Michigan Department of Treasury 5597 (08-18)

Protecting Local Government Retirement and Benefits Act Corrective Action Plan: Retirement Health Benefit Systems Issued under authority of Public Act 202 of 2017.

1. MUNICIPALITY INFORMATION Local Unit Name: ______Six-Digit Muni Code: ______Retirement Health Benefit System Name:______Contact Name (Administrative Officer):______Title if not Administrative Officer: ______Email:______Telephone:______

2. GENERAL INFORMATION Corrective Action Plan: An underfunded local unit of government shall develop and submit for approval a corrective action plan for the local unit of government. The local unit of government shall determine the components of the corrective action plan. This Corrective Action Plan shall be submitted by any local unit of government with at least one retirement health benefit system that has been determined to have an underfunded status. Underfunded status for a retirement health system is defined as being less than 40% funded according to the most recent audited financial statements, and, if the local unit of government is a city, village, township, or county, the annual required contribution (ARC) for all of the retirement health systems of the local unit of government is greater than 12% of the local unit of government’s annual governmental fund revenues, based on the most recent fiscal year.

Due Date: The local unit of government has 180 days from the date of notification to submit a corrective action plan to the Municipal Stability Board. The Board may extend the 180-day deadline by up to an additional 45 days if the local unit of government submits a reasonable draft of a corrective action plan and requests an extension.

Filing: Per Sec. 10(1) of the Act, this Corrective Action Plan must be approved by the local government’s administrative officer and its governing body. You must provide proof of your governing body approving this Corrective Action Plan and attach the documentation as a separate PDF document. Per Sec. 10(4) of the Act, failure to provide documentation that demonstrates approval from your governing body will result in a determination of noncompliance by the Board.

The submitted plan must demonstrate through distinct supporting documentation how and when the local unit will reach the 40% funded ratio. Or, if the local unit is a city, village, township, or county, the submitted plan may demonstrate how and when the ARC for all of the retirement healthcare systems will be less than 12% of annual governmental fund revenues, as defined by the Act. Supporting documentation for the funding ratio and/or ARC must include an actuarial projection, an actuarial valuation, or an internally developed analysis. The local unit must project governmental fund revenues using a reasonable forecast based on historical trends and projected rates of inflation.

The completed plan must be submitted via email to Treasury at [email protected] for review by the Board. If you have multiple underfunded retirement systems, you are required to complete separate plans and send a separate email for each underfunded system. Please attach each plan as a separate PDF document in addition to all applicable supporting documentation.

The subject line of the email(s) should be in the following format: Corrective Action Plan-2017, Local Unit Name, Retirement System Name (e.g. Corrective Action Plan-2017, City of Lansing, Employees’ Retirement System OPEB

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Plan). Treasury will send an automatic reply acknowledging receipt of the email. Your individual email settings must allow for receipt of Treasury’s automatic reply. This will be the only notification confirming receipt of the application(s).

Municipal Stability Board: The Municipal Stability Board (the Board) shall review and vote on the approval of a corrective action plan submitted by a local unit of government. If a corrective action plan is approved, the Board will monitor the corrective action plan for the following two years, and the Board will report on the local unit of government’s compliance with the Act not less than every two years.

Review Process: Following receipt of the email by Treasury, the Board will accept the corrective action plan submission at the next scheduled meeting of the Board. The Board shall then approve or reject the corrective action plan within 45 days from the date of the meeting.

Considerations for Approval: A successful corrective action plan will demonstrate the actions for correcting underfunded status as set forth in Sec. 10(7) of the Act (listed below), as well as any additional solutions to address the underfunded status. Please also include steps already taken to address your underfunded status, as well as the date prospective actions will be taken. A local unit of government may also include in its corrective action plan a review of the local unit of government's budget and finances to determine any alternative methods available to address its underfunded status. A corrective action plan under this section may include the development and implementation of corrective options for the local unit of government to address its underfunded status. The corrective options as described in Sec. 10(7) may include, but are not limited to, any of the following:

(i) Requiring cost sharing of premiums and sufficient copays.

(ii) Capping employer costs.

Implementation: The local unit of government has up to 180 days after the approval of a corrective action plan to begin to implement the corrective action plan to address its underfunded status. The Board shall monitor each underfunded local unit of government's compliance with this act and any corrective action plan. The Board shall adopt a schedule, not less than every 2 years, to certify that the underfunded local unit of government is in substantial compliance with the Act. If the Board determines that an underfunded local unit of government is not in substantial compliance under this subsection, the Board shall within 15 days provide notification and report to the local unit of government detailing the reasons for the determination of noncompliance with the corrective action plan. The local unit of government has 60 days from the date of the notification to address the determination of noncompliance.

3. DESCRIPTION OF PRIOR ACTIONS Prior actions are separated into three categories below: System Design Changes, Additional Funding, and Other Considerations. Please provide a brief description of the prior actions implemented by the local government to address the retirement system’s underfunded status within the appropriate category section. Within each category are sample statements that you may choose to use to indicate the changes to your system that will positively affect your funded status. For retirement systems that have multiple divisions, departments, or plans within the same retirement system, please indicate how these changes impact the retirement system as a whole.

 Please Note: If applicable, prior actions listed within your waiver application(s) may also be included in your corrective action plan.

Please indicate where in the attached supporting documentation these changes are described and the impact of those changes (i.e. what has the local unit of government done to improve its underfunded status, and where can we find the proof of these changes in the supporting documentation?).

Note: Please provide the name of the system impacted, the date you made the change, the relevant page number(s) within the supporting documentation, and the resulting change to the system’s funded ratio. Page 2

Category of Prior Actions:

 System Design Changes - System design changes may include the following: Changes to coverage levels (including retiree co-payments, deductibles, and Medicare eligibility), changes to premium cost-sharing, eligibility changes, switch to defined contribution retiree health care plan, changes to retiree health care coverage for new hires, etc.

Sample Statement: Benefit levels of the retired membership mirrors the current collective bargaining agreement for each class of employee. On January 1, 2017, the local unit entered into new collective bargaining agreements with the Command Officers Association and Internal Association of Firefighters that increased employee co-payments and deductibles for healthcare. These coverage changes resulted in an improvement to the retirement system’s funded ratio. Please see page 12 of the attached actuarial analysis that indicates the system is 40% funded as of June 30, 2017.

 Additional Funding – Additional funding may include the following: paying the annual required contribution in addition to retiree premiums, voluntary contributions above the annual required contribution, bonding, millage increases, restricted funds, etc.

Sample Statement: The local unit created a qualified trust to receive, invest, and accumulate assets for retirement healthcare on June 23, 2016. The local unit of government has adopted a policy to change its funding methodology from Pay- Go to full funding of the Annual Required Contribution (ARC). Additionally, the local unit has committed to contributing $500,000 annually, in addition to the ARC for the next five fiscal years. The additional contributions will increase the retirement system’s funded ratio to 40% by 2022. Please see page 10 of the attached resolution from our governing body demonstrating the commitment to contribute the ARC and additional $500,000 for the next five years.

 Other Considerations – Other considerations may include the following: outdated Form 5572 information, actuarial assumption changes, amortization policy changes, etc.

Sample Statement: The information provided on the Form 5572 from the audit used actuarial data from 2015. Attached is an updated actuarial valuation for 2017 that shows our funded ratio has improved to 42% as indicated on page 13.

4. DESCRIPTION OF PROSPECTIVE ACTIONS The corrective action plan allows you to submit a plan of prospective actions which are separated into three categories below: System Design Changes, Additional Funding, and Other Considerations. Please provide a brief description of the prospective actions implemented by the local government to address the retirement system’s underfunded status within the appropriate category section. Within each category are sample statements that you may choose to use to indicate the changes to your system that will positively affect your funded status. For retirement systems that have multiple divisions, departments, or plans within the same retirement system, please indicate how these changes impact the retirement system as a whole.

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Please indicate where in the attached supporting documentation these changes are described and the impact of those changes (i.e. what will the local unit of government do to improve its underfunded status, and where can we find the proof of these changes in the supporting documentation?).

Category of Prospective Actions:

 System Design Changes - System design changes may include the following: Changes to coverage levels (including retiree co-payments, deductibles, and Medicare eligibility), changes to premium cost-sharing, eligibility changes, switch to defined contribution retiree health care plan, changes to retiree health care coverage for new hires, etc.

Sample Statement: The local unit will seek to align benefit levels for the retired membership with each class of active employees. Beginning with summer 2018 contract negotiations, the local unit will seek revised collective bargaining agreements with the Command Officers Association and Internal Association of Firefighters to increase employee co-payments and deductibles for healthcare. These coverage changes would result in an improvement to the retirement system’s funded ratio. Please see page 12 of the attached actuarial analysis that indicates the system would be 40% funded by fiscal year 2020 if these changes were adopted and implemented by fiscal year 2019.

 Additional Funding – Additional funding may include the following: meeting the annual required contribution in addition to retiree premiums, voluntary contributions above the annual required contribution, bonding, millage increases, restricted funds, etc.

Sample Statement: The local unit will create a qualified trust to receive, invest, and accumulate assets for retirement healthcare by December 31, 2018. The local unit of government will adopt a policy to change its funding methodology from Pay-Go to full funding of the Annual Required Contribution (ARC) by December 31, 2018. Additionally, beginning in fiscal year 2019, the local unit will contribute $500,000 annually in addition to the ARC for the next five fiscal years. The additional contributions will increase the retirement system’s funded ratio to 40% by 2022. Please see page 10 of the attached resolution from our governing body demonstrating the commitment to contribute the ARC and additional $500,000 for the next five years.

 Other Considerations – Other considerations may include the following: outdated Form 5572 information, actuarial assumption changes, amortization policy changes, etc.

Sample Statement: Beginning in fiscal year 2019, the local unit will begin amortizing the unfunded portion of the healthcare liability using a level-dollar amortization method over a closed period of 10 years. This will allow the health system to reach a funded status of 42% by 2022 as shown in the attached actuarial analysis on page 13.

