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WE'RE GOOD.

[00:00:01]

OKAY, GREAT.

[CALL TO ORDER]

GOOD MORNING.

MY NAME IS ALLISON ALTER, MAYOR PRO OF THE CITY OF AUSTIN, AND I'M CHAIR OF THE AUDIT AND FINANCE COMMITTEE WHO WOULD LIKE TO CONVENE THIS MEETING OF THE AUDIT AND FINANCE COMMITTEE.

IT'S 9:55 AM ON MONDAY, NOVEMBER 21ST, AND WE ARE MEETING IN COUNCIL CHAMBERS.

UM, OBVIOUSLY ANY OF OUR OTHER COLLEAGUES ARE WELCOME TO STAY FOR OUR AUDIT AND FINANCE COMMITTEE MEETING.

UM, THE COLD WEATHER SHELTER AND COOLING CENTER AUDIT IS POSTPONED TO THE DECEMBER MEETING, UH, PER THE CITY MANAGER'S OFFICES REQUEST.

TODAY WE'LL BE DISCUSSING THE AIRPORT AT LISA'S SPECIAL REQUEST FROM COUNCIL MEMBER FUENTES AND MYSELF, AND AN UPDATE ON THE CITY'S PENSION SYSTEMS, THE FY 22 INTEGRITY UNIT UPDATE AND FUTURE ITEMS FOR OUR DECEMBER MEETING.

[Public Communication: General]

ARE THERE ANY PUBLIC COMMUNICATIONS SPEAKERS THIS MORNING? WE HAVE ONE IN PERSON.

OKAY.

TAKE MISS GREENBERG FIRST CHAIR AL.

I'M MEMBERS OF THE COMMITTEE.

MY NAME IS BETSY GREENBERG AND I'M A MEMBER OF THE ETHICS REVIEW COMMISSION.

IN JULY, THE COMMISSION PASSED TWO RESOLUTIONS THAT I'D LIKE YOU TO CONSIDER.

THE RESOLUTIONS RECOMMEND CHANGES TO SECTION TWO DASH SEVEN OF THE CITY CODE.

IN PARTICULAR, THE PARTS OF THE CODE, UM, THAT DESCRIBE WHAT IS REQUIRED TO BE LISTED ON THE STATEMENT OF FINANCIAL INTEREST.

AS COUNCIL MEMBERS, ONE OF YOUR IMPORTANT RESPONSIBILITIES IS MAKING DECISIONS ABOUT LAND USE.

AND MEMBERS OF THE PUBLIC NEED TO BE ASSURED THAT THE MAYOR AND COUNCIL MEMBERS DO NOT HAVE CONFLICTS OF INTEREST WHEN MAKING THESE DECISIONS.

SO THE PURPOSE OF THE FIRST RESOLUTION IS TO REQUIRE THAT INTERESTS IN REAL PROPERTY BE IDENTIFIED EVEN WHEN THE PROPERTY IS HELD BY A CORPORATION PARTNERSHIP OR OTHER ENTITY IN WHICH THE OFFICIAL OWNS A SUBSTANTIAL INTEREST AS DEFINED ELSEWHERE IN THE CODE.

CURRENTLY, THE MAYOR AND OR COUNCIL MEMBERS HAVE INTERESTS IN LIMITED PARTNERSHIPS, BUT THERE'S NO DISCLOSURE ABOUT WHAT THESE ENTITIES OWN.

SO THIS CODE CHANGE WOULD IMPROVE TRANSPARENCY.

THE SECOND RESOLUTION WOULD FURTHER IMPROVE TRANSPARENCY BY REQUIRING THE CITY CLERK TO POST TO THE CITY'S WEBSITE THE FINANCIAL DISCLOSURE FORMS FILED BY ELECTED CITY OFFICIALS AS WELL AS CANDIDATES FOR ELECTED OFFICE.

CURRENTLY, THE FORMS ARE AVAILABLE, BUT ONLY WITH THE PUBLIC INFORMATION REQUEST.

MY EXPERIENCE WITH THE PUBLIC INFORMATION REQUEST PROCESS IS THAT RECEIVING REQUESTED INFORMATION IS OFTEN SLOW AND INCOMPLETE.

SO ELIMINATING THE NEED FOR A REQUEST, UM, WOULD BE HELPFUL.

I HAVE UNSUCCESSFULLY AND REPEATEDLY EMAILED THIS, UM, COMMITTEE ASKING FOR THESE, UH, RESOLUTIONS TO BE CONSIDERED.

SO TODAY, I AM IN HERE IN PERSON RATHER THAN ASKING YOU TO DISCUSS THE ITEM IN DECEMBER, WHICH MEANS AT BEST THE CODE SOME CHANGE SOMETIME NEXT YEAR.

I'M ASKING THOSE OF YOU WHO ARE IN FAVOR OF TRANSPARENCY TO PUT THESE CODE CHANGES ON THE AGENDA FOR ONE OF YOUR REMAINING COUNCIL MEETINGS FOR THIS YEAR, AND TO REQUIRE THAT IT APPLY TO OUTGOING MAYOR AND COUNCIL MEMBERS.

THANK YOU.

THANK YOU, MS. GREENBERG.

WE HAVE ONE ONLINE SPEAKER, MS. ICE, CAN YOU HEAR US? UH, YES, I CAN.

CAN YOU HEAR ME? MM-HMM.

, YOU'RE ALL SET TO GO.

ALL RIGHT, THANK YOU.

UM, YES.

MY NAME IS LAUREN ICE.

I'M HERE TO SPEAK.

UM, UM, RELATED TO ITEM THREE REGARDING THE AIRPORT COMMUNITY BENEFITS REPORT.

UM, AND I'M SPEAKING TODAY ON MY INDIVIDUAL CAPACITY AS A RESIDENT OF DISTRICT ONE.

UM, I WANTED TO SAY THAT I APPRECIATE, UM, Y'ALL FOLLOWING UP ON SOME OF THE COMMITMENTS THAT WERE MADE REGARDING THE AIRPORT BACK IN MARCH AND APRIL WHEN COUNCIL MEMBER FLINT LED THE EFFORTS TO REQUIRE ALTERNATIVE LOCATIONS FOR THE NEW JET FUEL TANK FARM.

BUT I DO HAVE A FEW CONCERNS ABOUT THE REPORT THAT I'D LIKE TO NOTE FOR THE RECORD.

UM, FIRST MY UNDERSTANDING IS THAT THIS, THIS REPORT WAS IN LARGE PART A RESPONSE TO THE COMMUNITY OUTCRY OVER THE TANK FARM AND WHAT I WOULD DESCRIBE AS A BROKEN PROCESS, UM, CONSIDERING THAT IT WAS APPROVED WITH ZERO COMMUNITY ENGAGEMENT.

AND I THINK MOST FOLKS AGREED AT THE TIME THAT IT WAS A BROKEN PROCESS.

AND SO, WHILE UNAID FOLKS AWARE OF THE DRAFT REPORT AND THE MEETING TODAY, UM, WE DIDN'T FIND OUT ABOUT IT UNTIL FRIDAY EVENING.

AND THIS IS, YOU KNOW, THANKSGIVING WEEK.

AND I UNDERSTAND EVERYONE'S BUSY, BUT I HOPE THAT YOU'RE PLANNING ANOTHER MEETING WITH THE COMMUNITY, DISCUSS THE DRAFT REPORT, CONSIDER ABOUT COMMUNITY BENEFITS.

UM, I THINK THE COMMUNITY WILL HAVE A LOT OF THOUGHTS THAT COULD HELP MAKE A FINAL REPORT A LITTLE MORE VALUABLE AND, AND USEFUL.

[00:05:01]

UM, AND THE SECOND THING I WANTED TO DISCUSS WAS THE PURPOSE OF THE REPORT.

THE OBJECTIVES THAT ARE POSED IN THE REPORT REALLY SEEM TO BE WHETHER THE AIRPORT TENANTS ARE MEETING THE AIRPORT'S MINIMUM DEVELOPMENT STANDARDS, AND HOW THE AIRPORT IS PERFORMING ON CERTAIN COMMUNITY BENEFIT ME BENEFITS METRICS COMPARED TO OTHER AIRPORTS.

UM, REGARDING THE MINIMUM STANDARDS, I DON'T FEEL LIKE THIS IS THE APPROPRIATE METRIC FOR US TO BE USING.

I DON'T KNOW THAT IT'S A PARTICULARLY USEFUL ONE TO EXAMINE.

FOR EXAMPLE, WHAT HAPPENED WITH THE TANK FARM WAS THE PROB THE EXACT PROBLEM WAS THAT THE AIRPORT ONLY MET THE MINIMUM STANDARDS.

THE MINIMUM STANDARDS DID NOT INCLUDE ADEQUATE COMMUNITY ENGAGEMENT IN ORDER DO THEY INCLUDE ANY KIND OF ENVIRONMENTAL JUSTICE COMPONENT.

AND THAT WAS THE PROBLEM, WAS THAT THE MINIMUM STANDARDS WERE JUST NOT GOOD ENOUGH.

UM, AND ALONG THOSE SAME LINES, UM, WHEN THIS WAS RAISED, THE PUBLIC FELT LIKE THERE WAS VERY LITTLE OVERSIGHT OF THE PRIVATE ACTORS, THE PRIVATE ACTORS WHO WERE USING THE AIRPORT PROPERTY, AND THAT OUR AIRPORT IS ACTING LIKE IT'S MORE ACCOUNTABLE TO THOSE PRIVATE ACTORS THAN IT IS TO THE PUBLIC.

AND THIS REPORT RELIES HEAVILY ON INFORMATION PROVIDED BY THE AIRPORT.

AND I THINK THERE ARE OTHER BETTER SOURCES OF THIS INFORMATION, PARTICULARLY IF WE'RE ASKING THE RIGHT QUESTIONS.

UM, AND I THINK THAT THE MORE IMPORTANT QUESTION FOR THIS REPORT TO GET AT WILL BE NOT AT HOW THE AIRPORT COMPARES NECESSARILY TO WHAT HAPPENS AT OTHER AIRPORTS, ALTHOUGH I DO THINK THERE IS REALLY SOME REALLY VALUABLE INFORMATION ON THAT POINT.

BUT REALLY THE BETTER QUESTION IS HOW THE AIRPORT COMPARES TO WHAT THE COMMUNITY NEEDS AND WHAT THE COMMUNITY.

AND SO, IN CLOSING, I WOULD JUST, UM, URGE YOU TO PROVIDE THE COMMUNITY AN OPPORTUNITY TO HELP REFINE SOME OF THE METRICS IN THIS REPORT.

AND AT THE SAME TIME, UM, URGE YOU NOT TO LET THIS REPORT BE AN OBSTACLE TOWARD ACHIEVING REAL CHANGE THAT'S NEEDED RIGHT NOW.

FOR EXAMPLE, ONE OF THE THINGS THAT WAS MENTIONED IN THE COMMUNITY BENEFITS PROGRAM THAT OTHER AIRPORTS ARE DOING IS FUNDING FOR HEALTH, ENVIRONMENTAL, AND AIR QUALITY STUDIES.

UM, AND AIR MONITORS ARE SOMETHING THAT THE COMMUNITY'S BEEN ASKING FOR NOW.

AND THIS SHOULD BE SOMETHING THAT COULD BE HAPPENING NOW, UH, BEFORE ANY MORE CONSTRUCTION GETS STARTED AT THE AIRPORT PROPERTY.

