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    5.    
AIRPORTS COMMITTEE
Meeting Date: 03/14/2018  
Subject:    Review and discuss the Airports’ proposed rates and charges
Department: Airports  
Referral No.:  
Referral Name:
Presenter: Contact: Beth Lee, (925) 681-4200

Information
Referral History:
In 2013, the Airports Division initiated a business retention and attraction program to strengthen and grow the Buchanan Field and Byron Airports. Airports staff convened an Economic Development Incentive Program (EDIP) process, which included a diverse working group representing leasehold tenants, businesses, flight clubs, County hangar and tie-down tenants, and the Aviation Advisory Committee, to help staff develop a program that would best help us to retain and attract new aviation tenants. EDIP participants identified 48 total desired projects and programs to meet the attraction and retention goals. The EDIP process was completed in late 2015 and included a top projects/programs prioritization list for both airports, Buchanan Field and Byron Airport.

One top priority item was to examine the aviation use rents to determine if the airports were regionally competitive. Airports staff conducted a market rate rent comparison and found that, in general, aviation rents at our airports were at the high end for the regional market, which could negatively affect the Airports’ ability to attract new and retain existing tenants. As such, on February 9, 2016, the Board of Supervisors approved a three-year CPI waiver starting April 1, 2016, and ending March 31, 2019, for aviation use tenants in order to make the aviation use rental rates more comparable to other regional general aviation airports.

In August 2017, the Airports Division completed updating its strategic plan to best position the airports for regional competiveness. The strategic plan has a multi-tiered approach that included high stakeholder involvement to best ensure that it would address the business/tenant needs. The intent was to create, and then implement, an effective business retention/attraction program to strengthen and grow the Buchanan Field and Byron Airports to achieve the following:
  • Best position the Airports Division to react and behave more like a business in order to successfully compete for marketplace in the region
  • Improve the financial well-being of the airports system
  • Create environment that cultivates staff to deliver better customer service, increase creativity and lower turn-over (all of benefit to our customers)
  • Create environment that fosters tenant and business retention (trust, confidentiality, reliability and fairness are baseline roots)
  • Let our tenant and business community know that we are appreciative that they call the Contra Costa County airport system home
  • Attract business aircraft and aeronautical businesses
  • Attract general aviation aircraft and pilots
  • Regional marketing to increase awareness of the airports; benefits and what they have to offer
  • Increase revenue generation
  • Continue to diversify revenue base
  • Increase community knowledge, in interest in, and support of both airports
  • Small airport system that can become an industry model and leader
  • Distinguish Buchanan Field and Byron as the preferred general aviation airports in the San Francisco Bay Area for pilots and businesses
The next crucial component in the County’s economic retention and development program is to implement the top priority projects and activities that were identified by the comprehensive multi-year process. The top projects and activities are to develop a new rates and charge schedule for both airports, initiate the development of a terminal building at Buchanan Field, initiate the development of a hangar and office building at Byron, and initiate projects to improve aesthetics at both airports. Staff will continue to work with the stakeholders as they move to implement these priority projects and activities for the Buchanan Field and Byron Airports. The rates and charge schedule will be vetted through the public process in advance of scheduling this item before the full Board of Supervisors for their review and approval.

Referral Update:
This is a continuing discussion from September 13, 2017 regarding the Airports Division’s strategic planning and implementation process for the four identified priority projects.

Recommendation(s)/Next Step(s):
Review and discuss the Airports’ proposed rates and charges. This is a general discussion of the proposed new rates and charges for the Buchanan Field and Byron Airports to best position the airports to be most regionally competitive. Developing new rates and charges for both airports was a top ranked priority project arising from the EDIP and AAC priority ranking input that was later reaffirmed through the Airport Division’s strategic planning process.

Fiscal Impact (if any):
The proposed hangar and tie-down rents will result in an approximate $65, 514 reduction in annual revenue to the Airport Enterprise Fund. However, the rent and fee adjustments are necessary to make our airports regionally competitive which should lead to long-term economic stability and viability.
Attachments
Rates & Charges Draft

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