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5. CONFIRMATION OF FUNDING Please check the applicable answer:

Do the corrective actions listed in this plan allow for (insert local unit name) ______to make, at a minimum, the retiree premium payment, as well as the normal cost payments for all new hires (if applicable), for the retirement health benefit system according to your long-term budget forecast?

 Yes  No If No, Explain

6. DOCUMENTATION ATTACHED TO THIS CORRECTIVE ACTION PLAN Documentation should be attached as a .pdf to this corrective action plan. The documentation should detail the corrective action plan that would be implemented to adequately address the local unit of government’s underfunded status. Please check all documents that are included as part of this plan and attach in successive order as provided below:

Naming convention: when attaching documents please use the naming convention shown below. If there is more than one document in a specific category that needs to be submitted, include a, b, or c for each document. For example, if you are submitting two supplemental valuations, you would name the first document “Attachment 2a” and the second document “Attachment 2b”.

Naming Convention Type of Document

 Attachment – 1 This Corrective Action Plan (Required)

 Attachment – 1a Documentation from the governing body approving this Corrective Action Plan (Required)

 Attachment – 2a An actuarial projection, an actuarial valuation, or an internally developed analysis, which illustrates how and when the local unit will reach the 40% funded ratio. Or, if the local unit is a city, village, township, or county, ARC will be less than 12% of governmental fund revenues, as defined by the Act. (Required)

 Attachment – 3a Documentation of additional payments in past years that is not reflected in your audited financial statements (e.g. enacted budget, system provided information).  Attachment – 4a Documentation of commitment to additional payments in future years (e.g. resolution, ordinance)

 Attachment – 5a A separate corrective action plan that the local unit has approved to address its underfunded status, which includes documentation of prior actions, prospective actions, and the positive impact on the system’s funded ratio

 Attachment – 6a Other documentation, not categorized above

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MBS International Airport Commission PA 202 Internally Developed Analysis Retiree Health Care Corrective Action Plan March 21, 2019

Net OPEB obligation (end of FY 2017) $2,383,810 (1) Amount deposited in qualified trust 0 OPEB liability $2,383,810

Net OPEB liability (end of FY 2018) $2,403,810 (2) Amount deposited in qualified trust 0 OPEB liability $2,403,810

Net OPEB liability (end of FY 2019) $2,423,810 (3) Amount transferred from restricted fund to qualified trust $969,524 (4) OPEB liability $1,454,286

Footnotes:

(1) MBS 2017 financial audit page 22 (2) Estimate based on past performance (3) Estimate based on past performance (4) 40% of estimated OPEB liability

2a 1 MBS INTERNATIONAL AIRPORT

Notes to Financial Statements

The components of the Airport’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the Airport’s net OPEB obligation are summarized below as of December 31. The amounts are based on projections noted in the January 1, 2017 (for December 31, 2017 and 2016) actuarial valuation.

2017 2016

Annual required contributions (ARC)$ 327,418 $ 240,820 Interest on net OPEB obligation 94,599 91,923 Adjustment to ARC (270,394) (144,929)

Annual OPEB cost (postemployment health benefit expense) 151,623 187,814 Contributions made, net (132,788) (120,906) Increase in net OPEB obligation 18,835 66,908 Net OPEB obligation - beginning of year 2,364,975 2,298,067

Net OPEB obligation - end of year $ 2,383,810 $ 2,364,975

The Airport’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation were as follows for the year ending December 31:

Three-Year Trend Information Percentage of Annual OPEB Annual OPEB Cost Net OPEB Year Ended Cost Contributed Obligation

2017 $ 151,623 42.30% $ 2,383,810 2016 187,814 64.38% 2,364,975 2015 194,312 57.60% 2,298,067

Funded Status and Funding Progress. Other postemployment health benefits are not advance funded on an actuarially determined basis, but instead are financed on a pay-as-you-go basis. The Airport thus far has decided that future benefits will not be prefunded; however, the Airport has designated assets to meet future obligations in the amount of $1,850,827 as of December 31, 2017 and $1,848,045 as of December 31, 2016, earnings from which will be used to offset annual postemployment contributions, however, these assets are not in a trust and therefore are not considered Plan assets. The actuarial accrued liability and the unfunded actuarial accrued liability was $2,786,701 as of December 31, 2017 and 2016. Since the benefits are not advance funded, the funded ratio was 0.00% for both years and there was no covered payroll information available.

2a 2

MBS INTERNATIONAL AIRPORT COMMISSION

February 21, 2008

MINUTES

The meeting was held in the Airport Commission Board Room, 8600 Garfield Road, Freeland, Michigan 48623. Chairman Kenneth Distler called the meeting to order at 12:59 p.m. Roll was called by Diane Klapish.

COMMISSIONERS

Present Absent & Excused Staff Other Kenneth W. Distler George J. Biltz Jeff Nagel John Palen, Midland Issues Darnell Earley Brian K. Elder A. T. Lippert Rich Bostwick, NWA Eugene F. Gwizdala Jon Lynch Ryan Riesinger Barrie Barber, Saginaw News Ernie Krygier Joyce J. Seals Diane Klapish Hollis H. McKeag

Dr. Distler introduced Ernie Krygier from Bay County as a new member of the commission. The Board welcomed him.

PLEDGE OF ALLEGIANCE

MINUTES: Mr. Gwizdala made a motion to approve the minutes of the Regular Commission Meeting held on January 17, 2008. Mr. Earley seconded the motion. The motion was unanimously approved by the Board.

JANUARY 2008 WARRANT AND CASH & INVESTMENT SUMMARY: Mr. Gwizdala made a motion to approve the Warrant Registers for the January Payroll Account Check Numbers 83601- 83688; the January Operations and Maintenance Check Numbers 38151-38247; and the January Cash and Investment Summary. Mr. McKeag seconded the motion and the Board unanimously approved it.

PUBLIC COMMENT: None .

RESOLUTION OF APPRECIATION: Chairman Distler presented the following resolution.

MBS International Airport Commission Resolution of Appreciation

The MBS International Airport Commission recognizes with great appreciation the dedicated service of

Exhibit 6a 1 PATRICK H. BESON

who has served the airport and the owner communities since 2003. During his years of service he has shared his skills as a local business owner, his understanding of community needs, and his knowledge of aviation related activities and concerns to the commission. He has willingly aided the airport manager and management staff as an active committee member.

His counsel, support, and pleasant personality will be missed by all who have served and worked with him, and the best wishes of all go with him as he leaves us to dedicate more time to his role as Chairman of the Bay County Board of Commissioners.

This Resolution of Appreciation was unanimously adopted at a regular meeting of the MBS Airport Commission on February 21, 2008 and shall be retained in the permanent minutes of the commission.

MBS INTERNATIONAL AIRPORT COMMISSION

BAY COUNTY CITY OF MIDLAND CITY OF SAGINAW Eugene F. Gwizdala Hollis H. McKeag Kenneth W. Distler Brian K. Elder George J. Biltz Joyce J. Seals Ernie Krygier Jon Lynch Darnell Earley

Jeffrey A. Nagel Airport Manager A. T. Lippert, Jr., Airport Attorney

Mr. Gwizdala made a motion to approve the Resolution of Appreciation for Pat Beson. Mr. Earley seconded and the motion passed unanimously.

AUDIT SCOPE LETTER: Chairman Distler stated that Andrews Hooper and Pavlik annually give the Board the audit scope letter which outlines the scope of services for the upcoming audit. Mr. Gwizdala made a motion to receive the audit scope letter from Andrews Hooper & Pavlik. Mr. Kryieger seconded and the motion passed unanimously.

RETIREE HEALTH CARE UPDATE: Mr. Nagel stated that the Personnel Committee met and discussed a variety of topics over the past several months. One benefit which has been closely examined is retiree health care. Currently, administrative staff retiring into the MERS system receive full retiree health care benefits. Other staff receive $1,500 per year in benefit if they remain on the airport’s Blue Cross/Blue Shield insurance plan.

Based on the discussions at the committee level, the following recommendation is for full commission action. This change will not impact current retirees or those currently employed in this job classification.

“Effective January 1, 2008 all newly hired administrative staff personnel shall be eligible for the following health care benefit upon retirement: The Employer shall pay to the Airport’s health insurance carrier, as a premium contribution, a sum not to exceed $125 per month. The Employer’s responsibility shall continue so long as the retired employee’s health insurance coverage remains in full force and effect.”

Exhibit 6a 2 Mr. Nagel stated that the handbook has been reviewed and that additional changes may be made in the next 12 to 18 months.

Mr. Earley made a motion to approve the recommendation of the Personnel Committee and authorization to modify MBS Employee Handbook to reflect this change. Mr. Gwizdala seconded.

Mr. Earley stated that this is a cost containment measure, one that the Personnel Committee studied very closely with the Airport Manager and Airport Attorney. The committee is confident that this will take MBS in the direction that is needed in terms of long-term cost containment. There being no further discussion the motion passed unanimously.

2008 AIRPORT MANAGER GOALS: Mr. Nagel stated that during his annual job performance the commission requested a list of goals for 2008. The Board was given a list of goals and steps to reach each one. The Airport Manager stated that the list is broad in nature and in no way is meant to encompass all daily activities of this position. Mr. Earley made a motion to approve the 2008 goals for the Airport Manager with Mr. Gwizdala seconding.

Mr. McKeag commented on the first goal which is to continue to monitor fares and service from incumbent carriers. He stated that he would like to see take action as appropriate added. He expressed concern over continued declining passenger numbers. Mr. McKeag stated that he would like to see Mr. Nagel add a goal of increase passenger numbers over previous years. As the Personnel Committee Chairperson, Mr. Earley stated it may be better or more achievable for Mr. Nagel to put together a plan as to how he would address increased ridership rather than holding Mr. Nagel solely responsible for increasing passenger numbers. Chairman Distler stated that the 2008 goals have been moved and supported and that Mr. Nagel has agreed to add “take action as appropriate” to the first goal. Chairman Distler also stated that the Marketing Committee will discuss ridership and numbers and bring a recommendation to the Board. The Chairman called for the vote and the motion passed unanimously.

Chairman Distler stated that although ridership will not be directly tied to the Airport Manager’s goals it should be addressed. The Marketing Committee will discuss using ridership and numbers as a parameter to judge the success of the marketing strategy.