SO, UM, WITH THAT, I'LL JUST SAY, I HOPE YOU GUYS PUT THIS ON A, ON A NEW AGENDA.

I HOPE YOU DO, UM, MORE OUTREACH TO THE COMMUNITY ON THIS ITEM.

UM, THANK YOU VERY MUCH FOR YOUR TIME.

THANK YOU, MS. SEIS.

WE'LL SPEAK TO THIS ITEM WHEN IT, UM, COMES UP A LITTLE BIT, A LITTLE BIT MORE ON, ON WHAT A SPECIAL REPORT MEANS AND, AND, AND, AND WHERE THIS FITS INTO OVERALL EFFORTS TO ADDRESS THE CONCERNS, MANY OF THE CONCERNS THAT, INCLUDING THOSE YOU RAISED.

UM,

[1. Approve the minutes of the Audit and Finance Committee meeting of October 19, 2022.]

WE HAVE, UM, FIRST ON OUR AGENDA IS TO APPROVE THE MINUTES.

I HAVE A MOTION TO APPROVE THE MINUTES.

COUNCIL MEMBER FUENTES MAKES THAT MOTION SECONDED BY COUNCIL MEMBER KELLY, ALTHOUGH IN FAVOR, IT'S UNANIMOUS WITH THE FULL COMMITTEE HERE ON THE DIAS OR VIRTUAL.

OKAY.

ITEM, UM, NUMBER TWO

[2. Presentation of the Cold Weather Shelters and Hot Weather Cooling Centers Audit.]

IS THE PRESENTATION OF THE COLD WEATHER SHELTERS AND HOT WEATHER COOLING CENTERS AUDIT.

UM, WE ARE GONNA POSTPONE THIS IF THERE'S NO OBJECTION TO THE DECEMBER 13TH MEETING.

OBJECTION.

SURE, GO AHEAD.

OBJECTION ON MY END.

BUT I DO, YOU KNOW, I WANNA HIGHLIGHT YOU THIS WEEK WE'VE EXPERIENCED SOME, SOME COOLER, SOME COLD WEATHER.

AND, UH, JUST WANNA HIGHLIGHT THE IMPORTANCE OF HAVING, UM, THIS INFORMATION PRESENTED TO COUNCIL.

IT IS ON US TO ENSURE THAT WE HAVE AN INCLEMENT WEATHER, RESPON INCLEMENT WEATHER SYSTEM PLAN, UH, AND RESPONSE EFFORT COORDINATED FOR OUR UNHOUSED NEIGHBORS.

UM, THIS IS EXTREMELY TIMELY, AND I DON'T WANT US, I DON'T WANT TO SEE THIS FURTHER DELAYED.

UH, AND WE GET INTO THE WINTER MONTHS AND HAVE, UM, AND HAVE SOME IC CONDITIONS AND US NOT HAVE A PLAN IN PLACE.

WE CERTAINLY LEARNED A LOT FROM LAST YEAR'S WEATHER CONDITIONS, AND I JUST WANT US TO KEEP MOVING FORWARD ON OUR EFFORTS.

THANK YOU.

COUNCIL MEMBER FONTES.

COUNCIL MEMBER KELLY.

AND THEN COUNCIL MEMBER TOVO.

THANK YOU.

AND THANK YOU COUNCIL MEMBER FUENTES FOR YOUR, YOUR FEEDBACK ON THAT.

I'M IN THE SAME LINE OF THINKING AS YOU.

I WOULD JUST ASK THAT BETWEEN NOW AND OUR BRIEFING THAT THE C PIO REALLY WORK HARD TO, UM, ENSURE THAT OUR CITY HAS INFORMATION THAT THEY NEED IN BETWEEN NOW AND THEN SO THAT EVERYONE IS CONSIDERED WHEN WE MOVE FORWARD WITH OUR PLANS.

THANK YOU.

COUNCIL ELLO? YEAH, I, I SHARE THE CONCERNS AND I'D LIKE TO KNOW A LITTLE BIT MORE ABOUT WHY THE, WHY THE MANAGER REQUESTED POSTPONEMENT, BECAUSE ONE OF THE THINGS THAT HAPPENS IS, IS, UM, IN ADDITION TO WHAT COUNCIL MEMBER FRONTEST MENTIONED, WHICH IS THAT WE'RE IN THE COLD WEATHER SEASON, IT ALSO PREVENTS US IF SOME POLICY ACTION OR OTHER OTHER KIND OF ACTION OR DIRECTION THAT OUR, OUR COUNCIL WOULD NEED TO TAKE.

UM, IT PREVENTS US FROM DOING SO BECAUSE IT'LL HAPPEN AFTER OUR LAST COUNCIL MEETING OF THE YEAR.

SO CAN I, FROM THE CITY MANAGER, WHY THEY'VE REQUESTED A POSTPONEMENT? SURE, SURE.

WE HAVE MS. HERE, COUNCIL MEMBER OF VERONICA BRIO, ASSISTANT CITY MANAGER.

UH,

[00:10:01]

THE CITY MANAGER'S OFFICE REQUESTED THE POSTPONEMENT TO ALLOW US FOR, UH, ADDITIONAL TIME TO COORDINATE OUR RESPONSE.

THE AUDIT IMPACTS MULTIPLE DEPARTMENTS AS, AS Y'ALL ARE AWARE, AND WE WANTED TO MAKE SURE THAT WE WERE COORDINATING THAT RESPONSE THROUGH THE CITY MANAGER'S OFFICE, UH, TO THE AUDIT FINANCE COMMITTEE MEETING.

WE UNDERSTAND THE IMPORTANCE OF HAVING THIS BRIEFING SOONER THAN LATER, AND SO APPRECIATE THE, THE, THE GENEROSITY OF THE ADDITIONAL MONTH.

AND WE ARE COMMITTED TO COMING IN DECEMBER SO THAT WE CAN HAVE THIS DISCUSSION, UH, PRIOR OR AS WE'RE COMING INTO COLDER WEATHER.

UH, CERTAINLY UNDERSTAND THE PRIORITY FROM COUNCIL IN THAT REGARD.

UH, DIRECTOR, UH, SAM, UM, THE, THE CHALLENGE THOUGH IS THAT IF THERE'S ANY COUNCIL ACTION NEEDED IT, THERE WOULD LONG LACK BETWEEN THE TIME OF THE PRESENTATION AND WHEN THAT COUNCIL DIRECTION COULD HAPPEN.

SO, YOU KNOW, I'M NOT SURE, I'M NOT SURE WHETHER THE MANA THE CITY AUDITOR CAN GIVE US SOME SENSE OF, OF WHAT KINDS OF FINDINGS MIGHT HAVE BEEN IN THERE, OR WHAT KINDS OF OBSERVATIONS MAY HAVE THEY MAY HAVE MADE, UM, SO THAT WE CAN AT LEAST THINKING ABOUT, ABOUT THINGS THAT MAY REQUIRE CITY ACTION.

SO, COREY STOK, CITY AUDITOR, I THINK THAT WE HAVE, UM, DONE BRIEFINGS WITH SOME OF YOU AND WE CAN DO BRIEFINGS WITH OTHERS.

IF YOU WANT TO HEAR THE RESULTS OF THAT WORK.

UM, WE CAN CERTAINLY PROVIDE THE RESULTS.

I THINK WHAT WE, UM, WERE ALLOWING MORE TIME FOR IS THE RESPONSE TO THE RECOMMENDATIONS THAT ARE COMING OUT OF THAT.

SO WE'RE HAPPY TO SHARE THOSE, UM, AND WE CAN SET THAT UP WITH YOUR OFFICE IF YOU'RE INTERESTED.

THAT SOUNDS GOOD.

THANK YOU.

GREAT.

VICE CHAIR.

I WANNA JUST TO DOUBLE CHECK WITH ACM, UH, VERIO THAT, UM, THE FACT THAT, UH, STAFF HAS ASKED FOR ADDITIONAL TIME TO WORK ON RECOMMENDATIONS AND RESPONSES TO THIS AUDIT SOUNDS LIKE GOOD DUE DILIGENCE.

IT ALSO TELLS ME THAT STAFF IS AWARE OF THE AUDIT, WHAT THE FINDINGS ARE IN THE AUDIT, AND IS TAKING THEM SERIOUSLY AND CREATING A ROBUST RESPONSE TO THAT SO THAT WHILE THE DELAY IN, UH, DELIVERING THE REPORT, FINAL REPORT TO US, UH, IN AUDIT AND FINANCE IS A SIMPLY THE MINISTERIAL PIECE OF THAT.

BUT THE REST OF IT, WHICH IS THE ACTUAL, UH, PROGRAMMATIC OPERATIONAL AND IMPLEMENTATION PIECES, ARE THEY GOING AHEAD? ARE THEY PROCEEDING COUNCIL MEMBER? UH, THAT IS CORRECT.

WE ARE, ARE REALLY WANTING TO PROVIDE A ROBUST RESPONSE BECAUSE WE UNDERSTAND THE IMPORTANCE OF THIS.

WE ARE, UH, WE DO HAVE THE FINDINGS FROM THE AUDITOR, AND WE ARE TAKING THEM VERY SERIOUSLY AND WANTING TO MAKE SURE THAT WE'RE TALKING ABOUT EVERYTHING THAT WE'RE DOING, UH, IN RESPONSE.

UM, AND, AND OPERATIONALLY, WE ARE STILL MOVING FORWARD, OF COURSE, AS WE ANTICIPATE THE, UM, THE COLD SEASON COMING UPON US.

UM, THAT WILL NOT STOP OUR, OUR WORK IN THAT REGARD EITHER.

THANK YOU.

MM-HMM.

, THANK YOU.

UM, YOU KNOW, I TOO AM CONCERNED ABOUT MAKING SURE THAT WE HAVE THE RIGHT, UM, TOOLS IN PLACE AS WE, WE ENTER INTO OUR, OUR COLD WEATHER.

IT WAS MY UNDERSTANDING THAT THIS DELAY WAS GONNA ALLOW THEM TO REINFORCE AND REALLY, UM, YOU KNOW, COMES ALSO AT THE SAME TIME AS THEY HAVE TO PREPARE FOR IT FOR THAT SEASON.

SO WE WANTED TO MAKE SURE, UM, THAT THEY COULD DO BOTH THE PREPARATIONS AND THE RESPONSE TO, TO THE REPORT.

UM, SO I WAS COMFORTABLE WITH THIS.

WE CAN ALWAYS DO A SPECIAL CALLED MEETING, UM, IF WE NEED TO, UM, WE CAN PROVIDE DIRECTION OF SORTS AT OUR, AT OUR MEETING, UM, IN DECEMBER, UM, AS WELL.

UM, SO IF THERE ARE NO OBJECTIONS, WE'RE GONNA GO AHEAD AND POSTPONE THAT ITEM TILL THE DECEMBER 13TH MEETING.

THANK YOU MS. PEREZ, FOR, FOR JOINING US, UM, THIS MORNING.

ON THAT, WE WILL

[3. Presentation of the Airport Leases and Community Benefits Special Request report.]

NOW MOVE TO ITEM NUMBER THREE, WHICH IS THE PRESENTATION OF THE AIRPORT LEASES AND COMMUNITY BENEFITS SPECIAL REQUEST REPORT.

UM, AND MS. STOKES, BEFORE WE GET INTO THE DETAILS OF THAT, IF YOU COULD SPEAK TO WHAT A SPECIAL, THE PURPOSE OF A SPECIAL REPORT IS.

