CITY OF EL PASO DE ROBLES
"The Pass of the Oaks"
Airport Ad Hoc Committee Meeting
Thursday, May 9, 2024, 2:00 PM
Paso Robles Municipal Airport
4900 Wing Way
Paso Robles, CA 93446
Members of the public are welcome to attend in person. As a reminder, Ad hoc committees consist of 1 or 2 members of the City Council who are appointed by the City Council to perform specific tasks, usually working with staff or representatives from local organizations. An ad hoc committee functions for a limited period of time, reporting back to the full Council periodically during the duration of the committee or at its termination.
AMERICANS WITH DISABILITIES ACT Any individual, who because of a disability needs special assistance to attend or participate in this meeting, may request assistance by contacting the City Clerk’s Office (805) 237- 3960. Whenever possible, requests should be made four (4) working days in advance of the meeting.
Pages
A. PUBLIC COMMENT
B. COMMITTEE MEMBERS
Councilmember Steve Gregory, Co-Chair
Councilmember Sharon Roden, Co-Chair
Chair Airport Commissioner Eric Cook
Airport Commissioner Ben Andros
C. CITY STAFF
Freda Berman, Public Works Director
Mark Scandalis, Airport Manager
Thomas Rice, Assistant City Attorney, BBK
If Available:
Ty Lewis, City Manager
Chris Huot, Assistant City Manager
Melissa Boyer, City Clerk
Elizabeth Hull, City Attorney, BBK
D. SUBJECT MATTER EXPERT
Robert Trimborn, Senior Consultant, Aviation Management Consulting Group (AMCG) E. DISCUSSION ITEMS
1. 1. Review and clarification of FBO proposals 3 - 104 Presentation by Robert Trimborn, Senior Consultant, (AMCG) 15 Minute break after this presentation
2. 2. Ad Hoc Committee to discuss proposals
Make recommendation to the City Council regarding the preferred FBO vendor and any preferred negotiation points.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
F. ADJOURNMENT
Airport /Ad Hoc Committee Meeting (May 9, 2024)
May 7, 2024
Ad-Hoc Committee
Meeting #2 Question
Response
City of El Paso de Robles
Paso Robles MunicipalAirport
Airport /Ad Hoc Committee Meeting (May 9, 2024)
9085 East Mineral Circle | Suite 315 | Centennial, Colorado | 80112-3499 | 303.792.2700 | www.aviationmanagement.com May 7, 2024
Mark Scandalis
Airport Manager
Paso Robles Municipal Airport
4912 Wing Way
Paso Robles, California 93446
RE: Fixed Base Operator: Proposal Submittal Review
Dear Mark:
This report conveys Aviation Management Consulting Group’s (AMCG’s) response to the questions and clarification of issues that arose from the Paso Robles Municipal Airport (Airport) Ad-Hoc committee meeting #2 which occurred April 18, 2024. It is important to note that both ACI Jet and Loyd’s Aviation have been contacted to provide additional information as necessary. Loyd’s and ACI Jet responses are presented here verbatim.
AMCG is pleased to have been called on to provide the following information. Please contact me if you have any questions pertaining to the information presented in this report.
Helping your aviation management excellence,
Robert Trimborn
Senior Aviation Consultant
Aviation Management Consulting Group
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 2
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) I. QUESTION COMPILATION AND RESPONSE
Based on the questions received, the AMCG team developed written responses. Each of the questions submitted have been addressed in this document. Each comment is represented by a “C” and the response to the comment is represented by an “R”.
Numbering is utilized only as a method to identify and organize comments.
C1 Ensure the analysis identifies the length of the contract term offered by each proposer. If there are inconsistencies in what either proposer has offered, please note that.
R1 – Loyd’s Aviation Question not posed to respondent.
R1 – ACI Jet Question not posed to respondent.
R1 – AMCG As stated in Loyd’s Aviation proposal (Page 33), “Loyd’s Aviation proposes an initial 5-year lease with a contingency that a new lease term will begin upon the commencement of construction for the Executive FBO. At that point, a new term of 30 years, with two 5 year options will begin. That arrangement should allow Loyd’s Aviation plenty of time to design and procure building permits with enough lease to adequately finance the project, and it gives the City an assurance that construction will begin.” As stated in ACI Jet’s proposal (Page 3), “Our response is structured in this fashion to allow the City to select ACI Jet as a successful proposer for the 5-year term identified in the RFP with the option of adding its proposed development plan at the City Council’s discretion.” A 40 year term would then begin at construction of Phase 1 improvements.
Further, ACI Jet’s proposal (Page 28) states ACI Jet “proposes that the negotiated lease term be set at 40 years. This will allow for refinancing, if necessary or desirable, and complies with FAA policies regarding the length of leases.”
It is AMCG’s understanding Loyd’s Aviation desires a 5-year term followed by a 30-year term with two 5-year options while ACI Jet desires a 40-year term.
C2 Ensure the analysis clearly identifies the staffing level proposed by each proposer.
R2 – Loyd’s Aviation Question not posed to respondent.
R2 – ACI Jet Question not posed to respondent.
R2 - AMCG As stated in Loyd’s Aviation proposal (Page 16), 1 on-site supervisor, 1 Customer Service Representative, and 4-5 Line Service Technicians are proposed.