OLD BUSINESS: Mr. Nagel updated the commission on the FAA reauthorization. He stated that the House and Senate have both passed a temporary continuation of the AIP taxes and fees until June of 2008. The AIP contract authority has been signed, or will be shortly, and MBS will receive grants for 2008. Mr. Nagel stated that the State Capital Outlay Bill has not been passed. The Capital Outlay Bill allows federal funds to be transferred from the federal government FAA to the state and then to the communities. Without the Capital Outlay Bill passed there is no transfer mechanism so MBS would not receive grant money. A group of airport managers testified before a joint House and Senate subcommittee to see if the aeronautics portion can be moved out of the Capital Outlay Bill. Mr. Nagel stated that he would continue to keep the Airport Commission updated.

Mr. Nagel updated the commission on the property purchase. The Airport did a partial purchase with the owner keeping 40 acres to the north as well as a 12 foot strip for access. Because both

Exhibit 6a 3 parties were in agreement, the necessity hearing was dropped. A good faith offer of $463,656.35 which was discussed and approved by the Board has been paid. The airport is in possession of the property, however, the final amount could change. The property owner is still living in the house, has access to the house for six months and at that time an evaluation of the residency will be made. Staff will continue to work through the process of determining the final amount.

NEW BUSINESS: Mr. Nagel stated that in January the airport had its annual FAA Certification Inspection. They inspect the airfield side, all the paperwork and training records. This was the third year in a row that there were no discrepancies listed. Mr. Nagel thanked Mr. Riesinger and the entire staff for all their efforts.

Mr. Nagel stated that there has been a lot of discussion in various media outlets regarding airline mergers. He talked about a possible airline merger between Northwest and Delta and was unsure of the impact it would have on MBS. The airport does not have Delta service; Northwest is the dominant carrier and serves two hubs. Mr. Nagel thought the impact would be minimal but at this time he acknowledged it was purely speculation. Staff will continue to monitor whether the merger goes through and how it will affect MBS.

Mr. Nagel updated the Board on our last major snow storm which totaled 14 inches. He stated that airport employees worked over 140 hours of overtime to keep the airport open during the entire storm. He mentioned that it was discouraging because they worked so hard to keep the airport open but flights were still cancelled.

Chairman Distler stated that MBS has a great track record of not being closed yet flights are being cancelled by Northwest and United that are not due to problems at MBS. Discussion took place regarding cancellations at the airport. Mr. Riesinger stated that one thing to keep in mind is that the airport may be open but there are also meteorological conditions that prevent flights whether it is low visibility, fog, wind or deicing issues. It is an airline decision to operate the flight and involves more than whether or not the airport is open. Mr. Bostwick, NWA, reiterated to the Board that the runways may be open however the visibility or the ceiling is too low to permit a landing. He stated that flight information is posted or announced to the passengers and they are given a reason for the cancellation. Mr. Bostwick assured the Board that he is very proactive with Northwest at MBS Airport.

COMMITTEE ASSIGNMENTS: Chairman Distler appointed Joyce Seals to the Finance Committee and Ernie Krygier to the Personnel Committee.

ADMINISTRATIVE MATTERS: Next regular meeting is scheduled for March 20, 2008.

ADJOURNMENT: There being no further business, Mr. Earley made a motion to adjourn. Mr. Gwizdala seconded and the Board unanimously passed the motion. The meeting adjourned at 1:35 p.m.

Eugene F. Gwizdala, Secretary

Exhibit 6a 4 MBS INTERNATIONAL AIRPORT COMMISSION

August 18, 2011

MINUTES

The meeting was held in the Airport Commission Board Room, 8600 Garfield Road, Freeland, Michigan 48623. Chairman Darnell Earley called the meeting to order at 1:00 p.m. Roll was called by Debbie Meisel.

COMMISSIONERS

Present Staff Other Tom Adams Jeff Nagel Angela Osmond, TSA George J. Biltz Andre R. Borrello Rich Carpenter, Standard Parking Bregitte Braddock Ryan Riesinger Kristin Statler, Standard Parking Greg Branch Debbie Meisel Bob Reiser, Standard Parking Kim Coonan Pat Wurtzel, Bierlein Darnell Earley Guests Ernie Krygier Mark Wilcer, RS&H Tom Ryder Pat Frame, RS&H Paula Whittington Steve Westerbeke, RS&H

PLEDGE OF ALLEGIANCE

MINUTES: Mr. Krygier made a motion to approve the minutes of the Regular Commission Meeting held on July 21, 2011. Mr. Biltz seconded the motion. The motion was unanimously approved by the Board.

JULY 2011 WARRANTS AND CASH & INVESTMENT SUMMARIES: Mr. Coonan made a motion to approve the Warrant Registers for the July Payroll Account Check Numbers 86339- 86394; the July Operations and Maintenance Check Numbers 41440-41522; and the July Cash and Investment Summaries. Mr. Krygier seconded the motion and the Board unanimously approved it.

PUBLIC COMMENT: None

HANGAR #1 CONSTRUCTION: Mr. Nagel stated that at the June 16, 2011 meeting the Airport Commission approved a new ground lease with Bierlein for the Hangar #1 location. Bierlein has completed the design for a new hangar at this location and has received bids on the project. They are now requesting Airport Commission approval of the project.

The proposed hangar is 100’ x 100’ with a small office attached to the side. This will be an excellent addition to the general aviation flight line at MBS.

Final approval of the construction is subject to the FAA airspace determination, (approval has now been received), airport staff approval of the plans as well as obtaining the appropriate building permits. Bierlein and staff are currently reviewing the drawings. Bierlein has also been working

Exhibit 6a 5 with local Township officials on the necessary permits. Once these steps are completed, Bierlein will begin by removing the existing hangar at this location.

Mr. Krygier made a motion to approve the construction of Hangar #1 by Bierlein pending final FAA airspace determination, final staff review and approval of local building authorities. Mr. Biltz seconded and the motion passed unanimously. Mr. Wurtzel informed the board that demolition will take place within 30 days and the project should be completed within 120 days.

AUDIT SERVICES PROPOSAL: Mr. Nagel stated that Andrews Hooper and Pavlik (AHP) have completed the MBS audit services for the past several years. They have done a good job of preparing the annual audit, the PFC audit and recently, the single audit required for the ARRA grants. In order to get a fresh look at the MBS operations, AHP has designated a new project manager for the MBS audit approximately every three years.

The MBS Finance Committee had asked staff to obtain a proposal for audit services from AHP for the next five years. This request was due to the fact that MBS currently has nine open FAA grants with two of those being “stimulus” grants. AHP has submitted a proposal and the Finance Committee met on July 22, 2011 to review the proposal. The committee felt that due to the complexities of the terminal project, the number of outstanding AIP grants and the two stimulus grants, it would be best to stay with AHP. The committee also felt the proposal provided by AHP was very reasonable.

The AHP proposal was included in the packet and in summary, the cost of the annual audit service increases less than 2% per year. The cost for the PFC also has a slight increase, which totals $500 over the five year service period.

Based on the costs provided by AHP, and the ongoing terminal project, the committee recommends approval of the AHP proposal. Mr. Coonan made motion to approve the proposal of Andrew’s Hooper and Pavlik to provide audit services for MBS for the next five years. Mr. Adams seconded and the motion passed unanimously.

STANDARD PARKING AMENDMENT: Mr. Nagel stated that Standard Parking has been managing the parking lot at MBS for the past 40 years. The current agreement expires on December 31, 2011. Mr. Nagel introduced Bob Reiser, Senior Vice President from Cleveland, Kristin Statler, Regional Manager, and Rich Carpenter, Local Manager. Staff approached Standard to gauge their interest in signing an extension. Standard was interested in an extension and has proposed a five- year deal which would see the airport through the transition into the new terminal parking lot. After much discussion, Standard provided a proposal which was included in the packet.

In summary, Standard has offered the following:

 $250,000 investment in the new equipment for the new parking lots  Support, engineering and testing of the equipment, in coordination with RS&H  Development of a transition plan from the existing lot to the new lot including providing temporary shuttle bus service at their cost  Elimination of a $.25 per day “capital expense” provision which will result in additional airport revenue of approximately $40,000 annually.

Exhibit 6a 6

In exchange for this Standard requests a five-year extension of the existing agreement.

Standard Parking currently manages the airport parking facilities at several Michigan airports including Traverse City, Lansing, Flint, Grand Rapids and Kalamazoo. Ms. Statler, Regional Manager is based in Kalamazoo and maintains excellent contact about once a quarter with MBS. Rich Carpenter has been the local manager for the MBS operation for the past 11 years. He is very familiar with the operation and does a good job to solve any issues that develop with this agreement.

This proposal was presented at the Finance Committee meeting on July 22, 2011 and the committee agreed to present this to the full commission for approval. Mr. Branch made a motion to approve a five-year extension to the Standard Parking agreement according to the proposal dated June 23, 2011 and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Ryder seconded the motion.

Discussion took place regarding the rates. Mr. Nagel stated that any change in rates would come to the commission for approval. Normally rates are reviewed approximately every two to three years to keep pace with other airports but not outpace those airports.

Mr. Biltz questioned if moving to a new terminal is the right time to be looking at other alternatives or options versus signing a five year contract. Mr. Nagel stated that there are several ways to contract out the parking. The current Standard Parking encompasses staffing the lot, providing liability insurance, maintenance, etc. Mr. Nagel talked to others in the industry and was told to get through the transition and go out to bid after the transition.

Mr. Biltz asked what percentage of the costs for the parking lot is the $250,000 capital investment. Mr. Reiser stated that the amount is entirely towards new revenue control equipment, which includes ticket spitters, computers, credit card access, and electronic license plate monitoring but does not include parking booths. As part of the proposal, Standard Parking will supervise the process and will provide RS&H with drawings that include the conduit and layouts for the entrance and exit lanes. At the end of the contract the equipment passes to the airport. Mr. Biltz also asked if there are any limitations under the contract for other things that the airport may want to do with the parking lot such as installing solar collection. Mr. Nagel stated that this had been discussed in preliminary discussions and Standard Parking is very willing to work with the airport with incentives that are brought to them. Nothing would bar the airport from using the space. Mr. Reiser stated that the parking lot is the airport’s facility and it is in charge of the parking rates. Standard Parking provides a service to collect and protect the airport’s revenue and provide customer service.

