[00:00:04]
[CALL TO ORDER]
COMMISSIONERS AND STAFF AND OUR AND GUESTS.WELCOME TO THE REGULAR MEETING OF THE AIRPORT ADVISORY COMMISSION.
IT'S JANUARY 8TH, 2025, AND I HAVE 3:01 PM HERE AT THE PERMITTING CENTER.
PRESENT ARE COMMISSIONERS ELLER, TODD, MIDAL YOUNG, UH, ROSE AND HENDRICKS.
OH, I DO SEE, UH, THERE WE GO.
I SEE UH, VICE CHAIR BROCK AND, UM, COMMISSIONER KON ONLINE.
UM, I DON'T BELIEVE THAT WE HAVE ANYBODY SIGNED UP FOR PUBLIC COMMUNICATION, IS THAT CORRECT? CORRECT.
[APPROVAL OF MINUTES]
SO WE'LL PROCEED TO, UM, THE APPROVAL OF THE MINUTES.DO I HAVE A MOTION TO APPROVE THE MINUTES OF THE REGULAR MEETING OF THE AIRPORT ADVISORY COMMISSION FROM DECEMBER 11TH, 2024? THANK YOU.
UM, SECRETARY ROSE, AND THANK YOU.
UM, COMMISSIONER HENDRICKS, ANY, UM, ANY CORRECTIONS OR COMMENTS TO THE MINUTES? UM, I MIGHT ASK IN THE MINUTES IF WE CHARACTERIZE THE FUTURE AGENDA ITEM CORRECTLY? UM, I THINK THAT I GOT AN ANSWER, UM, IF, IF, JUST FOR A MOMENT HERE, THE, THAT THE, THAT, UH, COMMISSIONER HENDRICKS AND I ASKED WHETHER THERE'S A CORRELATION BETWEEN THE NUMBER OF FLIGHT OPERATIONS AND TOWER STAFFING.
WE GOT THAT INFORMATION FROM, UH, RAJIV THOMAS, I BELIEVE GAVE US A CHART THAT SAYS, NOT REALLY.
SO, UM, BUT I DON'T REMEMBER IF THAT WAS OUR QUESTION AS A FUTURE AGENDA ITEM OR NOT, BUT, UM, YOU WANNA HELP ME THOUGHT IT, MY NOTES INDICATED THAT WE WERE, BASICALLY, IT BOILED DOWN TO IS THERE A CORRELATION BETWEEN THE STAFFING AND THE UPTICK IN CARGO, WAS WHAT I RECALL RIGHT NOW, WHAT WE PROVIDED, AND I, AND IT HAS NOT GONE TO THE FULL COMMISSION, BUT WHAT WE PROVIDED WAS A CHART THAT SHOWED THAT ACTUALLY CARGO OPERATIONS ARE DOWN.
WEIGHTS MAY BE UP, BUT, SO THAT, OH, THAT'S RIGHT.
THERE WAS NOT A DISTINGUISHABLE CORRELATION FROM THE DATA.
WE HAVE TO, TO DEMONSTRATE A CORRELATION BETWEEN THAT AND STAFFING.
SO IS A FUTURE AGENDA ITEM, BUT WE WILL COME TO US IN THE FUTURE.
WELL, IT WAS SORT OF, IT WAS A FUTURE AGENDA ITEM KIND OF POSED AS A QUESTION.
SO I SUBMITTED THE MATERIAL TO ANSWER THE QUESTION.
SHOULD HAVE SENT IT TO THE FULL COMMISSION, BUT WE, WE, WE CAN CIRCULATE THAT, NO PROBLEM.
IT WAS MORE OF A QUESTION, I THINK.
ALRIGHT, SO WE HAVE A MOTION AND A SECOND AND NO CORRECTIONS.
SEEING NONE, UM, WE WILL APPROVE.
ANY OKAY, EVERYONE COOL WITH THAT ONLINE? YOU GUYS OKAY? YEAH.
[2. Briefing on November 2024 Financial Results presented by Rajeev Thomas, Chief Financial Officer]
NUMBER OF STAFF BRIEFINGS TODAY AND A SPECIAL GUEST.UM, THE FIRST, OUR FIRST BRIEFING AGENDA ITEM TWO IS ON THE NOVEMBER, 2024 FINANCIAL RESULTS.
RAJIV THOMAS, CHIEF FINANCIAL OFFICER.
UM, SO I'LL START WITH THE NOVEMBER, UH, 2024 STATS, UH, FOR THE MONTH OF NOVEMBER.
UH, COMPARED TO THE PRIOR YEAR, UH, TOTAL PASSENGER TRAFFIC WAS DOWN ABOUT 7.4%.
UH, THE AVERAGE DAILY DEPARTURES WERE 271 IN NOVEMBER OF 2023 VERSUS TWO 40 IN NOVEMBER OF 2024.
THAT, SO THAT WAS ABOUT 11% DECLINE, UH, YEAR OVER YEAR.
ON THE LANDED WEIGHTS, WE SAW A DECREASE OF 8.7% ON THE LANDED WEIGHTS.
UM, UH, IN, YOU KNOW, IN LINE WITH THE, THE, THE NUMBER OF FLIGHT DECREASES.
AND ALSO JUST, UH, ONE THING TO NOTE HERE FOR THE FIRST TIME, I KNOW IN THE PAST FEW MONTHS I'VE BEEN TALKING ABOUT CARGO AND HOW CARGO YEAR OVER YEAR HAS BEEN PERFORMING WELL.
BUT IN NOVEMBER WE DID HAVE A SLIGHT DECREASE OF ABOUT 5% IN CARGO.
SO I DON'T KNOW WHETHER THAT IS JUST A ANOMALY FOR A MONTH OR NOT, BUT WE'LL SEE WHETHER THAT, UH, CONTINUES OR NOT.
UM, ON THE OPERATING REVENUE SIDE, UM, THE OPERATING REVENUES CAME IN ABOUT $28.1 MILLION, AND THAT WAS 2 MILLION BETTER THAN LAST YEAR.
UM, WHAT WE SAW WAS, EVEN WITH THE DECREASE IN PASSENGER TRAFFIC, WE SAW TRANSACTIONS, FOR EXAMPLE, THE TNC TRIPS WERE FLAT YEAR OVER YEAR.
THE RENTAL CAR TRANSACTIONS WERE ROUGHLY FLAT.
THERE WERE SOME DECREASES IN THE AVERAGE RATE IN THE RENTAL, RENTAL CAR TRANSACTIONS, WHICH LED TO THE DECLINE IN THE REVENUE THERE.
UH, BUT COUPLE OF THE BRIGHT SPOTS WHERE RETAIL DID PRETTY WELL, IT INCREASED 3% YEAR OVER YEAR.
AND ADVERTISING CONTINUES TO OUTPERFORM WHAT WE HAD IN THE BUDGET.
AND ALSO YEAR OVER YEAR, UH, AIRLINE REVENUES, UM, WERE UP 17%, BUT YOU CAN SEE THE NON AIRLINE REVENUES WERE KIND OF FLAT YEAR OVER YEAR.
SO OVERALL OPERATING REVENUES ARE UP ABOUT 8%.
ON THE EXPENSE SIDE, UM, THE EXPENSES WERE UP ABOUT 4%.
[00:05:01]
THERE WERE A COUPLE OF THINGS THAT IS CONTRIBUTING TO THAT LOWER PERCENTAGE, UH, IN INCREASE IN EXPENSES.ONE WAS LAST YEAR THE, THE FIREFIGHTING GROUP OR THE FIRE DEPARTMENT HAD THE, THE COLLECTIVE BARGAINING BARGAINING AGREEMENT HIT IN THE MONTH OF NOVEMBER, WHICH WAS A ALMOST A $300,000 AMOUNT THAT HIT IN NOVEMBER OF 2023.
AND ALSO PARKING EXPENSES WERE DOWN ABOUT $200,000 VERSUS COMPARED TO LAST YEAR.
SO OUR OVERALL INCREASE FOR THE MONTH IN OPERATING EXPENSES WAS LOWER THAN WE ANTICIPATED.
SO VERSUS BUDGET, YOU'LL SEE THAT.
UM, ON THE OPERATING EXPENSES, YEAR TO DATE, WE ARE ABOUT 857,000 FAVORABLE.
ON THE REVENUE SIDE, WE ARE DOWN BECAUSE OF THE NON-AIR AIRLINE REVENUE, AND THAT IS REALLY DUE TO PASSENGER TRAFFIC BEING DOWN, BUT IT IS JUST DOWN ABOUT 500,000 VERSUS WHERE WE BUDGETED.
BUT BOTTOM LINE, UH, IF YOU LOOK AT IT, IT'S STILL, UM, BETTER THAN WHAT WE DID LAST YEAR, YEAR TO DATE.
SO ABOUT $1.2 MILLION BETTER, UH, FROM A BOTTOM LINE STANDPOINT, UH, YEAR TO DATE THAN WHAT WE DID LAST YEAR.
SO THIS IS JUST, YOU'RE ONLY SHOWING FISCAL YEAR STARTED OCTOBER 1ST.
SO WE HAVE TWO MONTHS OF DATA.
SO YOU HAVE, YOU HAVE PLENTY OF TIME TO MAKE THAT UP.
UM, COMMISSIONERS, DO WE HAVE ANY QUESTIONS FOR RAJEEV THOMAS? I MIGHT ASK, WHEN, WHEN, WHEN SHOULD WE BE CONCERNED WHEN IT'S DOUBLE DIGIT, UM, IN THE RED, LIKE, WHE WHEN IS, WHEN IS THERE CONCERN? I KNOW WE'RE, IT'S STILL VERY EARLY IN THE YEAR AND WE, WE HAVEN'T HAD, WE'VE HAD THE BIG FESTIVALS IN OCTOBER, BUT WE HAVEN'T HAD THE SPRING FESTIVALS YET.
I THINK WE'LL WAIT TILL MARCH.
I MEAN, USUALLY JANUARY AND FEBRUARY ARE LOW MONTHS ANYWAY FOR PASSENGER TRAFFIC.
UH, AND ALSO SOME OF THE, THE PULLBACK IN THE AMERICAN FLIGHTS THAT WE SAW, UM, THAT EFFECT WILL START TO MITIGATE AS OF JANUARY NUMBERS IN TERMS OF PASSENGER GROWTH.
UH, SO WE WILL SEE A BETTER YEAR OVER YEAR COMPARISON WITHOUT ALL THAT CONNECTING TRAFFIC THAT WAS RELATED TO THE AMERICAN, UH, PULLBACK.
UH, SO I THINK STARTING JANUARY, FEBRUARY GOING FORWARD, WE'LL GET A BETTER YEAR TO YEAR COMPARISON.
UH, AND I'M HOPING THAT, YOU KNOW, THE PASSENGER GROWTH WILL START TO PICK UP AGAIN, UM, SOON, BUT IF NOT, YOU KNOW, THERE WILL BE SOME MISS ON THE NON-AIR AIRLINE REVENUE SIDE BECAUSE THE NON-AIR AIRLINE REVENUES ARE REALLY DEPENDENT ON PASSENGER TRAFFIC.
SO WE EXPECT IF, LET'S SAY GROWTH WEAR TO KIND OF STAY FLAT VERSUS PRIOR YEAR, THERE WOULD BE ABOUT A $5 MILLION, UH, DECLINE IN, IN THE NON-AIR AIRLINE REVENUE COMPARED TO WHERE WE BUDGETED.
THAT'S WHAT OUR APPROXIMATE ESTIMATION IS RIGHT NOW.
[3. Briefing on Air Service Update provided by Jamy Kazanoff, AUS Air Service Development]
AGENDA ITEM THREE IS THE BRIEFING ON AIR SERVICE, UM, UPDATE BY JAMIE KOFF.AND I'LL, WE'LL ALSO LET, LET YOU HELP INTRODUCE, UM, SURE.
SO HAPPY NEW YEAR COMMISSIONERS.
UH, SHORTLY I WILL BE INTRODUCING KEVIN SHORE, VICE PRESIDENT AND PRINCIPAL OF CAMPBELL HILL AVIATION, OUR AIR SERVICE DATA AND CONSULTING FIRM IN WASHINGTON C.
SO HE'LL BE PRESENTING THE SLIDESHOW THAT YOU'VE BEEN PROVIDED.
UH, I MIGHT POP IN EVERY NOW AND THEN FOR THE SLIDESHOW, BUT LET'S GO OVER BRIEFLY THE JANUARY REPORT.
WELL REALLY JUST ONE, CHANGE THE, THE FRONT GRAPH INSTEAD OF A MONTHLY MONTH OVER MONTH, WHICH WAS GETTING BUSY AND CONFUSING, WE ROLLED THIS UP INTO QUARTERLY.
SO WE'RE COMPARING SEATS FOR THE QUARTER OF FIRST QUARTER 2025 COMPARED TO THE SAME QUARTER IN 2019.
SECOND QUARTER, 37% COMPARED TO 2019 PRE COVID.
AND ON YOUR RIGHT, WE'RE LOOKING AT FIRST QUARTER SEATS LOADED.
CURRENTLY FOR SALE ARE DOWN 2%, FIRST QUARTER, 2025 COMPARED TO 24.
AND IN SECOND QUARTER A LITTLE BIT UP, BUT VIRTUALLY FLAT YEAR OVER YEAR.
SOME OF THE HIGHLIGHTS I'LL GO THROUGH ARE AIR CANADA.
AIR CANADA ADDED AN EXTRA FREQUENCY TO FIVE TIMES A WEEK FOR THE SUMMER.
THIS IS, UH, MORE THAN THEY OFFERED LAST YEAR.
THIS MAY BE IN PART BECAUSE WESTJET IS NOW GOING TO BE FLYING TO
[00:10:01]
VANCOUVER.THAT'S A NEW NONSTOP FOR AUSTIN.
UH, AIR CANADA WILL RESTART MONTREAL FOR ITS SEASONAL.
WE'RE PLEASED TO SEE THAT COME BACK.
