DULUTH INTERNATIONAL Travel Globally. l=lyLocally.

DULUTH AIRPORTAUTHORITY MEETING AGENDA MARCH 17, 2020

AMATUZIO CONFERENCE ROOM DULUTH INTERNATIONALAIRPORT

I *EXECUTIVEDIRECTORS REVIEW

Information Letter to DAA Directors.

II *APPROVAL OF PREVIOUS MEETINGMINUTES & OTHERCONSENT AGENDA ITEMS

A. Approval of February 18, 2020 Meeting Minutes.

III *DAA CASH DISBURSEMENTS

A. Cash Disbursement Sheets #4 and #5, 2020. Construction Fund Sheet #4, 2020,

IV *CORRESPONDENCE

A. Februaiy3, 2020 Letters to Senator Klobuchar, Senator Smith, Congressman Stauber and Congresswoman Craig from MN Local Air Service Action Committee (LASAC) RegardingIncrease of Passenger Facility Charges in the InfrastructureBill. B. Airport News: Februaiy 12, 2020 DAA Press Release "Delta Airlines to Bring Daily Mainline Service Back to Duluth", Februaiy 12, 2020 DNT News Release "American Airlines Plans to Exit the Duluth Market Later this Spring" and "Delta Airlines to Upsize Aircraft Serving Duluth"; Februaiy 25, 2020 DAA Press Release "DLH Not Awarded SCASD Grant for Denver Se1vice in Most Recent DOT Grant Cycle, Will Re-Apply" and DNT News Release "Duluth International Comes Up Empty on Request for Grant to Help Establish Air Service to Denver"; Februaiy 26, 2020 DAA News Release ''New Study Shows Duluth International Airport Contributes $760.6 Million Annuallyto Local Economy". C. Februaiy 28, 2020 Letter from DAA to Congressman Stauber, Congresswoman Craig, Senator Smith and Senator Klobuchar Regai·ding S.3360 National Center for Advanced Aviation. D. March 1, 2019 E-Mail from Monaco Air Foundation with Surnrnaiy of Februaiy 2020 Activities. E. Mai·ch 4, 2020 Letter from MN Employment and Economic Development Awai·ding the Airport InfrastructureRenewal (AIR) Program Grant to DAA. F. Public Notice "Intentto Impose and Use a Passenger Facility Charge (PFC 13). G. Link for Metropolitan Airp01ts Commission (MAC) Minutes https://metroairports.org/Airport-Authority/Metropolitan-Airports-Commission/Public­ Meetings/Board-Meetings.aspx.

V OPPORTUNITY FOR PERSONS TO BE HEARD

Duluth International Airport 4701 Grinden Drive Phone (218) 727-2968 [email protected] Sky Harbor Airport Duluth, MN 55811 Fax (218) 727-2960 www.duluthairport.com

DULUTH INTERNATIONAL AIRPORT Travel Globally. Fly Locally.

DATE: March 17, 2020 TO: DAA Directors FROM: Executive Director SUBJECT: EXECUTIVE DIRECTORS REVIEW

The following items will be briefed during the Executive Director's Review. If action is required of the DAA on any of these items, they will also appear on the agenda. If you have questions or desire additional information, please contact me and I will provide it at the DAA meeting.

AIR SERVICE

► Conection: January's Passenger Numbers Understated by 4000 ► 49.7% Increase in Total Passengers YTD ► 53.8% Increase in Total Passengers in February YOY ► 36.5% Increase in Delta Passengers YTD ► 9.3% Decrease in United/United Express Passengers YTD ► 4,938 American Passengers in January ► 2,053 Landline Passengers in February ► Small Community Air Service Development Grant Update

AIRFIELD OPERATIONS/CONSTRUCTION/PLANNING

► Planning • Master Plan Update • Paii 150 Noise Study Update ► Landside • IT Site Assessment ► Sky Harbor • Phase 3 Closure Update • AircraftParking Area Planning Study

BUSINESS/PROPERTY DEVELOPMENT

► AIR Grant Award

FINANCIAL UPDATE

► Audit ► Preliminary Year End Financial

Duluth International Airport 4701 Grinden Drive Phone (218)727-2968 [email protected] Sky Harbor Airport Duluth, MN 55811 Fax (218)727-2960 www.duluthairport.com

DULUTH INTERNATIONAL AIRPORT Travel Globally. Fly Locally. DRAFT MINUTES OF THE MEETING

DATE: February 18, 2020

PLACE: AmatuzioConference Room Duluth International Airport, Duluth, MN

DIRECTORS PRESENT: Anna Tanski Todd Fedora Don Mcisaac Richard Stewait Kim Maki

DIRECTORS ABSENT: Craig Fellman JeffAnderson

OTHERS PRESENT: Tom Werner, Executive Director Mary Ann Wittkop, Recording Secretary Mark Papko, Director of Operations Natalie Peterson, Director of Communications & Marketing Jana Kayser, Business Development Manager Ken Timm, Interim Airport Facilities Manager Kathy Leon, ConfidentialBookkeeper Benita Crow, SEH Scott Sannes, SEH Rob Missinne, Monaco Air Duluth Bill King,Ci1Tus Design