Ms. Whittington asked for an explanation of the minimum guarantee. Mr. Nagel explained that the minimum guarantee is an amount that is paid up front each month with the revenue over that amount being paid the following month. Increasing the minimum does not increase the amount of revenue the airport will receive however it will change the revenue flow. It also locks the amount that Standard Parking is guaranteed to pay.

There being no further discussion, the motion passed unanimously.

Exhibit 6a 7 SAGINAW COUNTY SHERIFF CONTRACT: Mr. Nagel stated that MBS has had a contract with Saginaw County Sheriff Department to provide law enforcement support to the airport as required by the TSA. The partnership has worked well throughout the years and the Department has worked with MBS on numerous special events including training exercises, VIP visits and sheriff administration attendance at various security-related meetings. A deputy is on duty 16 hours per day seven days per week and they are responsible for responding to all checkpoint alarms, patrolling the curb, random security checks on the ramp, responding to all terminal security-system alarms as well as a variety of other functions. The contract is a “pass-through” contract where MBS pays actual costs associated with the Deputies stationed here and the County adds a 5% administration fee. In December, 2010, the Airport Commission approved a nine-month extension of the existing agreement at the current rate of $28,600 per month. The extension expires at the end of September, 2011.

Discussions have taken place between the County and MBS on a new three-year agreement. The County has their new costs for the upcoming fiscal year. Based on these numbers, the first year cost to MBS will be $26,416 per month which represents a 7.6% decrease in the current contract cost. The cost for the final two years of the contract will be discussed prior to each year. Once the county realizes their expenses related to the contract, it will be brought to the commission for approval. MBS does have some protection built into the contract by virtue of a 90-day out clause.

This contract was discussed at the MBS Finance Committee meeting on July 22, 2011 and the committee agreed with staff recommendation of a three-year agreement with SCSD with the first year being $26,416 per month. Mr. Nagel stated that it was recommended that an outside attorney review the contract since Mr. Borrello works for the county and MBS. Mr. Nagel had Gary Campbell who has a history of working with MBS in the past review the contract. Mr. Campbell stated that he had no issues with the contract. Mr. Krygier made a motion to approve a new three- year agreement with the Saginaw County Sheriff Department with the first year cost to be $26,416 per month and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Biltz seconded the motion. Chairman Earley asked what the reporting procedure is between SCSD and the airport. Mr. Nagel explained the procedures and stated that the airport has a written handbook for the deputies. There being no further discussion, Chairman Earley called for a vote. The vote was 8 yeas, 0 nays, and 1 abstention. Ms. Braddock abstained. The motion passed.

2011 AIP GRANTS: Mr. Nagel stated that the intention for this grant was to address strictly entitlements for about $1.6 million. This money was to be used for reimbursement for a portion of the Spence contract and for reimbursement for a portion of the water main loop. These costs were part of the finance plan the commission previously approved for this phase of work.

The commission has also approved the bids for both Phase X (ramp and perimeter road) and Phase XI (building finishes) along with associated construction administration costs. All of these approvals were subject to receiving FAA funding.

Mr. Nagel continues to work with the FAA on various funding scenarios for both entitlements and discretionary dollars for the project. Because of the recent FAA shut-down and the fast-approaching end of the government fiscal year, he has been asked by the FAA to submit a hybrid grant application including both entitlement dollars and discretionary dollars. In addition to this grant application, MBS may actually receive more than one grant in the next five weeks.

Exhibit 6a 8

Therefore, Mr. Nagel asked the commission for flexibility to submit any requested FAA grant application necessary to receive either 2011 AIP entitlement funding or 2011 AIP discretionary funding.

Ms. Braddock made a motion to authorize the Airport Manager to submit FAA grant applications as requested by the FAA for 2011 entitlements and 2011 discretionary money related to the terminal project and authorize the Chairman, or in his absence the Vice Chairman, to sign the related grant documents. Mr. Krygier seconded. Mr. Biltz stated that there is not a September meeting. There will be many budgeting issues in the next four to five weeks. The purpose of this motion is to give Mr. Nagel as much flexibility as possible to react to however the budgeting process happens. Mr. Nagel stated that this is very unusual since he normally comes to the commission with very specific grants. He is working with RS&H and staff in addition to the items that have been approved by the commission pending funding, they are moving forward to bid the security system for the building and the relocation and installation of the passenger loading bridges. Those are the last two pieces of the project that would require federal funding. They are hoping for last minute available money. The numbers from the bids would be used for grant application with formal approval later from the commission. The airport is trying to get as much funding as possible into this year.

Mr. Coonan asked what the status of the FAA in Washington was. Mr. Nagel stated that the FAA was shut down for about ten days. The Senate and the House passed and the President signed another short-term extension to the AIP funding program that goes until September 16. That’s why the projects are being bid so the numbers are ready on September 16. Chairman Earley stated that flexibility is very important at this time. Mr. Nagel stated that he reiterated the plan with the manager at the FAA district office in Detroit and he is in favor of any flexibility that can be obtained. Chairman Earley stated that he appreciates that Mr. Nagel is staying on top of this. There being no further discussion, the motion passed unanimously.

PHASE V SPENCE BROTHERS CONTRACT CHANGE ORDER #7 AND #8: Mr. Nagel stated that the Spence Brothers contract for the current phase of the terminal project is divided into three sections. Each portion of work was given its own Notice-To-Proceed (NTP). This was done because of the complexities involved in the financing of this work and to coordinate with certain FAA grants. As done in the past, each change order is directly related to an individual Notice-To- Proceed. This has worked well to keep the financing clear with the State and with the FAA.

In order to keep an accurate record of change order approvals, it is best to discuss each proposed change order individually.

Change Order #07 for NTP #1: Mr. Nagel stated that this change order has three items as outlined in the letter from Mark Wilcer including kitchen area modifications, electric signage infrastructure and additional power receptacles. In summary, these three changes would increase the amount of NTP #1 by $20,238.25. It should be noted that previous changes to this NTP had reduced the amount by over $1.5 million. Therefore, even with this change, this NTP will still be well under the original amount. Mr. Nagel stated that the Operations Committee met to discuss this change order. Mr. Biltz made a motion to approve Spence Brothers Change Order #07 for NTP #1 and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Krygier seconded the motion. Chairman Earley stated that the flexibility to meet to discuss the change and

Exhibit 6a 9 modifications keeps the project moving. Mr. Nagel does an excellent job of keeping the Operations Committee informed so there are no surprises. There being no further discussion, the motion passed unanimously.

Change Order #08 for NTP #2: Mr. Nagel stated the Notice-To-Proceed #2 was divided out to equal the exact amount of the second ARRA (stimulus) grant which MBS received. This work covers a very specific portion of work for this phase of the project. The two items included in this change order are a modification to the passenger screening wall which will provide additional flexibility for the future and modification to the steel bracing at the ticket counter to coordinate between previous phases of the project and this phase. These two adjustments will increase the amount of NTP #2 by $40,278.58. It must be noted that the FAA has been reluctant to increase the amount of ARRA grants in the past and these costs will most-likely be MBS responsibility. That being said, because the overall contract cost has been decreased through previous changes the local dollars committed to this phase are still within the commission-approved finance plan. Mr. Nagel stated that the Operations Committee also reviewed this change order. Mr. Krygier made a motion to approve Spence Brothers Change Order #08 for NTP #2 and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Ryder seconded and the motion passed unanimously.

PERSONNEL COMMITTEE UPDATE: Mr. Nagel stated that negotiations between MBS and the local Teamsters union have been ongoing since last fall. Shortly after negotiations began, Mr. Nagel was informed that the Teamsters local had changed from 486 to 214. This change caused a delay in the negotiations and caused the process to revert backwards to some degree. Since that time, negotiations have continued with Local 214.

Airport staff along with the airport attorney met with the Personnel Committee on August 8, 2011 to discuss a contract proposal. The discussion of collective bargaining strategy is eligible for closed session and the union has made a request for the commission to have these conversations held in closed session. Mr. Borrello stated that under the provisions of the Open Meetings Act the collective bargaining process, the public body is allowed to have a strategy session in closed session if the body so chooses. It does require a roll call vote. Mr. Biltz made a motion to go into closed session. Mr. Krygier seconded. Chairman Earley asked for a roll call vote. Ms. Meisel took roll call as follows: Mr. Adams, yes; Mr. Biltz, yes; Ms. Braddock, yes; Mr. Branch, yes; Mr. Coonan, yes; Mr. Earley, yes; Mr. Krygier, yes; Mr. Ryder, yes; Ms. Whittington, yes. The motion carried.

Mr. Branch left the meeting after closed session. Upon return from closed session Mr. Coonan moved to accept the recommendation from the airport manager to approve and ratify the collective bargaining agreement (CBA), as proposed to the commission by the airport attorney and manager and as summarized below. The commission ratifies this CBA with the understanding that the Teamsters Local 214 bargaining team has tentatively agreed to these terms and contingent on ratification by the Teamsters bargaining unit. Approval includes authorization for the appropriate parties to execute the CBA on behalf of the MBS International Airport Commission when ratified.

Summary of the terms of the new CBA:

1. Wages a. 2010-11: Wages Frozen

Exhibit 6a 10 b. 2011-12: $0.35/hour Wage Increase; $500 lump sum c. 2012-13: $0.30/hour Wage Increase; $300 lump sum d. 2013-14: Wages frozen; $1,000 lump sum e. 2014-15: Wages Frozen; $1,000 lump sum f. Eliminate highest rate shift premium for non-24 hour employees 2. Health Care a. Change from PPO2 to Michigan Conference of Teamsters Welfare Fund b. Rates as provided in MCTWF Schedule, but summarized as follows: c. Significant savings in annual premium i. 1st year: 12.5% decrease from current rates ii. 2nd year: 7.9% decrease from current rates iii. 3rd year: 0.7% decrease from current rates iv. 4th year: 2.9% increase from current rates; employer and employees to split cost of increase d. Eliminate Employer hearing and vision contributions e. Eliminate Employer offer of monthly stipend for retirement health care 3. Miscellaneous a. Nearly 5-year term: Expiring March 28, 2015 b. Language clarifications throughout c. Streamlined and clarified grievance procedure d. Add different uniform options as proposed by Union e. Other minor operational issues

Ms. Braddock seconded the motion. Mr. Biltz asked when ratification could be expected. Mr. Nagel stated that the union would be voting, Tuesday, August 23. The end of the payroll is the 24th and the payroll changes would take effect on the 25th, the first day of the pay period. There being no further discussion, the motion passed unanimously.

