HomeMy WebLinkAboutRES 12-209 RESOLUTION NO. 12-209
BE IT RESOLVED BY THE CITY COUNCIL
OF THE CITY OF BEAUMONT:
THAT the City Manager is authorized to submit an application to the Federal Aviation
Administration(FAA)to authorize the exemption of airport revenue generated from mineral
extraction activities for the construction of the streets as shown on Exhibit "A," attached
hereto.
PASSED BY THE CITY COUNCIL of the City of Beaumont this the 18th day of
September, 2012.
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U ayor Becky Ames -
REVISED PROJECT IDENTIFICATION SCHEDULE
STREET CONSTRUCTION PROJECTS ESTIMATED REQUESTED
TOTAL COST AMOUNT
Washington Blvd. from 1H 10 to MLK $29,500,000 $29,500,000
Seventh St. from 1H 10 to Laurel St. $6,500,000 $6,500,000
Old Dowlen from Hwy 105 to Dowlen $9,000,000 $5,000,000
Northwest Parkway from Folsom to Parkdale $6,000,000 $6,000,000
Dowlen Rd. from Hwy 69 to Delaware $16,000,000 $800,000
TOTAL $67,000,000 $47,800,000
EXHIBIT "A"
U.S. Department Airport Compliance and Management Analysis 800 Independence Ave.,SW.
of Transportation Washington,DC 20591
Federal Aviotion
Administration
January 30,2013
Mr. Kyle Hayes
City Manager
City of Beaumont
801 Main Street, Suite 300
Beaumont, TX 77701
Dear Mr. Hayes:
The Federal Aviation Administration(FAA)has reviewed the application and supporting
documentation submitted by you,as an authorized and legal representative of the City of
Beaumont, Texas (City), owner and operator of Beaumont Municipal Airport(BMT)
requesting certain mineral rights revenue be exempted as provided by the FAA Modernization
and Reform Act of 2012, cited to Public Law 112-95, Section 813 (the Act). In accordance
with Section 813 of the Act, on behalf of the Administrator of the Federal Aviation _
Administration,this determination grants the City's application, subject to certain conditions
that must be met consistent with the authorizations provided herein.
BACKGROUND
With the passage of the FAA Modernization and Reform Act of 2012, certain airports became
eligible to request limited and specific exemptions from airport revenue use requirements.
Specifically, Section 813 of the Act, Use of Mineral Revenue at Certain Airports, grants the
FAA Administrator the authority to exempt a defined amount of airport revenue generated
from mineral extraction activities on general aviation airports from statutory, grant assurance,
and policy provisions if specific conditions are met.
Paragraph(e)of Section 813 directed the FAA to "promulgate regulations to carry out this
section"within 90 days after the date of enactment of the Act. The FAA took two steps to
complete this directive. First,the Agency published the Notice of Modification of Airport
Improvement Program grant assurances on April 13,2012,which modified Grant Assurance
25,Airport Revenues,to reflect this new statutory provision. Secondly,the FAA
implemented Compliance Guidance Letter(CGL) 2012-01,FAA Implementation of Public
Law 112-95 Section 813, Use of Mineral Revenue at Certain Airports, on May 16,2012. The
guidance became effective upon issuance; however,it was subject to comments received in
response to a companion Notice of Guidance published in the Federal Register at
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77 FR 30350 on May 22,2012. The comment period closed on June 30,2012,and no
comments were received. Accordingly,the guidance was implemented without change.
DISCUSSION
The City exercised its option,as provided by Section 813 of the Act,by submitting an
application to the FAA's Southwest Airports Division on October 21,2012. The Southwest
region forwarded the application to the FAA's Office of Airport Compliance (ACO-100) on
October 31,2012 as prescribed by FAA CGL 2012-01. While this action should have
triggered the 90-day clock prescribed by Section 813 (d)for the FAA to complete its review,
upon receipt of the application,ACO-100 determined it did not contain the"requisite
supporting documentation"prescribed by CGL 2012-01 as implemented in accordance with
Section 813 paragraphs(d-e).
The FAA is issuing this authorization pending the City's agreement that the conditions
prescribed herein are met within the time allotted.