ALLEGIANT, THE SUMMER SCHEDULE THIS YEAR WILL BE 12 MARKETS IN 2025 VERSUS 18.
THE ALLEGIANT BASE, WE DO LOSE THIS MONTH, BUT WE STILL HAVE, AND IT'S IMPORTANT TO EMPHASIZE A SUBSTANTIAL AMOUNT OF SERVICE.
AND I DO ALSO WANT TO MENTION THAT ALLEGIANT COMPLETELY EXITED SAN ANTONIO.
THEY NO LONGER FLY SAN ANTONIO IN 2024.
OF COURSE, WE HAD A GREAT DEAL OF FOCUS AND SOME PAIN AS AMERICAN RETRENCHED FROM AUSTIN AFTER ITS MASSIVE BUILDUP DURING COVID.
BUT IN SPITE OF THESE MARKET EXITS, I DO WANNA POINT OUT THAT AMERICANS 15% LARGER THAN IT WAS PRE COVID HERE IN AUSTIN, EVEN WITH THESE CUTS.
AND THEY ALSO OFFER MORE NONSTOPS SUCH AS ASPEN AND CABO TO OUR CUSTOMERS THAN THEY DID PRE COVID.
THEY HAVE ALSO PAID ATTENTION AS OTHER CARRIERS HAVE AS WELL, WITH SPECIAL EVENT FLYING TO THE UNIVERSITY OF TEXAS GAMES AND SOME SPECIAL CONVENTIONS, OTHER WELL ATTENDED EVENTS, DELTA DELTA HAS HELPED PICK UP THE SLACK EXITED BY AMERICAN AND I SUSPECT WILL LIKELY CONTINUE GROWING IN AUSTIN.
IMPORTANTLY, IT'S PICKING UP SOME OF THE ROUTES DROPPED AND IT'S ALSO IMPORTANTLY CONNECTING PASSENGERS THROUGH AUSTIN, WHICH WILL HELP WITH THE NON-AIR AIRLINE REVENUE ON THE CONCESSION SALES IN OTHER AREAS.
SOME OF THE NEW MARKETS ARE NEW ORLEANS, UM, INDIANAPOLIS, JACKSONVILLE, MEMPHIS, SAN FRANCISCO, TAMPA.
THEY'RE ADDING THE MASTER'S GOLF TOURNAMENT, ADDING COLLEGE FOOTBALL GAMES.
THEY'VE, UH, REALLY PUT A, A NICE AMOUNT OF FOCUS ON AUSTIN SOUTHWEST IS ALSO, UM, SWINGING AWAY HERE IN AUSTIN, PICKING UP THE SLACK HAS MORE IN AUSTIN THAN IT HAS IN PREVIOUS YEARS BY BOTH NONSTOP MARKETS.
NUMBER OF DEPARTURES AND SEAT CAPACITY.
THEIR NEW YEAR-ROUND SERVICE TO MILWAUKEE STARTS IN MARCH.
NEW SEASONAL SERVICE TO RENO STARTS IN MARCH AS WELL.
AND WE WERE VERY EXCITED TO SEE THAT SOUTHWEST NOW ADDS ANOTHER OPTION TO SAN FRANCISCO STARTING IN AUGUST, 2025.
UH, BRITISH AIRWAYS THE SECOND DAILY STARTS MARCH 29TH.
AFTER 10 YEARS, THEY'LL NOW HAVE TWO A DAY.
UM, I DID WANNA MENTION THAT, UH, FRONTIER HAS NEW SERVICE.
FRONTIER AND ULTRA LOW COST CARRIER CHANGED ITS MODEL A BIT AND HAS ADDED A, A GREAT DEAL TO AUSTIN, PHOENIX, ORLANDO, CHICAGO, CINCINNATI, HAWAIIAN, UH, HAWAIIAN'S LAST DAY WILL BE IN AUSTIN, MARCH 26TH.
AS YOU KNOW, ALASKA BOUGHT HAWAIIAN AND NOW NEEDS OUR WIDE BODY AIRCRAFT FOR HIGHER PRIORITIES FOR ITS NEW INTEGRATED AIRLINE.
THERE'S JUST NOT A LOT WE CAN DO IN AUSTIN WHEN THAT HAPPENS.
AND WE'RE VERY SAD TO SEE THAT GO.
UM, ALASKA MEANWHILE IS ANNOUNCING NEW NONSTOP LONG HAUL.
THEY'VE ANNOUNCED SEATTLE TO TOKYO.
IS THAT OUR JET? I DON'T KNOW
UM, UNITED, WHICH JUST FLIES FROM ITS HUBS IN AUSTIN, HAS FOCUSED ON ADDING EVENT FLYING, UM, RECENTLY, WHICH IS, WHICH IS GREAT NEWS TO SEE THEM PICK UP ON THE FOOTBALL GAMES.
ON A BRIGHT NOTE, AS I ALREADY MENTIONED, WESTJET ANNOUNCED THAT IN ADDITION TO CALGARY, THEY WILL START FLYING FOR THE FIRST TIME FROM AUSTIN TO VANCOUVER ON MAY 11TH.
SO NOW WE HAVE TWO CARRIERS FLYING TO VANCOUVER, KLM AND LUFTHANSA ARE DOING WELL IN AUSTIN FROM EVERYTHING THAT I CAN SEE.
WE ALSO NOTED, AND I WOULD LIKE TO LET YOU KNOW THAT CONDOR HAS EXITED SAN ANTONIO CONDOR WAS SAN ANTONIO'S ONLY TRANSATLANTIC SERVICE AND IT WAS TO, UH, FRANKFURT.
THEY WILL NO LONGER BE FLYING TRANSATLANTIC SERVICE.
SO SAN ANTONIO'S CURRENTLY WITHOUT SENT, UH, TRANSATLANTIC SERVICE, A LIST OF ALL THE NONSTOPS ARE, ARE IN THE FULL REPORT.
UM, BUT LET'S, LET'S GET ONTO THE, UH, SLIDESHOW, IF, IF THAT'S ALL RIGHT WITH EVERYONE AND WE CAN ASK, UH, ME OR KEVIN ANY QUESTIONS AT THAT POINT.
SO LET ME INTRODUCE, UH, KEVIN SHORE.
UH, CAMPBELL HILL'S BEEN WORKING ON AUSTIN AIR SERVICE FOR QUITE SOME TIME.
THEY PROVIDE DATA THAT AIRLINES LOOK AT.
AND WHAT I LIKE ABOUT THIS FIRM IS NOT ONLY DO THEY REPRESENT AIRPORTS, THEY ALSO REPRESENT AIRLINES SO THEY CAN BRING A PARTICULAR TYPE OF
[00:15:01]
INTELLIGENCE TO OUR WORK.UH, THERE'S A LOT OF CONSTRAINTS WITH THEIR AIRLINES.
I'LL REPEAT THAT, UH, WHERE THE FINITE NUMBER OF AIRCRAFT CAN GO.
SO KEVIN, WHY DON'T YOU TELL US A LITTLE BIT ABOUT, UH, WHAT'S WITHIN A AUSTIN'S ECONOMIC PARAMETERS, A LITTLE BIT ABOUT THE STATE OF THE INDUSTRY AND, UH, WHAT YOU SEE FOR OUR FUTURE.
SO AGAIN, I'M KEVIN SHORE VICE PRESIDENT WITH CAMPBELL HILL AVIATION GROUP.
UH, WE ARE BASED HERE IN SNOWY WASHINGTON, DC UM, I'VE PERSONALLY BEEN DOING AIR SERVICE DEVELOPMENT NOW FOR A LITTLE OVER 23 YEARS.
BEFORE THAT, I WORKED WITH TRANSWORLD AIRLINES IN ST.
UM, OUR FIRM, UH, AS JAMIE SAID, WORKS WITH BOTH AIRLINES AND AIRPORTS.
UM, WE WORK PROVIDE CONSULTING SERVICES TO A NUMBER OF THE AIRLINES THAT SERVE AUSTIN.
UM, AND WE WORK FOR ABOUT 40 DIFFERENT AIRPORTS THROUGHOUT THE AMERICAS AND EUROPE, UH, PROVIDING AIR SERVICE DEVELOPMENT SERVICES.
UM, AND WE'RE FORTUNATE THAT WE'VE BEEN, UH, A PARTNER WITH THE AIRPORT SUPPORTING THE AIRPORT ON AIR SERVICE DEVELOPMENT SINCE ABOUT 1999.
SO WE'RE GONNA TALK A BIT ABOUT AIR SERVICE DEVELOPMENT.
WHAT DOES IT MEAN? WHAT IS IT THAT WE DO? TALK ABOUT THE INDUSTRY AND WHAT'S HAPPENING, AND THEN WE'LL TALK AT HIGH LEVEL ABOUT WHAT'S HAPPENING IN THE AUSTIN AIR SERVICE MARKET.
AND WE'LL FINISH UP WITH OUR GOALS AND OBJECTIVES FOR AIR SERVICE DEVELOPMENT.
[4. Briefing on Air Service Development and Airline Industry Trends presented by Jamy Kazanoff, AUS Air Service Development, and Kevin Schorr, Vice President, Campbell-Hill Aviation Group]
AS I SAID, WE'LL START OFF WITH AIR SERVICE DEVELOPMENT AND WE WILL, UH, RUN A, A BRIEF BRIEF TIME TALKING ABOUT AIRLINE INDUSTRY TRENDS.SO WHAT IS AIR SERVICE DEVELOPMENT AND WHY DOES AIR SERVICE NEED DEVELOPMENT? UM, AND WHY DO AIRPORTS NEED TO DO AIR SERVICE DEVELOPMENT? UM, SO AS WE KNOW, THE AIRLINES ARE FOCUSED ON MAXIMIZING PROFITS EVEN THOUGH SOME THINGS THAT THEY DO MAY SUGGEST OTHERWISE.
AND SOME OF THE THINGS THEY DO MAKE US SCRATCH OUR HEADS.
IN THE END, THEY STILL ANSWER TO THEIR BOARDS AND THEY ANSWER TO WALL STREET.
WE MUST KEEP IN MIND THAT AIRCRAFT ARE MOVABLE ASSETS.
UM, THEY CAN BE EASILY MOVED TO OTHER MARKETS AND OFTEN DO, AS WE RECENTLY UNFORTUNATELY SAW WITH HAWAIIAN MOVING THEIR WIDE BODY A THREE 30 OUT OF AUSTIN AFTER THE ALASKA MERGER.
UH, THIS IS SOMETHING THAT CAN HAPPEN AT ANY POINT IN TIME WITH ANY AIRLINE AS THEY MOVE AIRCRAFT TO WHAT THEY DEEM ARE HIGHER PRIORITY ROUTE AND BETTER OPPORTUNITIES.
UM, BUT AGAIN, AUSTIN HAS ALSO BEEN THE BENEFICIARY OF THAT AS WE HAVE SEEN OTHER AIRLINES MOVE AIRCRAFT INTO OUR MARKET.
WE WORK WITH THE AIRLINES TO IDENTIFY OPPORTUNITIES FOR GROWTH.
WE ALSO WORK WITH THE AIRLINES TO HELP UNDERSTAND WHERE THEY SEE WEAKNESS IN THE MARKET.
UM, AND THEN TOGETHER WE WORK ON SOME KIND OF ACTION THAT MAY BE NEEDED, AND THAT COULD BE ON A PART OF THE AIRPORT.
IT COULD ALSO BE ON THE PART OF THE COMMUNITY.
AND AGAIN, IN AIR SERVICE DEVELOPMENT, WE HAVE TO KEEP IN MIND THAT OUR COMPETITION IS GLOBAL.
WE ARE NOT JUST COMPETING WITH AIRPORTS WITHIN THE UNITED STATES, WITHIN NORTH AMERICA, WITHIN EVEN JUST THE AMERICAS WHEN IT COMES TO AIR SERVICE DEVELOPMENT.
UM, AIRPORTS ALL AROUND THE WORLD ARE COMPETING FOR THE SAME ASSETS THAT WE ARE, ESPECIALLY WITH SOME OF OUR FOREIGN FLAG CARRIERS LIKE BRITISH AIRWAYS, LIKE KLM, LIKE LUFTHANSA.
SO IN THE END, WE'RE FOCUSED ON WHAT'S BEST FOR THE AIR SERVICE NEEDS OF THE AUSTIN COMMUNITY.
SO HOW DO AIRLINES MAKE ROUTE PLANNING DECISION? WELL, THE AIRLINES HAVE VARIOUS FACTORS THAT YOU SEE HERE THAT HELP NARROW DOWN THEIR LAUNDRY LIST OF OPPORTUNITIES.
AND AGAIN, THE GOAL IN THE END FOR THEM IS TO MAXIMIZE THEIR REVENUE AND THEIR STRATEGIC PRIORITIES.
SO THEY START WITH INDUSTRY AND OTHER DATA.
THEY GET DEMAND DATA FROM THE DOT IN TERMS OF WHAT WE CALL O AND D ORIGIN AND DESTINATION DATA.
AND THAT TELLS THEM HOW MUCH DEMAND IS THERE ON THE MARKET ON AN ON AVERAGE, HOW MUCH ARE PEOPLE PAYING? THE AIRLINES GET PERFORMANCE DATA FROM THE DOT IN TERMS OF WHAT THEY CALL T 100 DATA OR LOAD FACTOR DATA.
SO HOW FULL ARE THE AIRCRAFT? AND THE AIRLINES USE A LOT OF POPULATION AND DEMOGRAPHIC DATA.
UM, AND IN SOME PART THEY RELY ON THE AIRPORT AND THEY RELY ON US AND THEY RELY ON THE COMMUNITY PARTNERS TO PROVIDE THAT DATA AND HELP THEM UNDERSTAND WHAT TRENDS ARE HAPPENING IN THE COMMUNITY.
SO WE WILL ALSO PASS ALONG DATA FROM OPPORTUNITY AUSTIN, FROM THE CHAMBER AND FROM VISIT AUSTIN ON A REGULAR BASIS.