As stated in ACI Jet’s proposal (Page 12), 4 hybrid Ground Support/Hospitality Agents and 1 dedicated Hospitality & Experience agent are proposed. Additionally, as stated in ACI Responses to Ad Hoc Committee Q&A (see Appendix F), “ACI’s General Manager (Luke Newlon) is permanently committed to operate the FBO and assist with the oversight of all future development at KPRB. Luke’s presence is in addition to the staffing in ACI’s proposal and it provides deeper local relationships and connections than the Supervisor Role proposed by the competition.”
C3 Ensure the analysis identifies the estimated (or claimed) equipment cost and equipment type that will be dedicated to KPRB.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 3
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) R3 – Loyd’s Aviation Question not posed to respondent.
R3 – ACI Jet Question not posed to respondent.
R3 – AMCG Loyd’s Aviation proposes the following equipment dedicated to the Airport:
• 2 Jet-A fuel truck
• 1 avgas fuel truck
• 1 GPU
• 1 Lavatory Service Cart
• 1 Tug
Loyd’s Aviation Total Equipment Investment = $875,000
ACI Jet proposes the following:
• 3 Jet-A fuel trucks
• 1 Avgas truck
• 3 Tugs
• 2 GPUs
• 1 Turbine Air Starter
• 1 Lavatory Cart
• 1 Water Cart
• 1 Tower for de-icing
• 1 Follow-Me cart
• 1 Crew car
• 1 Pickup Truck.
ACI Jet’s Total Equipment Investment = $1,274,000
C4 Ensure the analysis identifies the fuel storage rents in each proposal.
Please ensure the analysis notes that fuel storage is a component of our fuel flowage fees.
R4 – Loyd’s Aviation This seems like a question for ACI. Per the current rates and fee schedule, and per the Airport Manager, that fee has been rolled into the adopted flowage fee schedule. A separate fee was not proposed.
R4 – ACI Jet “As identified in our original response, and all subsequent financial comparisons, ACI has always proposed paying additional rent for the Fuel Storage Facility in addition to the proposed Land & Building Rents. This additional rent of $7,680 per year ($0.24 per available gallon of storage capacity) is not in any way related to the Fuel Facilities Development Fee and is still being offered as part of our proposal.” See Appendix D – ACI Jet Response for additional detail.
R4 – AMCG As a point of clarification, Page 32 of Loyd’s Aviation proposal identified at Fuel Facilities Development Fee of $0.03 per gallon (all fuels) C5 Eliminate any references in the analysis to any proposals for ramp space not offered in the RFP.
R5 – Loyd’s Aviation Question not posed to respondent.
R5 – ACI Jet Question not posed to respondent.
R5 – AMCG Reference of ramp space not offered in the RFP is from analysis and conclusions from Staff Report and not included in AMCG’s financial or operational analysis.
C6 To the extent new fee structures are proposed, please identify how the proposed structure differs from the City Council-approved fee structure. (See attached 03 Exhibits to Resolution…for current fee schedule FY23- 24 on this document were adopted.)
R6 – Loyd’s Aviation Question not posed to respondent.
R6 – ACI Jet Question not posed to respondent.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 4
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) R6 – AMCG As stated in Loyd’s Aviation Additional Information Response (Page 2), “It is Loyd’s Aviation’s understanding that the fees identified in the adopted Comprehensive Fee Schedule are designed to fund the City’s ongoing efforts to support and maintain the airport and are not a source of income for the FBO. Therefore, Loyd’s Aviation’s “negotiated split” mentioned in the proposal, has been envisioned as an 85/15 (City/Loyd’s Aviation) split.
Loyd’s Aviation’s portion is just to cover staff and processing fees.” The City’s adopted Comprehensive Fee Schedule is based upon 4 categories of aircraft (Single-Engine, Twin-Engine, Jet and Helicopter).
See Appendix G.
As stated in ACI Jet’s Additional Information Response (Page 2), ACI Jet proposes a new fee schedule of ramp fees and parking fees, which can all be waived with a minimum fuel purchase based on aircraft type. The fee schedule proposed by ACI Jet includes 10 categories of aircraft (Piston Single, Piston Twin, Helicopter Small, Helicopter Standard, Very Light Jet, Light Jet, Mid-Size Jet, Super Mid Jet, Large Jet and Super Long Range Jet). ACI Jet will remit 20% of the revenue collected from such fees to the City and will keep 80%. See Appendix H.
C7 Ensure the analysis identifies any revenue share splits for airport fees offered by either proposer.
R7 – Loyd’s Aviation Question not posed to respondent.
R7 – ACI Jet Question not posed to respondent.
R7 – AMCG See Response R6 – AMCG.
C8 Include information on government contracts in the analysis.
Specifically, please ensure the DLA contract process is explained and confirm whether any FBO operating at KPRB can obtain such contracts.
Please request copies of the DLA contract from the proposers for this purpose.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 5
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) R8 – Loyd’s Aviation Question: Please confirm if Loyd’s Aviation will provide DLA contract services at PRB to allow for the procurement of aviation fuel, fuel-related supplies, and approved ground services by the Department of Defense and federal civilian agencies.
• Please provide a copy of Loyd’s Aviation DLA contract.
Answer:
• Some terminology and procedures need to be clarified. • The DLA does not sign obligatory fuel “contracts,” they are only pricing agreements. These pricing agreements do not obligate any aircraft to utilize any specific fuel service provider. Every DLA aircraft can utilize any FBO that accepts a government Air Card…which is nearly every FBO.
• As alluded to in the first point, a Pricing Agreement is not required to provide services to DLA aircraft. Most soleprovider FBOs don’t have one. • Neither Loyd’s Aviation nor ACI hold the Pricing Agreement with the DLA. That agreement is between the DLA and Avfuel.