CONDITIONS
Requirements for RFPs/Project Bids
The City requested to exempt$47,800,000 of airport revenue for the purposes expressly stated
in Appendix D,inclusive of Table D,of the City's application. The FAA CGL 2012-01
application exemption process required that the City affirm that its estimated costs comported
with competitive proposal(s). However, the City claims it is unable to comply fully with this
exemption requirement because it cannot issue requests for proposals until the funds are no
longer encumbered for airport use.' This letter serves to provide notice that the City's
proposed projects, set forth in the accompanying documentation to the application, meet the
eligibility thresholds set forth in statute. Consequently,these projects are eligible for funding
through this revenue exemption program.
The FAA authorizes the City of Beaumont to expend from the airport fund an amount not to
exceed$47,800,0002 for the projects identified in Appendix D,inclusive of Table D, subject
to Condition#1.
Condition #1: All final funding authorizations conditioned on the City meeting the request
for proposals and/or bid requirements set forth in FAA CGL 2012-01. Failure by the City to
comply with these requirements may result in suspension and/or rescission of this
determination.
This letter represents the FAA's efforts to accommodate the City's issues while complying with and
maintaining the statutory mandates prescribed and followed by the Agency in promulgating the guidance.
2 The fmal amount authorized for exemption will be determined once the sponsor obtains bids in accordance
with FAA CGL 2012-01.
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Complying with applicable design and safety standards: Taxiway A
Section 813 of the Act requires airport sponsors requesting exemption under this provision
"comply with applicable design and safety standards of the Administration." The FAA has
issued a modification to standards for Taxiway A, which is located less than the prescribed
distance to the runway centerline set forth in FAA Advisory Circular No. 150-5300-13. The
City submitted a proposed solution to fix this temporary deviation from standards in its
Airport Development Plan Final Report for Beaumont Municipal Airport, which was
submitted by the City subsequent to its initial application for exemption at the FAA's request.
Chapter 8 of the Report identifies the planned airport development projects and anticipated
time periods for implementation over the course of the 20-year plan. The implementation
periods are segregated into the following three phases:
Phase I 5 years 2007-2011
Phase II 5 years 2012-2016
Phase III 10 years I 2017-2026
The Report states "Parallel Taxiway A (240' CL separation)"is planned to be reconstructed at
an estimated cost of$4,100,000 during Phase II, which extends through 2016. However,the
five-year plan the City included with its submissions under the Section 813 exemption,which
extends through 2017, did not include the full scope of this project as the companion
submission had.
In addition to the statutory language that requires the sponsor to "comply with applicable
design and safety standards of the Administration,"FAA,CGL 2012-01 requires the sponsor
to identify in its five-year capital improvement program the items previously identified in past
airport capital improvement plans or provide a justification for the exclusions. This
requirement ensures the intent of this legislation is not subjugated to allow an airport sponsor
to circumvent high dollar airport development and improvement projects while funding other
nonairport related projects. This is consistent with the FAA's notice,Factors Affecting Award
of AIP,64 FR 31031 (June 9, 1999). In this notice,the FAA reiterates four factors that may
militate against a decision by the FAA to award AIP discretionary funding to an airport
sponsor, including revenue diversion and the use of airport revenue for local purposes under
the "grandfather provision."
The sponsor is obligated to ensure its airport is operating in a manner that complies with FAA
safety and design standards. The CGL also requires sponsors include previously planned
improvements in the five-year capital improvement programs submitted with Section 813
exemption applications. The City did not identify its plan to fix the deviation and did not
include this project as part of its five-year plan,thus failing to meet the requirements set forth
in Section 813,as well as the FAA's implementation guidance. Although,the sponsor stated
the pavement will not need repairs for a period of 7 years, this is not consistent with its
previous planning document. Additionally,the continuation of a modification to standards
does not fix the deviation.
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While entitlement and discretionary funding eligibility is suspended during the revenue
exemption period,the City is cautioned that its failure to comply with applicable safety and
design standards during the exemption period is a factor the FAA may consider when
determining future discretionary award funding for airport development projects.