Non-Union Personnel: Mr. Nagel reviewed a memo that he had issued the Personnel Committee. At the MBS Personnel Committee meeting held on August 8, 2011 he briefly discussed possible wage adjustments for the six administration employees who are not part of the bargaining unit. The airport manager is not included since he has a separate review process. The committee had asked for additional information.

In summary, the administration employees have not had a wage adjustment since September, 2008. Historically, the administration employees receive wage adjustments similar to what is called for in the collective bargaining agreement for the union employees. It should be noted that wages and benefits are not always exactly the same for both employee groups, but they are usually close.

In September, 2009 the union employees received a 3% pay increase as called for in the approved collective bargaining agreement. The administration staff did not receive an increase at that time. Mr. Nagel requested an adjustment in administration employee wages if the airport commission approved the proposed union contract at today’s meeting.

His proposal for the administration employees is as follows: 3% pay increase effective immediately and $500 lump sum payment for each employee. The 3% wage adjustment is commensurate with

Exhibit 6a 11 the 2009 increase provided to union employees and the $500 lump sum payment coincides with the lump sum payment for union employees.

Mr. Nagel stated that another factor to consider is the ever-changing health care coverage. As mentioned in the committee meeting, staff is closely tracking the State legislative proposal to cap the amount a public employer can pay towards a monthly health care premium and/or require employee health care contributions. Mr. Nagel has asked the airport’s insurance agent to research policies that can cover our administration employees along with the retirees and stay below the proposed caps. Once this proposal becomes law, that could have a financial impact on the non- union employees as well, and he may have to go back to the Personnel Committee for further action.

Mr. Nagel also recommended that the administration wages be evaluated annually and that process will involve the airport manager and the Personnel Committee. Mr. Krygier made a motion to give the administration employees a 3% pay increase effective immediately and a $500 lump sum payment for each employee. Ms. Whittington seconded. Mr. Biltz asked the Personnel Committee’s opinion. Chairman Earley stated that they had talked about the proposal during the Personnel Committee meeting. He and Ms. Whittington were in attendance. He stated that this is the standard way of how to handle non-union employees when bargaining with the union employees. It’s well in the scope of the airport’s ability to pay. The last thing you want to do is have your non-union employees feel that they don’t have the same kind of acknowledgement as a union employee. Ms. Whittington added that the administration employees have been under a wage freeze since September of 2008. She stated that in the local area they are starting to see businesses coming out of wage freezes and getting 2-3% increases and she feels it is appropriate. There being no further discussion, the motion passed unanimously.

Mr. Coonan asked whether the five-year contract with the union protects them if the state mandates employees to pay 20% towards their health insurance. Mr. Nagel stated that it is not law yet but based on the proposal he believed it would protect them. Mr. Borrello added that the contract would need to be ratified prior to the law passing. He also stated that the proposal states that it won’t take effect until January 2012.

OLD BUSINESS: Mr. Nagel thanked Mr. Riesinger for handling the press inquiries regarding the FAA shutdown while Mr. Nagel was on vacation and not within cell phone coverage. It did not affect the phase of work with Spence Brothers. FAA is back working since the extension is good through September 16th.

NEW BUSINESS: Mr. Nagel stated that Allegiant Air announced that they will begin less than daily non-stop air service between MBS and Orlando Sanford Airport in Florida beginning November 3rd. Mr. Nagel has been working with Allegiant for about four years. They have been to MBS twice to visit; he has visited them several times at their headquarters and provided them with various proposals. He was in the process of working with another carrier for Orlando service but it had not been finalized. Allegiant sent Mr. Nagel an email last night. Tickets are now on sale and MBS is on the Allegiant website. The service is less than daily which is very common for airports MBS’ size. Mr. Nagel stated that Allegiant currently does not have an operating agreement or an air service agreement to be able to take advantage of the airport’s Air Service Grant. Most likely a special meeting will be needed sometime in September to get agreements approved. Mr. Biltz stated that the board could give power to a committee to approve a contract. Mr. Nagel stated that

Exhibit 6a 12 typically a committee recommends and the board approves and five members would be needed. Mr. Nagel stated that the Air Service Grant is $600,000 which is $500,000 Federal money and $100,000 of local money. Of the local money $30,000 is from various chambers and economic development groups and $70,000 of MBS money. Plus Allegiant will be looking for additional marketing monies. Mr. Nagel stated that he would feel more comfortable having the board approve the contracts.

Chairman Earley stated the following:

“This is wonderful news not only for the MBS Airport but for the region as well. Allegiant’s announcement as a new discount carrier service provider will put MBS on a more competitive footing with similar size airports in the region. This good news along with our $48 million new terminal currently under construction will enhance our status as the most desirable transportation hub for north, central and mid-Michigan air travelers. I think those of us that have been around here for at least six years know that has always been a goal and a point of contention. Thanks to Jeff and to the staff and everyone who have brought us to this point, I think that it opens up the door for other discussions with regards to the carrier’s capacity and what they are willing to do to help as we move forward to become more competitive. So this is very good news for the region and for the airport. Thank you.”

ADMINISTRATIVE MATTERS: Next regular meeting is scheduled for October 20, 2011 and possibly a special meeting in September.

ADJOURNMENT: There being no further business, Mr. Krygier made a motion to adjourn. Mr. Coonan seconded and the Board unanimously passed the motion. The meeting adjourned at 2:05 p.m.

Ernie Krygier, Secretary

Exhibit 6a 13 MBS INTERNATIONAL AIRPORT COMMISSION

October 18, 2012

MINUTES

The meeting was held in the Airport Commission Board Room, 8600 Garfield Road, Freeland, Michigan 48623. Chairman Darnell Earley called the meeting to order at 1:01 p.m. Roll was called by Debbie Meisel.

COMMISSIONERS

Present Absent & Excused Staff Guests Tom Adams Greg Branch Jeff Nagel Mark Wilcer, RS&H George J. Biltz Ernie Krygier Andre R. Borrello Steve Westerbeke, RS&H Kim Coonan Ryan Riesinger Pat Frame, RS&H Darnell Earley Debbie Meisel Todd Hare Tom Ryder Paula Whittington

PLEDGE OF ALLEGIANCE

MINUTES: Mr. Ryder made a motion to approve the minutes of the Regular Commission Meeting held on September 20, 2012. Mr. Adams seconded the motion. The motion was unanimously approved by the Board.

SEPTEMBER 2012 WARRANTS AND CASH & INVESTMENT SUMMARIES: Mr. Ryder made a motion to approve the Warrant Registers for the September Payroll Account Advice Numbers 001448-001503; the September Operations and Maintenance Check Numbers 42532- 42597; and the September Cash and Investment Summary. Mr. Biltz seconded the motion and the Board unanimously approved it.

PUBLIC COMMENT: Chairman Earley welcomed Todd Hare as the new commissioner from Saginaw. Mr. Hare works at Nexteer Automotive in the IT Department, served 14 years on the Saginaw County Board of Commissioners, and is currently on the Saginaw County Road Commission Board. He appreciates the opportunity to serve on the airport board.

MBS INTERNATIONAL AIRPORT COMMISSION BOARD MEETING LOCATION: Mr. Nagel stated that at the annual meeting of the MBS International Airport Commission held in May of each year, the commission selects the dates, time and location for next year’s meetings. With the new terminal set to open in October, 2012 and the current terminal set to be closed at the end of this year, the commission needs to take formal action to change the location of the Board meetings.

The most suitable location to hold future Airport Commission meetings is the conference room in the Airport Administration Building. The previously approved dates and times do not need to be

Exhibit 6a 14 amended. Mr. Biltz made a motion to amend the location of future MBS International Airport Commission meetings to the conference room of the MBS International Airport Administration Building effective November 15, 2012 and post the change in accordance with the Michigan Open Meetings Act. Ms. Whittington seconded and the motion passed unanimously.

RENTAL CAR AGREEMENTS: Mr. Nagel stated that negotiations with the rental car companies have been ongoing for several months. This was one of the tasks that Bill Sandifer, from RS&H, has assisted with through the separate Transition Services Agreement. The corporate rental car representatives have also participated in the monthly transition meetings.

Currently the rental car companies pay 10% of gross rental for their business plus they pay $25.28 per square foot for the back office space and they pay $30.60 for their front counter space. They do not currently pay anything towards their queuing area in front of their counter.

In summary the new agreements call for the following:

 A five year agreement  10% of gross business, which is typical for the industry  $35.00 per square foot for back office, front counter and for queuing space  2% per year escalator clause  An increase of the Minimum Annual Revenue Guarantee (MAG) from the current $12,000 per year to $30,000.

These terms will bring in additional revenue for MBS while remaining fair for the companies. Getting the companies to pay for queuing space was a difficult decision but one that needed to be included. Also, a five year agreement allows MBS the flexibility to go out to bid in five years should the airport see fit to do so.

Although the new terminal was designed and built for four rental spaces, due to past consolidation in the industry, and future consolidation still coming, most likely only three of the available spaces will be used.

Mr. Borrello has been involved in the lease review process with Mr. Sandifer and Mr. Nagel. Mr. Biltz made a motion to approve the new rental car agreement terms and conditions and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Ryder seconded and the motion passed unanimously.

USDA PROPOSAL: Mr. Nagel stated that MBS Airport had a wildlife hazard assessment completed by the USDA, Animal Damage Control, back in 2002. Based on that assessment, a wildlife hazard plan was drafted and is still followed today, as required by federal regulation.