In turn, Avfuel utilizes their service provider (ACI in PRB and Loyd’s Aviation in BFL) to fulfill the agreement.
• If awarded a lease, Loyd’s Aviation would provide fuel services to the DLA starting on day 1. Since we are already an Avfuel dealer, and would continue to be in PRB, the transition would be a seamless non-event for DLA customers.
• Regarding the DLA Agreement, there are 3 items attached. • The Award letter from DLA to Avfuel (see Appendix A). • Fuel Supply Agreement between us and Avfuel (see Appendix B).
• Standard Form 1449 showing the purchase authorization. To comply with my contract with Avfuel, the pricing has been redacted in this document (see Appendix C).
R8 – ACI Jet Question: Please confirm if Loyd’s Aviation will provide DLA contract services at PRB to allow for the procurement of aviation fuel, fuel-related supplies, and approved ground services by the Department of Defense and federal civilian agencies.
• Please provide a copy of Loyd’s Aviation DLA contract.
Answer:
• “Yes. Please see below (award letter) and attached (contract)." See Appendix D – ACI Jet Response.
R8 – AMCG AMCG understands the Defense Logistics Agency (DLA) facilitates the U.S. Government AIR Card® Program that provides the Department of Defense military services and federal civilian agencies a means to procure aviation fuel, fuel-related supplies and approved ground services worldwide at both DLA Energy contract locations and commercial airports.
The program is based on a charge card that can be electronically swiped, Mechanically imprinted or hand scribed onto a commercial delivery ticket The DLA contract is secured directly with the fuel provider, both Loyd’s Aviation (Avfuel) and ACI Jet (Chevron) utilize a fuel provider with a DLA contract. This relationship allows Loyd’s Aviation and ACI Jet to accept the U.S. Government AIR Card®.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 6
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) C9 Ensure the analysis addresses how each proposer proposes to handle aircraft charter operations.
R9 – Loyd’s Aviation Question: Please provide additional information regarding Loyd’s Aviation proposed aircraft charter operations at PRB. Identify aircraft type, where aircraft will be based, and how a customer would obtain aircraft charter services and estimated response times.
Answer: “Loyd’s Aviation has operated charter aircraft in and out of PRB for many years. We will continue to do that. Positioning time to move an aircraft from BFL to PRB is 30 minutes or less. Upon award of a lease, we will actively seek local aircraft to be added to our charter certificate. We have already interviewed local PRB pilot staff to operate the aircraft.”
R9 – ACI Jet Question: Please provide additional information regarding ACI Jet’s proposed aircraft charter operations at PRB. Identify aircraft type, where aircraft will be based, and how a customer would obtain aircraft charter services and estimated response times.
Answer: “Upon completion of a large commercial hangar, ACI is ready and willing to base a Global Express Aircraft at PRB, which will bring additional operational and tax revenue to the city of Paso Robles.
With respect to charter operations, ACI already operates routinely out of PRB and would continue doing so in the same fashion. Customers can contact our charter team 24/7 via email or telephone and request a quote for a trip. Response time varies depending on the time of day of the request and the length of the trip (FAA Duty & Rest Requirements), but can be as short as 1 hour.” See Appendix D – ACI Jet Response.
R9 – AMCG N/A
C10 Ensure the analysis addresses the number and type of aircraft currently maintained by each proposer’s Part 145 repair station.
The analysis should ideally identify the number of both piston and turbine/jet aircraft each repair station maintains on a yearly basis.
R10 – Loyd’s
Aviation
Question: Please provide a synopsis detailing the number and type of aircraft currently maintained by Loyd’s Aviation Part 145 repair station. • Identify the number and type of both piston and turbine/jet aircraft the repair station maintains on an annual basis over the preceding three (3) year period.
Answer:
• “We don’t track information broken down that way. What I can tell you is that we have over 1,580 shop orders in that time period. I can also tell you that our labor is billed into three categories, Piston, Turbine, and Avionics (Avionics includes both turbine and piston). Over the last two months, that split was 40% piston, 34% turbine, and 26% avionics. That’s fairly typical for us as our turbine and piston maintenance are fairly evenly split.”
R10 – ACI Jet Question: Please provide a synopsis detailing the number and type of aircraft currently maintained by ACI Jet Part 145 repair station. • Identify the number and type of both piston and turbine/jet aircraft the repair station maintains on an annual basis over the preceding three (3) year period.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 7
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) Answer:
• “ACI Jet’s Maintenance organization as a whole maintained over 4,100 aircraft over the last three (3) years, with those released under 14 CFR Part 145 noted accordingly.” See Appendix D – ACI Jet Response for additional detail.
R10 – AMCG N/A
C11 Ensure the analysis addresses whether either proposer offers price breaks for fuel purchase to routine customers and at what point (gallon or dollar amount) does an aircraft qualify for a fuel price break.
R11 – Loyd’s
Aviation
Question: Will Loyd’s Aviation offer a price discount for fuel purchases by routine customers and at what point (either gallon or dollar amount) would an aircraft operator qualify for a fuel discount rate? Answer: The short answer is yes. Through Avfuel’s contract fuel program, Loyd’s Aviation currently offers discounts starting at the first gallon. That will continue in Paso Robles. Other discounts will be offered for based and volume customers.
R11 – ACI Jet Question: Please verify whether or not ACI Jet would offer a price discount for fuel purchases by routine customers and at what point (either gallon or dollar amount) would an aircraft operator qualify for a fuel discount rate.