Condition#2: Should the City elect to not proceed with the Taxiway A relocation project
during the exemption period, it must submit a justification within 60 days of the date of
issuance of this letter. The FAA will consider the City's statement explaining its justification
why either rescinding the modification to standards for Taxiway A or allowing it to expire is
not in the best interest of the airport. The statement should also justify the possibility that the
FAA may be asked to fund the fix after the revenue exemption period ends. The FAA will
consider the statement of justification, if submitted, but is not obligated to allow the sponsor
to continue to deviate from applicable design and safety standards. The City's failure to
submit a timely justification will result in the FAA determining the sponsor must comply with
applicable design and safety standards and fund the required projects associated with fixing
the deviation for Taxiway A to make it fully compliant. Barring any future waivers by the
FAA, the City's acceptance of this letter by signature below confirms that the City agrees to
fully fund the relocation of Taxiway A upon expiration of the existing modification to
standards and agrees to waive its right to request discretionary funding for any portion of this
project.
Compliance with FAA Guidance issued in accordance with Section 813(e)of the Act.
The City failed to submit all the items as specifically prescribed in FAA CGL 2012-1,
Appendix B-1. Therefore, the City must submit the following items:
• A five-year capital improvement program reflecting the Taxiway A relocation project as
applicable and in accordance with Condition#2 within 60 days of the issuance of this
letter.
• A revised Airport Layout Plan reflecting the location of the capped oil rig and other
revisions to the airport's surfaces as applicable within the first year of the issuance of this
letter.
Condition#3: The FAA's granting of the City's application is conditioned on receipt of
items (a)and(b)within the time periods stipulated. Additionally,the City is required to
submit Appendix F-1, Sponsor Annual Projects) Financial Statement,which details the cost
of each transportation infrastructure project using the exempted revenue,in accordance with
the CGL Failure to submit adequate and substantially complete items may result in a
revocation of the exemption granted herein for noncompliance with statutory authority and
FAA implementation procedures.
DETERMINATION
In accordance with Section 813,the FAA acknowledges and accepts the executed copy of
C-1,Sponsor Agreements, the City submitted with its initial application.
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In accordance with Section 813, the FAA predicates its final determination upon the City's
ability to meet the conditions prescribed herein in accordance with statute and FAA guidance,
as directed and implemented by the Act.
Due to the extenuating circumstances presented by the City's initial and subsequent
submissions, the terms and conditions of this letter will become effective and the funding
authorized accordingly upon the City's designated official signing and returning this letter to
the FAA's Office of Airport Compliance at the address below within 45 days of receipt.
If at any time the City of Beaumont, owner and operator of Beaumont Municipal Airport, fails
to meet the requirements set forth in the agreed upon five-year capital improvement program,
or any part of its submissions and application, or fails to comply with the.conditions set forth
herein, the FAA may extinguish the exemption and revoke the provisions provided under this
agreement. If the FAA finds revenue was used for purposes other than those certified by the
City of Beaumont, owner and operator of Beaumont Municipal Airport,the FAA may review
the use to assess its eligibility under this determination. Any uses beyond the scope agreed to
herein may be subject to revocation and fines according to statutory authority for revenue
diversion. All other statutory requirements not exempted herein remain in effect. [See, title
49 U.S.C., Sections 47107(b) and 47133]
This agreement is effective on upon receipt by the FAA of an executed copy of this letter by
an authorized agent of the City of Beaumont, Texas. By statute,this agreement expires five
years and zero days from the date of receipt of the signed letter. The FAA will issue a
subsequent confirmation letter upon execution.
Signed, on behalf of the Federal Aviation Administration:
3a
Randall S. Fiertz Date
Director, FAA Office of Airports,
Airport Compliance and
Management Analysis
Signed, on behalf of the City of Beaumont, Texas, owner and operator of Beaumont
Municipal Airport:
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Kyle Hayes Date
City Manager, City of Beaumont
Owner and Operator of Beaumont Municipal Airport
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Sponsor to return one signed copy to:
Randall S.Fiertz,
Director, Office of Airports,Airport Compliance&Management Analysis
Federal Aviation Administration
800 Independence Avenue, SW
6th Floor,Room 615
Washington, DC 20591
FAA will provide copies of executed agreement to:
FAA Office of Airports, APP-500
FAA/Block Grant State Project/Program Manager
FAA Southwest Airports Division Manager(ASW-600)
Designated Regional Program Manager
State Aeronautics Division Head
U.S.Depadffont Avpmt compknce and ManePmsnt Analysis 800 tri VWn,ler�oe Ate.,SW.
of Tranapmlaflon
WasMngtoo.DC 201
Fedwd Aviation .