WITH ALL THAT DATA, THE AIRLINES ARE THEN LOOKING AT THE COMPETITION.
WHAT'S THE COMPETITION DOING IN THE MARKET? THEY LOOK AT THEIR OWN INTERNAL DATA AND, AND THEY ALSO LOOK AT AIRLINE TRENDS.
WHAT ARE WE SEEING IN TERMS OF THE DIFFERENT KINDS OF CARRIERS IN THE MARKET? WHAT ARE WE SEEING IN TERMS OF THE TYPES OF AIRCRAFT THAT AIRLINES ARE FLYING? AND SOME OF THE OTHER FACTORS,
[00:20:01]
UM, THAT, UM, IMPACT THE DECISIONS THEY MAKE ARE OA PROJECTED PERFORMANCE.SO HOW ARE OTHER AIRLINES PERFORMING IN THE MARKET AIRCRAFT AVAILABILITY? UM, WE CAN'T START NEW SERVICE.
WE CAN'T ADD NEW FLIGHTS IF WE DON'T HAVE AIRCRAFT AVAILABLE.
AND WE KNOW THAT THAT'S A BEEN A BIG ISSUE LATELY.
AND WE'LL TOUCH ON THAT AGAIN IN A COUPLE OF SLIDES.
AND OTHER FACTORS LIKE SEASONALITY, IS THIS A WINTER MARKET? IS IT A SUMMER MARKET? IS IT A MARKET THAT WE SEE, UH, THAT REALLY PEAKS AROUND SPRING BREAK? AND WITH LOTS OF DIFFERENT AUSTIN MARKETS? WE DO SEE THAT KIND OF SEASONALITY, UH, WHERE DIFFERENT TIMES OF THE YEAR WE SEE MORE OR LESS DEMAND.
AND THEN DAY OF WEEKS, EXCUSE ME, BECOME VERY IMPORTANT, ESPECIALLY POST COVID AS WE KNOW PEOPLE ARE COMBINING THEIR LEISURE, UM, TRAVEL WITH BUSINESS TRAVEL.
SO IS THIS A MARKET THAT WE SHOULD SERVE SATURDAY ONLY? IS IT A MARKET WE SERVE ON THE WEEKENDS? IS IT A MARKET WE SERVE MONDAY, THURSDAY AND FRIDAY BECOME TUESDAY BECAUSE TUESDAYS AND WEDNESDAYS HAVE JUST BECOME THAT MUCH SLOWER AND WE SEE THE AIRLINES GETTING THAT MUCH MORE SURGICAL ABOUT THEIR SCHEDULES AS THEY TRY TO MATCH CAPACITY WHERE THE DEMAND IS.
WITH ALL THAT TOGETHER, THE AIRLINES THEN PUT TOGETHER A LIST OF POTENTIAL MARKETS AND THEN THEY HAVE A RANKING OR VETTING PROCESS.
AND THEY NEED TO LOOK AT ALL THESE MARKETS BASED ON WHAT DOES THE REVENUE FORECAST LOOK LIKE IF THEY SERVE THE MARKET, THE STATION COSTS, WHAT DOES IT COST TO OPERATE AT THAT AIRPORT? WHAT DOES IT COST TO OPERATE ANOTHER FLIGHT AT THAT AIRPORT? DOES IT MEAN WE HAVE TO ADD A SECOND GATE, FOR EXAMPLE, OPERATIONAL VIABILITY? DO WE HAVE ROOM IN THE SCHEDULE BOTH AT THE, UM, ORIGIN AND DESTINATION AIRPORT AND THEN REGULATORY ISSUES.
UM, IF IT'S AN INTERNATIONAL MARKET, DO WE HAVE THE RIGHTS THAT WE NEED TO SERVE THE MARKET WITH THAT? THEY THEN WORK WITH SCHEDULING TO CREATE A SCHEDULE FOR ALL NEW FLIGHTS THAT GOES TO THE EXECUTIVE TEAM AND THE BOARD FOR THEIR APPROVAL.
AND THEN THE AIRLINES COME UP WITH A PLAN.
UM, MOST AIRLINES DO THIS ON AN IT ITERATIVE, UH, BASIS, AND IT'S REPEATED REGULARLY.
AND THEY MIGHT HAVE A ONE YEAR PLAN, A FIVE YEAR PLAN, A 10 YEAR PLAN, UM, BUT AS WE ALL KNOW, THINGS CHANGE.
SO THESE PLANS ARE ALWAYS BEING UPDATED, UH, DEPENDING ON WHAT'S HAPPENING IN THE INDUSTRY, DEPENDING WHAT'S HAPPENING, UM, GLOBALLY IN TERMS OF THE ECONOMY.
SO THE PEOPLE THAT WE MEET WITH AT THE AIRLINES, THE, UH, NETWORK PLANNERS, THESE ARE ALL THE DIFFERENT KINDS OF FUNCTIONS THAT THEY'RE WORKING ON ON A DAILY BASIS.
SO THEY'RE NOT JUST FOCUSING ON HOW MANY MORE FLIGHTS CAN WE ADD IN AUSTIN, HOW MANY MORE SEATS CAN WE ADD IN AUSTIN? BUT THEY'RE DOING ALL THE OTHER THINGS THAT YOU SEE HERE AS WELL.
SO THE PLANNING TEAM MUST ALWAYS BE BALANCING MANY VARIOUS FUNCTIONS THAT ALL PLAY AN INTEGRAL ROLE IN BUILDING A SUCCESSFUL NETWORK.
AND THE PLAN THAT WE TALKED ABOUT BEFORE, THEIR ONE YEAR PLAN, FIVE YEAR PLAN, 10 YEAR PLAN.
SO IN THE END, THE NETWORK PLANNERS THAT WE MEET WITH ARE STRETCHED VERY THIN AND PULLED IN MANY DIFFERENT DIRECTIONS, BUT WE MEET WITH THEM ON A REGULAR BASIS SO THAT WE CAN KEEP AUSTIN TOP OF MIND WHEN THEY ARE PLANNING NEW SERVICE.
AND WHEN THEY ARE ALLOCATING NEW CAPACITY, WE WANT TO MAKE SURE WHEN THEY HAVE MORE AIRCRAFT TO SCHEDULE THAT THEY'RE THINKING ABOUT AUSTIN IN TERMS OF A PLACE TO PUT THAT AIRCRAFT.
SO WHAT WE SEE HERE IS EFFECTIVELY A TIMELINE OF AIRLINE MERGERS AND CONSOLIDATIONS.
SINCE THE INDUSTRY WAS DEREGULATED IN 1978 AND BECAUSE OF THE CONSOLIDATION, WE BASICALLY HAD 80% OF ALL DOMESTIC CAPACITY NOW BEING SERVED AND CONTROLLED BY JUST FIVE AIRLINES.
IF WE GO BACK TO 1978, WHEN THE, UH, INDUSTRY WAS FIRST DEREGULATED, YOU EFFECTIVELY HAD ABOUT 20 DIFFERENT AIRLINES ALL COMPETING WITH EACH OTHER TO SERVE THE MARKET JUMP AHEAD TO 1990.
THAT SHRUNK TO ABOUT 15 TO 2000.
WE HAD ABOUT 13 OF THESE AIRLINES.
SO NOW AGAIN, WE EFFECTIVELY ARE DEALING WITH FIVE AIRLINES THAT CONTROL 80% OF OUR CAPACITY.
AND AGAIN, AS WE ALSO KNOW, AND WE DON'T HAVE ON THIS CHART YET BECAUSE IT'S SO NEW, WE SAW THE ALASKA AND HAWAIIAN MERGER AS THE MOST RECENT DEVELOPMENT.
AND AFTER THAT MERGER, THE COMBINED COMPANY EFFECTIVELY HAS A NEW STRATEGY.
THEY CAN DO DIFFERENT THINGS WITH THEIR AIRCRAFT, SERVE DIFFERENT MARKETS, THEY HAVE STRENGTHS, UH, THAT EACH DIDN'T HAVE BEFORE.
SO WITH THAT, OF COURSE, ONE OF THE UNFORTUNATE, UH, PITFALLS OF THE MERGER, SOMETIMES WE BENEFIT FROM OUR MERGER, SOMETIMES WE DON'T, IS THAT OF COURSE WE LOST THE NONSTOP SERVICE TO HONOLULU AS THEY USE THAT WIDE BODY AIRCRAFT FOR A HIGHER PRIORITY.
AND AS JAMIE ALLUDED TO BEFORE, THEY DID ANNOUNCE NEW SERVICE TO ASIA, BUT THEY'RE ALL ALSO USING THE, UM, WIDE BODIES TO INCREASE CAPACITY BETWEEN SEATTLE AND ANCHORAGE AND BETWEEN HAWAII
[00:25:01]
AND THE MAINLAND.SO WE CAN'T EXACTLY POINT A FINGER AND SAY, HEY, THAT'S WHERE OUR AIRCRAFT WENT, BUT WHAT WE DO NOW IS WHAT WE DO NOW, IS THAT BECAUSE OF THE NEW STRATEGY OF THE COMBINED AIRLINE, THEY HAD A DIFFERENT PURPOSE FOR THAT AIRCRAFT.
SO THESE ARE THE ALL THE DIFFERENT INDUSTRY TRENDS THAT EFFECTIVELY KEEP ME AND THE AIRLINE NETWORK PLANNERS UP AT NIGHT.
UM, AND AS YOU CAN SEE, THEY'RE UH, DIVIDED INTO SIX DIFFERENT, UH, CATEGORIES.
AND WE'RE NOT GONNA TALK ABOUT ALL OF THESE UNLESS, UM, WE HAD ANOTHER THREE HOURS WE COULD SPEND TOGETHER TODAY, WHICH I'M OF COURSE HAPPY TO DO.
UH, BUT SOME OF THE KEY THINGS ARE, UM, UNDER AIRCRAFT THERE'S A LOT OF INTERESTING NEW AIRCRAFT THAT CAN FLY A LOT FARTHER WITH E EXTREMELY LOW COSTS.
SO AN AIRCRAFT LIKE THE A TWO 20, WHICH WE NOW HAVE AIR CANADA, JET BLUE, AND DELTA FLYING IN THE MARKET IS GIVING THEM THE ABILITY TO DO SOME THINGS THEY MIGHT NOT HAVE BEEN ABLE TO DO FIVE OR SIX YEARS AGO.
UM, SOUTHWEST IS NOW EAGERLY WAITING ON THE APPROVAL OF THE, UH, 7 37 MAX SEVEN AIRCRAFT, WHICH HAS BEEN HELD UP IN CERTIFICATION DELAYS WITH THE FAA FOR ABOUT TWO OR THREE YEARS NOW.
UM, WE HOPE THAT THEY'LL BE FLYING THIS AIRCRAFT NEXT YEAR BECAUSE AGAIN, THIS IS ABOUT 140 SEAT AIRCRAFT THAT WILL GIVE THEM THE CAPABILITY TO DO THINGS THEY COULDN'T DO BEFORE AND DO IT OUR AT A LOWER COST.
AND THEN THE LARGER VERSION, THE MAX 10, UM, WHICH SEATS CLOSER TO 200 PEOPLE, WHICH AGAIN, WE'LL BE ABLE TO FLY 200 PEOPLE FURTHER AND AT A LOWER COST THAN WE COULD BEFORE.
UM, THE BOEING STRIKE HAD A, A BIG IMPACT ON BOEING'S ABILITY TO DELIVER AIRCRAFT AND THE LINE IS UP AND RUNNING, BUT WE'VE READ THAT IT COULD TAKE UPWARDS OF EVEN A YEAR TO GET BACK TO FULL PRODUCTIVITY UNDER COMPETITION.
WE TALKED ABOUT THE ALASKA HAWAIIAN MERGER, WE KNOW HOW THAT HAS IMPACTED, UM, THE AUSTIN MARKET.
BUT AGAIN, WITH THAT MERGER, ALASKA IS ALSO BUILDING UP ITS PRESENCE IN THE PORTLAND AIRPORT.
SO NOW WE HAVE LOST THE HAWAII FLIGHT, BUT WE'RE GETTING OUR SECOND FREQUENCY BACK TO PORTLAND.
SO WITH THE BAD NEWS COMES SOME GOOD NEWS AS WELL.
AND ALASKA WILL BE BUILDING MORE CONNECTING BANKS IN PORTLAND.
SO YOU'LL BE ABLE TO FLY FROM AUSTIN TO PORTLAND, CONNECT TO A LOT OF DIFFERENT PLACES, MUCH LIKE WE DO ON ALASKA TO SEATTLE NOWADAYS.
UM, MANY OF US ARE TRYING TO, UH, UH, IMAGINE WHAT THE SPIRIT OF FUTURE IS GONNA LOOK OF.
SPIRIT IS GONNA LOOK LIKE AS THEY HAVE DECLARED BANKRUPTCY.
AND THERE'S A LOT OF, UM, A LOT OF PEOPLE OUT THERE PROGNOSTICATING WHAT MIGHT HAPPEN.
UM, SO WE'RE CURIOUS TO SEE WHAT HAPPENS WITH SPIRIT IN THE FUTURE.
DO THEY MERGE WITH SOMEONE ELSE? DO THEY, UM, CHANGE THEIR STRATEGY AND TRY TO STAY, UM, AS A STANDALONE ENTITY ON THE GLOBAL SCALE? UM, CATEGORY ONE, UM, IN MEXICO HAS RECENTLY BEEN REINTRODUCED IN, UM, 2023.
SO WITH THAT, WE SAW THE ADDITION OF VEEVA ABUS SERVING MONTEREY, UH, FROM 2023.
SO VERY HAPPY THAT, UH, MEXICO'S BACK TO CATEGORY ONE STATUS.
AGAIN, THESE ARE ALL THE DIFFERENT THINGS THAT ARE IMPACTING AN AIRLINE'S DECISION MAKING ON ANY GIVEN DAY.