Answer: “Yes, as a matter of policy, ACI’s retail Avgas pricing is discounted for all customers and requires no minimum purchase. By comparison, Jet Fuel is sold at ACI Jet’s normal retail margins and then discounted for uplifts in excess of 1,000 gallons. Also extended is an additional $1.22/gal off of truck rates for self-serve fuel. ACI believes this policy along with its investment in self-serve equipment is the best way to support the light GA community. Over the last 10+ years, ACI’s retail price has averaged $1.34 lower per gallon on Avgas and $0.53 per gallon on Jet-A than Loyd’s Aviation. In addition to competitive pricing, ACI offers volume discounts to all clients that exceed the following volumes:
• Any individual uplift in excess of 1,000 gallons
• 25,000 gallons of Avgas annually
• 50,000 gallons of Jet Fuel annually.”
See Appendix D – ACI Jet Response for additional detail.
R11 – AMCG N/A
C12 Please check with sources and try to confirm ACI Jet assertions in public comment that Loyd’s Aviation is “actively engaged in considering the potential sale of the business”.
R12 – Loyd’s
Aviation
Question not posed to respondent.
R12 – ACI Jet See Appendix E – ACI Jet Letter Regarding Loyd’s Aviation for complete letter response.
R12 – AMCG N/A
C13 Please confirm the ownership of ACI Jet and whether there are intentions for Freeman Holdings Group to combine FBOs with ACI Jet as stated in the October 19, 2021 report on ainonline.com
(https://www.ainonline.com/aviation-news/business-aviation/2021-10- 19/million-air-franchisee-acquires-aci-jet-stake).
R13 – Loyd’s
Aviation
Question not posed to respondent.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 8
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) R13 – ACI Jet ACI is majority owned by William Borgsmiller and approximately 30 San Luis Obispo County resident employees, with Mr. Borgsmiller having full voting control of the corporation. This has been the case for ACI’s entire presence in Paso Robles. In 2021, Freeman Holdings Group (“FHG”) took the place of Olivier leclercq who had been a minority shareholder since 2014. This was a simple stock purchase, as has occurred several times in ACI’s history with no change in control, brands, focus, direction, etc.
The relationship with FHG has been highly productive and the quote of “combining of FBOs to provide a huge choice of destinations to our customers” occurred at the time of the transactions. Both ACI and FHG have worked together to market Paso Robles and each others’ mutual locations at conferences and trade shows such as (MRA, NBAA S&D, etc.) which has proved highly valuable to both companies and all locations. The ability to leverage these relationships across such has been invaluable to PRB as an airport.”
See Appendix D – ACI Jet Response.
R13 – AMCG N/A
C14 Each proposer has stated they would utilize existing on airport maintenance staff to fulfill the maintenance obligations of the RFP; can you ask each proposer whether they have or could obtain a letter of agreement or similar with any existing maintenance entities at KPRB? R14 – Loyd’s
Aviation
Question: Please provide additional detail regarding proposed aircraft maintenance services at PRB.
• Detail the number of aircraft maintenance technicians proposed to be utilized;
Answer: We have an agreement with one technician already, and will supply another apprentice through our already-established and operating apprenticeship program. Our plan is to grow the shop to include 5-6 technicians.
• Aircraft maintenance services to be offered at PRB;
Answer: Piston and Turbine airframe and powerplant maintenance. • Identify whether or not the maintenance technicians will be employees of Loyd’s Aviation;
Answer: Yes, all technicians and staff will be employees of Loyd’s Aviation • If maintenance technicians will not be employees of Loyd’s Aviation, please provide information as to how such services will be provided and whether a letter of agreement (or similar instrument) will be utilized with existing maintenance entities based at KPRB or if Loyd’s Aviation intends to utilize a firm(s) based at another airport.
Answer: Not applicable.
R14 – ACI Jet Question: Please provide additional detail regarding proposed aircraft maintenance services at PRB.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 9
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) • Detail the number of aircraft maintenance technicians proposed to be utilized;
• Aircraft maintenance services to be offered at PRB;
• Identify whether or not the maintenance technicians will be employees of ACI Jet;
• If maintenance technicians will not be employees of ACI Jet, please provide information as to how such services will be provided and whether a letter of agreement (or similar instrument) will be utilized with existing maintenance entities based at KPRB or if ACI Jet intends to utilize a firm(s) based at another airport Answer: ACI intends to provide Turbine maintenance support directly through its team of 12 AOG technicians that are available 24/7, with the future potential to base these types of people and equipment in PRB upon completion of ACI’s new hangar facilities. (Additionally, this team can support unscheduled light GA needs of any kind at night and on weekends.)
With respect to Piston Service, ACI plans to subcontract maintenance under a long-term leasehold agreement, as we believe it is in the City’s best interest to see a specialized local maintenance tenant thrive and grow. ACI Jet believes that its role is to help establish, fund, and mentor this venture to ensure its success and will continue to own the responsibility of ensuring piston aircraft maintenance services are available and thriving under any circumstance.
The prompt construction of new hangar facilities will greatly enhance the airport’s ability to provide all of these services across a broad range of aircraft and emerging technologies such as eVTOL and commercial spacecraft.
ACI JET’S PLAN TO FURTHER DEVELOP PISTON MAINTENANCE @
KPRB
It is helpful to understand that ACI has continually subsidized piston Maintenance at a cost in excess of $100,000 per year in PRB, but has been unable to implement a long term plan for success while on successive short term leases without adequate hangar facilities to meet all of the airport’s needs.