Ad llhda Fian
April 18,2013
Mr.Kyle Hayes
City Manager
City of Beaumont
801 Main Street,Suite 300
Beaumont,TX 77701
Dear Mr.Hayes:
RE: Beaumont Municipal Airport,Section 813 Exemption Confirmation
On March 15,the Federal Aviation Administration's(FAA)Office of Airport Compliance
and Management Analysis received from the City of Beaumont(City),a fully executed copy
of the determination letter issued by this office on January 30. This letter serves to confirm
and finalize the FAA's decision to grant the City's request to exempt certain mineral rights
revenue generated on Beaumont Municipal Airport(BMT),with the conditions agreed upon
in the determination letter,in accordance with Section 813 of the FAA Modernization and
Reform Act of 2012 (the Act).
The conditions agreed to by the City include submitting the following documentation to the
FAA:
1. Requests for proposals and/or bid requirements—The City must submit to the FAA's
Southwest Airports Division,appropriate solicitations and replies for each project detailed
in Appendix D,Table D. Should the FAA object to any submissions,the FAA will notify
the City to initiate action to resolve outstanding concerns. The FAA considers the City's
agreement to provide this information acceptable in meeting this condition at this time.
2. Updated Capital lmproveMCDt Program(C1P)to include Taxiway A Funding—The City
did not submit a justification within 60 days of the date of the issuance of the
determination letter regarding the Taxiway A project. Therefore,the City has agreed to
fully fiord the relocation of Taxiway A upon expiration of the existing modification to
standards,which will comply with applicable design and safety standards in accordance
with the legislation. The City agreed to waive its rights to future Federal financial
assistance for any portion of this project and was required to submit a five-year CIP
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reflecting the Taxiway A relocation project. The revised five-year CIP submitted on
behalf of the City by the Texas Department of Transportation,Aviation Division,included
a line item to"construcVrelocate concrete parallel TW 240 ft.from RW centerline to meet
design standards(4,500 x 35)in 2017" The CIP estimated the Taxiway A would cost
$1,750,000. However,in previous C1P submissions,the cost was estimated to be
$4,100,000. The City indicated the$4.1 million construction costs in 2010,still reflected
higher construction costs attributable to Hurricane Rita,which impacted the Texas coast in
2005. The FAA requested a more detailed cost breakdown for this project to account for
the differential. On April 4,the City provided to the Southwest Airports Division the
City's engineering estimate that totaled$1,352,335. The FAA will accept the City's
submission because the City has agreed not to seek Federal financial assistance and fully
fund the Taxiway A.project.
3. Updated Airport Layout Plan(ALP)—The City is required to submit an updated ALP
within one year of the date of issuance of the determination letter. This is required no
later than January 30,2014. The City is on target to meet this condition.
4. Sponsor Annual project(s)Financial Statements—The City is required to submit
Appendix F,Sponsor Annual Projects Financial Statement annually. These submissions
must either occur annually on or before January 30 or,should the City prefer,the FAA
will allow the City to submit the annual statements in the quarter that coincides with its
fiscal year end. The City should advise the Southwest Airports Division of the City's
intended submission dates within 30 days of receipt of this letter. The FAA considers the
City's agreement to provide this information acceptable in meeting this condition at this
time.
According to the determination letter and based on satisfactory completion of the conditions
set forth and agreed to therein,the City's Section 813 Exemption expires on March 15,2018.
The City will regain eligibility for AIIP finding on March 16,2018 and all revenue use must
be compliant at that time unless otherwise agreed.
Should you have any questions,please contact the FAA's Southwest Region Airport Division.
Your point of contact will be Mr.Ed Chambers and he can be reached at(9 17)222-5673.
Sincerely,
Randall S.FierM
Director of Airport Compliance
and Management Analysis
cc: FAA Southwest Airports Division Manager
FAA Office of Airports,Airport Improvement Program Branch Manager(APP-520)
Texas DOT,Aviation Division,Planning and Programming Director