President Tanski welcomed everyone to the DAA Board meeting and called the meeting to order at 8:02 a.m. She invited Mr. Tom Werner, Executive Director, to present on the Executive review. Mr. Werner reviewed the following:

EXECUTIVE DIRECTOR'S REVIEW:

• Air Service: Solid month, almost 20% increase year over yeai·; Delta increased 21. 7% and United decreased by 6.8%; American Airlines (AA) passenger load was 4,328; Landline just under 2,000 passengers. SCASD grant - have not heard anything, will 1 continue to monitor. Additional air service notes: AA pulling out of market April 28 \ disappointing news -- due to low load factor and profitability, fleet constraints put pressure on DLH market. SkyWest/United will be reducing flights the month of March for maintenance reasons, back to nmmal in April; United will be conve1ting to Contract Purchase Agreement (CPA) in March - shows confidencein this route; good news -- Delta introducing mainline service in March; and for the second month in a row leakage percentage is over MSP -- 56%.

Duluth International Airport 4701 Grinden Drive Phone (218) 727-2968 [email protected] Sky Harbor Airport Duluth, MN 55811 Fax (218) 727-2960 www.duluthairport.com

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MINNESOTA'S LOCAL AIR SERVICE ACTION COMMITTEE Committed to growing air service throughout Minnesota

February 3, 2020 -:.11Z- A

Hon. Amy Klobuchar 425 Dirksen Senate Office Building Washington, DC 20510

Re: Increase Passenger Facility Charges in the Infrastructure Bill

Dear Senator Klobuchar,

A record number of Americans are taking to the skies in recent years, have an easy solution to help repair aging infrastructure, reduce congestion and improve the passenger experience. We are simply asking Congress to give airports the option to generate more local revenue for critical, federally-approved projects by increasing the federal cap on local Passenger Facility Charges (PFC).

The PFC is a modest local user fee that airports use to pay for much-needed projects that directly benefit travelers, like fixing aging runways and terminals, relieving congestion, and spurring new airline competition. Unfortunately, Congress hasn't raised the $4.50 cap since 2000. Today's PFC buys the equivalent of approximately $2 because of construction cost inflation. In the past 20 years while the PFC's buying power has gone down, airport capital needs, construction costs and passenger levels have continued to rise.

The airlines also claim that a PFC increase will unfairly harm passengers at Minnesota's small airports. But increased PFC flexibility would allow small airports to generate more money from airport users for critical projects and pay for their local match on federally-funded projects that benefit residents in communities across the State. Allowing airports to generate more money from passengers who travel to their communities could also reduce their reliance on local taxpayer revenue - a win for people who live and work in small communities across Minnesota.

Minnesota's commercial service airports are eager to build and upgrade their facilities and improve the flying experience for their customers. Congress can help us by modernizing the PFC program.

At a time when there is increasing pressure to reduce federal spending, adjusting the PFC cap would provide airports with the self-help they need to finance critical infrastructure projects without relying on scarce federal funds. On behalf of Minnesota's commercial service airports, we urge you and colleagues to adjust the outdated PFC cap.

Sincerely,

Executive Director Executive Director Executive Director Brainerd Regional Airport Duluth lnt'I Airport �6/)� Airport Manager Executive Director/CEO Executive Director Falls International Airport Minneapolis St Paul lnt'I Airport

Executive Director Executive Director Executive Director Rochester lnt'I Airport St Cloud Regional Airport Thief River Falls Regional Airport

7. Purchase a replacementSnow Removal Equipment (SRE). Replacement of Broom Truck forremoval of snow, ice, and slush on movement areas. This Broom Truck replaces a 2005 which has become expensive to keep operational and replacement parts are no longer readily available. Total Project Cost: $ 707,352 PFC Share: $ 35,368

8. Cost to the Duluth Airport Authority for administration of pendingPFC application (PFC 13) according to requirements found in 14 CFRPart 158. Total Project Cost: $ 15,102 PFC Share: $ 15,102

9. Runway 9/27 sealant for preventative maintenance. TotalProject Cost: $ 49,114 PFCShare: $ 14,734

10. Rehabilitate Taxiway "A" with mill overlay. Total Project Cost: $ 41,500 PFC Share: $ 12,450

11. Preventative crack seal to maintain Taxiway A2, A3 and A4. Total Project Cost: $ 66,401 PFC Share: $ 13,280

12. Preventative crack seal to maintain Taxiway Al and A3. TotalProject Cost: $ 48,116 PFCShare: $ 9,623

13. Rehabilitate Taxiway Al to A3 with mill overlay. TotalProject Cost: $949,688 PFCShare: $ 47,484

Total Project Cost Total PFC (Projects 1 thru 13): $ 17,928,133 (Projects 1 thru 13): $ 963,289