In order to be successful, a light GA shop needs to operate with the minimum staffing levels identified below:
• One (1) Manager / A&P w/ I.A.
• Two (2) A&P Technicians (One with 5+years experience, one can be new)
• One (1) Assistant Technician
ACI intends to accomplish the following steps to ensure that demand is properly met by the team of people most likely to succeed as the service provider.
• Surveying aircraft owners in PRB to determine their level of satisfaction with Mx Services currently provided on the field.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
QUESTION COMPILATION AND RESPONSE
FBO Proposal Review 10
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) • Identifying gaps in service provided vs service desired (both quality & quantity).
• Developing the team identified above in a way that fills those gaps.
After identifying the existing top service providers, ACI would develop a path to bring existing providers together to serve in the more experienced roles identified while pairing them with newer entrants to the field (e.g. Cuesta AMT Program Graduates) to ensure that the airport is developing the next generation of providers as well.
ACI sees itself functioning as an investor, partner, contributor, and advisor, to help this new business grow. (i.e. ACI currently owns about $25,000 worth of equipment that it is allowing Air Jav to use for its maintenance operation.)
ACI believes that starting with PRB based technicians and firms that have existing relationships is best. When paired with our new facilities, ACI will be able to best leverage these strengths, to increase the airport’s overall capacity to provide maintenance services across a broad range of aircraft and even emerging technologies such as eVTOL and commercial spacecraft.
See Appendix D – ACI Jet Response.
R14 – AMCG N/A
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX A
FBO Proposal Review 11
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) A. Loyd’s Aviation Award Letter from DLA to Avfuel
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX B
FBO Proposal Review 12
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) B. Loyd’s Aviation Fuel Supply Agreement
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX B
FBO Proposal Review 13
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX C
FBO Proposal Review 14
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) C. Loyd’s Aviation Standard Form 1449 Showing Purchase Authorization Loyd’s Aviation: “Standard Form 1449 showing the purchase authorization. To comply with my contract with Avfuel, the pricing has been redacted in this document.” Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX C
FBO Proposal Review 15
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX C
FBO Proposal Review 16
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APPENDIX C
FBO Proposal Review 17
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APPENDIX C
FBO Proposal Review 18
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APPENDIX C
FBO Proposal Review 19
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APPENDIX C
FBO Proposal Review 20
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APPENDIX C
FBO Proposal Review 21
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APPENDIX C
FBO Proposal Review 22
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX D
FBO Proposal Review 23
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) D. ACI Jet Response
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX D
FBO Proposal Review 24
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX D
FBO Proposal Review 25
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APPENDIX D
FBO Proposal Review 26
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APPENDIX D
FBO Proposal Review 27
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX D
FBO Proposal Review 28
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APPENDIX D
FBO Proposal Review 29
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX D
FBO Proposal Review 30
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APPENDIX D
FBO Proposal Review 31
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APPENDIX D
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APPENDIX D
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APPENDIX D
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APPENDIX D
FBO Proposal Review 35
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX D
FBO Proposal Review 36
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 37
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) E. ACI Jet Letter Regarding Loyd’s Aviation
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX F
FBO Proposal Review 38
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) F. ACI Jet Response to Ad Hoc Committee Q&A
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX F
FBO Proposal Review 39
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 40
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 41
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 42
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 43
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX F
FBO Proposal Review 44
Airport /Ad Hoc Committee Meeting (May 9, 2024) City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024)
APPENDIX G
FBO Proposal Review 45
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) G. City Adopted Comprehensive Fee Schedule
Airport /Ad Hoc Committee Meeting (May 9, 2024)
APPENDIX H
FBO Proposal Review 46
City of El Paso de Robles, Paso Robles Municipal Airport (05/07/2024) H. ACI Jet Fee Schedule
Airport /Ad Hoc Committee Meeting (May 9, 2024)
Writen Public Comments Received Since Ad
Hoc Mee�ng on April 18, 2024
Airport /Ad Hoc Committee Meeting (May 9, 2024)
April 26th, 2024
Via Electronic Mail:
City Council & FBO RFP Ad Hoc Committee Members,
ACI is providing this letter in response to remarks made at the last meeting and to help provide more insight and clarity on comments made in our previous letter about the ownership status of the other proposer (Loyd’s Aviation).
To provide context, ACI was brought in to operate an FBO in Bakersfield (“BFL”) from 2010 - 2011 and during that time I personally had conversations with Steve Loyd who was open to considering the sale of Loyd’s Aviation but ultimately we did not put a deal together. More recently, the FBO we used to operate in BFL has become available for purchase and we have been reconnecting with numerous prior clients in Bakersfield as part of our due diligence in potentially pursuing an acquisition. During these discussions, we were told by numerous sources that Steve has moved to the bay area, is no longer as involved in the business, and that the management team at Loyd’s may be taking over ownership.
Perhaps this was all already disclosed to the City? Notably during the discussion, one of the Ad Hoc Committee members asked “is there a difference if it is internal vs external?” with respect to a potential change. Regardless, I want to be clear that ACI has a great deal of respect for Steve Loyd and the entire team at Loyd’s Aviation. Our comments were simply made in the context of a competitive bidding process to highlight what might be an important and potentially hidden difference between the two proposers.
With that said, while ACI Jet believes in aggressively advocating for any of its competitive advantages, we always do so in alignment with our core value of Integrity and wanted to share the source of our comments to demonstrate that.
We appreciate the opportunity to give the City full and complete information that may be relevant to its decision as part of this competitive bidding process. If selected, we look forward to a long and productive partnership.