UM, THIS IS A REQUEST THAT, UH, COUNCIL MEMBER FUENTES AND I MADE.

WE DO NOT NORMALLY, UH, PRESENT A SPECIAL REQUEST AT THE COUNCIL MEETING.

SO IF YOU COULD SPEAK TO PROCEDURALLY WHAT, WHAT THIS INVOLVES, PLEASE, BEFORE.

ABSOLUTELY.

SO A SPECIAL REQUEST IS A TOOL AVAILABLE TO CITY COUNCIL.

WE NEED TWO PEOPLE ON CITY COUNCIL TO AGREE THAT THEY WANT US TO GO, UM, ANSWER SOME QUESTIONS.

MY STAFF HAVE A LOT OF RESEARCH SKILLS, UM, THAT CAN BE VALUABLE WHEN YOU HAVE A POLICY QUESTION OR YOU HAVE SOMETHING THAT YOU WANT MORE INFORMATION ABOUT, EITHER HOW THE CITY DOES SOMETHING OR HOW OTHER CITIES DO SOMETHING.

UH, SO IN THIS CASE, THAT'S WHAT WE WERE LOOKING AT.

SO IT IS DESIGNED TO ANSWER VERY SPECIFIC QUESTIONS.

WE TRY TO DESIGN IT IN A WAY THAT WE CAN DO IT FAIRLY QUICKLY, UM, AND GET THE INFORMATION BACK TO Y'ALL.

AND THE IDEA IS THAT IT'S INFORMATION THAT MY OFFICE CAN PROVIDE TO HELP INFORM, UM, DECISIONS, UH, THAT YOU NEED

[00:15:01]

TO MAKE OR, OR TO HELP INFORM YOU ABOUT, UM, WAYS THE CITY OPERATES, UM, THAT MAY BE DIFFERENT, UM, OR THAT, THAT MAY REQUIRE SOME KIND OF, UH, MORE IN DEPTH RESEARCH THAN, UM, Y'ALL CAN DO IN A LIMITED TIME YOU HAVE AVAILABLE WHEN NOT, UH, DOING THE REST OF YOUR JOB.

SO THAT'S THE IDEA BEHIND THE SPECIAL REQUEST.

AND THAT'S WHY THIS DOES ANSWER SPECIFIC QUESTIONS.

I UNDERSTAND IT SOUNDS LIKE THERE ARE SOME COMMUNITY QUESTIONS THAT GO BEYOND THE KIND OF QUESTIONS ASKED IN THE SPECIAL REQUEST.

CERTAINLY WE COULD HANDLE THOSE WITH A FUTURE SPECIAL REQUEST, UM, SHOULD THE COUNCIL WANT TO DO THAT, BUT REALLY, UM, WE'RE TRYING TO PROVIDE YOU ALL WITH SOME INFORMATION TO HELP INFORM NEXT STEPS.

BUT THANK YOU.

AND, AND I JUST WANNA UNDERSCORE IT IS NOT AN AUDIT.

UM, WE DON'T HAVE TO DO ANY, WE DON'T TAKE ANY ACTION.

UM, WE ARE PROVIDING THIS AS AN ADDITIONAL FORUM, UM, TO DAYLIGHT SOME OF THE ISSUES.

UM, BUT IT IS, IT IS, AS THE AUDITOR MENTIONED, A WAY FOR US TO GET ADDITIONAL INFORMATION.

I DIDN'T WANNA SPEAK FOR COUNCIL MEMBER FUNDIS, BUT I'LL JUST SPEAK FOR MYSELF.

I THINK THIS IS ONE PIECE OF EFFORTS WE'RE TAKING, UM, TO BETTER UNDERSTAND HOW WE CAN MEET, UM, THE COMMUNITY OBJECTIVES VIS-A-VIS THE AIRPORT AS WE EXPAND.

UM, AND, AND SO WE CAN GO AHEAD WITH THE PRESENTATION.

AND I, I WOULD SAY THE OTHER THING, AND I THINK YOU MENTIONED THIS, IS THAT WE DON'T USUALLY PRESENT THESE, WE DO PRESENT THEM IF ASKED, UM, WE WILL PRESENT THEM TO AUDIT FINANCE, BUT WHAT USUALLY HAPPENS IS, UM, WE RELEASE THEM TO THE REQUESTERS, WE WAIT A COUPLE OF DAYS AND WE RELEASE THEM TO THE FULL COUNCIL AND THE PUBLIC.

SO AS OUR GENERAL PROCESS, UM, WE DON'T NECESSARILY PRESENT THEM, BUT THIS SEEMED LIKE A GREAT OPPORTUNITY, UH, TO SHARE THE RESULTS OF OUR WORK.

SO, UM, OLGA OF TCO WAS THE MANAGER ON THIS PROJECT.

HENRY TUMO WAS THE LEAD.

UH, AND JAKE PERRY WILL BE MAKING THE PRESENTATION TODAY, SO HE'S GONNA TAKE MY PLACE HERE.

SEE.

HELLO.

CAN EVERYBODY HEAR ME? ALL RIGHT, RESUME.

OKAY.

GOOD MORNING.

MY NAME'S JAKE PERRY.

I'M ONE OF THE AUDITORS WHO WORK TO FILL THIS SPECIAL REQUEST ON AIRPORT LEASES AND COMMUNITY BENEFITS.

UM, DOES THIS WORK? OKAY.

UM, SO OUR AOS AIRPORT COVERS A LITTLE OVER 4,200 ACRES OF LAND.

UM, AND OF THAT LAND, A LITTLE OVER 300 ACRES ARE LEASED OUT TO VARIOUS VENDORS.

THESE VENDORS INCLUDE EVERYONE FROM CONCESSIONARIES TO FIXED BASE OPERATORS, TEXAS NATIONAL GUARD, UH, ET CETERA.

UM, AUS AIRPORT ALSO HAS PLANS TO EXPAND OVER THE NEXT 20 YEARS.

UH, IN A REVIEW OF THE LEASE LAND, WE FOUND THAT OVER THE PAST 10 YEARS, THERE WERE 40 ACTIVE LEASES, OF WHICH 31 OF THOSE ARE STILL CURRENTLY ACTIVE.

UH, WE ALSO REVIEWED THE LEASES TO SEE IF ANY OF THEM CONTAINED ANY EXPLICIT PROVISIONS THAT EXEMPTED TENANTS FROM COMPLIANCE WITH THE AIRPORT RULES OR THE AIRPORT MINIMUM STANDARDS.

UM, FOR A LITTLE BIT OF CONTEXT, THE AIRPORT RULES PERTAIN TO THE ORGANIZATION OF THE AIRPORT.

THEY'RE TO ENSURE THAT EVERYTHING MOVES ON EFFICIENTLY AND THAT CUSTOMERS HAVE A GREAT CUSTOMER EXPERIENCE.

UM, WHEREAS THE MINIMUM STANDARDS ARE ABOUT THE CONSTRUCTION OPERATION AND MAINTENANCE OF FACILITIES ON THE AIRPORT LAND.

UM, AND WE FOUND TWO EXPLICIT EXEMPTIONS FROM THE AIRPORT, MINIMUM STANDARDS AND NO EXEMPTIONS FROM THE AIRPORT RULES.

UM, THE TWO OF THE TWO EXEMPTIONS WE FOUND, THE FIRST WAS FOR A PRIVATE HANGAR OPERATOR TO CONSTRUCT A FUEL TANK.

AND THE SECOND WAS NOT NECESSARILY AN EXEMPTION FOR SPECIFIC PURPOSE, BUT IT WAS A PROVISION THAT SAID IF THE LEASE WERE TO CONFLICT WITH THE MINIMUM STANDARDS THAT THE LEASE WOULD OVERRIDE AND CONTROL.

UH, WE ALSO REVIEWED THE LEASES TO, PARDON? SHOULD YOU MAYBE TALK LOUDER? OH, YEAH, SURE.

OR TURN, YEAH, FIX THAT MIC.

SO IT PICKS UP BETTERS.

I MISSED WHAT YOU JUST SAID ABOUT THE, UM, THE TWO LEASES THAT WERE THE TWO EXEMPTIONS NOT IN COMPLIANCE.

YEAH, YEAH, YEAH.

THE TWO EXCEPTIONS.

THE FIRST WAS FOR A PRIVATE HANGAR OPERATOR TO CONSTRUCT A FUEL TANK.

UM, AND THE SECOND WAS A PROVISION THAT SAID THAT IF THE MINIMUM STANDARDS WERE TO CONFLICT WITH THE LEASE, THAT THE LEASE WOULD OVERRIDE AND CONTROL.

UH, WE ALSO REVIEWED THE LEASES TO SEE IF ANY OF THEM WOULD HINDER THE AIRPORT'S ABILITY TO BE SELF-SUSTAINING, SELF SUSTAINABILITY.

IN THIS CONTEXT, IT'S NOT ENVIRONMENTAL, IT'S FINANCIAL.

IT'S TO MAKE SURE, AT LEAST HOW THE FAA JUST FINDS IT, UM, IS THAT THE AIRPORT CAN MAXIMIZE THE USE OF ITS RESOURCES IN THIS CASE LAND, AND THEN THE LEASE REVENUE THAT COMES OFF THE LAND.

UH, WE FOUND THAT AUS LEASES ARE ALL BASED ON HISTORICAL RATES, WHICH ARE INSCRIBED IN THE INITIAL LEASE.

UM, THEY DO HAVE PROVISIONS FOR PERIODIC ESCALATIONS, THOUGH.

UM, THE, WE ALSO FOUND TWO SPECIFIC LEASES THAT CHARGE NOMINAL RATES OF $1 PER ACRE.

THOSE ARE TO THE TEXAS NATIONAL GUARD AND THE STATE OF TEXAS.

THAT'S PRETTY NORMAL.

BUT THE FAA DOES RECOMMEND THAT ALL LEASES FOLLOW FAIR MARKET VALUE.

UH, THE FAA ALSO RECOMMENDS THAT A STUDY BE CONDUCTED TO DETERMINE FAIR MARKET VALUE BY THE AIRPORT.

UM, AND AIRPORT MANAGEMENT HAS INFORMED US THAT THEY'RE CURRENTLY IN THE PLANNING PHASE OF SUCH A STUDY FOR THEMSELVES.

UM, OUTSIDE OF LEASES, WE ALSO LOOKED AT HOW THE AIRPORTS IN OTHER CITIES AND IN AUSTIN SUPPORT THE COMMUNITIES AROUND THEM.

UM,

[00:20:01]

TO START OFF WITH DIRECT BENEFITS PROVIDED TO THE COMMUNITY, UM, WE IDENTIFIED FOUR MAJOR CATEGORIES OF EDUCATIONAL COLLABORATION, TARGETED HIRING, SMALL BUSINESS PROMOTION, AND GREEN BUILDING, UM, THAT WERE PRETTY COMMON IN THE A OR THE EIGHT AIRPORTS WE SURVEYED.

UM, WE FOUND THAT AUSTIN ALREADY HAS EDUCATIONAL COLLABORATION IN GREEN BUILDING WITH SMALL BUSINESS PROMOTION UNDERWAY.

UM, AIRPORTS ALSO HAD UNIQUE PROGRAMS THAT THEY WOULD DO.

AUSTIN, FOR EXAMPLE, HAS A FOOD ASSISTANCE PROGRAM THAT WITH A UNIQUE, UH, JFK HAS A BUSINESS INCUBATOR PROGRAM THAT OFFERS BUSINESS CONSULTANCY SERVICES.