AND IF WE WERE TO LOOK AT THIS, UH, SLIDE ABOUT TWO, THREE MONTHS FROM NOW, I GUARANTEE YOU SOME OF IT WILL LOOK DIFFERENT.
SO HONING IN ON SOME OF THE THINGS SPECIFIC, UM, SOME OF THE MOST PRESSING ISSUES, THE AIRCRAFT DELIVERY DELAYS, UM, AGAIN, WE KNOW THAT, UM, THERE'S BEEN DELIVERY DAY DELAYS WITH BASICALLY EVERY AIRCRAFT MANUFACTURER WITH BOTH BOEING AND AIRBUS.
UM, THE BOEING STRIKE AGAIN, SLOWED THINGS DOWN.
UH, THEY'VE BEEN WAITING TWO, THREE YEARS NOW FOR CERTIFICATION OF THE MAX SEVEN, THE MAX 10, THE TRIPLE SEVEN X.
AGAIN, ALL THESE THINGS IMPACTING AN AIRLINE'S ABILITY TO DO NEW THINGS AND START NEW SERVICE.
UM, WE KNOW FOR EXAMPLE, LUFTHANSA THOUGHT THEY WOULD HAVE THE TRIPLE SEVEN X BY NOW, WHICH MEANS THAT THEY HAVE A SHORTAGE IN TERMS OF THE AIR AIRPLANES, UH, THAT THEY CURRENTLY USE TO SERVE THE AUSTIN MARKET, WHICH IS WHY WE'RE GOING BACK TO THE A THREE 30 TO FRANKFURT INSTEAD OF THE, UH, BOEING 7 87.
UM, BUT AGAIN, WE'RE SEEING THESE DELAYS AND THERE'S NOW SOME, UH, THERE'S SOME CERTAINTY IN TERMS OF THE, UM, DELAY WHAT DELIVERIES MIGHT LOOK LIKE FOR THIS YEAR.
BUT AGAIN, SOME AIRLINES DON'T KNOW IS AN, UH, AN AIRLINE GONNA GET THEIR NEXT PLANE A MONTH FROM NOW, SIX WEEKS FROM NOW, TWO MONTHS FROM NOW.
UM, AND AGAIN, IT MAKES IT REALLY HARD TO PLAN AN AIRLINE IF YOU DON'T EXACTLY KNOW WHEN THOSE AIRCRAFT ARE GOING TO COME IN.
ALL THE AIRLINES ARE SEEING INCREASED LABOR COSTS AS THEY, AS THEY HAVE SIGNED SOME REALLY EXPENSIVE NEW CONTRACTS, ESPECIALLY SOME PILOT CONTRACTS.
SO WE KNOW AT SOME POINT THAT'S GOING TO, UH, DEFINITELY COME HOME TO ROOST AT THE AIRLINES.
[00:30:01]
BUSINESS TRAVEL TRENDS, WE'RE HEARING FROM MOST AIRLINES THAT THEY SEE THAT BUSINESS TRAVEL IS BACK, BUT THAT BUSINESS TRAVEL LOOKS DIFFERENT.YOU DON'T HAVE THE, AS MANY OF THE ROAD WARRIORS WHO ARE LEAVING TOWN EVERY MONDAY MORNING, COMING BACK THURSDAY NIGHT.
AND AGAIN, AS I'VE SAID BEFORE, BECAUSE OF LEISURE TRAVEL WHERE PEOPLE HAVE COMBINED THEIR BUSINESS AND LEISURE TRAVEL, WE'RE SEEING A LOT MORE TRAVEL ON MONDAYS AND FRIDAYS AND SATURDAYS AND EVEN LESS TRAVEL THAN WE SAW BEFORE ON TUESDAYS AND WEDNESDAYS, WHICH AGAIN, IS SOMETHING THAT THE AIRLINES HAVE TO PLAN FOR.
AND THEN WE'RE DEALING WITH LIMITED REAL ESTATE AT A LOT OF AIRPORTS, ESPECIALLY SOME OF THE MAJOR HUBS THROUGHOUT THE UNITED STATES, WHICH IS MAKING IT TOUGH FOR SOME AIRLINES TO ACCESS THOSE AIRPORTS DURING THE TIMES WHEN THEY REALLY WANNA GET IN THERE, ESPECIALLY WHEN WE'RE TALKING ABOUT, UH, CONNECTING FLIGHTS AND AIRLINES THAT WANT TO CONNECT BETWEEN FLIGHTS AT THOSE AIRPORTS.
UM, AND ALSO CBP AVAILABILITY HAS BEEN AN ISSUE THROUGHOUT THE COUNTRY.
THERE ARE A LOT OF AIRPORTS THAT WANT ADDITIONAL HOURS FROM CBP AND THEY'RE JUST NOT ABLE TO, UH, PROVIDE THAT COVERAGE.
UM, IN TERMS OF THE INFRASTRUCTURE AT THE AUSTIN AIRPORT, WE'RE VERY FORTUNATE NOW THAT WE CAN OFFER AN ALTERNATIVE LIKE GROUND LOADING.
UM, AIRLINES HAVE SAID THEY'RE MORE THAN HAPPY TO DO GROUND LOADING THROUGHOUT THE WORLD.
IT'S SOMETHING THAT'S REGULARLY DONE AND FOR SOME REASON WE JUST HAVEN'T REALLY EMBRACED IT HERE IN THE UNITED STATES YET.
BUT GROUND LOADING COULD BE A WAY TO, UM, ALLOW AN AIRLINE MORE FLEXIBILITY AT THE AIRPORT AND AT A LOWER COST AS WELL.
SO HERE YOU CAN SEE THE NUMBER OF SCHEDULED AIRCRAFT DELIVERIES GOING BACK TO 2019.
UM, AND AGAIN, WE KNOW THAT PRODUCTION AND CERTIFICATION DELAYS HAVE SIGNIFICANTLY IMPACTED AIRCRAFT DELIVERIES AND THE AIRLINE'S ABILITY TO PLAN.
SO FOR 2024, WE SAW ABOUT 46% FEWER DELIVERIES THAN WERE EXPECTED.
THE AIRLINES WERE EXPECTING ABOUT 543 NEW AIRCRAFT DELIVERIES LAST YEAR.
SO AS YOU CAN IMAGINE, THAT HAS A BIG IMPACT ON THEIR ABILITY TO PLAN, THEIR ABILITY TO SCHEDULE, THEIR ABILITY TO ADD NEW SERVICE TO AUSTIN AND OTHER AIRPORTS.
AND THIS IS JUST FOR THE AIRLINES THAT YOU SEE AT THE BOTTOM THERE IN THAT NOTE, UM, THIS DOESN'T INCLUDE A LOT OF THE OTHER AIRLINES, BOTH IN THE UNITED STATES AND THROUGHOUT THE WORLD THAT HAVE SEEN SIMILAR DELAYS.
UM, AND NOT ONLY, UM, IS THE QUESTION, UM, ABOUT THE NUMBER OF AIRCRAFT THE AIRLINES ARE GONNA GET, BUT THE TIMING AS WELL.
LIKE I SAID BEFORE, DO WE GET THAT AIRCRAFT A MONTH FROM NOW? TWO MONTHS FROM NOW? SOME AIRLINES ARE EXPECTING AN AIRCRAFT DELIVERY A MONTH INSTEAD THEY'RE GETTING THREE AT ONE TIME.
AND FOR SOME AIRLINES THAT'S NOT REALLY THE BEST USE OF THEIR RESOURCES.
SO WE'RE GONNA TALK A BIT ABOUT WHAT'S HAPPENING IN THE AUSTIN MARKET ITSELF.
SO HERE IS A SLIDE LOOKING AT ANNUAL PASSENGER TRAFFIC.
AND UP UNTIL A FEW MONTHS AGO, AND OF COURSE DURING COVID, IT'S BEEN A PLEASURE OF MINE TO UPDATE THIS UH, CHART EVERY MONTH AS THE NUMBERS HAVE, UH, CONTINUED TO GO IN THE RIGHT DIRECTION.
UM, AS WE KNOW, THE UH, PASSENGER TRAFFIC TOOK A BIG DIP DURING COVID, UM, BUT AUSTIN DEFINITELY, UM, RECOVERED FASTER THAN JUST ABOUT ANY MAJOR AIRPORT IN THE UNITED STATES.
SO YOU COULD SEE THAT WE ACTUALLY FIRST EXCEEDED OUR MONTHLY 2019 PASSENGER LEVELS IN NOVEMBER OF 2021.
SO AGAIN, LIKE I SAID, ONE OF THE FIRST AIRPORTS TO RECOVER IN THE UNITED STATES.
UM, FOR CALENDAR YEAR 23, WE SAW THAT PASSENGERS WERE UP ABOUT 27% COMPARED TO 2019, UM, AND 23 WAS UP ABOUT 5% FROM 22.
UM, WHAT WE'RE SEEING NOW, AND I KNOW RAJEEV TALKED, HAS TALKED ABOUT THIS, JAMIE HAS TALKED ABOUT THIS, WE ARE STARTING TO SEE A SLIGHT DECREASE YEAR OVER YEAR ATTRIBUTED MAINLY TO THE AMERICAN PULLBACK.
SO MY GUESS IS WE'RE GONNA PROBABLY END THIS YEAR AT ABOUT 21.6 MILLION, DOWN ONLY ABOUT 2% FROM 2023, WHICH AGAIN, IN THE END IS NOT THAT BAD SINCE WE'RE STILL UP SIGNIFICANTLY FROM 2019 LEVELS.
UM, SO AGAIN, WE WILL SEE A SLIGHT DECREASE YEAR OVER YEAR.
UM, AND I DO WANNA REITERATE THAT WE STILL ARE THE ONE OF THE SHINING STARS OF THE MEDIUM AND LARGE HUBS IN THE UNITED STATES.
UM, LET'S JUMP TO THE NEXT SLIDE PLEASE.
SO, UM, AS YOU HAVE IN THE MONTHLY REPORT, AND AS JAMIE ALLUDED TO BEFORE, UM, OUR FUTURE CAPACITY IS STILL WELL ABOVE 2019.
SO FOR THE FIRST QUARTER OF 2025, RC CAPACITY IS UP 34% VERSUS THE FIRST QUARTER
[00:35:01]
OF 20 OF 2019, WHICH IS ABSOLUTELY FANTASTIC.THE AVERAGE, UH, US MARKET IS ACTUALLY ONLY UP 7%.
IF YOU LOOK AT THE SECOND QUARTER OF 2025, OUR CAPACITY WILL BE UP 37% VERSUS 2019.
AGAIN, THE US MARKET ON AVERAGE IS ONLY UP 9%.
NOW, IF WE LOOK AT THE YEAR OVER YEAR COMPARISONS, WE DO SEE THINGS ARE DIFFERENT.
SO FOR THE FIRST QUARTER OF 25 COMPARED TO 2019, UM, I'M SORRY, FIRST QUARTER OF 25 COMPARED TO 24, WE WILL BE DOWN EVER SO SLIGHTLY.
AND AGAIN, THE US MARKET IS ONLY GONNA BE UP 1%.
SO WE'RE REALLY NOT THAT FAR OFF.
AND IF WE JUMP AHEAD TO THE SECOND QUARTER OF 2025, UM, WE DO SEE THAT CAPACITY WILL BE FLAT YEAR OVER YEAR.
AGAIN, THE US MARKET ON AVERAGE IS ONLY GONNA BE UP 2%.
UM, AND AGAIN, THIS IS BASED ON THE DATA THAT'S FILED RIGHT NOW, UH, THERE STILL COULD BE SOME CHANGES TO THAT SECOND QUARTER DATA.
THERE STILL COULD BE CHANGES TO THE FIRST QUARTER DATA AS WELL.
BUT THIS IS BASICALLY WHAT WE'RE SEEING RIGHT NOW FOR CALENDAR YEAR 24, WE WERE STILL UP 32% COMPARED TO 2019 IN TERMS OF OUR CAPACITY.
UM, BUT OUR CAPACITY WAS DOWN ABOUT 6% YEAR OVER YEAR.
SO, AS I WAS SAYING, IF YOU LOOK AT ALL THE MEDIUM AND LARGE HUB AIRPORTS IN THE UNITED STATES, EVEN WITH THE CAPACITY REDUCTIONS THAT WE'VE HAD, AUSTIN IS STILL THE EIGHTH FASTEST GROWING AIRPORT FOR FIRST QUARTER OF 2025 COMPARED TO THE FIRST QUARTER OF 2019.
IN TERMS OF OUR CAPACITY, WHICH IS STILL FANTASTIC, WE'RE STILL UP 31%.
UM, IF YOU LOOK ALL THE WAY TO THE RIGHT SIDE OF THAT CHART, YOU SEE SOME SIGNIFICANT AIRPORTS THAT ARE STILL DOWN, UH, SINCE COVID, SO OAKLAND, SAN JOSE, SAN JOSE, LAX, THESE AIRPORTS ARE STILL DOWN 20, 25% SINCE COVID.
SO EVEN THOUGH OUR CAPACITY HAS, UM, UH, BEEN REDUCED A BIT FOR THE FIRST QUARTER, 2025, WE STILL ARE ONE OF THE DARLINGS OF THE MEDIUM AND LARGE HUB AIRPORTS.
UM, AND WE KNOW THIS AND WE MEET.
WE, UH, THIS IS WHAT WE HEAR FROM THE AIRLINES WHEN WE MEET WITH THEM.
SO, LOOKING ON A CARRIER BY CARRIER BASIS, THE UH, LEFT HAND SLIDE, UH, SLIDE LOOKS AT THE FIRST QUARTER OF 2025 COMPARED TO 2019.
SO AGAIN, WHAT'S HAPPENED SINCE COVID ON AN AIRLINE BASIS IN TERMS OF THEIR CAPACITY IN AUSTIN, SOUTHWEST IS UP 61% SINCE 2019, WHICH IS FANTASTIC.