Sincerely,
William R. Borgsmiller
CEO
4751 Aviadores Way, San Luis Obispo, California 93401 | (805) 782-9722 | www.acijet.com Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
QUESTIONS & DISCUSSION FROM FBO AD HOC COMMITTEE
MEETING HELD ON APRIL 18, 2024
1) Clarify ACI Jet’s lease terms and timeline for Capital Improvements? As identified on page 28 of ACI’s RFP Response (shown below), in exchange for a 40 year lease, ACI agrees to construct its proposed improvements as soon as possible and within the proposed 40 year term. (i.e. The capital improvements paid for by ACI become the property of the City in 40 years from the date the lease is signed and the time spent permitting and constructing the improvements is within the lease period, not outside of it.) able to secure FAA grant funding to refurbish these areas. Following the 10 year period, the lease at FMV will provide additional revenue that can be used to help cover / reimburse the City for its portion of any ramp repair costs. We also agree to work in good faith with the City of Paso Robles to help them secure grant funding from the FAA to facilitate any necessary repairs. schedule For design, site PreParation (deMolition), develoPMent, and coMPletion oF the ProPosed iMProveMents By MaJor coMPonent
Assuming lease negotiations are completed and ACI Jet is awarded a 40-year lease as outlined above by the end of 2023, we estimate facility design and permitting will be complete by early 2025. Construction on Phase 1 would commence within 12 months of permit issuance and is estimated to occur in late 2025 or early 2026. Assuming 18 months of construction, the completed facilities would open sometime in 2027. evidence oF the aBility to oBtain a Bond FroM a Bonding coMPany or irrevocaBle letter oF credit FroM a Federally regulated Bank that guarantees the tiMely, Full, and FaithFul PerForMance oF the ProPoser’s construction oBligations in the aMount eQual to the cost oF the ProPosed iMProveMents Please see Confidential Information Packet, Tab “Financial Capacity” identiFication oF the ProPosed aMortization Period For the ProPosed iMProveMents ACI Jet would initially amortize any financed portion of its improvements over a period of twenty (20) years with respect to the loan amortization, but proposes that the negotiated lease term be set at 40 years. This will allow for refinancing, if necessary or desirable, and complies with FAA policies regarding the length of leases. We also believe that this is a commercially-reasonable term considering that all improvements revert to the City upon lease termination.
2023 2024 2025 2026 2027
Lease Negotiated Design & Permitting Phase 1 Construction Open 2) The City’s Consultant Identified that Loyd’s proposal would require certain infrastructure improvements in order for the individual hangars to be built on demand.
Who pays for this infrastructure and who pays to move the self-serve fuel farm? Without the ability to view the competing proposal, we cannot advocate for how our proposal might compare to the competition, but we can clarify the terms of our proposal. ACI intends to pay for the construction and maintenance of infrastructure improvements (ramp, fuel farm relocation, etc.) in its Phase 2 development. Additionally, ACI has an extremely successful track record with this type of development.
Phase 2 features an enlarged mixed-use community hangar that can house any type of aircraft – from small GA to long wingspan horizontal space launch vehicles. This development also includes the previously proposed joint-use education facility that could be shared by Cal Poly’s Aerospace Engineering Department and the Cuesta College AMT Program.
Phase 1 construction would begin as soon as possible and Phase 2 would commence upon securing funding for the educational facilities and anchor tenants for the multi-use hangar. We estimate this would take less than 10 years, which is why we proposed a 10-year initial lease term for this space in our initial proposal.
Our development plan is based on our ability to handle transient aircraft consistent with normal Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
3) What are the differences in the two proposals with respect to one that includes Land Rent and building rent versus building rent alone? Without the ability to view the competing proposal, we cannot advocate for how our proposal might compare to the competition, but we can clarify the terms of our proposal. At most airports, FBOs pay for both ground rent and facilities rent (for facilities it does not own), which is consistent with ACI’s proposal.
ProPosal – FBo at Paso roBles MuniciPal
5.7 Financial Plan | Page
and rents remitted to the City monthly.
Fee/rent tyPe year 1 year 2 year 3 year 4 yea
Fuel Flowage Fees (Jet-A)* $13,500 $13,770 $14,045 $14,326 $14 Fuel Flowage Fees (Avgas)* $77,400 $78,948 $80,527 $82,137 $83 Land & Building Rents** $156,079 $160,762 $165,584 $170,552 $17 Fuel Storage Rents** $7,680 $7,910 $8,148 $8,392 $8,
Total $254,659 $261,390 $268,304 $275,408 $28
*Assumes 2% Annual Escalation | **Assumes 3% Annual Escalation Proposed rents (as indicated above) are determined
according to the available building space and overall
footprint of occupied land, calculated as follows for year 1:
rents land Bldg sPace
Hangar 10,000-sq-ft 10,000-sq-ft
Office Building 4,300-sq-ft 8,600-sq-ft
Ramp 80,400-sq-ft -
FBO Office 546-sq-ft 546-sq-ft
Restaurant 1,780-sq-ft 1,780-sq-ft
Public Access & Restrooms 745-sq-ft 745-sq-ft
Terminal Lobby 1,333-sq-ft 1,333-sq-ft
Total 99,104-sq-ft 23,004-sq-ft
Annual Rent/Sq-Ft. $0.60 $4.20
Annual Rent $59,462 $96,617
Additional revenues generated for the City of Paso Robles shall include, but not be limited to, the • City and District portions of applicable Sales & Use Taxes (fuel, oil, and other retail sales) • City portion of unsecured property taxes generated as result of any ACI Jet aircraft or equip may based in PRB
ProoF oF insurance or evidence oF aBility to oBtain required insurance Please see Attachment 6 for proof of insurance.