THAT WAS ALSO PRETTY UNIQUE, JUST FOR SOME EXAMPLES.

WE ALSO LOOKED AT WHAT MITIGATING MEASURES AIRPORTS OFFER TO THEIR COMMUNITIES.

CAUSE, YOU KNOW, LIVING NEAR AN AIRPORT, IT CAN BE NOISY, IT CAN BE KIND OF INDUSTRIAL.

UM, WE FOUND THAT COMMUNITY CONSULTATION WAS VERY COMMON ACCORDING TO THE MATERIALS THAT WE OBTAINED.

UM, WITH EVERY AIRPORT WE SURVEY, DOING SOME SORT OF BACK AND FORTH WITH THE COMMUNITY RELATED TO EXPANSIONS, UM, WITH NOISE CONTROL, ENVIRONMENTAL PROTECTION, NIGHTTIME DEPARTURE RESTRICTIONS, AND OTHER LAND USE PROGRAMS BEING PRETTY COMMON.

WE ALSO LOOKED INTO WHAT, UH, AIRPORTS HAD COMMUNITY BENEFITS AGREEMENTS.

UH, A COMMUNITY BENEFITS AGREEMENT OR A CBA IS A FORMAL GUARANTEE OF SPECIFIC BENEFITS AND MITIGATING MEASURES TO A COMMUNITY WHILE AN AIRPORT CONDUCTS A SPECIFIC EXPANSION.

UH, OF THE EIGHT AIRPORTS WE LOOKED AT ONLY JFK AND LAX HAD ACTIVE OR RECENTLY ACTIVE CBAS.

UM, THE PROGRAMS THAT WERE IN CBAS WERE SOMETIMES UNIQUE.

THERE WERE SOMETIMES NEW PROGRAMS THAT WERE BROUGHT TO LIFE THROUGH A CBA, BUT MOST OF THE TIME IT WAS SIMPLY A GUARANTEE OF EXISTING OR SPECIFIC BENEFITS, UM, FOR A SPECIFIC EXPANSION.

LAST, WE ALSO LOOKED AT HOW AIRLINE CARRIERS SUPPORT NEARBY COMMUNITIES.

WE SURVEYED THE SEVEN MOST FREQUENT FLYERS TO AUS AIRPORT, UM, AND LOOKED AT WHAT BENEFITS THAT THEY OFFER TO THEIR COMMUNITIES.

UM, THE BIG CAVEAT HERE BEING THAT THEY PROVIDE THESE BENEFITS TO AIRPORTS WHERE THEY OPERATE A HUB.

AND AUSTIN CURRENTLY DOES NOT OPERATE A HUB FOR ANY OF THESE AIRLINES.

SO THESE ARE WHAT THEY OFFER IF WE WERE TO ENTER INTO A PARTNERSHIP LIKE THAT.

AND THAT CONCLUDES A REPORT.

THANK YOU ALL, AND WE'D BE HAPPY TO ANSWER ANY QUESTIONS.

THANK YOU.

UH, COUNCIL MEMBER FUENTES, THIS IS YOUR REPORT.

DID YOU WANNA ASK QUESTIONS FIRST? THANK YOU.

UM, THANK YOU SO MUCH, COLLEAGUES.

AS Y'ALL KNOW, THIS REPORT CAME ABOUT FROM A REQUEST TO BETTER UNDERSTAND HOW AIRPORTS, UM, OPERATE AND, UH, WELL, ONE TO UNDERSTAND LAND USE, UH, AGREEMENTS AND LAND LEASES ON OUR AIRPORT.

AND THEN TWO, BETTER UNDERSTAND HOW AIRLINES, UM, SUPPORT AND INVEST IN SURROUNDING COMMUNITIES AROUND THE AIRPORT.

AND SO THIS REPORT WAS EXTREMELY HELPFUL.

I WANNA APPRECIATE STAFF'S, UM, FINDINGS.

AND, AND I KNOW WE HAD THE CHANCE TO MEET WITH STAFF PREVIOUSLY TO DISCUSS THE FINDINGS.

UM, AT THIS TIME, I JUST WANTED, I JUST HAVE ONE QUICK QUESTION, UM, OR TWO QUESTIONS I WANTED TO CLARIFY.

YOU SAID THAT THE AIRPORT DID SAY THAT THEY WERE WORKING ON A MARKET STUDY? YES, MANAGEMENT INFORMED IS THAT THEY'RE IN THE PLANNING PHASE OF A MARKET STUDY PLANNING PHASE OF A MARKET STUDY.

THAT IS CERTAINLY SOMETHING THAT I WILL FOLLOW UP WITH OUR AVIATION LEADERS.

UM, I THINK IT'S IMPORTANT, ESPECIALLY KNOWING THAT MANY OF OUR, UH, OUR LAND LEASES ARE NOT AT, AT MARKET AT THIS POINT, AND THAT THEY'RE USING HISTORICAL RATES.

AND THAT THERE'S A LOT OF IMPROVE, A LOT OF WORK TO DO ON THAT END.

THAT IS SOMETHING THAT I WILL CONTINUE TO PRESS FOR, TO ENSURE THAT AS THE AIRPORT EXPANDS, THAT WE ARE, ARE DOING RIGHT BY OUR COMMUNITY AND, UM, BY OUR CONSTITUENTS.

AND THE OTHER QUESTION I HAD WAS ON THE LAST SLIDE, YOU, THERE WAS A, UM, YOU CAN PUT IT BACK UP TO THE LAST SLIDE, MAYBE IT WAS A SECOND TO LAST SLIDE.

UM, BUT THERE WAS, IT WAS THE CHART THAT HAD LAND USE PROGRAMS. LET ME ME SEE.

OOPS, SORRY.

IT WAS ON THIS ONE.

YEAH.

CAN YOU FURTHER EXPLAIN WHAT YOU MEAN BY LAND USE PROGRAMS AS PART OF THE YEAH, BUT THAT'S KIND OF THE BIG CATCHALL CATEGORY THAT WE MADE TO INCLUDE ANYTHING THAT INVOLVES LIKE CERTAIN BUILDING STANDARDS LIKE SAN JOSE, FOR EXAMPLE.

LIKE TRIES TO COORDINATE WITH BUSINESS OWNERS, RESIDENTIAL OWNERS TO MAKE SURE THAT LIKE THERE'S NOT BUILDING ABOVE A CERTAIN HEIGHT FOR CONVENIENCE AND STRUCTURAL INTEGRITY PURPOSES.

UM, THERE'S ALL KINDS OF OTHER THINGS THAT INCLUDE THAT.

UM, MAKING SURE THAT, FOR EXAMPLE, HOMELESS POPULATIONS ARE NOT TOO CLOSE TO HAZARDOUS AREAS OF THE AIRPORT.

THAT'S, IT IS JUST KIND OF A CATCH ALL TERM TO, FOR LOTS OF LIKE LAND USE PROGRAMS. OKAY.

OKAY.

THANK YOU.

UM, CERTAINLY WE WILL, WE'LL LOOK INTO, INTO THAT ISSUE FURTHER TO SEE IF THERE ARE ANY BEST PRACTICES THAT WE CAN PICK UP.

AS I MENTIONED EARLIER, THE AIRPORT IS UNDERGOING A MASSIVE EXPANSION PROGRAM AND SOUTHEAST AUSTIN IS AN AREA THAT'S EXPERIENCING TREMENDOUS GROWTH.

WE HAVE A LOT OF PEOPLE MOVING TO SOUTHEAST AUSTIN AND SOUTHEAST TRAVIS COUNTY.

SO I JUST WANNA MAKE SURE THAT, THAT WE'RE BALANCING THE NEEDS OF, OF BOTH.

UM, AND AGAIN, JUST COLLEAGUES JUST WANNA POINT OUT THAT THIS REPORT, THE SPECIAL REPORT WAS, IS AN EFFORT TO BETTER UNDERSTAND, UM, HOW WE CAN OPERATE AS A CITY THAT MANAGES OUR OWN AIRPORT.

AND SO I LOOK FORWARD TO

[00:25:01]

ADVANCING ADDITIONAL POLICY MEASURES.

UM, WORKING WITH OUR AVIATION LEADERS.

UM, THEY ARE ROLLING OUT A GREEN TEAM AND A COMMUNITY ADVISORY GROUP.

UM, THEY'RE FIRST HIRING, UH, THE FTE THAT WAS APPROVED IN THE LAST BUDGET CYCLE THAT WE PASSED, UM, WILL INCLUDE A FULL-TIME COMMUNITY ENGAGEMENT SPECIALIST.

AND ONCE THAT PERSON IS ON BOARD, THEY WILL THEN WORK WITH THE COMMUNITY IN DEVELOPING A COMMUNITY ADVISORY GROUP, UM, THAT WILL HAVE THESE CONVERSATIONS WITH OUR AVIATION TEAM AND WILL HELP ADVISE ON THE EXPANSION OF THE AIRPORT.

THANK YOU.

COUNCIL MEMBER FUENTES, UM, FOR THE LAND USE PROGRAMS THAT YOU JUST MEANT, HOW DID YOU COUNT THE AIRPORT OVERLAY PART? PARDON ME? HOW DID YOU COUNT THE AIRPORT OVERLAY HERE IN AUSTIN? BECAUSE WE HAVE A, WE HAVE A, WHAT WE CALL AN OVERLAY WITHIN OUR LAND DEVELOPMENT CODE THAT DOESN'T ALLOW CERTAIN THINGS WITHIN THE AREA NEAR THE AIRPORT.

UM, I THINK WE COUNTED THAT AS THIS ONE, HOLD ON ONE SECOND.

OLD GOENKA QUALITY, A SHORT COORDINATOR.

UH, SO I GUESS, UH, THE WAY WE COLLECTED AND ANALYZED THE INFORMATION IS, UM, WE ASKED THE AIRPORT STAFF TO UM, KIND OF SHARE THE PROGRAMS THAT THEY HAVE, UH, IN, UM, THAT ARE ACTIVE RIGHT NOW AND, UH, KIND OF HELP US CLASSIFY THEM.

AND, UM, I DON'T BELIEVE THAT WAS ONE OF THE PROGRAMS WHERE THEY CAN DEFINITIVELY SAY THAT, UM, WHAT'S HAPPENING.

I THINK THERE MIGHT HAVE BEEN SOME CHANGE OF LEADERSHIP AND KIND OF MISSING INFORMATION FOR THEM TO SPEAK TO THAT PROGRAM FOR US TO INCLUDE IT WITH A LEVEL OF CONFIDENCE THAT WE WANTED.

SO, WE'LL LOVE TO AGREE.

OKAY.

CAN YOU SEND US A LIST OF WHAT ARE THE LAND USE PROGRAMS THAT WERE CITED BY OTHER FOLKS SO WE CAN UNDERSTAND, UM, THOSE, BECAUSE I THINK THAT'S KIND OF A, A BUCKET OF THINGS, UM, THAT MAY BE USEFUL, UM, AS WE MOVE AS WE MOVE FORWARD.

YES, ABSOLUTELY.

WE'LL FILL UP WITH THAT DETAIL.

VICE CHAIR POOL, IF YOU COULD PUT SLIDE, UH, THE SLIDE BACK UP THAT WE WERE LOOKING AT BEFORE, UM, WHEN COUNCIL MEMBER FUENTES.

YEAH.

THERE.