AMERICAN, EVEN WITH THE REDUCTIONS PER FIRST QUARTER OF 25 VERSUS 19 WILL BE UP 15% DELTA WITH ALL THEIR NEW SERVICE, THEIR CAPACITY IS UP 58%.
UNITED, WHICH IS NOT SERVING ANY NEW MARKETS, IS STILL SERVING ITS HUBS, IS UP 13%.
ALASKA WILL STILL BE UP 26%, DRIVEN A LOT BY THE SECOND FREQUENCY TO PORTLAND.
UM, AND THEN AGAIN, ON AVERAGE THE AUSTIN MARKETS UP ABOUT 33% FOR FIRST QUARTER 25 VERSUS 2019.
WHERE DO WE SEE THE REDUCTIONS? IT'S WITH SPIRIT, WITH FRONTIER, WITH JETBLUE SINCE THAT TIME, YEAR OVER YEAR ON THE RIGHT SIDE, UM, HERE'S WHERE WE SEE SOUTHWEST WILL BASICALLY BE FLAT FOR THE FIRST QUARTER, 25 VERSUS 24.
UM, AMERICAN WILL BE DOWN 27% IN TERMS OF CAPACITY FOR FIRST QUARTER, 25 VERSUS 24.
AGAIN, THEY'RE STILL UP 15% SINCE COVID.
DELTA'S GONNA BE UP 24%, UM, BANKS IN PART TO THE SIX NEW MARKETS THAT THEY WILL HAVE IN INTRODUCED BETWEEN THE FIRST QUARTER, 25 AND FIRST QUARTER 24.
UM, ONE OF THE REAL INTERESTING THINGS TO SEE IS FRONTIER.
THEIR CAPACITY WILL BE UP 400% YEAR OVER YEAR, THANKS IN PARTS OF THE FOUR NEW ROUTES THAT THEY'RE ADDING TO THE MARKET.
SO AGAIN, EVEN THOUGH AMERICAN MIGHT BE REDUCING CAPACITY, WE'RE SEEING SO MUCH NEW SERVICE FROM DELTA.
WE'RE SEEING SOME NEW ALASKA SERVICE, WE'RE SEEING NEW SERVICE FROM FRONTIER AND OTHERS.
UH, AND THEN, UH, MARKET AGAIN, BRITISH AIRWAYS.
WE KNOW THAT COME THE SECOND QUARTER THAT WE'RE GONNA SEE A BIG, BIG INCREASE FROM BRITISH AIRWAYS AS THEY BRING THE SECOND FREQUENCY, UM, INTO THE MARKET SIX DAYS A WEEK.
AGAIN, A MEXICO IS ALSO UP SIGNIFICANTLY AS THEY'VE UPDATES FROM THE E ONE 90 TO, TO THE 7 37.
SO IF YOU LOOK AHEAD, LOOK AT THE SECOND QUARTER YEAR OVER YEAR COMPARED
[00:40:01]
IN TERMS OF CAPA CAPACITY, THE CAPACITY OVERALL WILL BE UP 2% YEAR OVER YEAR.LOOK AT THE THIRD QUARTER, BASED ON WHAT'S FILED RIGHT NOW, CAPACITY WILL ACTUALLY BE UP 5%.
SO I THINK WHAT WE'RE SEEING IS, UM, A BLIP IN TERMS OF OUR CAPACITY.
THANKS AGAIN, IN PART TO WHAT'S HAPPENING WITH AMERICAN, BUT WE DO SEE OTHER CARRIERS JUMPING IN TO PICK UP THE SLACK.
UM, WITH THAT, I'M GONNA PASS IT OVER TO JAMIE FOR THE NEXT FEW SLIDES.
JAMIE AND KEVIN, THANK YOU SO MUCH.
WE HAVE A PRETTY FULL AGENDA TODAY.
YEAH, SO I DO YOU THINK ANOTHER FIVE MINUTES FAST AND WE CAN WRAP UP? IT'LL BE MINUTES.
THIS, THIS NEXT SLIDE JUST SHOWS OUR NONSTOP AND I JUST WANNA REMIND EVERYONE THAT OUR NONSTOP SERVICES ON OUR WEBSITE, IT'S UPDATED EVERY SINGLE MONTH.
THIS, THIS ONE INCLUDES THE EXTRA EVENT FLYING FOR UTE AND OTHERS.
AND THE NEXT SLIDE PLEASE, IS JUST A SUMMARY OF THE AMERICAN AIRLINES SERVICE CHANGES, WHICH WE'VE GONE THROUGH BEFORE.
IS THIS AN EASY SNAPSHOT FOR YOU? NEXT SLIDE, PLEASE.
THE SOUTHWEST SERVICE CHANGES, UM, WITH THE, UM, THE INDEX THERE THAT EXPLAIN ALL THE DIFFERENT COLOR OF DOTS.
THE ALLEGIANCE SERVICE CHANGES AT AUSTIN.
AND NEXT SLIDE PLEASE ARE THE DELTA SERVICE CHARGE SERVICE CHANGES.
THEN THERE ARE THE INTERNATIONAL NON AA OUTSIDE THE 48 CONTIGUOUS STATES.
SO IF YOU'RE ASKED A QUESTION AT A COCKTAIL PARTY OR A COFFEE, YOU GUYS CAN, UM, GRAB ONE OF THESE AND IT'LL BE EASIER FOR YOU TO TALK FROM.
AND THE LAST SLIDE PLEASE, IF YOU COULD PUT THAT UP.
MUCH QUICKER THAN I WENT THROUGH MY SLIDES.
UM, SO HERE YOU, YOU SEE, UM, ALL OF OUR AIR SERVICE GOALS AND OBJECTIVES.
UM, AND AGAIN, THE KEY IS TO FOCUS ON DEVELOPING AND MAINTAINING SERVICE.
UM, AND AGAIN, SOME OF OUR PROSPECTS ARE AS MUCH AS FIVE YEARS OUT.
SO SOME OF THE AIRLINES WE'RE TALKING TO TODAY, WERE LAYING THE GROUNDWORK FOR WHAT COULD HAPPEN THREE YEARS FROM NOW, FIVE YEARS FROM NOW, AIR SERVICE DEVELOPMENT'S A MARATHON, NOT A SPRINT.
SO AS YOU COULD SEE, UH, THE GOALS AND OBJECTIVES IN EVERY SECTOR, BE IT NEAR INTERNATIONAL SERVICE, LONG, LONG-HAUL, INTERNATIONAL, DOMESTIC, IS TO MAINTAIN AND SUPPORT OUR CURRENT SERVICE.
WE'LL BE PURSUING NEW NEAR INTERNATIONAL SERVICE TO LEISURE VFR AND BUSINESS FOCUSED MARKETS.
WE'RE PURSUING NEW LONG-HAUL INTERNATIONAL SERVICE, ESPECIALLY FOCUSING ON NEW GEOGRAPHIES THAT ARE IN SERVED NOW LIKE ASIA, THE MIDDLE EAST AND SOUTH AMERICA, WITH A NUMBER OF THE DOMESTIC AND NEAR INTERNATIONAL MARKETS AND LONG HAUL MARKETS AS WELL.
WE'RE ALSO LOOKING TO CARRIERS TO EXTEND THE SEASON.
SO START THE SEASON EARLIER, END THE SEASON LATER, AND MAYBE ADD DAYS OF THE WEEK.
SO IF A CARRIER FLYING THREE DAYS A WEEK NOW, WORKING WITH THEM TO INCREASE TO FOUR TIMES A WEEK TO FIVE TIMES A WEEK.
UM, AND AGAIN, CONTINUING THE WORK THAT WE DO WITH OUR, UH, COMMUNITY STAKEHOLDERS AND PARTNERS IN ECONOMIC DEVELOPMENT, EDUCATION, POLITICS AND TOURISM TO MAXIMIZE OUR AIR SERVICE UTILITY FOR THE WHOLE AUSTIN COMMUNITY.
UM, AND AGAIN, WE ALWAYS WANNA BE COGNIZANT THAT WE'RE MAXIMIZING CHOICE FOR AUSTIN PASSENGERS.
SO WE'RE ALWAYS WORKING WITH DIFFERENT KINDS OF CARRIERS WITH THE NETWORK CARRIERS, HYBRID CARRIERS, AND BOTH THE LCCS AND UCCS THAT CAN OFFER LOW FARES TO THE COMMUNITY.
UH, JAMIE AND, UM, EVERYONE FOR HOSTING KEVIN HERE TODAY THAT WE'VE LEARNED A GREAT DEAL.
I HAVE SOME NEW VOCABULARY WORDS, UM, THAT I, I WILL NEED HELP WITH LATER.
UH, VFRI GUESS IT'S, UH, VISITING FRIENDS AND RELATIVES AND THERE WAS SOMETHING ELSE, A CATEGORY ONE AIRPORT, UH MM-HMM.
THAT MEANS THAT THEY HAVE AN INSTRUMENT, LANDING SYSTEM TECHNOLOGY.
IS THAT WHAT THAT MEANS? THEIR RUNWAYS ARE SET UP FOR THAT? NO.
AT, AT ONE POINT, UM, THERE, MEXICO WAS RESTRICTED IN TERMS OF THE, UM, IN TERMS OF AIR SERVICE TO THE UNITED STATES.
SO AT SOME, AT ONE POINT, FOR A SPAN OF A FEW YEARS, THEY WERE, UH, MEXICAN CARRIERS WERE NOT ALLOWED TO ADD MORE SERVICE TO THE UNITED STATES.
SO ONCE CATEGORY ONE WAS REINSTATED, THEN THE MEXICAN AIRLINES LIKE VIVA AIRBUS HAD THE ABILITY TO ADD NEW CAPACITY TO OUR MARKET.
COMMISSIONERS, I KNOW THAT THEY'RE GONNA BE QUESTIONS.
SO THANK YOU SO MUCH, SECRETARY ROSE.
AND THANK YOU JAMIE, FOR THE PRESENTATION.
KEVIN, WHILE WE'VE GOT YOU, UM, I KNOW YOU'RE IN GREAT AND MEANINGFUL DIALOGUE WITH OPPORTUNITY
[00:45:01]
AUSTIN, WITH THE CHAMBER, ET CETERA, BUT IF WE COULD NARROW IN A LITTLE BIT ON NONSTOP TO ASIA, FOR EXAMPLE.WHAT ARE YOUR, FOR, FOR A GROUP OF PEOPLE LIKE US WHO ARE TRYING TO LEARN AND ADVOCATE, WHAT, WHAT WOULD YOU IDENTIFY AS THE CRITICAL PATH ITEMS FOR US TO GET FROM WHERE WE ARE TODAY TO DIRECT SERVICE TO ASIA? SO WE'RE, WE'RE HAVING INCREDIBLY PRODUCTIVE CONVERSATIONS WITH ASIAN AIRLINES.
UM, AND WE TALK TO THE AIRLINES AS OFTEN AS WE CAN TO HELP THEM UNDERSTAND NOT JUST WHAT'S HAPPENING IN THE AUSTIN COMMUNITY AND IN CENTRAL TEXAS, BUT MOST IMPORTANTLY, WE WANNA HELP 'EM UNDERSTAND, UM, HOW MANY NEW ASIAN BUSINESSES ARE OPENING UP, UM, HOW MANY ASIANS ARE MOVING INTO THE AREA.
AND FOR THOSE PEOPLE MOVING INTO THE AREA, UM, WHAT IS THEIR HERITAGE? WHAT PART OF ASIA DO THEY COME FROM? UM, AND AS YOU KNOW, WE, WE'VE SEEN A LOT OF CHANGES IN ASIAN BUSINESS SINCE COVID.
SO HELPING THE AIRLINES UNDERSTAND WHERE ARE THOSE OPPORTUNITIES.
UM, UH, IT REALLY COMES DOWN TO A, A FEW THINGS, UM, THINGS THAT WE'VE TALKED ABOUT BEFORE, AIRCRAFT AVAILABILITY.
UM, SOME OF THE AIRLINES THAT WE'RE TALKING TO, UM, RETIRED A LOT OF AIRPLANES WITH COVID.
SO IT'S HAVING THE AIRCRAFT AVAILABLE TO SERVE AUSTIN.
UM, IT'S ALSO, THESE ARE DECISIONS FOR MOST OF THE ASIAN AIRLINES THAT ARE MADE IN, UH, JOINTLY WITH THEIR US COUNTERPARTS, WITH THEIR JOINT VENTURE PARTNERS.
SO WE HAVE TO MAKE SURE THAT BOTH THEIR JOINT VENTURE PARTNERS AND THE ASIAN AIRLINES THEMSELVES UNDERSTAND THE OPPORTUNITY HERE IN AUSTIN.
UM, AND EVERYTHING THAT WE'RE SEEING IS THAT THINGS ARE HEADING IN THE RIGHT DIRECTION.
UM, WE DO BELIEVE WE'RE IN ABOUT THE BEST POSITION THAT WE'VE EVER BEEN.
SO IT'S REALLY A MATTER OF TIME FOR, UM, AUSTIN TO FIT IN WITH AN AIRLINE STRATEGY AND, UM, CORPORATE STRATEGY IN TERMS OF THEIR, UM, DESIRE TO EXPAND TO NORTH AMERICA.
'CAUSE AGAIN, ASIAN AIRLINES, UM, ARE GLOBAL.
SO WE ARE FIGHTING WITH THAT SAME AIR FOR THAT SAME AIRCRAFT AS IS A CITY IN, UM,
AS A CITY IN EUROPE, AS A CITY IN, YOU KNOW, EVERY PART OF THE WORLD.
I KNOW YOU'RE AND SUSPECT THAT YOU'RE GETTING EVERYTHING YOU NEED FROM THE TALENTED PROFESSIONAL STAFF HERE.