Proposed Fuel Storage Fees (as indic
above) are based on available storage
calculated as follows for year 1:
storage tyPe storag
Avgas Tank 12,000
Jet-A Tank 20,000
Annual Rent/Avail.
Capacity (Gallons) $0.24
Annual Rent $7,680
4) Clarify the flow fees and fuel storage rents?
Without the ability to view the competing proposal, we cannot advocate for how our proposal might compare to the competition, but we can clarify the terms of our proposal. ACI’s numbers reflect total fuel flow fee revenue to the City based on projected volumes at the current rates set by the City. Our proposed fuel storage fee utilizes the same approach, but it is worth noting that ACI currently spends thousands of dollars each year to maintain the fuel farm and would continue to do so moving forward.
5.7 FINANCIAL PLAN
stateMent oF Financial caPacity FroM a qualiFied Financial institution or other source easily veriFied By the city that identiFies the sources and the Funds availaBle to Provide working caPital to initiate the ProPosed activities and Make any ProPosed caPital investMent Please see Confidential Information Packet, Tab “Financial Capacity” three-year historical incoMe (ProFit and loss) stateMent Please see Confidential Information Packet, Tabs “2020 P&L,” “2021 P&L,” “2022 P&L” & “PRB P&L” identiFication oF rents, Fees, and other charges ProPosed to Be Paid to the city ACI Jet proposes the payment of rents, fees, and other charges to the City of Paso Robles as outlined below.
Direct payments consist of flowage fees calculated on a per-gallon basis and remitted to the City quarterly, and rents remitted to the City monthly.
Fee/rent tyPe year 1 year 2 year 3 year 4 year 5
Fuel Flowage Fees (Jet-A)* $13,500 $13,770 $14,045 $14,326 $14,613 Fuel Flowage Fees (Avgas)* $77,400 $78,948 $80,527 $82,137 $83,780 Land & Building Rents** $156,079 $160,762 $165,584 $170,552 $175,669 Fuel Storage Rents** $7,680 $7,910 $8,148 $8,392 $8,644 Total $254,659 $261,390 $268,304 $275,408 $282,706
*Assumes 2% Annual Escalation | **Assumes 3% Annual Escalation Proposed rents (as indicated above) are determined
according to the available building space and overall
footprint of occupied land, calculated as follows for year 1:
rents land Bldg sPace
Hangar 10,000-sq-ft 10,000-sq-ft
Office Building 4,300-sq-ft 8,600-sq-ft
Ramp 80,400-sq-ft -
FBO Office 546-sq-ft 546-sq-ft
Restaurant 1780sqft 1780sqft
Proposed Fuel Storage Fees (as indicated
above) are based on available storage space,
calculated as follows for year 1:
storage tyPe storage qty
Avgas Tank 12,000 gal.
Jet-A Tank 20,000 gal.
Annual Rent/Avail.
Capacity (Gallons) $0.24
Annual Rent $7,680
Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
5) Does ACI’s General Manager stay in Paso Robles and is that part of the proposed head count?
ACI’s General Manager (Luke Newlon) is
permanently committed to operate the FBO
and assist with the oversight of all future
development at KPRB. Luke’s presence is
in addition to the staffing in ACI’s proposal
and it provides deeper local relationships
and connections than the Supervisor Role
proposed by the competition.
6) What was ACI’s Maintenance Proposal? Can you clarify what Grads paired with seasoned professionals means?
ACI would guarantee the development of a more robust GA maintenance facility in Paso Robles.
We believe the best way to do this is to pair a seasoned FAA mechanic (or two) with new graduates from the Cuesta AMT program that show an interest in working with light GA Aircraft. We are willing to do this directly as the employer or through a partnership depending on the skill sets (business acumen, entrepreneurship, etc.) of the individuals involved. In short, ACI will use its resources and connection with the AMT program to help ensure the future success of a light GA maintenance facility in PRB.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
7) Ad Hoc Committee Member asked if both organizations have the same maintenance certifications?
ACI and the other proposer have drastically different maintenance ratings and capabilities. The significance of these differences would be most apparent in a comparison of each company’s FAA Operations Specifications, but in the absence of that, the following data from the FAA’s website shows the high level differences.
8) The Ad Hoc Committee discussed the differences between the two proposers’ aircraft charter fleets.
While both proposers hold an FAA Air Carrier Certificate, as with the maintenance certifications above, there are significant differences in the size, scope, and complexity of the two operations.
ACI operates a fleet of 16 aircraft ranging from light jets to ultra long range aircraft throughout the world with FAA authorizations for transoceanic and polar regions. Loyd’s operates a small fleet of light aircraft, primarily suited to operations within North America.
Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
9) I don’t understand the ACI Ramp Space / Revenue Sharing model? Concurrent with the plan to build new first class facilities, page 9 of ACI’s supplemental response proposes ramp and parking fees for large & turbine powered aircraft that are higher than the City’s established fees. This is a normal and commercially accepted practice when first class facilities are paired with marshaling, towing, high-end service, and a robust offering of amenities and equipment. In most cases, the 20% split of these fees proposed to the City is greater than 100% of the “space only” fees the City is capable of charging. This mechanism also serves to incentivise fuel sales which are a source of revenue for both the City and the FBO.