SO THE MITIGATING, UM, MEASURES, I HAD A COUPLE OF QUESTIONS ON THE SLIDES WHERE IT SAYS THE RED X FOR AUSTIN FOR NIGHTTIME DEPARTURE RESTRICTIONS.

UM, I KNOW THAT FLIGHTS AND AT A CERTAIN TIME, LIKE SAY 1130 AT NIGHT OR MIDNIGHT, AND THEN THEY BEGIN AGAIN AROUND FIVE 30 IN THE MORNING.

SO WE HAVE EFFECTIVELY NIGHTTIME RESTRICTIONS.

AT LEAST THAT'S HOW IT LOOKS TO ME.

CAN YOU EXPLAIN WHY THERE'S A REDX FOR AUSTIN IN THAT BOX? I CAN, SURE.

SO HOW WE COUNTED IT, THAT'S KIND OF THE CASUALTY OF HOW WE'RE CHOOSING TO PRESENT THE INFORMATION.

UM, WE COUNTED SPECIFIC LIKE, OR LIKE RESTRICTIONS, LIKE RULES, HARD AND FAST RULES.

UM, THE AIRPORT DOES CLOSE AT NIGHT AND ALSO HAS AN INFORMAL AGREEMENT WITH AIRLINES AND NOT TO FLY IN PAST CERTAIN TIMES.

UM, BUT WE COUNTED FORMAL RESTRICTIONS.

SO THAT'S JUST KIND OF HOW WE CHOSE TO PRESENT THE INFORMATION.

BUT IN FACT, WE HAVE NIGHTTIME DEPARTURE RESTRICTIONS, NOT A FORMAL RULE.

OKAY.

SO TELL ME AGAIN YEAH, THE AIRPORT, THE AIRLINES DO STOP FLYING AT.

YEAH, SO, SO THE AIRPORT DOES CLOSE BETWEEN, IT'S LIKE MIDNIGHT TO FIVE OR MIDNIGHT TO SIX.

UM, AND AIRLINES HAVE AN INFORMAL AGREEMENT NOT TO FLY AT THOSE TIMES OR LATER.

UM, BUT THE WAY THAT WE COUNTED THE INFORMATION WAS WE COUNTED IF THERE WAS A SPECIFIC FORMAL RESTRICTION.

OKAY.

SO THE, SO AVIATION DEPARTMENT IS NOT TELLING THE AIRLINES THEY ARE RESTRICTED FROM FLYING, BUT THE AIRLINES KNOW THAT THE AIRPORT IS CLOSED RIGHT FROM MIDNIGHT TILL 5:00 AM.

UM, THAT SEEMS A LITTLE BIT OF A, OF A NUANCE, UH, WHERE THAT RED, UH, X TO ME SAYS THAT WE DON'T CARE ABOUT NIGHTTIME DEPARTURE AND WE'RE NOT RESTRICTING IT WHEN IN FACT AIRLINES ARE CLEAR THAT BETWEEN MIDNIGHT AND 5:00 AM UH, THE AIRPORT'S CLOSED.

SO IT, SO I, I TAKE EXCEPTION TO THAT BOX THERE.

UM, IF YOU COULD SCROLL DOWN TO THE NEXT ONE, TO THE NEXT SLIDE PLEASE.

UM, I THINK IT WAS THE NEXT SLIDE, WHICH IS THE SLIDE THAT TALKS ABOUT, OKAY.

THE COMMUNITY BENEFITS AGREEMENTS.

YEAH.

WHERE IS THAT CHART? THE NEXT ONE? UM, OH, THE COMMUNITY.

THERE'S COMMUNITY BENEFITS.

IT WAS THE HUBS.

WELL LET'S TALK ABOUT THE HUBS ISSUE.

UM, MY UNDERSTANDING IS THAT THESE AIRLINES HAVE ENTERED INTO A FINANCIAL AGREEMENT WITH THEIR, UH, IN ORDER WITH A CITY TO HAVE A HUB AT THE CITY.

UM, CAN YOU EXPLAIN WHAT IT MEANS FOR AN AIRLINE TO HUB OUT OF A CITY? UM, WE,

[00:30:01]

FROM THIS, I MEAN WE KNOW THAT THAT'S WHERE THE PLANS FLY INTO AND GO OUT OF, BUT THERE ARE FINANCIAL CONSIDERATIONS WITH REGARD TO A HUB.

AND THAT'S THE PIECE THAT I'D LIKE YOU TO FOCUS ON.

PLEASE.

UM, SO THAT IS OUTSIDE THE SCOPE OF WHAT AT LEAST I LOOKED AT IN THIS PROJECT.

SO I WOULD SAY THAT I'M NOT QUALIFIED TO SPEAK ABOUT THE FINANCIAL RAMIFICATIONS OF A HUB AGREEMENT.

UM, BUT THIS WOULD BE ONE OF THE BENEFITS OF ENTERING INTO ONE MY UNDERSTANDING AND MAYBE OUR, OUR CITY AUDITOR COULD RESPOND IS THAT THE FINANCIAL THERE, A CITY WILL GRANT CONCESSIONS TO AN AIRLINE FOR THE AIRLINE TO DESIGNATE THAT CITY AIRPORT AS A HUB.

SO THAT THE TRADE OFF THEN WOULD BE COMMUNITY BENEFITS COMING BACK TO THE CITY THAT HAS THE HUB.

SO THERE'S A GIVE AND TAKE FINANCIALLY BETWEEN THE AIRLINE AND THE CITY INVOLVED.

RIGHT.

AND I THINK THAT'S WHAT OUR RESEARCH IS SHOWING HERE.

WE DIDN'T GET IN DEPTH INTO WHAT IT MEANS TO BE A HUB OR WHAT IT COSTS TO BE A HUB OR YOU KNOW, WHAT, WHAT THE BENEFITS ARE ON EITHER SIDE FOR THE AIRLINE OR FOR US.

WHAT WE SAW WAS THAT AS WE LOOKED AT THESE VARIOUS AIRLINES, THEY WERE OFFERING, YOU KNOW, THESE BENEFITS, STUDENT COL SCHOLARSHIPS, UM, MILES, DONATIONS, LOTS OF NON-PROFIT INTERACTION.

CAUSE IT WAS IN THEIR HUB CITY.

SO I THINK WE IDENTIFIED, YOU KNOW, IN EACH AIRLINE HAS ONE OR MORE HUB SLASH HEADQUARTER CITIES.

THAT'S WHERE WE SAW THESE BENEFITS.

WE AREN'T NECESSARILY SEEING THESE BENEFITS IN AUSTIN BECAUSE WE ARE NOT, UH, A HUB OR HEADQUARTER CITY FOR ANY OF THESE AIRLINES.

SO I THINK IF WE WERE TO, UM, INVESTIGATE POTENTIALLY HAVING AUSTIN BE A HUB FOR AN AIRLINE, SHOULD WE, SHOULD WE DO THAT, WE WOULD NEED TO FIND OUT WHAT ARE THE FINANCIAL TRADE OFFS.

SURE.

IS THERE SUFFICIENT COMMUNITY BENEFIT COMING TO THE CITY, UH, TO UM, MAKE UP FOR WHATEVER TAX WAIVERS OR FEE WAIVERS OR SUBSIDIES OR JUST, UM, UH, FINANCIAL SUPPORT THAT THE CITY WOULD BE GIVING TO THE AIRLINE TO CREATE THE HUB? CERTAINLY NOT SOMETHING THAT WE LOOKED INTO THIS IN THIS REQUEST.

MY GUESS IS THAT THE AVIATION STAFF WOULD HAVE MORE INSIGHT ONTO THAT CUZ THEY, THEY WORK ON THESE KIND OF THINGS REGULARLY.

THANK YOU.

AND THEN MY LAST QUESTION WENT TO THE TARGETED HIRING PIECE, THE SLIDE THAT THAT'S ON, PLEASE.

THERE WAS A RED X FOR AUSTIN IN THAT BOX AS WELL AND I WANTED TO, UM, TO GET A LITTLE BIT MORE INFORMATION.

WHEN YOU TALK ABOUT TARGETED HIRING, ARE YOU TALKING ABOUT AVIATION STAFF? ARE YOU TALKING ABOUT VENDOR STAFF? ARE YOU TALKING ABOUT AIRLINE STAFF? WHICH, WHICH HIRING FOR WHICH STAFF? UM, SO THAT WOULD APPLY SPECIFIC.

SO HOW WE DETERMINED TARGETED HIRING WAS WE LOOKED AT IF THE CITY SLASH AVIATION DEPARTMENT HAD ANY SORT OF, UM, HIRING PROGRAM THAT TARGETED SPECIFICALLY PEOPLE OF UNDERREPRESENTED BACKGROUNDS THROUGHOUT THE ENTIRE CITY OR SPECIFICALLY PEOPLE FROM WHO LIVE AND WERE IN THE, LIKE IN THE AIRPORTS AROUND THE NEIGHBORHOOD ITSELF.

UM, FOR WHAT KIND OF WORK? FOR WORK WITH VENDORS OR WORKING AS AIRPORT STAFF THEMSELVES? NOT NECESSARILY FOR CONCESSIONARIES, NOT NECESSARILY FOR AIRLINE CARRIERS.

SO THE CHOICE OF VENDOR, THE VENDOR SELECTION, THERE WAS NO TARGET AT LOOKING FOR PEOPLE OR VENDORS WHO WERE UNDERREPRESENTED IN DIFFERENT CLASSES BASED UPON THE MATERIALS THAT WERE PROVIDED TO US BY THE AVIATION DEPARTMENT.

WE DID NOT FIND ANY ACTIVE PROGRAM.

OKAY.

AND OUR VENDORS, DO THEY, DO THEY CONTRACT DIRECTLY WITH THE AVIATION DEPARTMENT OR IS THERE, ARE THEY SUBCONTRACTORS FROM A LARGER, UH, CONTRACT? I AM NOT SURE HOW THAT WORKS.

I WOULD REFER YOU TO THE AVIATION DEPARTMENT OR MAYBE SOMEONE ELSE KNOWS.

MY UNDERSTANDING IS WE HAVE CONTRACTS WITH AN OVERARCHING ONE OR TWO, UH, LARGE NATIONAL CONCERNS WHO THEN SUBCONTRACT FOR THE VENDORS.

AND WE HAD SOME ISSUES WITH, UM, VENDORS AND THAT'S, AND, AND WHO WAS SELECTED AND WHO WASN'T SELECTED.

UM, I THINK IT WAS PRE PANDEMIC WHERE, UM, THE LIST OF WHO THE VENDORS WERE, WERE GOING TO BE, WHO GOT THOSE CONCESSIONS THROUGH SKY, SKY CHIEF, OR WHATEVER THE NAMES THAT I CAN'T REMEMBER.

SKY CHEFS.

YEAH.

AND THEN THERE'S ONE OTHER, UM, THERE WE HAD TO VOTE ON, ON THE NEW VENDOR CONCESSIONAIRE LINEUP.

BUT THIS WOULD MEAN THAT THE TARGETED HIRING REDX RELATES TO SKY CHEF AND CISCO OR WHOMEVER THE OTHER, UH, LARGE CONTRACTOR IS WHO THEN HIRES THE VENDORS UNDERNEATH.

IS THAT CORRECT? I'M, I'M SORRY, I'M NOT REALLY FAMILIAR WITH THAT DISTINCTION.

YEAH, I STILL DON'T UNDERSTAND.

IT'S A LITTLE COMPLICATED, THE RED X AND TARGETED HIRING, BECAUSE I THINK THERE'S A LIMIT TO WHO THE AVIATION DEPARTMENT IS ACTUALLY HIRING.