UM, IS THERE ANYTHING FROM THE BUSINESS COMMUNITY OR THE CIVIC LEADERSHIP IN THE COMMUNITY THAT, THAT COULD BETTER ARM YOU THAT YOU DON'T HAVE, THAT YOU WISH YOU HAD, UM, AS YOU GO OUT THERE AND MAKE THAT PITCH? I, I, I HAVE TO SAY THAT THE WORK WE'VE BEEN DOING WITH, WITH THE CHAMBER, WITH OPPORTUNITY AUSTIN, WITH THE, UM, AUSTIN CHAMBER OF COMMERCE, I'M SORRY, THE ASIAN CHAMBER OF COMMERCE WITH VISIT AUSTIN, THEY'VE ALL BEEN, UM, INCREDIBLE PARTNERS PROVIDING US WITH A LOT OF DATA AND REALLY GOING ABOVE AND BEYOND TO GIVE US THE AMMO THAT WE NEED IN TERMS OF THESE AIRLINE DISCUSSIONS.
SO I, I THINK WE'RE ACTUALLY IN A GOOD PLACE.
WE'RE MOVING TOGETHER IN THE RIGHT DIRECTION.
WE JUST HAVE TO KEEP THE MOMENTUM UP.
UH, THIS COULD BE, UH, YOU KNOW, YOU NEVER KNOW WITH THEIR SERVICE.
THIS COULD BE THREE YEARS FROM NOW, FIVE YEARS FROM NOW, IT COULD BE SIX MONTHS FROM NOW.
WELL, YOU HAVE GREAT PEOPLE IN EACH OF THOSE LOCAL ORGANIZATIONS THAT YOU REFERENCED WHO CARE A LOT ABOUT THIS AND A LOT OF US DO IN THE COMMUNITY.
SO WE ALL APPRECIATE YOUR HARD WORK.
YEAH, THANK YOU FOR THE QUESTION.
UH, DO WE HAVE OTHER QUESTIONS? YES.
UH, COMMISSIONER KUHN, AND THEN I'LL GO TO ER, SORRY, IT'S GONNA HELP IF I UNMUTE.
UM, WHEN WE OPEN THE NEW TERMINAL, WHAT, WHAT FLIGHTS DO YOU THINK WE'LL GET FIRST? IS THAT GONNA HELP US WITH INTERNATIONAL? DOES IT MEAN WE GET DOMESTIC DESTINATIONS THAT WE DON'T HAVE? DO WE JUST GET MORE OF WHAT WE'VE EX, YOU KNOW, CURRENTLY HAVE? WHAT MAKES, WHAT'S, WHAT ARE THE AIRLINES MOST EXCITED ABOUT, DO YOU THINK WITH THE NEW TERMINAL? WHAT WILL IT ADD FOR OUR SERVICE WHEN IT OPENS? UM, I, I THINK IT'S REALLY GONNA GIVE THE ABILITY SOME AIRLINES THE ABILITY TO GROW AND SPREAD THEIR WINGS, NO PUN INTENDED.
UM, MORE THAN THEY'VE BEEN ABLE THAN THEY'RE ABLE TO DO CURRENTLY.
SO I THINK WE'RE GONNA, YOU'RE GONNA SEE, UH, DOMESTIC MARKETS, INTERNATIONAL MARKETS, YOU'RE GONNA SEE, UM, I THINK AIRLINES ADDING, UM, MORE BREADTH TO THEIR SCHEDULE AS WELL.
SO WHERE SOME AIRLINES HAVE WANTED TO ADD ADDITIONAL FREQUENCIES IN, UH, SOME MARKETS, WE'LL SEE THAT ALSO, UM, WE COULD ALSO, I FIRMLY BELIEVE WE'LL SEE SOME NEW RAIL LINES AS WELL, UM, THAT WANT TO COME IN CERTAIN TIMES OF THE DAY AND ARE PRETTY INFLEXIBLE ABOUT THAT.
SO I THINK YOU'LL BE ABLE TO SEE SOME OF THOSE AS WELL.
UM, BUT I, I THINK IT'S REALLY GONNA GIVE US THE, UM, GIVE THE AIRLINES THE OPPORTUNITY TO DO SOME THINGS THAT THEY'VE BEEN WANTING TO DO WHEN YOU
[00:50:01]
KNOW THEIR HANDS ARE, YOU KNOW, TIED BEHIND THEIR BACK A LITTLE BIT.IN YOUR PERCENTAGE OF CHANGE OF SEATS CHART, I CAN KIND OF RATIONALIZE ALL THE NUMBERS THERE BASED ON THE AIRPORTS, BUT THE ONE THAT STUCK OUT TO ME THAT I JUST CAN'T QUITE FIGURE OUT WHY THEY GREW THAT MUCH WAS ONTARIO, CALIFORNIA.
AND, YOU KNOW, AGAIN, WITH, WITH ONTARIO, YOU'RE STARTING FROM A SMALLER BASE, SO THE ADDITIONS ARE GOING TO HAVE A BIGGER IMPACT.
AND ONTARIO, YOU KNOW, AS LAX BECOMES, UH, HARDER AND HARDER TO OPERATE AT AND MORE AND MORE EXPENSIVE, AND AS YOU SEE MORE AND MORE PEOPLE MOVE IN THE LA BASIN AWAY FROM LAX, ONTARIO'S REALLY IN A, UH, A, A GREAT, UH, POSITION TO, UM, TAKE ADVANTAGE OF THAT OPPORTUNITY.
UM, AND THEY'VE ALSO SEEN SOME CARRIERS THAT ARE DOING WELL AT A X AND WANT TO EXPAND BUT CAN'T DO SO IN ONTARIO, LIKE AIRLINES, LIKE AVIANCA AIRLINES, LIKE, UH, CHINA AIRLINES, FOR EXAMPLE.
ANY OTHER QUESTIONS FOR JAMIE OR FOR, UH, KEVIN FROM CAMPBELL HILL.
UM, I DID HAVE ONE QUESTION, WHICH IS THAT I KNOW THAT AUSTIN HAS SEEN AN UPSURGE IN FIXED BASED OPERATIONS AND, UM, PRIVATE AIRCRAFT.
IS THAT SOMETHING THAT THE CON THE CONSULTANCY ENGAGES WITH OR IS IT MOSTLY COMMERCIAL? UH, WE WORK ON THE COMMERCIAL SIDE AND A LITTLE BIT ON THE CARGO SIDE AS WELL.
ALRIGHT, WELL WE ARE GONNA MOVE ON
[5. Briefing on Journey with AUS (AUS AEDP/Capital Improvement Program) Active Projects provided by Lyn Estabrook, Deputy Chief Development Officer]
TO AGENDA ITEM FIVE.UH, LYNN, YOU HAVE A LOT TO TALK ABOUT, I'M SURE TODAY AS A BRIEFING OF ON THE, UM, UH, EXPANSION AND CAPITAL IMPROVEMENT PROGRAM.
UH, GOOD AFTERNOON COMMISSIONERS LYNN ESTHER W CHIEF, I'M JUST GONNA DO A QUICK UPDATE ON TWO HIGHLIGHTS IF, UM, THE, UM, PRESENTATION CAN MOVE FORWARD TO THE PARKING IN LANDSIDE WEST GARAGE.
UM, SO WE HAD MULTIPLE OUTREACHES FOR THIS PROJECT, UM, FROM THE CONTRACTOR TO GET SUBCONTRACTORS.
I HAD MENTIONED IT LAST MONTH, BUT NOW I HAVE ALL THE DATA, SO I WANTED TO BRING THAT TO THE COMMISSION.
SO ON THE 11TH THERE WA AND ON THE FOURTH THERE WERE TWO DIFFERENT, UM, DATES.
THEY DID BOTH VIRTUAL AND IN PERSON EACH OF THOSE DAYS ON THE VIRTUAL, ON THE 11TH, UM, UM, NOVEMBER 7TH, SORRY, UM, 108 PEOPLE ATTENDED VIRTUALLY ON UM, NOVEMBER 7TH AND ON DECEMBER 4TH, 148 ATTENDEES FOR THE VIRTUAL.
AND ON THE IN-PERSON ON UM, NOVEMBER, UM, THE, THERE WERE 83 PEOPLE IN THE IN-PERSON AND ON THE FOURTH THERE WERE 76.
SO WE HAD, UM, A TOTAL OF OVER 450 PEOPLE ATTENDING, UM, THE, THE OUTREACH FOR SUBCONTRACTORS FOR THIS PROJECT.
SO WE ARE VERY EXCITED ABOUT THAT AND WE ARE LOOKING FORWARD TO GETTING SOME GOOD SUBS AND SOME GOOD PRICES ON THIS PROJECT.
IT IS ON TIME AND UM, WE RECEIVED THE 60% DRAWINGS JUST RECENTLY AND WE ARE WORKING THROUGH THOSE DRAWINGS AND REVIEWING THEM.
UM, AND THEN ON THE NEXT PAGE I JUST WANNA GIVE A QUICK UPDATE ON THE WEST GATE EXPANSION.
UM, SO THAT IMAGE YOU SEE THERE IS THE MOON TOWER, IT'S BEEN CRANED UP AND PUT INTO PLACE AND THEY'VE STARTED TO PUT THE ROOF TRUSSES ON.
AND SO THE PROJECT IS MOVING ALONG.
UM, IF YOU HAVE FLOWN OUT OVER THE HOLIDAYS, YOU MAY HAVE SEEN, UH, WITH A DIFFERENT COLOR THAN THE, UM, THE REST OF THE STEEL.
SO THAT'S HOW YOU CAN TELL IT'S A ROOF TRUSS.
IT'S SORT OF A WHITISH GRAY COLOR VERSUS ALL THE OTHER STEELS, THE, THE MAIN COLOR RIGHT NOW, WHICH IS A MORE REDDISH BROWN COLOR.
SO THAT'S AN EXCITING PROJECT AND IT IS ON SCHEDULE CURRENTLY.
SO THOSE ARE THE TWO HIGHLIGHTS I WANTED TO GIVE FOR THE EXPANSION PROJECT BECAUSE I KNOW WE'VE GOT A VERY FULL AGENDA.
UM, DO WE HAVE ANY QUESTIONS FOR LYNN TODAY? AND I URGE YOU TO LOOK AT THE OTHER PROJECTS IN THE PACKET AS WELL.
UM, THERE HAVE BEEN SOME COVERAGE LATELY ABOUT THE ESCALATING COSTS FOR THE CAP AND STITCH FOR I 35 AND I'M WONDERING IF YOU ARE WHAT'S HAPPENING, EVEN THOUGH THERE'S A GUARANTEED MAXIMUM PRICE FOR MANY OF THESE CONTRACTS, THERE ARE ESCALATING CONSTRUCTION COSTS AND HOW, UM, WHAT WHAT WE MIGHT EXPECT IS THIS BODY FOR APPROVING
[00:55:01]
THOSE CHANGES OR HOW YOU'RE KEEPING TRYING TO KEEP THE COSTS DOWN BY, YOU KNOW, I IMAGINE BY KEEPING THE CONSTRUCTION SCHEDULES TIGHT, SO, BUT I'M CURIOUS TO KNOW FOR THE PROJECTS THAT HAVEN'T BROKEN GROUND YET, NAMELY THE CONNECTOR AND THE NEW TERMINAL, HOW THE GUARANTEED MAXIMUM PRICE AND HOW THOSE COSTS WILL NOT ESCALATE AS OTHER, UM, MAJOR INFRASTRUCTURE PROJECTS IN THE AREA HAVE ESCALATED IN COST.WE DO A NUMBER OF DIFFERENT THINGS FOR PROJECTS, YOU KNOW, ONE IS KEEPING THE DESIGN COSTS DOWN AND UM, MAKING SURE THAT WE ARE DESIGNING AN EFFICIENT, EFFECTIVE, UM, AIRPORT THAT IS NOT BASED ON UM, THINGS WE WANT, BUT THINGS WE DESPERATELY NEED.
AND WE ALSO DO HAVE SOME CONTINGENCIES AND OTHER THINGS SET ASIDE THAT IS IN THE CONTROL OF THE FINANCE GROUP AND NOT IN THE CONTROL OF MY TEAM.
SO IT'S VERY HARD TO GET THAT MONEY.
SO WE'VE GOT TO WORK, UM, IN A VERY, UM, WISE WAY, UM, SHREWD AND WISE IS WHAT I TOLD THEM TO, TO, TO BE ABLE TO CUT THE THINGS THAT WE DON'T NECESSARILY NEED BUT TO DO IT IN A VERY WISE WAY, UM, SO THAT THERE AREN'T FUTURE COSTS, UM, BASED ON DIFFERENT INFRASTRUCTURE NEEDS.
SO WE ARE KEEPING A VERY CLOSE EYE, A TIGHT EYE ON DESIGN TO HELP CONTROL THE COSTS OF CONSTRUCTION AND THESE OUTREACHES HELP THE MORE UM, WE CAN GET THE WORD OUT, THE MORE SUBS, THE BETTER BIDS WE CAN GET AND THAT HELPS KEEP COSTS DOWN.
ANYTHING ELSE FOR LYNN TODAY? WELL THANK YOU AND GOOD LUCK.
I KNOW THIS IS A, A CHALLENGING TIME OF YEAR FOR CONSTRUCTION, SO, UM, HOPE THE WEATHER COOPERATES WITH EVERYTHING.
[6. Authorize negotiation and execution of an amendment to a lease with the Transportation Security Administration (TSA) to add two (2) one-year option periods, and to provide for the issuance of a rent credit to TSA for reimbursement of costs incurred for remediation and site work on their leased premises, in an amount not to exceed $195,353.74. It is anticipated that the agreement as amended will reimburse TSA an estimated $195,353.74 over an eight year term.]
GONNA MOVE ON TO THE UM, DISCUSSION AND ACTION ITEMS FOR TODAY.WE HAVE 1, 2, 3, 4, 5, UM, REQUEST FOR COUNSEL ACTION ON THE AGENDA.