Note that the fees for light GA aircraft remain extremely low or non-existent, which is consistent with ACI’s long standing policy (at all of its FBOs) in support of light GA..
SUPPLEMENTAL INFORMATION & MATERIALS (CITY COUNCIL)
A detailed proposal on any proposed revenue share fee split and the proposed structure of parking fees, ramp fees, and other FBO fees at the Airport if different than the City Council adopted comprehensive fee schedule.
Revenue Share Fee Split & Fees
Provided that the City would like to proceed with ACI Jet’s proposed capital improvements, we propose an 80% (ACI) / 20% (City) split on the ramp and parking fees, all of which can be waived with minimum fuel purchases. The proposed fees shown below are consistent with normal commercial practices within our industry when an FBO provides marshaling, parking, towing, exceptional facilities, concierge services, and customary amenities. This package of services is precisely what ACI is proposing and what sophisticated and high value customers are willing to pay for.
Aircraft Ramp Fee Parking Fee Min. Fuel to Waive
Piston Single $0 $12 Any
Piston Twin $0 $12 Any
Helicopter Small $60 $45 20 gal
Helicopter Standard $125 $55 50 gal
Very Light Jet $125 $150 75 gal
Light Jet $250 $210 150 gal
Mid-Size Jet $385 $270 250 gal
Super Mid Jet $510 $360 350 gal
Large Jet $635 $460 400 gal
Super Long Range $825 $550 500 gal
A Sustainable Win-Win FBO Business Model
Our proposed financial model is integral to our ability to deliver high-end services that are synonymous with the ACI Jet brand and to contribute significantly to the airport experience for all types of airport users, including light GA. This model also incentivizes more sales to transient flight crews resulting in more direct revenue to the City that can- be reinvested in the airport.
By providing a higher level of service, ACI can generate a corresponding higher level of revenue that when split with the City will generate more income than the established fees that are merely for the use of space instead of a combined high touch service experience. Our proposed arrangement is standard practice at FBOs across the country and aligns with industry best practices. As mentioned by City’s consultant, Scottsdale Airport (KSDL) is a shining example of economic success and all of the FBOs in Scottsdale employ a similar ramp fee structure with waiver of all or part of the fees with an appropriate fuel purchase. (Continued on Next Page)
D
Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
10) What are the details with the DLA contract? Are they exclusive to ACI? Loyd’s is also a DLA provider, can they just pick up where ACI would leave off if they came in? DLA contracts are specific to a provider and a location and are non-transferable. Absent any special action by the DLA, if ACI were to leave PRB, there would be no contract there through the remainder of the current term in 2026. Upon expiration, the DLA may offer a new contract which a new provider could bid on but there is no guarantee that this will happen. (Habits and the perceived need for a contract often change in the interim.) 11) How is the RAF tied to ACI?
ACI has a long term relationship and over 10 years of experience working with the RAF which requires certain equipment in ACI’s proposal that is not provided for by our competitor (see highlighted items below.) In addition to these basic items, ACI has over $100K of additional equipment (power transmission cables, roller tines, towbars, and a long reach forklift) that are specific to their operation.
It is also notable that the RAF was denied access to PRB and was shifting their focus to Santa Maria until ACI intervened by approaching the City Council directly. This saved millions of dollars of economic impact each year, including direct income to the airport that helped fund an increased staffing plan.
This was demonstrated during busy fire seasons at a time when fuel delivery companies were overwhelmed.
We were able to load a full 5,000 gallons truck on a local hazmat certified hauler and quickly transport fuel and equipment to Paso Robles, thus ensuring that there was no interruption to the Cal Fire base.
Fuel trucks est. cost
5k Gallon Jet-A Fuel Truck $217,000
5k Gallon Jet-A Fuel Truck $217,000
3k Gallon Jet-A Fuel Truck $125,000
1k Gallon 100LL Fuel Truck $100,000
tugs est. cost
Lektro 8800 Tug $115,000
Lektro 8600 $80,000
Gas Tug $55,000
eQuiPMent est. cost
28-Volt DC Aircraft GPU $96,000
400Hz AC/DC GPU $110,000
Turbine Air Start $75,000
Lavatory Cart $8,000
Water Cart $5,000
Tower De-Icing $18,500
Follow-Me Cart $500
vehicles est. cost
Crew Car $30,000
Pickup Truck $22,000
descriPtion oF the Policies and Procedures to ensure the anticiPated Products and services will Be Provided in a saFe, secure, eFFicient, ProMPt, and ProFessional Manner ACI Jet boasts one of the most comprehensive and technologically advanced safety and training programs, customized to our operation in accordance with industry-standards and systems with proven reliability.
Our General Operations Manual (GOM) serves as the master training and procedures record and is maintained by the VP of FBOs and each FBO General Manager. It contains best practices and requirements for everything from driving and operating vehicles and equipment to answering phones, fueling aircraft, quality control, and every other action performed by FBO staff members.
ACI Jet training goes above and beyond industry standards. We developed our own “Lead-Mentor” program which features progressive levels of responsibility as training is completed, complete tracking of each Airport /Ad Hoc Committee Meeting (May 9, 2024)
Questions & discussion from fbo ad hoc committee
Meeting Held on April 18, 2024
12) The Ad Hoc Committee specifically requested Information on each proposer’s philanthropic efforts in the community, but no information was provided by staff or the consultant who stated that they do not have any knowledge in that area.
ACI has contributed to numerous Philanthropic causes and organizations during its 25 year history on the Central Coast, with the examples below being some of the most recent within the last 12 months.
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