During the recent FAA/State planning meeting, the FAA mentioned that a new requirement is being developed and airports will need to conduct an additional wildlife hazard assessment. Although this is not yet a formal requirement, MBS should be prepared to conduct another study. There are a couple ways to fund such a study: it can be programmed into the FAA AIP plan and use AIP dollars or an airport can use 100% local money. After the meeting, Mr. Nagel was contacted by a representative of Michigan Aeronautics and he mentioned that there might be available State/Local

Exhibit 6a 15 money to assist with this work. After further discussion it was determined that the grant would be 90% State and 10% local. The Michigan Aeronautics Commission meets in November and this item will be placed on their agenda, pending MBS Airport Commission action.

In response to this meeting Mr. Nagel contacted Pete Butchko, State Director for USDA Wildlife Services to get an estimate of the cost of work. The USDA did the original assessment for MBS and they have been used in the past as any questions have arisen where staff needed additional consultation. Mr. Butchko provided Mr. Nagel with a memorandum showing the estimate to be $19,486. The intent is to apply for the State/Local grant to fund this work. If MBS is not approved for the grant, staff would then program this assessment into a future year using AIP dollars.

Mr. Ryder made a motion to approve the proposal from USDA for a wildlife hazard assessment pending approval of the State/Local grant program and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents, pending final review of the airport attorney. Ms. Whittington seconded and the motion passed unanimously.

TRILLION AVIATION AGREEMENT II: Mr. Nagel stated that at the March 15, 2012 meeting the Airport Commission approved Trillion Aviation to assist MBS with the development of a rates and charges model to use for airline negotiations. Trillion was selected based on their experience and based on the fact that they were priced substantially lower than the other proposal.

Over the past several months, Trillion has been working with staff to develop the model and they provided their input on forms of potential non-airline revenue generation. Some of those concepts have been incorporated into the agreements in the new terminal building.

MBS is currently in the midst of developing the 2013 budget, which should be brought to the commission at the December meeting. Based on the work produced so far by Trillion, they were asked to prepare a proposal to provide a complete line-by-line review of the MBS operating budget as well as a review of all existing airport agreements and provide recommendations for potential cost savings and/or revenue generation based on current industry standards. In addition, Trillion will continue to assist MBS with the implementation of additional non-airline revenue plans.

As MBS moves past the terminal project, and the cash reserves are significantly lower, it is important to conduct a top-down independent evaluation of the budgetary process and an independent review of the existing agreements. This will help ensure that the airport is taking full advantage of all potential opportunities. Trillion has proved themselves with the work conducted under their current scope of work and the recommendation is to continue this relationship with this next phase.

Attached is a letter from Dan Benzon, President of Trillion, who has been personally involved in the project from the beginning. This letter outlines their proposed scope of work and would be added as Statement of Work #2 to their Master Services Agreement. Cost of the work is $27,500 plus expenses. Mr. Biltz made a motion to approve Trillion to provide the services as outlined in the attached proposal and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Adams seconded and the motion passed unanimously.

Exhibit 6a 16 BAGGAGE CART SYSTEM PURCHASE: Mr. Nagel stated that MBS has been utilizing a Smarte Carte baggage cart system for a number of years. In 2009 Smarte Carte informed staff of their intent to pull their equipment out of MBS. However, they would allow it to remain if MBS agreed to manage their system for them. This was acceptable at that time because MBS would not be required to purchase or lease a new system and there would still be baggage carts available to the passengers. With the move over to the new terminal, staff has been investigating ways to provide luggage carts without moving the current system over. The current system is well over 20 years old and is not worth relocating, plus it is still owned by Smarte Carte.

Several options were evaluated with the best one being the purchase of a good-quality used system. Unfortunately, there are not many of those available but staff was able to locate one from Flight Services and Systems. The system is currently in St. Louis and is approximately 5 to 7 years old. It includes the cart system, the revenue control management system and 25 carts. MBS would own the system, maintain the system and generate any revenue from the system. A proposal was attached from FSS to this Exhibit. The cost for the system is $26,425 with $5,000 of that being estimated freight, so the final price could be slightly higher or lower.

It is important to have baggage carts available to the public in the new terminal and MBS would receive some, although limited, revenue from this system. The data provided for the existing system demonstrate revenues of approximately $1,200 per year. Mr. Coonan made a motion to approve the purchase of the baggage cart system from FSS at the above stated terms and authorize the Airport Manager to make payment as required. Mr. Biltz seconded. The motion passed unanimously after discussion.

PERSONNEL COMMITTEE UPDATE: Mr. Nagel stated that the Personnel Committee met on October 11, 2012 as a follow-up to the discussion that took place at the September 20, 2012 Airport Commission Meeting. The following four issues were discussed at this meeting:

I. A comparison of the cost impacts for the union contract changes which took place in April, 2012 and the proposed changes to non-union personnel wages that were recommended at the September 20th meeting.

II. The present Airport Manager’s wage and benefit package.

III. Criteria for union and non-union and Airport Manager pension eligibility.

IV. Criteria for post-retirement health care for union, non-union and the Airport Manager.

All four of these issues were discussed at length during the committee meeting.

I. The first item discussed at the committee meeting was a comparison of the total cost impact of the union contract changes for 2012 and the recommendations for non-union personnel. This was done by first looking at year-end numbers for 2011 and looking at the wage impact and then the health care cost impact.

The union wages have been approved in the collective bargaining agreement and the non-union wages are pending from a recommendation made last month. After careful review of the information provided, the committee agreed to bring this recommendation back to the full

Exhibit 6a 17 commission for their approval. Mr. Nagel reviewed the information with the board and stated that the wage recommendation for the non-union personnel is only for 2012 and does not include any recommendation for 2013 or 2014. Discussion took place. Chairman Earley stated that the information is the response to the inquiry that was submitted after the meeting last month. Ms. Whittington, as a member of the Personnel Committee, stated they had looked at the historical practice at MBS, the agreement that was reached with the union plus the health care changes made with the non-union employees and she felt that the Personnel Committee received full disclosure and is comfortable with moving forward. Chairman Earley, as chairman of the Personnel Committee, said that the committee went the extra mile to be sure that the commission had a full explanation of the issues that were raised and he is satisfied. He also stated that he would not speak for Mr. Krygier, however he asked each member of the committee if the questions that were brought up at the previous meeting had been satisfied. The committee feels it did the due diligence taking a look at the information. The Personnel Committee is concurrence with the manager’s recommendation. Mr. Biltz made a motion to approve a lump sum payment of $300 per non-union employee and implement a 1.5% wage increase for non-union employees. Ms. Whittington seconded. Mr. Coonan stated that he felt it was important to have the total value of the union and non-union package before voting. Mr. Biltz stated that the reason the committee organization was set up was so the committee would do the work for the board. Chairman Earley called for a roll call vote. Ms. Meisel called roll. Tom Adams, yes; George Biltz, yes; Kim Coonan, no; Darnell Earley, yes; Todd Hare, yes; Tom Ryder, yes; Paula Whittington, yes. Six yes and one no. Motion passed.

II. The next item on the agenda was a review of the Airport Manager’s wage and benefit package.

Information was given to the Board for their review. No action or recommendations were made.

III. The third item on the agenda was a review of the criteria for union, non-union and airport manager pension eligibility.

Mr. Nagel recommended to the Personnel Committee that staff work with MERS to implement a hybrid pension program for the new non-union employees. After discussion, the committee voted to direct airport staff to work with MERS to implement a hybrid pension program for new non-union employees. Staff should pay particular attention to the MERS interdepartmental transfer rules and bring the recommendation back to the Personnel Committee prior to bringing any recommendation to the full Airport Commission. No action was required of the board.

IV. The final item discussed by the Personnel Committee was the criteria for post-retirement health care benefits for union, non-union and the airport manager.

After discussion, the committee agreed with the Airport Manager’s recommendation and voted to bring the recommendation to the full commission for approval. Mr. Biltz made a motion to end the $125/month retiree health care stipend for non-union employees hired after November 1, 2012. Mr. Adams seconded. After discussion the motion passed unanimously.

Chairman Earley stated that the Personnel Committee had good discussion at the meeting. The process went very well in terms of getting specific issues for administration to respond to and then bringing them back to the committee and then the full commission. He is satisfied that the issues

Exhibit 6a 18 that were brought to the board today were thoroughly vetted in the committee based on the specific information requested. Chairman Earley recommended that when the board members receive the agenda for the meetings be sure to get any questions to administration so they have time to research and get the information back in a timely fashion. Board members are welcome to any committee meeting but as members of the public.

DELTA AIRLINES LEASE AMENDMENT: Mr. Nagel stated that Amendment #3 for the lease which allows Delta to operate into MBS Airport was included in the packet. Discussions with the airlines have been ongoing for some time now and this lease amendment serves several purposes.

 Grants permission to Delta to operate into the new terminal building.  Re-defines the premises which Delta will occupy.  Maintains the existing lease language needed to meet our operational and legal requirements.  Defines the goal of the rate-making methodology as an increase of approximately 5% in airline rents.

The term of the amendment is not yet defined and it could be as short as six months or possibly go through the end of 2013. With the earlier move into the terminal building in October, 2012, it forced both parties to agree to a shorter term amendment rather than a long-term lease. Mr. Adams made a motion to approve Amendment #3 to the Delta Airlines lease with the above purpose and financial goals and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents subject to final language review by the attorney. Mr. Biltz seconded and the motion passed unanimously.

UNITED EXPRESS LEASE AMENDMENT: Mr. Nagel stated that Amendment #1 for the lease which allows United Express carrier to operate into MBS was included in the packet. This lease was originally with Skywest and was supposed to be assigned to Air Wisconsin; however, that lease assignment was never formally executed. At one point, United was going to take over the lease but that did not occur either. Late in August, staff was informed that Skywest would formally hold the lease at MBS. Since they had a lease in place, this amendment is the best way to extend their operating rights. This amendment serves the same purpose as the Delta amendment.

 Grants permission to Skywest to operate into the new terminal building.  Re-defines the premises which Skywest will occupy.  Maintains the existing lease language needed to meet our operational and legal requirements.  Defines the goal of the rate-making methodology as an increase of approximately 5% in airline rents.

