never responded to further inquiries.

Two banks, National Bank of Arizona and Yuma Community Bank, responded with written statements containing regrets that they could not participate.

Wells Fargo, Mohave State Bank and 1st Bank Yuma (in partnership with Foothills Bank) provided proposals in response to our solicitation.

After an in-depth analysis on June 6, 2008, the Finance Committee selected 1st Bank Yuma as the most favorable recommendation to the Board of Directors on June 10. The selection was due to their lower interest rate, the flexibility of their terms, the structure of their proposed line of credit and the fact that under their proposed terms the YCAA can refinance its existing debt and fund the construction of the first hangar with no increase to our current debt service.

Mr. Gresser then summed up the process and restated that the committee recommended the offer from 1st Bank Yuma to the Board of Directors.

3) Discussion and Possible Action to select one architectural style and size of aircraft hangar from the schematic designs presented by the Architectural firm of NEIAW.

Mr. Williams briefed that On April 14, 2008 the YCAA signed a contract with NEIAW of Yuma to provide different styles of Hangars for review by the Board of Directors. After review with Airport Staff and the planning division of the City of Yuma, the Architect has developed two basic proposals for the hangar building and four basic styles of architecture.

All of the proposed styles stretch the desired $1.5M price tag, in part due to the heavy civil road work that may be required by the City of Yuma along 40th Street and by the uncertain costs of steel, concrete and asphalt in the current economy.

He then presented several stylistic options and two size options. The board felt that the two story option with 20 foot eaves was best and selected style 2.

4) Discussion and Possible Action to authorize the YCAA President to sign four new leases with Sun Western Flyers contingent upon final approval by Airport counsel and agreement to terms with airport staff.

Mr. Williams briefed that During the May Board meeting the Board of Directors tasked airport staff to renegotiate the currently proposed lease terms with Sun Western. Airport Staff met with the Sun Western principals on May 16 to discuss different options. During the meeting Sun Western pointed out that their existing lease provides them with a 20 year lease with three (3) five year options which is essentially a 35 year lease and requires and investment of only $1M. They are asking for an additionally 15 years on the lease in return for an additional investment of $1.5M or, in other words, and additional year for each additionally $100,000 of investment which complies with the currently proposed YCAA leasing policy.

They also suggested the proposed lease wording provides YCAA with the authority to terminate the lease in case of an overriding need of the Airport or National Security, and is the same wording that applies to their current lease and to most (if not all) other leases on the airport. In fact, this wording has long been in use by the YCAA.

The result of the meeting was that Sun Western strongly wishes to complete the lease under the terms previously negotiated. Failing that effort Sun Western will likely continue with the existing lease of 35 years and reduce their level of investment accordingly.

Mr. Benesch then provided a discussion on several legal aspects of the lease and answered questions from the Board.

Mr. Banovac briefed the Board on the changes Sun Western, soon to be Lux Air, planned on making. He had a short slide show presentation to show the board.


5) Discussion and update regarding current construction projects, associated contracts, grant status, general aviation, conferences and meetings and items with the city and county.

Mr. Williams briefed that not much had changed since the last meeting. He provided a quick update on this year's grant expectations which change almost daily.

ACTION

Mr. Gresser made a motion to Motion to authorize the YCAA President to sign a letter of intent with 1st Bank Yuma to refinance existing airport debt of approximately $2.4M, to finance the construction of up to two aircraft maintenance hangars for a combined price of approximately $3M for a total debt of approximately $5.4M and to establish a $1 million line of credit. Mr. Ingold seconded the motion. The vote was unanimous.

Mr. Norton made a motion to select the two story hangar with 20 foot eaves and the number two (2) Architectural building styles as presented. Mr. Israel seconded the motion. The vote was unanimous.

Mr. Hengl made a motion to Motion to authorize the YCAA President to sign four new leases with Sun Western Flyers contingent upon final approval by Airport counsel and agreement to terms with airport staff. Mr. Ingold seconded the motion. The motion passed by majority. Mr. Magrino and Mr. Israel voted nay.


MILITARY LIAISON
Greg McShane stated that Lt. Col. Bonzo mentioned that he is very close on the Joint Use Agreement. There was a brief discussion on when he thought it may be done. He also stated that the Air Show will be moving to March 14, 2009.


CALL TO THE PUBLIC

Mr. Banovac expressed his appreciation to the Board. He promised they will have a first class facility and look forward to working with the Authority to grow the aviation industry here in Yuma.


ADJOURNMENT

There being no further discussion before the board Mr. Hengl mad a motion to adjourn. Mr. Ingold seconded the motion. The vote was unanimous. The meeting adjourned at 5:20 pm.







// Approved //
Craig Williams
Airport Director
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