UM, ITEM NUMBER SIX IS TO AUTHORIZE NEGOTIATION AND EXECUTION OF AN AMENDMENT TO THE DEPARTMENT OF AVIATION LEASE WITH TSA TO ADD TWO ONE YEAR OPTION PERIODS TO PROVIDE FOR THE ISSUANCE OF A RENT CREDIT TO TSA FOR REIMBURSEMENT COSTS INCURRED FOR REMEDIATION AND SITE WORK.
UM, NOT TO EXCEED $195,353 AND 74 CENTS.
THERE IS 55,000 DO DOLLARS AVAILABLE IN THIS FISCAL YEAR OPERATING BUDGET.
UM, IS THERE SOMEONE HERE TO SPEAK TO THAT ITEM TODAY? I CAN SPEAK TO THAT.
UM, THIS IS A NORMAL COURSE OF BUSINESS TYPE OF RCA, THIS TSA LEASE IS FOR THE CANINE TEAM AND THE UH, STAFF FOR THE CANINE TEAM.
UH, WE UH, RELOCATED THEM FROM THE ORIGINAL LEASE SUPREMACIST TO A NEW LEASE SUPREMACIST AND, AND NEEDED TO BE DEVELOPMENT READY FOR THE TSA.
THEY DECIDED, UH, ON BEHALF OF THE CITY TO GO AHEAD AND DO THE SITE WORK AND THE REMEDIATION OF SOME ASBESTOS WRAP PIPES.
AND IN DOING THAT ON BEHALF OF THE CITY, WE ARE REIMBURSING THEM THROUGH RENT CREDITS.
SO IN ORDER TO DO THAT, WE'RE GIVING THEM A TWO YEAR EXTENSION.
SO THIS IS PRETTY MUCH A NORMAL COURSE OF BUSINESS, UH, TYPE OF AMENDMENT.
BUT I'M PLEASED TO ANSWER ANY QUESTIONS.
WELL, COMMISSIONERS, THAT'S GOOD TO KNOW.
I STILL WANT TO GO SEE THAT, THAT FACILITY
UM, YES, COMMISSIONER YOUNG, GOOD MORNING, RAYMOND YOUNG, UH, AFTERNOON.
SO THE REIMBURSEMENT IS FOR THE, IS ACTUALLY THE TWO YEAR CONTRACT.
SO THE REIMBURSEMENT IS FOR THAT DOLLAR AMOUNT TO BE AFFORDED IN RENT CREDITS TO ON THE LEASE HOLD AND IT'S OVER AN EIGHT YEAR TERM TO DO THAT.
SO, UM, IN ORDER TO ACCOMPLISH THAT, WE EXTENDED, WE GAVE THEM TWO YEAR OPTIONS TO MAKE SURE THAT THEY COULD HAVE A FULL REIMBURSEMENT OF THAT FULL AMOUNT FOR RENT.
OKAY, DO I HAVE A MOTION TO APPROVE THIS NEGOTIATION? COMMISSIONER HENDRICKS AND A SECOND ER.
UM, ANY COMMENTS OR QUESTIONS ON THIS CONTRACT? OKAY.
UM, ALL IN FAVOR? I DO NOT SEE COMMISSIONER KON.
UM, ITEM I WOULD BE FUN TO SEE THE DOGS.
[7. Authorize a contract for original equipment manufacturer baggage handling system parts for the Department of Aviation with Siemens Logistics, LLC, for an initial term of three years with up to two one-year extension options, for a total contract amount not to exceed $2,5000,000. Funding: $375,000 is available in the Fiscal Year 2024-2025 Operating Budget of the Department of Aviation. Funding for the remaining contract term is contingent upon available funding in future budgets. [Sole source contracts are exempt from the City Code Chapter 2-9B (Minority-Owned and Women-Owned Business Enterprise Procurement Program); therefore, no subcontracting goals were established.]]
AUTHORIZE A CONTRACT FOR ORIGINAL EQUIPMENT MANUFACTURER BAG OF HANDLING SYSTEM PARTS FOR THE DEPARTMENT OF AVIATION WITH SIEMENS LOGISTICS FOR AN INITIAL TERM OF THREE YEARS WITH AN EXTENSION OF A CONTRACT AMOUNT NOT TO EXCEED $2,500,000.UM, IS THERE SOMEONE TO SPEAK TO THAT HERE TODAY? HELLO, PAUL PENA.
[01:00:01]
OKAY, I'M LOOKING FOR THE RED THERE.PAUL PENA, AIRPORT SYSTEMS DIVISION MANAGER.
SO YES, WE ARE LOOKING FOR THE COMMISSION SUPPORT FOR THIS PROPRIETARY, UH, SIEMENS BAGGAGE HANDLING SYSTEM PARTS CONTRACT.
WE RECENTLY GOT APPROVAL FOR A SIEMENS OPERATIONS AND MAINTENANCE CONTRACT, BUT THAT'S MORE SO ON THE SERVICES SIDE, NOT NECESSARILY THE SPARE PARTS NEEDED TO MAINTAIN THIS, THIS NEWLY UH, INSTALLED BAGGAGE HANDLING SYSTEM.
SO WE ARE LOOKING FOR YOUR SUPPORT IN, UM, ESTABLISHING THIS TO MAINTAIN THAT CRITICAL INFRASTRUCTURE.
UM, THIS IS A NOT TO EXCEED AMOUNT, CORRECT? CORRECT.
SO IF IF THEY DON'T NEED THE PARTS, THEY'RE NOT GOING TO GET THE PARTS CORRECT.
IS THAT CORRECT? AND THIS IS FOR THE NEW, I KNOW THAT WE RECENTLY BOUGHT PARTS FOR THE OLD FOR SOMETHING OLD WHILE WE WHILE IT WAS STILL OPERATIONAL, IS THAT CORRECT? WE, THERE WERE SOME PARTS, SO WE, THIS IS, THIS IS ALSO TO REPLACE AN EXISTING CONTRACT THAT'S GET, THAT WAS ALREADY EXPIRED AT THE END OF 2024.
SO THIS IS JUST ADDING ONTO THAT RENEWING THE, THE SERVICE AGREEMENT THAT WE HAD WITH SIEMENS, WHICH SIEMENS IS A PROPRIETARY COMPANY, SO WE HAVE TO ESTABLISH SOME KIND OF PROCUREMENT PROCESS IN ORDER TO BE ABLE TO MAINTAIN THE SYSTEM AND PROCURE THOSE PARTS.
UM, COMMISSIONERS, DO I HAVE A MOTION? ELLER SECOND HENDRICKS.
UH, DO WE HAVE ANY QUESTIONS FOR MR. PENA REGARDING THIS CONTRACT? ALRIGHT, UH, THEN WE'LL MOVE TO VOTE.
ALL IN FAVOR? THAT IS ALL OF US.
[8. Authorize a contract for an emergency notification system for the Austin-Bergstrom International Airport for the Department of Aviation with Everbridge, Inc., for an initial term of one year with up to two one-year extension options, for a total contract amount not to exceed $272,090. Funding: $90,697 is available in the Fiscal Year 2024-2025 Operating Budget of the Department of Aviation. Funding for the remaining contract term is contingent upon available funding in future budgets. [This procurement was reviewed for subcontracting opportunities in accordance with City Code Chapter 2-9B (Minority-Owned and Women-Owned Business Enterprise Procurement Program). For the goods and services required for this procurement, there were no subcontracting opportunities, therefore, no subcontracting goals were established.]]
AUTHORIZE A CONTRACT FOR EMERGENCY NOTIFICATION SYSTEM WITH EVERBRIDGE FOR AN INITIAL TERM OF ONE YEAR WITH UP TO TWO YEAR EXTENSIONS FOR A TOTAL CONTRACT AMOUNT NOT TO EXCEED $272,090.THIS WAS SOMETHING THAT WAS POSTPONED FROM A PREVIOUS MEETING, IS THAT CORRECT? AND WE HAVE SOMEONE HERE TO SPEAK TO THAT TODAY.
UH, CHRIS LAC IT DIVISION MANAGER.
UM, YEAH, SO THIS IS A CONTRACT, UH, THAT WE'RE USING FOR EVERBRIDGE, WHICH IS AN EMERGENCY EMERGENCY NOTIFICATION SYSTEM.
UM, THIS ALLOWS OUR A OC, OUR AIRPORT COMMUNICATION CENTER TO, UM, COMMUNICATE TO ALL OF OUR STAFF ACROSS THE CAMPUS FOR ANY INCIDENTS OR, UM, NOTIFICATIONS THAT YOU GO OUT TO EVERYONE FOR LIFE SAFETY AND THE STAFF.
SO YES, THIS IS A ONE YEAR CONTRACT WITH TWO YEARS EXTENSION.
THIS IS AN EXISTING CONTRACT THAT WE HAD SINCE 2019 AS WELL.
SO WE'RE JUST LOOKING TO EXTEND THAT.
WE'RE ALSO LOOKING, UM, THE ONE YEAR IS BECAUSE WE'RE WORKING WITH THE CITY AS THEY PROCURE A MASTER AGREEMENT FOR ALL OTHER DEPARTMENTS USES AS WELL.
THAT WAS A QUESTION I DID HAVE IS HOW DOES THIS CO CONTRACT, UM, INTER INTERFACE WITH CITY EMERGENCY NOTIFICATION SYSTEM? YEAH, AGAIN, THIS IS JUST TO CONTINUE OUR SERVICES WHILE THE CITY MAN, UH, WORKS ON GETTING EVERYONE TO USE THE, TO GET THERE AS A, FOR ALL DEPARTMENTS.
DO WE HAVE ANY QUESTIONS FOR MR. BLAC? UM, ARE THERE, IS THERE TESTING BUILT INTO THAT CONTRACT AMOUNT? UH, IT'S ALREADY UP AND RUNNING.
WE, LIKE I SAID, WE'VE HAD THIS SERVICE SINCE 2019, SO THIS IS THE EXTENSION.
SO IT'S ALREADY CONFIGURED AND WORKING TO OUR STANDARDS THAT WE NEED FOR THE AVIATION DEPARTMENT.
BUT LIKE, SORT OF LIKE A FIRE DRILL, DO THEY DO A SCENARIO TESTING FOR IT IN CA FOR DIFFERENT SCENARIOS? WE CAN.
WE HAVE A DEVELOPMENT, SINCE IT IS A HOSTED ENVIRONMENT, THERE'S A DEVELOPMENT AREA THAT WE CAN DO TESTING.
SO IT DOESN'T AFFECT OUR, UM, OPERATIONAL OF THE OPERATION DAILY SERVICES.
SO YES, WE CAN DO THAT AND PUT IN SELECT USERS SO THAT THEY UNDERSTAND THAT THIS IS A TEST AND IT'S NOT A, A PRODUCTION ENVIRONMENT.
SO HERE'S A SCENARIO, UM, JUST FOR EMERGENCY.
UM, I, I WAS, I WAS ARRIVING AT THE AIRPORT SEVERAL A YEAR OR SO AGO WHEN, WHEN IT WAS, WHEN THE TERMINAL WAS CLOSED MM-HMM
THERE WAS, WHAT WAS THE POWER OUTAGE? THERE WAS, THAT WAS THE ELECTRICAL, THE AUSTIN ENERGY, NON-REDUNDANT POWER SITUATION.
AND THERE WAS NOT INFORMATION, THERE WAS NOT INFORMATION PROVIDED REALLY IN REAL TIME TO THE FLYING PUBLIC.
AND THEN THE AIRLINES WERE NOT NOTIFIED, YOU KNOW, THE, I WAS SITTING IN A PARKING AN OFFSITE PARKING LOT, LOT WITH OTHER PEOPLE FLYING AND NO ONE HAD ANY INFORMATION AND WE DIDN'T HAVE ANY INFORMATION FOR OVER AN HOUR.
SO CLEARLY THERE WASN'T ELECTRICITY IN THE TERMINAL.
BUT THAT WAS THE, IS THAT LIKE THE ONLY THING, THIS IS A HOSTED SERVICE, SO NOTHING IS ON PROPERTY, SO IT'S ALL IN THE CLOUD, SO IT GOES OUT TO USER CELL PHONES AND THAT'S HOW THE NOTIFICATIONS WERE BEING SENT OUT TO AVIATION STAFF THAT ARE ENROLLED INTO THE SYSTEM.
ARE YOU GONNA SPEAK TO THIS, BRIAN? LONG? THANK YOU.
YOU BROUGHT, YOU BROUGHT THE POWER UP SINCE YOU BROUGHT UP THAT GREAT DAY THAT WE HAD EPTEMBER.
WELL, SEPTEMBER, I HAVE A COUPLE AGO.
[01:05:01]
I, I, THE NOTIFICATION SYSTEM WENT TO MY PHONE.I DID RECEIVE IT AT ABOUT THREE 30 IN THE, WELL, THAT WAS ABOUT FOUR 30 IN THE MORNING WHEN I RECEIVED THE, THE EVERBRIDGE COMMUNICATION BECAUSE OUR BACKUP POWER THAT SENDS THAT, BECAUSE IT'S CLOUD-BASED WORKED, AND I DID RECEIVE THE NOTIFICATION AND SO DID OTHER PEOPLE THAT ARE ON THE, THE, UH, SYSTEM FOR EACH DEVICE.
SO I'M NOT ON SOMETHING THAT IS NOT RELATED TO MAINTENANCE OR, OR AIRFIELD AND AIRFIELD FOLKS ARE NOT RELATE ON THINGS THAT ARE RELATED TO MAINTENANCE.
SO IT'S A VERY SPECIFIC SYSTEM FOR NOTIFICATIONS FOR, UH, US TO, TO WORK IN.
HOPEFULLY THAT CLEARS UP THE SITUATION AND TIES IN YOUR QUESTION.
WELL, YEAH, BUT I GUESS I, I'M, I'M GONNA ASK, UH, A, A COMMUNICATIONS PROFESSIONAL HERE, BUT I MEAN, IN, IN, DOES IT GO TO THE, DO DO ALL OF THESE GO TO THE, UM, PUBLIC RELATIONS OR MEDIA DEPARTMENT FOR YES.