The term of the amendment is not yet defined and it could be as short as six months or possibly go through the end of 2013. With the earlier move into the terminal building in October, 2012, it forced both parties to agree to a shorter term amendment rather than a long-term lease. Mr. Ryder made a motion to approve Amendment #1 to the Skywest lease with the above purpose and financial goals and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents subject to final language review by the attorney. Mr. Biltz seconded and the motion passed unanimously.

Exhibit 6a 19 PHASE X CONTRACT ITEMS: Mr. Nagel stated that airport staff contacted RS&H concerning adding two items to the current Phase X contract. As a reminder, Phase X is the aircraft ramp and the perimeter road portion of the project. In summary, the two items are:

1. Fencing around the current terminal. Staff believes it is important from a safety and security standpoint to place fencing on the air-side of the current terminal building after the building is vacated. The cost for this item is $60,937.03 and staff would like the work to begin in mid- November.

2. Drainage system repairs. During the record rainfall which occurred in August there was a washout adjacent to one of the two main taxiways. To provide an adequate long-term fix to this problem a catch basin needed repair and a small portion of the taxiway needed to be repaired as well. This work was recommended by RS&H and approved by the Airport Manager and has already been completed. The fast action was needed to limit the amount of time the taxiway was closed to aircraft. The total of this project was $29,739.50.

RS&H is still in the process of evaluating total quantities for the Phase X project and it appears that the airport will be under the original grant/contract amount. Even with the approval of both of these items, the contract is estimated to come in under the original budget.

At this time there is not a formal Change Order to be approved however both items are over the Airport Manager’s normal approval amount of $10,000; therefore, it is best to get commission approval of these items to be added to the Phase X contract for placement into a future Change Order. These items were discussed at the Operations Committee meeting.

Mr. Adams made a motion to approve the additional fencing in the Phase X project and to place the fencing in a future Change Order for Phase X contingent on FAA approval. Mr. Biltz seconded and the motion passed unanimously.

Mr. Biltz made a motion to retroactively approve the taxiway repairs caused by the record rainfall and to place the repair in a future Change Order for Phase X contingent on FAA approval. Mr. Ryder seconded and the motion passed unanimously.

PHASE XI (BUILDING INTERIORS) CHANGE ORDER #06: Mr. Nagel stated that proposed Change Order #06 for the Phase XI contract with Graham Construction was attached to the exhibit. In summary, this change order reallocates money which was included in two existing allowances for paint and for inspections and places those dollars into the “coordination” allowance. The inclusion of the allowance amounts has assisted us in the past with items that have developed because of the numerous phases of the building project. The items added to the contract are included in the letter from Mark Wilcer that was attached to the exhibit. The total impact of this change order is an addition of $7,720.00. These costs should be eligible for payment in the FAA and will be submitted as such.

Mr. Biltz made a motion to approve Change Order #06 for the Graham Construction Phase XI contract and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Ryder seconded and the motion passed unanimously.

Exhibit 6a 20 PHASE V CHANGE ORDER #16 (CORRECTED): Mr. Nagel stated that in September the airport commission approved Change Order #16 for the Phase V Spence Brothers contract which increased the contract amount by $17,884.77, which included a decrease in the remaining utility allowance. When the change order was sent to Spence for execution, RS&H was notified that Spence had previously used a portion of the remaining utility allowance meaning that the calculations on the change order were not accurate. Based on that information, the change order needed to be re- calculated and submitted again to the airport commission. A letter from Mark Wilcer and the corrected Change Order #16 was attached to the exhibit. The change order is now an increase of $52,406.97. There are no new items on this change order and the change does still reflect the winter conditions element that was discussed at length last month. This was discussed with the Operations Committee.

Mr. Adams made a motion to approve Phase V Change Order #16 (corrected) with Spence Brothers and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents. Mr. Ryder seconded and the motion passed unanimously.

OLD BUSINESS: Mr. Nagel stated that MBS is moving quickly in the completion of the new passenger terminal. There will be new contracts, change orders, and amendments. He will work with the committee structure prior to presenting them to the full board.

Mr. Nagel stated that the ribbon cutting is scheduled for Friday, October 26th at 11:00 a.m. There have been some issues with the invitation list so hopefully all of the airport commissioners have received their invitation. Airport commissioners are welcome to bring their spouse or a guest to the ceremony. He apologized that it was not clear on the invitation. In order to have an accurate count and have a name badge available, please let the office know the number attending and the names.

Mr. Biltz asked about the publicity regarding the open house on Saturday, October 27th. Mr. Nagel stated that Bolger + Battle has issued the press release. There will also be some public announcements.

Chairman Earley stated that this has been quite a process. The logistics of something like this can be overwhelming. He complimented Mr. Nagel, staff, and the consultants with all of their hard work. He continues to be impressed with all the things that Mr. Nagel has brought to Operations and Marketing Committee meetings to keep things moving. Good job.

NEW BUSINESS:

New Meeting Room Name: Chairman Earley stated that at a Marketing Committee meeting he had brought up an issue. There was discussion as to how to recognize everyone that was involved in the project. Gene Gwizdala was very devoted and committed to this commission. He served for a number of years on the board and as chairman for two terms. He loved the airport. In absence of any kind of special recognitions in regard to the new terminal and because the new meeting quarters are going to be in the administration conference room, Chairman Earley asked for discussion to see how the members felt about naming the conference room in Gene’s honor as a show of the board’s appreciation for the many years that he worked hard to make it the kind of world class airport that it is. Mr. Coonan made a motion to name the administration conference room the Eugene F. Gwizdala Conference Room. Mr. Biltz seconded and the motion passed unanimously. Mr. Nagel requested

Exhibit 6a 21 that Mrs. Gwizdala and the family be invited to the next meeting. Chairman Earley agreed and with the context of opening the new terminal and changing the meeting place that it also should be announced.

Recognition of Chairman Earley: Mr. Biltz recognized Chairman Earley for all the time he has spent on all three committees for the last six months in absence of the other Saginaw members. It has been a stress and a strain but thank you. He also requested that the committee assignments be revisited now that Mr. Hare has joined the board.

Trillion Review: Mr. Biltz stated that one of things the airport would do when there was a new terminal was revisit whether MBS would want to provide services for the airlines such as ticket handling and gate services with their own employees. Mr. Biltz stated that while Trillion is looking at services at the airport that it may be the time to revisit this matter. Mr. Nagel agreed that this would be a great time to do that.

Committee Meetings: Mr. Coonan asked if it would be possible for all the commissioners to get the agendas for all of the committee meetings to be better prepared. Mr. Nagel stated that he can send postings of all the committee meetings but sometimes the agenda isn’t finalized until just before the meeting. Committee members do not normally get a full packet prior to the committee meeting. There is no problem sending it out; just when is everything known to be put on the agenda. Chairman Earley stated that the notifications should go out to all members and if the agenda is complete it also should be electronically sent.

Vacation: Mr. Nagel stated that 14 months ago his family booked a vacation for 14 family members out of the country. At that time he had no idea that the airport would get the grants and that the terminal would be opening this month. He departs November 15th after the commission meeting and returns the Saturday after Thanksgiving. This is only two weeks after the opening of the new terminal. Mr. Riesinger and staff will be here. Steve from RS&H is scheduled to be on-site through the end of the year. Mr. Nagel always leaves an emergency phone number but will be for the most part, out of communication. There are many benefits of opening early. If he had known that the terminal was opening now he would have made different plans.

RS&H-Mark Wilcer: Mr. Wilcer stated that there have been compliments and thank yous for the work that RS&H has done. Now RS&H would like to say thank you to the commission for all their work, effort and extra time that was greatly appreciated. Mr. Wilcer handed out a memento of the opening to each commissioner.

ADMINISTRATIVE MATTERS: Next regular meeting is scheduled for November 15, 2012 at the administration building.

ADJOURNMENT: There being no further business, Mr. Coonan made a motion to adjourn. Mr. Biltz seconded and the Board unanimously passed the motion. The meeting adjourned at 2:14 p.m.

Ernie Krygier, Secretary

Exhibit 6a 22 MBS INTERNATIONAL AIRPORT COMMISSION Cash and Investment Summary January 2019

Balance Receipts Disbursements Transfers In Transfers Out Balance

Chase Bank High Yield Savings $2,407,007.37 $572.31 $2,407,579.68

Reserved Funds; Reserved PRHI - High Yield $1,855,418.19 $441.16 $1,855,859.35 Reserved Misc. Funds - High Yield $110,977.37 $26.39 $111,003.76 Reserved Funds: $1,966,395.56 $1,966,863.11

Total Chase Bank: $4,373,402.93 $4,374,442.79

Chemical Bank & Trust Co. Certificate of Deposit $1,015,392.11 $1,015,392.11 Certificate of Deposit $1,015,392.11 $1,015,392.11 Interest Checking $219,345.51 $18.63 $219,364.14 General - Checking $877,203.28 $406,607.09 $327,970.72 $133,245.31 $131,044.84 $958,040.12 Payroll - Checking $36,189.99 $3.36 $119,446.44 $118,020.84 $34,767.75 Parking Lot - Checking $20,581.26 $120,417.81 $2,747.95 $133,245.31 $5,005.81 $3,184,104.26 $3,247,962.04 Reserved Funds: PFC Money Market $1,883,472.59 $39,236.57 $1,922,709.16 CFC Money Market $553,437.58 $11,300.75 $13,024.00 $577,762.33

Total Chemical Bank: $5,621,014.43 $5,748,433.53

TOTALS: $9,994,417.36 $578,624.07 $450,165.11 $264,290.15 $264,290.15 $10,122,876.32

Exhibit 6a 23 MBS INTERNATIONAL AIRPORT COMMISSION

June 21, 2018

MINUTES

The meeting was held in the Eugene F. Gwizdala Conference Room, 8500 Garfield Road, Freeland, Michigan 48623. Tom Adams, Chairman, called the meeting to order at 1:31 p.m. Roll was called by Nicole Moses.