THEY'RE HIRING THEIR STAFF, THEY'RE NOT HIRING THE

[00:35:01]

CREW.

THE, THE TARMAC CREW.

LIKE WHEN, WHEN YOUR AIRLINE, YOUR, YOUR AIRPLANE IS WAITING FOR A GATE AND THE CREW HASN'T COME OUT CUZ THEY'RE NOT READY YET.

THAT'S NOT AVIATION, THAT'S THE AIRLINES CREW AND THEY ARE HIRING THAT, THAT PERSON.

UH, WE'RE NOT TALKING ABOUT THE VENDORS, THE CONCESSION STAFF, BECAUSE THOSE ARE SUBCONTRACTED.

SO I'M, I'M STILL KIND OF AT A LOSS, UH, TRYING TO UNDERSTAND AUSTIN HAVING A RED MARK IN TARGETED HIRING.

I WOULD SAY THAT BASED ON THE MATERIALS WE RECEIVED, WE LOOKED AT A VARIETY OF AIRPORTS, JFK, LAX, SAN JOSE THAT HAD SPECIFIC INITIATIVES THAT WERE TO HIRE PEOPLE FROM UNDERREPRESENTED BACKGROUNDS.

AND WE DID NOT RECEIVE INFORMATION FROM THE AVIATION DEPARTMENT ABOUT ANY SORT OF MAYBE AGREEMENT THEY WOULD HAVE WITH THOSE LARGER CONTRACTORS THAT YOU MENTIONED.

UM, BUT WE JUST DIDN'T FIND ANYTHING THAT, UM, WAS SIMILAR IN THAT WAY TO THOSE OTHER AIRPORTS.

OKAY.

I, I'M, I'M GONNA LEAVE THAT THERE.

I'M NOT SATISFIED WITH THAT ANSWER.

UM, MS. STOKES, UM, I THINK THERE WERE SOME QUESTIONS LEFT ON THE TABLE WITH REGARD TO AVIATION'S RESPONSE POTENTIALLY.

UM, IT SEEMS TO ME THAT THE JURISDICTION HERE FOR AUSTIN MAY BE MISSING OR AT LEAST, UH, THE FRAMING FOR WHETHER AUSTIN AVIATION DEPARTMENT ACTUALLY HAS THE JURISDICTION TO HAVE A, A FULLY FORMED AND ROBUST POLICY FOR, UM, DIVERSE HIRING LIKE WE DO THROUGHOUT THE CITY OF AUSTIN, WHERE WE MAKE GREAT PAINS AND GO GREAT, GREAT STRIDES TO ENSURE DIVERSITY AND INCLUSION.

UM, SO THOSE ARE, THOSE ARE MY CONCERNS, UM, TO THE AUDITOR ABOUT, ABOUT THE, UH, FINDINGS IN THIS PARTICULAR SPECIAL REPORT.

THANK YOU, CHAIR.

THANK YOU.

IF WE CAN TAKE THE SLIDE DOWN SO I CAN SEE ANY COLLEAGUES, COUNCIL MEMBER TOVA.

YEAH, I HAVE A, A FEW QUESTIONS.

UM, I WANNA HIGHLIGHT A COUPLE RELATED TO REAL ESTATE BECAUSE WE'VE BEEN HAVING KIND OF A ROBUST CONVERSATION AROUND THAT.

UH, IT LOOKS LIKE THE CITY AUDITOR, UH, THAT YOU'VE IDENTIFIED A COUPLE ISSUES THAT MAY NEED ATTENTION.

UM, ONE OF THEM IS THAT THERE ARE TWO AGREEMENTS THAT APPEAR TO HAVE PROVISIONS.

ONE IS WITH TEXAS, WITH THE STATE OF TEXAS.

ONE IS WITH THE NATIONAL GUARD, UM, THAT MAY, THAT MAY HAVE, UM, PROVISIONS EXEMPT OR COULD EXEMPT THE TENANTS FROM COMPLIANCE WITH THE AIRPORT'S MINIMUM STANDARDS.

AND IT LOOKS LIKE THE FAA HAS WEIGHED IN, UM, SUGGESTING THAT SOME OF THE INKIND INKIND EXPENSES MAY BE LOW.

UM, ALSO SAYS, THERE'S ALSO A FINDING THAT I'D LIKE YOU TO ADDRESS THAT SAYS, THE CITY ESTABLISHES LEASE RATES THAT ARE OUR RESPONSIBILITY UNDER FAA REGULATIONS IS TO MAXIMIZE REVENUE FOR THE AIRPORT.

YET IT SOUNDS AS IF THE AIRPORT'S NOT DONE MARKET STUDIES ANYTIME RECENTLY TO DETERMINE, TO DETERMINE FAIR MARKET VALUE AND THAT THE LEASE RATES CHARGED BY THE CITY ARE, WERE EXECUTED, MANY OF THEM MORE THAN 10 YEARS AGO.

AND THE LEASES WHEN THEY'RE UPDATED, APPEAR TO BE BASED HISTORICAL RATES RATHER THAN MARKET RATES.

AND SO, YOU KNOW, I WANNA HIGHLIGHT THIS COLLEAGUES BECAUSE WE'VE, WE'VE MULTIPLE TIMES OVER THE LAST COUPLE YEARS TALKED ABOUT, UM, CHANGES AND POTENTIALLY THE, THE IDEA OF HAVING SOME UPDATES TO OUR REAL ESTATE PROCESS.

UM, THE AIRPORT'S A LITTLE BIT OF A DIFFERENT, A DIFFERENT ENTITY, BUT IT, IT SEEMS LIKE SOME OF WHAT OUR AUDITOR HAS FOUND IS THAT THESE TWO NEED SOME OF, I DON'T KNOW IF MY COLLEAGUES WANNA, IF I SHOULD WAIT FOR MY COLLEAGUES COUNCILMAN PULLING COUNCIL OVER KATHY'S ASKED TO WAIT FOR YOU GUYS.

OKAY.

WAITING ON, ON.

ANYWAY.

IF OUR CITY AUDITOR COULD PLEASE ADDRESS THE FINDINGS THAT RELATE TO LEASES AT THE AIRPORT, SUGGESTING THAT THERE MAY NEED TO BE CHANGES THERE, BECAUSE AGAIN, OUR REQUIREMENTS UNDER THE FAA REGULATIONS IS THAT WE MAXIMIZE REVENUE, SO WE'RE CHARGING UNDER BEAR MARKET VALUE FOR THOSE LEASES.

WE'RE OUT OF COMPLIANCE WITH FEDERAL LAW, UM, IN ADDITION TO, YOU KNOW, POTENTIALLY NOT THE BEST STEWARDSHIP OF OUR, OUR PUBLIC ASSET.

SO I THINK TO, TO CHARACTERIZE THAT AS WHAT WE FOUND DURING THIS WORK.

SO ONE, REMEMBER, IT'S NOT A FINDING.

SO WE'RE NOT SAYING HERE'S WHAT YOU NEED TO FIX OR HERE'S A RECOMMENDATION TO FIX IT.

WE DO SEE THIS AS AN AREA THAT THE AIRPORT NEEDS TO TAKE SOME ACTION IN.

AND I THINK THEY ARE.

UM, I THINK THE MAIN THING IS THAT ON, FOR THOSE TWO LEASES, UM, WHERE WE DO, I THINK IT'S A DOLLAR PER ACRE WHERE WE HAVE KIND OF A LESS THAN MARKET VALUE, UM, ARRANGEMENT, WE ALSO RECEIVE, UM, WE HAVE OTHER BENEFITS THAT WE RECEIVE FROM THOSE ENTITIES.

SO THEY DO MAINTENANCE ON THE LAND AND THEY'RE, SO THERE ARE, UM,

[00:40:01]

IN THE, IN THE INFORMATION THAT WE SAW BETWEEN, WITH A DISCUSSION BETWEEN THE AIRPORT AND FAA, FAA KIND OF SAID, WE ARE OKAY WITH THAT, BUT AT SOME POINT YOU REALLY NEED TO LOOK AT ARE YOU GETTING AS MUCH.

SO I WOULD SAY IT'S NOT, YOU KNOW, COMPLETELY UNDER MARKET.

WE KNOW THAT WE GET SOME OTHER BENEFITS.

WE JUST HAVEN'T DONE THE EVALUATION OF WHAT THE LAND IS WORTH AND WHAT THE, UM, OTHER BENEFITS ARE WORTH AND HOW THOSE ADD UP TO, ARE WE GETTING AN OKAY DEAL ON THOSE? SO IT'S JUST A CLARIFICATION THERE.

SEE, I THOUGHT THERE WAS A COMMENT THAT WAS CITED IN THE REPORT THAT, UH, THE, IN INKIND, THE INKIND BENEFITS APPEARED TO BE LOW, THAT THE FAA HAD MADE A STATEMENT.

YES.

AND THAT IS WHAT THEY SAID.

AND THAT IS WHY THE INKIND, THAT THAT THERE IS A RECOGNITION THAT INKIND BENEFITS MATTER TOO.

CORRECT.

BUT THAT THEY APPEARED TO BE THAT THEY, THAT THE FAA HAD STATED THAT THOSE APPEARED TO BE LOW FOR ONE OF THE TWO TENANTS.

CORRECT.

AND I THINK THAT IS WHY THE AIRPORT HAS TAKEN ON, UM, LOOKING AT THAT KIND OF IN MORE DEPTH AND DOING THE TALLYING OF HOW MUCH ARE WE GETTING IN KIND, HOW MUCH ARE WE CHARGING FOR MILLION? THANK YOU.

AND WHAT, UH, WHAT IS IN YOUR CONVERSATIONS AT THE AIRPORT, WHAT DID THEY SAY THEIR PLANS WERE FOR ADJUSTING FOR THOSE? THE OTHER LEASES? I, I BELIEVE THAT THE EVALUATION BETTER REFLECT, UM, FAIR MARKET.

I BELIEVE THAT THE EVALUATION WAS COVERING ALL OF THE LEASES, NOT JUST THOSE TWO THAT KIND OF STAND OUT.

UH, BUT THE AIRPORT IS HERE AND OH, MISS YAF IS, MSF IS HERE.

AND, UM, I ALSO WANNA ASK FOR YOU TO, UM, VERY BRIEFLY, CUZ WE DO HAVE TO MOVE TO SOME OTHER ITEMS AS WELL, IF YOU COULD, UM, SPEAK SPECIFICALLY TO SOME OF THESE ISSUES THAT WERE RAISED IN, IN THIS REPORT THAT CONSTABLE REFU AND I REQUESTED, UM, SPECIFICALLY THE FAA FOLLOW UP PIECES WHICH RELATE TO THIS INKIND POINT THAT COUNCIL MEMBER TOVO, UM, IS RAISING.

AND THEN IF YOU WANNA SPEAK TO ANY OF THE OTHER ELEMENTS, I WOULD INVITE YOU TO DO THAT.

MAYOR PROTE, IF I COULD ALSO ASK, UM, DIRECTOR YAF TO SPEAK TO THE, TO THE IDEA OF THE COMMUNITY BENEFIT AGREEMENT AND WHETHER OR NOT WE HAVE, UM, THE ABILITY TO NEGOTIATE ONE, WHICH I THINK WOULD BE, WOULD REALLY IMPORTANT, ESPECIALLY TO MAKE SURE THAT WE HAVE PRACTICES, YOU KNOW, TO THE EXTENT THAT THOSE CAN IDENTIFY COMMUNITY GOALS AND SUPPORT COMMUNITY GOALS, I THINK IT'S VERY IMPORTANT THAT WE PURSUE ONE.