AND THEN PIO WILL THEN INSEMINATE HOW THEY WANT TO PUT MESSAGES OUT TO THE PUBLIC.
AND TO BRIAN'S POINT, THERE ARE DIFFERENT, UH, ROLES IN THE SYSTEM THAT DIFFERENT DIFFERENT STAFF OR DIFFERENT TEAM MEMBERS OF AVIATION WILL GET DIFFERENT NOTIFICATIONS SO THAT WE'RE NOT JUST, JUST BOMBARDING EVERYONE WITH MESSAGES.
WELL, DO WE HAVE A MOTION FOR THIS, UH, CONTRACT EXTENSION.
UH, COMMISSIONER VALDEZ SECOND YOUNG.
AND I HOPE THAT WE DON'T NEED IT ANYTIME SOON.
[9. Authorize a contract for replacement of pre-conditioned air conditioning and heating hoses for the Department of Aviation with Metroplex Custom Services, LLC, for an initial term of two years with up to three one-year extension options, for a total contract amount not to exceed $465,000. Funding: $65,000 is available in the Fiscal Year 2024-2025 Operating Budget of the Department of Aviation. Funding for the remaining contract term is contingent upon available funding in future budgets. [Sole source contracts are exempt from the City Code Chapter 2-9B (Minority-Owned and Women-Owned Business Enterprise Procurement Program); therefore, no subcontracting goals were established.]]
ITEM NUMBER NINE.UM, THIS IS A REPLACEMENT OF PRECONDITION AIR CONDITIONING AND HEATING HOSES FOR THE DEPARTMENT OF AVIATION WITH METROPLEX CUSTOM SERVICES LLC FOR TWO YEARS, TOTAL CONTRACT AMOUNT NOT TO EXCEED $465,000.
UM, IS THERE SOMEONE HERE TO SPEAK TO THAT? HELLO, BRIAN.
THANK YOU, BRIAN LONG AIRPORT DEPUTY CHIEF INFRASTRUCTURE, AND, UH, EXCITED TO BRING THIS TO YOU.
WE, UH, THE, THIS IS A SPECIALLY CONTRACT FOR THE HOSES THAT CONNECT THE UNITS UNDER THE PASSENGER BOARDING BRIDGES THAT CONNECT TO THE AIRPLANE.
UH, I'M SURE Y'ALL HAVE NEVER BEEN ON AN AIRPLANE THAT FEELS WARM DURING THE SUMMER IN AUSTIN.
UM, BUT IF YOU HAVE, UH, THIS IS THE HOSE THAT, UH, WE WANT TO MAKE SURE IS NOT KINKED UP AND THAT DOESN'T HAVE ANY LEAKS AND THAT IS WORKING WELL.
AND JUST SO YOU KNOW, WE USE THEM OFTEN, UH, HERE.
SO, UH, THIS IS A, A DESIGN THAT, UH, WE WERE ASKED TO LOOK INTO WITH SOME OF OUR PARTNERS, AND WE, UH, HAVE BEEN WORKING ON IT IN SOME OF THE BRIDGES, AND WE'RE WANTING TO PUT IT ON MORE OF THE BRIDGES.
SO THAT'S WHAT WE'RE HERE TO, TO ASK FOR.
DO WE HAVE ANY QUESTIONS FOR BRIAN LONG? UM, YOU, THE AIRPORT HAS PURCHASED NEW BRIDGES, RIGHT? CORRECT.
THERE, THERE, THERE YOU ARE REPLACING BRIDGES AS WE SPEAK, RIGHT? CORRECT.
AND SO THOSE BRIDGES DON'T NECESSARILY COME WITH THE HOSES, OR IF THEY DO, WE'RE, WE'RE SPECIFYING, UH, THIS IS MAINLY FOR THE HOSES THAT HAVE, UH, THAT THE DIFFERENCE OF THESE.
AND YOU'LL SEE SOME OF THEM, IF YOU'RE OUT THERE, THEY HAVE A LITTLE TRAY THAT ARE ON SOME WHEELS THAT ALLOW THEM NOT TO GET BIND.
LIKE SOME OF THE OLDER ONES THAT DON'T HAVE THE TRAYS OR THE, THE, I SHOULD SAY CARTS MM-HMM
AND SO, UH, THE NEW JET BRIDGES WE'RE SPECIFYING JUST WITH THE PC UNITS, THEN THE HOSES WILL CONNECT TO THOSE.
AND SO WE'RE MAKING SURE NOT, YOU KNOW, UH, INCLUDING IT IN BOTH, BOTH AREAS.
WELL, I'M ALL FOR THERMAL COMFORT.
SO DO WE HAVE A MOTION HERE TO APPROVE THIS ITEM? YES.
UH, UH, VICE CHAIR BROCK AND A SECOND.
SE RESOUNDING SECOND FROM COMMISSIONER HENDRICKS.
YOU ALL, ALL IN FAVOR OF, UM, THE AIR CONDITIONED BRIDGES THIS SUMMER.
UM, I SEE EVERYONE, UH, EXCEPT FOR MEDO AND, AND ROSE.
[10. Authorize a contract for capital project auditing and controls for the Department of Aviation with Anchor Enterprises, LLC, for an initial term of five years with up to three one-year extension options for a total amount not to exceed $32,000,000. Funding: Funding is available in the Capital Budget of the Department of Aviation. [This solicitation was reviewed for subcontracting opportunities in accordance with City Code Chapter 2-9B (Minority-Owned and Women-Owned Business Enterprise Procurement Program) and subcontractor goals were applied to the solicitation. The subcontracting goals were exceeded, and the resulting contract will include 25% MBE and 5% WBE.]]
UM, ACTION ITEM TODAY IS, UH, TO AUTHORIZE A CONTRACT FOR CAPITAL PROJECT AUDITING AND CONTROLS FOR THE DEPARTMENT OF AVIATION WITH ANCHOR ENTERPRISES LLC FOR AN INITIAL TERM OF FIVE YEARS WITH UP TO THREE ONE YEAR EXTENSION OPTIONS FOR TOTAL AMOUNT NOT TO EXCEED $32 MILLION.UM, WHO IS HERE TO SPEAK TO THAT ITEM TODAY? I AM OKAY.
THOMAS GIE THOMAS, UH, CHIEF FINANCIAL OFFICER FOR THE DEPARTMENT OF AVIATION.
UM, SO THIS IS A CONTRACT FOR PROGRAM CONTROLS AND AUDITING.
UH, THIS IS SOMETHING THAT WE NEED, YOU KNOW, UM, TO KIND OF LOOK AT OUR FINANCIAL CONTROLS AND ANY DEFICIENCIES THAT WE CURRENTLY HAVE, AND ALSO TO PROVIDE COST ESTIMATIONS AND ALSO, UH,
[01:10:01]
COST CONTROLS THAT WE NEED.I KNOW YOU SPOKE TO THIS BEFORE, HOW DO WE PLAN TO MANAGE OUR COSTS AND CONTROL OUR COSTS IN THIS PROGRAM? AND THIS IS ONE OF THE WAYS THAT WE PLAN TO DO THAT, THAT IS AUDIT WHAT IS COMING DOWN IN THROUGH THE INVOICES AND ALL, YOU KNOW, WHETHER, YOU KNOW, WHETHER IT IS IN COMPLIANCE WITH THE CONTRACTS THAT WE HAVE.
LOOK AT ALL THE ALLOWANCES THAT WE HAVE, THE PROFIT MARKUPS THAT WE HAVE ARE ON, ON ALL THE INVOICES, ET CETERA.
AND ALSO PROVIDE SOME EXPERT ADVISORY SERVICES.
UH, SO THIS IS GONNA BE A JOINT CONTRACT BETWEEN FINANCE AND PLANNING AND DEVELOPMENT.
THAT'S WHY SHANE HARON IS ON THE LINE TO, TO KINDA SPEAK TO, YOU KNOW, THE NEEDS THAT HIS DEPARTMENT HAS ON IT.
BUT FROM A FINANCIAL, UH, STANDPOINT, THIS IS ABOUT FINANCIAL CONTROLS.
UM, YOU KNOW, THE, JUST THE CONTRACT MANAGEMENT AND CONTRACT COMPLIANCE AND ARE WE AUDITING THE INVOICES AND IS IT, IT'S IN COMPLIANCE WITH THE, THE CONTRACTS, ET CETERA.
UM, THIS IS A VERY LARGE SCOPE AND AN IMPORTANT CONTRACT.
UM, I HAVE A QUESTION ABOUT HOW, HOW ONE, UM, COST, UH, HOW YOU DEVELOP A BUDGET FOR THIS KIND.
WHETHER IT'S A PERCENTAGE OF CONSTRUCTION COST OR THE TOTAL OPERATING BUDGET FOR THE AIRPORT OR SQUARE FOOTAGE OR EMPLOYEE.
I DON'T KNOW HOW THIS, HOW WE ARRIVED THIS.
SO CURRENTLY WHEN WE GO THROUGH ESTABLISHING A BUDGET, YOU KNOW, WE LOOK AT THE PRELIMINARY DESIGN, ET CETERA, AND YOU LOOK AT, YOU GO THROUGH THE CURRENT PROGRAM MANAGEMENT SERVICES, WHICH IS WSP, AND THEY HAVE SUBCONTRACTORS THAT PROVIDE COST ESTIMATION BASED ON THE SCOPE THAT WE HAVE DESIGNED IN THERE, UH, OR DEFINED IN THERE.
WHAT WE WANT IS AN INDEPENDENT ANALYSIS OF THOSE COST ESTIMATES.
SO WE HAVE TWO OR THREE COST ESTIMATIONS THAT WE CAN LOOK AT, YOU KNOW, LOOK AT THE MATERIAL COST, THE LABOR COST, AND COME TO A RECONCILIATION ON WHAT IS CAUSING THE DIFFERENCES.
SO WE HAVE A BETTER BUDGET GOING FORWARD.
WHAT WE DON'T WANT TO HAVE IS ESTABLISH A BUDGET AND, AND FIGURE OUT THERE IS A MISSED TWO OR THREE DOWN YEARS DOWN THE LINE BECAUSE SOME ITEM WASN'T, YOU KNOW, YOU KNOW, DIDN'T HAVE THE CORRECT COST, ET CETERA.
RIGHT? SO WE WANT THAT INDEPENDENT ANALYSIS AND THAT INDEPENDENT COST ESTIMATION.
AND ALSO WE WANT IT TO BE FROM A FIRM THAT HAS AIRPORT EXPERIENCE, AIRPORT CONSTRUCTION EXPERIENCE, ET CETERA.
SO THAT'S WAS THE GOAL OF THIS.
UM, THIS CONTRACT AND, YOU KNOW, OTHER AIRPORTS THAT HAVE ALREADY PUT THIS INTO PLACE IS SALT LAKE CITY, UH, YOU KNOW, ORLANDO, UM, CHARLOTTE DOUGLAS, ET CETERA.
ALL THOSE AIRPORTS HAVE SORT OF A PROGRAM CONTROL IN PLACE TO BE ABLE TO KIND OF OVERSEE THE WHOLE PRO WHOLE PROGRAM.
I, I UNDERSTAND THE NEED FOR IT.
AND HOW THAT, HOW THAT ARISES.
I'M, I'M ASKING HOW THE, THE FEE FOR THE CONSULTING SERVICES WAS ARRIVED AT.
YEAH, SO THIS, THIS IS BASED ON SOME, SOME OF THE POSITIONS THAT WE FEEL LIKE WE NEED.
FOR EXAMPLE, WE NEED A AUDITOR.
UH, WE NEED SOME AUDIT ASSOCIATES.
UH, WE NEED, UH, COST ESTIMATION SERVICES, WE NEED PROGRAM MANAGEMENT OR PROGRAM CONTROL SERVICES.
SO WE LOOKED AT THOSE POSITIONS.
WE, WE, UH, SCHEDULER ALL THESE THINGS, RIGHT? I MEAN, SO WE LOOKED AT ALL THOSE POSITIONS AND WE CAME UP WITH WHAT WE THINK THAT THE RATE AND THE NUMBER OF HOURS WE, WE WILL BE USING ANNUALLY.
AND WE CAME UP WITH ROUGHLY ABOUT $4 MILLION A YEAR, IS WHAT WE EXPECT TO BE.
SO YOU VISUALIZE THIS SEEING YOU THROUGH TO, THROUGH THE CONSTRUCTION OF THE EDP.
AND WE EXTENDED IT TO 80 YEARS JUST TO MAKE, JUST TO MAKE SURE THAT WE HAVE SOME LEEWAY IN CASE SOMETHING GOES TO 20 31, 20 32, ET CETERA.
BUT MOST OF THE COSTS WILL BE IN THE NEXT FIVE YEARS, STARTING IN FISCAL YEAR 26 THROUGH ABOUT 2031 IS WHERE THE MAJORITY OF THE EXPENSES WILL BE.
COMMISSIONERS, ANY QUESTIONS FOR RAJIV ABOUT THIS CONTRACT? OKAY.
DO WE HAVE A MOTION TO APPROVE? UH, COMMISSIONER YOUNG, DO WE HAVE A SECOND? MEALL? OH, SORRY, SORRY.
UM, ALL IN FAVOR, I'M GONNA CALL THE VOTE.
ALL IN FAVOR OF THIS, UM, AUDITING PROGRAM.
AND THOSE ARE ALL OF THE ACTION ITEMS FOR TODAY.
WE DO NOT HAVE ANY DISCUSSION ITEMS. I'M GONNA CALL FOR ANY FUTURE AGENDA ITEMS FROM THE COMMISSIONER.
[NEXT REGULAR MEETING]
I'M GONNA ANNOUNCE THAT THE NEXT REGULAR MEETING OF THE AIRPORT ADVISORY COMMISSION IS SCHEDULED FOR WEDNESDAY, FEBRUARY 12TH.[01:15:01]
UM, WITHOUT, UM, ANY DISCUSSION, THIS MEETING IS ADJOURNED.