COMMISSIONERS

Present Absent & Excused Staff Guest Tom Adams Dennis Browning Jeff Nagel David Joye-RS&H Greg Branch Chris Sieklucki Craig Goslyn-Saginaw Spirit Tim Morales Amy Lusk Angela Osmond-TSA Tom Ryder Nicole Moses Brad Gray Tom Herek Ernie Krygier Brad Kaye

PLEDGE OF ALLEGIANCE

MINUTES

Mr. Krygier made a motion to approve the minutes of the Regular Commission Meeting held on May 17, 2018. Mr. Branch seconded the motion. The motion was unanimously approved by the Board.

MAY 2018 WARRANTS AND CASH & INVESTMENT SUMMARIES

Mr. Branch made a motion to approve the Warrant Registers for the May Payroll Advice Numbers 005468-005518 and May Operations & Maintenance Check Numbers 046563-046608. Mr. Gray seconded the motion and the Board unanimously approved them. Mr. Krygier made a motion to approve the May Cash and Investment Summary. Mr. Kaye seconded the motion and the Board unanimously approved them.

PUBLIC COMMENT: NONE

SAGINAW SPIRIT PROPOSAL

MBS has been a proud partner of the Saginaw Spirit since 2004. Typically we agree to a multi- year partnership and since the total amount is over the $10,000 spending limit for the airport manager, this requires airport commission approval. The latest two-year agreement ended with

Exhibit 6a 24 the 2017-18 season. The Spirit have proposed another two-year agreement which includes the following advertising elements:

 One pair of in-ice logos  Advertising in the pocket schedule  200 ticket vouchers  One parking ramp pass  One seat section cover  Official goal sponsor with radio, PA and video board features  100 tickets donated to a local school for the annual robotics night game

Overall the partnership has worked very well. MBS receives strong recognition for our role as a community partner with the Spirit. Since going from the four (4) fixed season tickets to the 200 ticket vouchers our usage rate has increased to nearly 100%.

The “rate card” value of this package is $47,055 per year and the Spirit have proposed an annual cost of $21,000 per year. This expense was put in the 2018 operating budget so funds are available.

The community partnerships have worked well for MBS in the past (Spirit, Loons, Tall Ships) as our name becomes associated with positive community events.

Mr. Herek made a motion to approve a two-year sponsorship agreement with the Saginaw Spirit as outlined above. Mr. Branch seconded the motion and the motion passed unanimously.

AIRFIELD CRACK SEAL

Airfield pavement crack sealing is an important tool we use every year to prolong the life of our pavements. Staff evaluates the pavement condition and we determine which areas to concentrate the resources each year.

We received two prices to complete the crack sealing this year:

Wolverine Sealcoating $.50 per foot Scodeller $.53 per foot

Although Wolverine Sealcoating has not worked at MBS in the past, they are certified by MDOT to complete the work and they have performed work at other airports.

It is estimated that the total amount of crack seal needed this year will not exceed $15,000. These funds were included in the 2018 operating budget.

Mr. Kaye made a motion to approve the price of Wolverine Sealcoating for 2018 airfield crack sealing and authorize the airport manager to sign the related documents and spend up to $15,000 of local funds. Discussion took place regarding the life expectancy of the crack sealing. MDOT has certain standards and cost ranges for rehabilitation and the FAA closely reviews these types of

Exhibit 6a 25 projects to ensure that the maintenance is worth the investment. Mr. Ryder seconded the motion and the motion passed unanimously.

AIRFIELD PAINT MARKING

Each year airport staff evaluates the airfield to determine which areas need to be painted. This year we received two bids for various paint markings as follows:

PK Contracting Hi-Lite

White .65/foot .85/foot Yellow .95/foot .85/foot Black .28/foot .65/foot

All paint will include the required beads to meet the FAA reflectivity standards.

PK Contracting has performed the airfield painting at MBS for several years and based on the provided quotes, it is recommended to approve their price. Staff will make the final determination which surfaces get painted once the crack seal work is completed. It is anticipated that the final amount of paint will not exceed $22,000 and funds were included in the 2018 operating budget to cover this expense.

It should be noted that based on comments received during the recent FAA certification inspection and based on staff recommendations, we have begun the process of evaluating the purchase of a paint marking machine to complete a portion of this work, in future years, in-house. There is no additional cleaning involved prior to painting, except for sweeping off the area which staff would perform regardless of who does the painting. Staff will be gathering data for the cost of materials and labor to compare to the prices of the contractors before we bring a recommendation to the board for a request to purchase paint marking equipment.

Mr. Branch made a motion to approve the quote of PK Contracting for paint marking and to authorize the airport manager to spend up to $22,000 to complete this project. Mr. Gray seconded the motion and the motion passed unanimously.

PA 202 TRUST ATTORNEY

Staff continues to evaluate various methods of meeting the requirement for 40% funded status for our retiree health care program under Public Act 202. After having follow-up conversations with different banking institutions, it became apparent that the best course of action was to first select an attorney to draft the trust document and after that is completed, then select a bank to hold the funds. We could use the trust document as a de facto RFP when soliciting proposals from the banks.

Rehmann, the airport audit firm, provided a proposal to MBS to assist with this item. Their proposal included using an attorney based in Southfield and the estimated cost was between $10,000 and $20,000 depending on the type of trust.

Exhibit 6a 26 The firm of Giarmarco, Mullins and Horton was also contacted. This firm has assisted MBS in the past with various labor issues. A conference call was held with airport staff and Amy along with John Clark and Larry Schiller from the firm. The call went well and they were well informed of the law and the requirements for the trust. They sent a follow-up letter which outlined the cost estimate to assist with the development of the trust (attached). Their cost is estimated to be between $5,000 and $7,000.

Two local attorneys were also contacted. Both names came from a meeting with a Huntington Bank representative. The first attorney performed his due diligence and declined to provide an estimate. The second attorney had no experience developing municipal trusts and questioned the need for the OPEB funding to be placed in an irrevocable trust to meet the “funded” status of PA 202.

Although this amount is under the $10,000 spending limit for the airport manager, it was decided to bring this item to the Finance Committee and then to the full commission. The Finance Committee met on June 11, 2018 and agreed, that based on experience and cost, the firm of Giamarco, Mullins and Horton would best serve the airport.

Since the initial discussion with the firm, the Airport Attorney re-negotiated a lower hourly rate for any additional services.

Mr. Branch made a motion to hire Giamarco, Mullins and Horton to assist with the development of a qualifying Public Act 202 trust to address the current OPEB liability. Mr. Herek seconded the motion and the motion passed unanimously.

RUNWAY 5/23 REHABILITATION BIDS

The 2018-19 Airport Improvement Project (AIP) for MBS will be a rehabilitation of the main runway, 5/23, along with a rehabilitation of the runway electrical systems. The project has been undergoing design by RS&H over the past eight months. Bids were received on Thursday, May 24th and the following two bids were submitted:

Pyramid Paving $9,456,471.90 ACE-Saginaw Paving $8,114,802.80

The bids have been reviewed and checked for errors by RS&H. Attached is the bid review letter and the bid tabulation.

Because of the uncertainty of the grant timing, the decision was made to apply for the grant funds in 2018 however hold off on the pavement rehabilitation until spring 2019. This would allow us to develop a firm schedule and also allow for better coordination with the based tenants and the airlines serving MBS.

Our FAA Program Manager has contacted us about grant funding. He has been authorized to process our grant as soon as he receives the final AIP grant application. RS&H has been preparing that document, which gets submitted through the State Aeronautics office. As a reminder, the AIP program is a 90% federal, 5% State and 5% local grant program. The local share of this total project is estimated at $428,000.

Exhibit 6a 27

The Finance Committee met on June 11, 2018 and discussed this item. The committee agreed to support the low as-read bid of ACE-Saginaw in the amount of $8,114,802.80 pending the receipt of federal funding. Based on conversations with FAA since that meeting, there is every indication we should receive the grant in July.

Mr. Krygier made a motion to approve the bid of ACE-Saginaw Paving and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents pending legal review and pending receipt of the federal grant. The motion shall also authorize the airport manager to pay the required local share. Mr. Branch seconded the motion and the motion passed unanimously.

RS&H CONSTRUCTION ADMINISTRATION AGREEMENT

An important part of the rehabilitation of the main runway is the construction administration contract with RS&H. This requires RS&H to provide vital services during the project such as:

 Contractor submittal review  Technical plan interpretation  Change Orders  Site inspections  Weekly progress meetings  Coordination with sponsor  FAA grant documentation

Attached is a spreadsheet which details the cost associated with this contract. The final price is $442,545. These costs are eligible and will be included in the final grant application.

This contract is subject to a third party evaluation and that service is performed by the State Office of Aeronautics staff. The agreement has been sent to Lansing and is currently being reviewed.

The Finance Committee met on June 11, 2018 and discussed this item. The committee supports the recommendation as follows:

Mr. Branch made a motion to approve the RS&H construction administration contract for the runway 5/23 rehabilitation project and authorize the Chairman, or in his absence the Vice Chairman, to sign the related documents pending State Aeronautics approval and local legal review. Mr. Herek seconded the motion and the motion passed unanimously.

OLD BUSINESS

There has been no movement on the FAA long term funding bill from Washington. We are waiting for the Senate to take the matter up because the House did not pass the measure.

The 11th Annual MBS Gold Outing was held on June 1st. The weather was perfect for the 112 golfers that participated in the 18-hole scramble at Beech Hollow Golf Course.

Exhibit 6a 28 NEW BUSINESS

MBS is sponsoring the 2018 Regional Chamber Summit meeting on Wednesday, August 1, 2018, being held at the Great Hall in Midland. The guest speaker will be the VP of Operations of The Dow Chemical Company. Please let the office know if you would like to attend as a guest.

ADMINISTRATIVE MATTERS

Next regular meetings are scheduled for July 19, 2018 at 1:30 p.m. and August 16, 2018.

ADJOURNMENT

There being no further business, Mr. Krygier made a motion to adjourn. Mr. Ryder seconded and the Board unanimously passed the motion. The meeting adjourned at 2:05 p.m.

Tom Ryder, Secretary

Exhibit 6a 29