SO I'M NOT SURE, REMEMBER IF I UNDERSTOOD WHAT YOU WERE SAYING TO SUGGEST THAT, THAT WE MAY NOT HAVE JURISDICTION OVER THAT BECAUSE WE'RE NOT A HUB FOR SOME OF THOSE AIRLINES.

BUT IF DIRECTOR YAF COULD, COULD TALK TO THE LIABILITY OF, OF ENTERING INTO A COMMUNITY BENEFIT AGREEMENT, THAT WOULD BE REALLY USEFUL.

THANK YOU.

UH, COUNCIL MEMBER TAB.

I THINK THAT WAS ONE OF THE REASONS THAT WE WERE ASKING THE QUESTIONS WAS TO UNDERSTAND WHAT, WHAT THOSE OPTIONS ARE.

SO CERTAINLY APPRECIATE, UH, DIRECTORY OFF SPEAKING TO THOSE AS WELL.

YES.

UM, GOOD MORNING COUNCIL MEMBERS.

UM, THANK YOU FOR, UM, YOUR QUESTIONS TODAY IN THE, IN THE AUDITOR'S OFFICE WORK AND THE REPORT.

UM, THERE IS SEVERAL ANSWERS AND I ALSO HAVE A COUPLE OF MY STAFF MEMBERS ON TO SPECIFICALLY SPEAK TO CERTAIN POINTS ON THE AUDIT.

UM, BUT IN GENERAL, UM, JUST WANNA HIGHLIGHT THE TWO LEASES THAT WERE MENTIONED, UM, ARE SPECIFICALLY ONE WITH, UM, IT'S A 99 YEAR LEASE THAT WAS, UM, CONDUCTED WAY BEFORE WE TOOK OVER AND THAT WAS ACTUALLY, UH, WITH THE TEXAS NATIONAL GUARD.

AND THEN THE SECOND LEASE, UM, UM, IS ALSO WITH THE, UM, A GOVERNMENT CONTRACT.

SO THOSE TWO LEASES THAT ARE EXEMPTION OUT OF ALL THE ONES THAT WERE AUDITED WERE SPECIFICALLY WITH GOVERNMENT AGENCIES.

AND IT IS A COMMON PRACTICE FOR A LOT OF AIRPORTS WITH THIS TYPE OF AGREEMENT.

I WILL HAVE MU PATEL, WHO'S OUR CHIEF FINANCIAL OFFICER IN REVENUE TO SPEAK TO THAT AS FAR AS THE COMMUNITY BENEFITS.

ALSO, TRACY'S GONNA TALK ABOUT HOW THE AGREEMENTS HAVE TODAY COMMUNITY BENEFITS REQUIREMENT OF OUR LEASES.

UM, IN GENERAL, I WILL TALK SPECIFICALLY TO THE HUB QUESTION.

UM, SO FOR AN AIRLINE TO CHOOSE THE CITY OF AUSTIN AS A HUB, THAT'S A HUGE COMMITMENT FROM THEIR CORPORATE OFFICE WHERE THEY ARE INTO THEIR PLANNING FOR THEIR BUSINESS MODEL TO BE INTO CITY AND MAKE THAT COMMITMENT FROM THE FINANCIAL AS, UM, THE STAFFING, THE MAINTENANCE, UM, THE CREW, UM, HOUSING.

UM, SO THERE'S A LOT ACTUALLY THAT GOES INTO, BUT IT SPECIFICALLY TIES TO IS THE AIRPORT BEING USED HEAVILY AS A CONNECTING FOR THAT CARRIER TO CREATE THAT HUB, UM, DESIGNATION? SO RIGHT NOW, AUSTIN IS NOT, WE ONLY 15% OF OUR, ABOUT 15% OR 20% RECENTLY OF OUR PASSENGER IS CONNECTING.

UM, THE MAJORITY OF OUR PASSENGERS ARE ON D AND WE DO NOT HAVE ANY OF THE CARRIERS TODAY THAT ARE HUB DESIGNATION.

UM, THE DESIGNATION BELOW THAT WOULD BE A FOCUS CITY, WHICH DELTA HAS MENTIONED THAT AS A COUPLE OF TIMES.

UM, AND WE ARE CONTINUING TO WORK WITH THEM, BUT ALSO THE COMMITMENT FROM THE CITY AND THE AIRPORT TO MATCH SUCH SUCH A HUB ANNOUNCEMENT IS THE INFRASTRUCTURE AND THE, THE GATING AND

[00:45:01]

ACTUALLY THE, THE PASSENGER PROCESSING THAT WOULD AC UM, INCREASE OUR PASSENGER FOOTPRINT HEAVILY.

AND WE NEED TO BE READY FOR THAT COMMITMENT, UH, WHICH IS PART OF WHAT WE'RE WORKING ON ON THE EXPANSION.

HOWEVER, AS FAR AS THE COMMUNITY ENGAGEMENT FOR THE AIRLINES, UM, WE DO HAVE A, A LARGE LIST OF WHAT THE AIRLINES ARE ACTUALLY DOING AND HOW THEY'RE PARTICIPATING IN THE, IN THE COMMUNITY.

UM, IT IS NOT PART OF THAT REPORT, IT DID NOT COME OUT, BUT WE DO HAVE A, UM, AND I'LL HAVE NO SPEAK TO THAT QUICKLY HERE ABOUT SOME OF THE AIRLINES AND WHAT THEY'RE DOING FOR THE, THE COMMUNITY.

THE OTHER QUICK COMMENT SPECIFICALLY ON THE TARGETED HIRING, UM, IT'S ACTUALLY, IF YOU LOOK AT SOME AIRPORTS, IN SOME AIRLINES, WHAT THEY DO IS THEY WOULD GO IN AND TEACH SPECIFIC TECHNICAL, UM, JOB SKILLS SUCH AS AN, AN AIRCRAFT MECHANIC OR, OR CREATE SUCH A, UH, PROGRAM INTO A SCHOOL THAT'S NEARBY WHERE THE GRADUATES OUT OF THAT PROGRAM WOULD WORK FOR THE AIRLINES.

SO THAT'S KIND OF MORE OF A TARGETED HIRING SPECIFICALLY WITH THE AIRLINES.

BUT THE REST OF, UM, THE CONCESSION OR THE AIRPORT HIRING, WE DO THAT AND, AND WE HOLD JOB FAIRS TWICE A YEAR.

WE GO WITH THE INTERNSHIPS THAT WE HAVE WITH THE UT ACTUALLY ON THE MASTER'S LEVEL, UM, STUDENTS.

AND WE ALSO DO FROM THE HIGH SCHOOL INTERNSHIPS AND JOBS AND, UM, EDUCATION, HOW TO GET A JOB AT THE AIRPORT.

AND WE WORK WITH THEM.

SO THERE'S SEVERAL, SEVERAL LAYERS, BUT I THINK THE X IS SPECIFICALLY IN THAT TARGET HIRING IS WORKING ON THAT.

THEY DO A TRADING PROGRAM THAT GETS CREATED BY THE AIRLINES INTO SOME OF THE TECHNICAL SCHOOLS AROUND, SO THEY CAN HIRE 'EM BACK INTO THEIR, UM, AIRCRAFT MAINTENANCE OR, SO WE DO NOT HAVE A LARGE AIRCRAFT MAINTENANCE CLUB HERE EITHER IN THE, IN THE FOOTPRINT OF AUSTIN.

SO THAT KIND OF DOESN'T MATCH WITH WHAT THEY HAVE.

BUT AS FAR AS THE CUSTOMER SERVICE AND ALL THAT, THAT'S STUFF THAT WE WORK ON.

UM, SO I'LL LET TRACY JUMP ON TO TALK ABOUT THE COMMUNITY BENEFITS AND OUR LEASES AND AGREEMENTS.

AND THEN, UM, SORRY, GO AHEAD.

COUNCIL .

OKAY.

ALL RIGHT, GO AHEAD, TRACY.

HI, TRACY THOMPSON, UM, CHIEF OFFICER OF ADMINISTRATIVE AND EXTERNAL AFFAIRS FOR THE DEPARTMENT OF AVIATION.

SO WITH THE COMMUNITY BENEFITS PER SE, UM, AS, AS, AND AGAIN, IT'S, IT'S A, UM, JUST A DISTINCTION, BUT THE, UH, JFK AND THE LAX COMMUNITY BENEFITS PROGRAMS WE'RE A PART OF THEIR CAPITAL EXPANSION PROGRAM SPECIFICALLY.

AND SO, UM, WE HAVE SIMILAR COMMUNITY BENEFITS PROGRAMS AS A PART OF OUR A E D P AS WELL, WHICH IS MAKING SURE THAT OUR, OUR COMMUNITY IS NOT NOT IMPACTED BY OUR EXPANSION PROGRAM TO THE EXTENT POSSIBLE.

SO, UM, WHAT WE, WHAT I THINK THE GO FORWARD PLAN IS WITH THE ESTABLISHMENT OF THE GREEN TEAM AND OUR COMMUNITY ENGAGEMENT PROGRAMS THAT ARE, UH, ARE INITIATED AT THE BEGINNING OF 2023, I THINK THAT YOU'LL BE, THE DEPARTMENT OF AVIATION WILL BE ABLE TO DEMONSTRATE THE COMMUNITY BENEFITS NOT ONLY RELATED TO, UM, THE AIRPORT EXPANSION PROGRAM, BUT AS OUR BUSINESS AND COMMERCIAL TEAM STARTS PUTTING TOGETHER THEIR, UM, LAND USE, UH, PROGRAM CONSULTANT PROGRAM THAT WAS NOTED IN THE REPORT THAT YOU'LL BE ABLE TO SEE HOW WE CAN FOLD THOSE INTO ALSO OUR THIRD PARTY, UM, LEASES AND DEVELOPMENTS AS WELL.

SO AGAIN, THE JFK AND THE LAX COMMUNITY BENEFITS PROGRAM WERE RELATED TO EXPANSION, BUT YET THE, THE NUANCES IS TAKING IT DOWN INTO THIRD PARTY DEVELOPMENT AGREEMENTS AS WELL.

AND I APOLOGIZE, I'M GONNA GO BACKWARDS A LITTLE BIT JUST FOR CLARIFICATION ON, UH, COUNCIL MEMBER POOL'S COMMENT.

I BELIEVE IT'S COUNCIL MEMBER POOLS FOR REGARD TO THE, UM, THE LAND.

UM, AND THE, UH, AS YOU KNOW, WE HAVE THE AIRPORT OVERLAY ZONE, SO, UM, WE SHOULD, UM, NOTE IN ONE OF THOSE CHARTS, AND FORGIVE ME, I'LL LOOK AT WHERE THAT CHART IS.

AND THAT WAS ON THE LAND USE PROGRAMS. AS YOU KNOW, THE CITY HAS IT'S, UM, AIRPORT OVERLAY ZONE, WHICH IS, UM, IN THE DEVELOPMENT CODE, UH, SECTION 25 POINT 13 THAT'S VERY, VERY PRESCRIPTIVE AND SPECIFIC REGARDING LAND USES AROUND THE AIRPORT PROPERTY AND COMPATIBLE DEVELOPMENT.

THAT'S IN ADDITION TO OUR PART ONE 50 NOISE PROGRAM THAT IS CURRENTLY MONITORED.

UM, WE CAN GO INTO DETAILS ABOUT THAT OR I CAN ANSWER QUESTIONS ABOUT THAT, YOU KNOW, OFFLINE AT ANOTHER TIME.

SO, UM, I THINK THAT THERE ARE LAND PROGRAMS AND COMMUNITY BENEFIT PROGRAMS THAT THE DEPARTMENT OF AVIATION CURRENTLY HAS IN PLACE AND WE'LL AUGMENT AS WE MOVE FORWARD WITH OUR LAND LEASING POLICIES.

UM, THAT MO THAT IS, YOU KNOW, CAN SPEAK TO, UM, MOVING FORWARD FOR OUR LEASES.

SO THAT'S KIND OF A GENERAL ANSWER.

I WANNA BE RESPECTFUL OF THE TIME HERE, BUT WE'RE PLEASED TO PROVIDE MORE DETAILED INFORMATION ON THESE, UM, ELEMENTS.

UH, AS A FOLLOW UP AS, AND I PLEASE ANSWER ANY OTHER QUESTIONS, COUNCIL MEMBER TOVO, AND THEN I THINK WE NEED TO HEAR FROM MR. PATEL.

YEAH, SUPER SPEED ONE, UM, AGAIN, JUST LOOKING THE AUDITOR, IT TALKS ABOUT THE FACT THAT THE LEASE RATES MANY WERE EXECUTED MORE THAN 10 YEARS AGO.

THAT DOESN'T NECESSARILY, UM, THAT DOES NOT CONSTITUTE NON-COMPLIANCE, BUT IF THE CITY CHARGES LOW RATE, IT COULD IMPACT THE AIRPORT'S GOAL TO BE SELF-SUSTAINING.

AND IT TALKS ABOUT, UM,

[00:50:01]

RECOMMENDING THE APPRAISAL OF, OR PROPERTY AVIATION DEPARTMENT HAS SAID THAT, UM, WITH THE HELP OF REAL ESTATE, THEY ARE GOING TO CARRY OUT A RENT MARKET STUDY, WHICH WILL HELP INFORM BASELINE GROUND RENTAL RATES.

AND I JUST WANTED TO ASK AIRPORT STAFF, WHOEVER'S THE BEST PERSON TO ANSWER THIS, WHAT IS THE TIMELINE FOR CONDUCTING THAT APPRAISAL AND WHEN WOULD THE RULES BE AVAILABLE? YES, UH, COUNCIL MEMBER TOBA, MY NAME'S MOKI PATELLA.

I'M THE CHIEF OF BUSINESS AND FINANCE FOR THE AIRPORT.

THAT'S A GREAT QUESTION.

UM, AIRPORTS TYPICALLY AROUND THE SYSTEM, UH, AROUND THE NETWORK AND THIS IS MY FOURTH CITY, UM, ADMINISTERED AIRPORT THAT I WORKED FOR.

UM, TYPICALLY LAB RENTAL RATE STUDIES AND APPRAISALS, UM, HOLISTIC APPRAISALS OF AIRPORT PROPERTY ARE DONE EVERY FIVE YEARS.

AND THAT'S A GUIDANCE FROM THE FAA TO CONTINUE TO DO FAIR MARKET VALUE EVALUATIONS.

MOST LEASES AROUND THE COUNTRY HAVE PROVISIONS IN THERE THAT ALLOW FOR ADJUSTMENTS TO LONG TERM LEASES WITH FAIR MARKET VALUE ASSESSMENTS, AND YOU DO NOT HAVE TO CHARGE THE FAIR MARKET VALUE RATE.

YOU CAN, UH, ON A NEW DEVELOPMENT CHARGE, UH, A COMPETITIVE RATE OR SOMETHING HIGHER, UH, THAN THE BASELINE FAIR MARKET VALUE.

UM, HISTORICALLY THIS AIRPORT AND, AND IT GOES BACK TO THE 2014 AUDIT FROM THE FAA THAT WAS REFERENCED IN THE CITY AUDIT DEPARTMENT'S REFERENCED THAT, UM, WE WERE USING HISTORICAL RATES.

UM, AND THAT'S ANOTHER MECHANISM FOR FOR, FOR DOING THAT.

UM, WE HAVE COMMISSIONED, WE'VE BEEN WORKING, UH, MORE RECENTLY WITH THE OFFICE OF REAL ESTATE HERE WITHIN THE CITY TO LOOK AT LAND LEASES AND LOOK AT, UH, RENTAL RATES MOVING FORWARD.

UH, WE ARE WORKING ON A, A COMMERCIAL DEVELOPMENT PLAN, UH, A UTILIZATION PLAN OF THE NORTHEAST QUADRANT OF THE AIRPORT, UM, THAT SITS AROUND OUR MAINTENANCE FACILITY AND, AND IS LOOKING AT THAT HOLISTICALLY FROM THE CONVEYANCE THAT CAME FROM THE MILITARY, ALL OF THE, UM, ENVIRONMENTAL CHALLENGES THAT WERE CONVEYED TO THE AIRPORT REMEDIATION OF THOSE PRIOR TO DEVELOPMENT.

AND YOU CALCULATE THOSE AND YOU BUILD THOSE RATES IN, UH, TO SETTING WHAT IS, WHAT'S FAIR MARKET VALUE AND THEN WHAT IS THE APPRECIATED VALUE OF THAT LAND.

WE'LL BE DOING THAT, UH, WE'VE JUST KICKED OFF THAT STUDY FOR THE COMMERCIAL LAND USE PLAN AND WE PROBABLY WILL HAVE THAT IN ABOUT EIGHT TO 12 MONTHS FROM NOW.

THAT WILL INCLUDE NOT ONLY EACH PARCEL OF PROPERTY AND ITS HIGHEST TO BEST USE, UM, AERONAUTICAL VERSUS NON AERONAUTICAL.

AND IF THERE IS LAND THAT CAN BE COMMERCIALLY DEVELOPED, WE'LL LOOK AT ALL OF THOSE PARCELS WITH A RATE STRUCTURE AND IT'LL GIVE GUIDANCE TO THE TEAM ON HOW TO EVALUATE THOSE FORWARD IN A MATRIX FASHION.

UM, GOING BACK TO THE TWO LEASES THAT YOU MENTIONED, COUNCIL MEMBER TOVO ON THE, UM, THE NATIONAL GUARD LEASE AND UM, THE TEXTILE LEASE, BOTH OF THOSE WERE MEMORANDUMS OF UNDERSTANDING WHEN THE AIRPORT WAS OPENED 22 YEARS AGO, UH, WITH RELOCATING, UH, BOTH OF THOSE UNITS FROM MUELLER AIRPORT OUT TO BERGSTROM.

AND SO WE, UH, THE FA AUDIT DID ALSO SUGGEST THAT A CONTINUED EVALUATION OF THOSE COMMUNITY BENEFITS OF THE, WHAT WE CALL THE IN KIND SERVICES ARE EVALUATED WITH THE RENTAL RATE STRUCTURE.

AND UH, I WAS JUST TALKING WITH OUR DIRECTOR YF THIS MORNING ABOUT REEVALUATING ALL OF THOSE AND TAKING ANOTHER CURSORY REVIEW OF OVAS LEASES TO, TO BRING THOSE INTO, UM, A LEVEL OF STANDARD THAT WE FEEL COMFORTABLE FOR THE CITY.

THANKS FOR THAT RESPONSE.

NO WORRIES.

AND WE'RE, JUST TO BE VERY CLEAR, WAS THIS STUDY DONE FIVE YEARS AGO AS RECOMMENDED, OR THAT'S NOT BEEN THE PRACTICE HERE IN AUSTIN? IT HAS NOT BEEN THE PREVIOUS PRACTICE.

WE WILL BE IMPLEMENTING THAT MOVING FORWARD.

THANK YOU VERY MUCH.

THANK YOU.

AND I THINK, UM, AS WE MOVE FORWARD WITH THIS, IF YOU CAN, YOU KNOW, MAYBE PLAN IN THE NEW YEAR TO COME BACK TO US WITH SOME DETAILS ON UM, HOW YOU'RE ADDRESSING THE INKIND ISSUES, HOW YOU'RE ADDRESSING THE MARKET STUDY.

UM, AND MAYBE WITH SOME OPTIONS THAT WE HAVE, I'M SURE THAT, UH, COUNCIL MEMBER FU IS GONNA WANNA LOOK MORE DETAIL ABOUT THE COMMUNITY BENEFITS AGREEMENTS AS WE EXPAND AND, AND WHAT THAT CAN LOOK LIKE AND HOW WE DO THAT IN THE MOST CONSTRUCTIVE MANNER POSSIBLE.

WE WILL BE INVESTING BILLIONS OF DOLLARS, UM, IN THIS EXPANSION.

IT WILL HAVE AN IMPACT ON THE COMMUNITY.

UM, AND IF THERE ARE MODELS THAT WE CAN BE ADOPTING, I THINK WE WANNA DEFINITELY WORK WITH THE AIRPORT, UM, TO ADVANCE THOSE.

SO WE'LL PLAN ON THAT.

WE ARE NOW GOING TO NEED TO MOVE ON

[4. Briefing on the City’s Pension Systems.]

TO THE NEXT ITEM ON OUR AGENDA, WHICH IS ITEM FOUR, WHICH IS A BRIEFING ON THE CITY'S PENSION SYSTEMS. WEAVER .

[00:55:01]

GOOD MORNING.

OH, OKAY.

THERE WE GO.

THANKS.

SO GOOD MORNING.

UM, I'M BELINDA WEAVER.

I'M THE CITY TREASURER.

I SHOULD ALSO MENTION THAT I AM A TRUSTEE ON BOTH THE POLICE AND FIRE SYSTEM PENSION BOARDS, UM, FOR THE CITY.

AND I'M HERE TODAY TO PROVIDE THE ANNUAL UPDATE FOR THE, UH, CITY OF AUSTIN'S PENSION PLANS.

SO FIRST, UM, THE CITY OF AUSTIN DOES HAVE THREE EMPLOYEE BASED PENSION PLANS THAT I'M SURE YOU'RE AWARE OF.

UH, IT IS THE CITY OF AUSTIN'S EMPLOYEES RETIREMENT SYSTEM, THE AUSTIN POLICE RETIREMENT SYSTEM, AND THE AUSTIN FIREFIGHTERS RELIEF AND RETIREMENT FUND.

ALL THREE ARE DEFINED BENEFIT PLANS AND ALL THREE PLANS WERE CREATED BY STATE LAW.

SO STATUTE DOES GOVERN BENEFIT AND CONTRIBUTION PROVISIONS AND ANY CHANGES TO THAT LAW HAS TO BE MADE THROUGH THE STATE LEGISLATURE.

UM, EACH OF THE PENSION SYSTEMS DO HAVE AN INDEPENDENT BOARD OF TRUSTEES AND EACH OF THOSE BOARDS ARE OR HAVE A DIFFERENT COMPOSITION OF ELECTED OFFICIALS, MANAGEMENT APPOINTEES, EMPLOYEES AND RETIREES.

AND ON THE EMPLOYEES AND THE POLICE BOARD, THERE ARE CITIZEN AT LARGE TRUSTEES AS WELL.

NEXT SLIDE PLEASE.

SO AS FAR AS PENSION SYSTEM ELIGIBILITY FOR THE THREE SYSTEMS, THE EMPLOYEES RETIREMENT SYSTEM