A G E N D a RENO-TAHOE AIRPORT AUTHORITY MEETING of the BOARD of TRUSTEES April 10, 2014 9:00 A.M

BOARD OF TRUSTEES PRESIDENT/CEO Adam Mayberry, Chair Marily M. Mora, A.A.E. Nat Carasali, Vice-Chair EXECUTIVE VICE-PRESIDENT/COO Rick Murdock, Secretary Dean E. Schultz, A.A.E. Dr. Kosta Arger, Treasurer GENERAL COUNSEL Bill Eck Ann Morgan, Fennemore Craig Jones Vargas Jerry Hall CLERK OF THE BOARD Steve Katzmann Cindy Riddell (Interim) Bob Larkin Andy Wirth

A G E N D A RENO-TAHOE AIRPORT AUTHORITY MEETING OF THE BOARD OF TRUSTEES April 10, 2014 9:00 a.m. Board Room, Administrative Offices Second Floor, Main Terminal Building Reno-Tahoe International Airport Reno, Nevada

Items V, VI, VIII, IX, and XII are action items for the Board to consider. The Board may discuss a matter when it is brought up, but no action may be taken on it unless it has been specifically included on an agenda as an action item.

Public comment at the Board meeting will be allowed on agenda items as well as non-agenda items. Persons are invited to submit comments in writing on agenda items and/or attend and make comment on that item at the Board meeting. Requests to speak on a particular item should be submitted to the Clerk of the Board before the item is called by the Chairman.

I. PLEDGE OF ALLEGIANCE

II. ROLL CALL

III. PRESENTATIONS AND AWARDS A. Employee, Tenant and Special Recognition B. Quarterly Employee First Class Award C. Introduction of New, Promoted and Retired Employees D. Tenant Communication

IV. PUBLIC COMMENT if any – Limited to three minutes per person

V. APPROVAL OF MINUTES – March 13, 2014 Board Meeting Minutes and March 28, 2014 Special Board Meeting Minutes

VI. APPROVAL OF AGENDA

VII. COMMITTEE AND LIAISON REPORTS A. Finance and Business Development Committee B. Planning and Construction Committee C. Airport Noise Advisory Panel (ANAP) D. Community Outreach Committee (COC) E. Stead Liaison Board Agenda April 10, 2014 Board Meeting Page 2

F. RSCVA Board G. Reno-Tahoe Air Service Task Force H. The Chamber Reno Sparks Northern Nevada I. Reno-Tahoe International Airport Users Committee

VIII. CONSENT ITEMS FOR BOARD ACTION

A. #14(04)-16 Authorization for the President/CEO to award a construction contract for Phase 21 of the Sound Insulation Program – Group 21.5 for 64 residential homes located in Reno, Sparks and Washoe County neighborhoods north and south of the Reno-Tahoe International Airport, with G&G Specialty Contractors, Inc. in the amount of $948,618

IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION

A. #14(04)-17 Discussion and confirmation of Chairman’s appointment of Trustee Kosta Arger to serve a two-year term on Reno-Sparks Convention and Visitors Authority Board effective July 1, 2014

B. #14(04)-18 Designation of Independent Auditor and authorization for the President/CEO to execute a five-year Professional Services Agreement for auditing services with Crowe Horwath LLP in the amount of $266,990

C. #14(04)-19 Approval to Amend the Reno-Tahoe Airport Authority Investment Policy to allow investment of Airport Authority funds in the Washoe County Pooled Investment Fund, and authorize the President/CEO to execute an Interlocal Agreement to provide this investment option

X. ITEMS FOR BOARD INFORMATION AND DISCUSSION A. Presentation a. Airport Authority Triennial Disaster Drill Exercise on May 29, 2014 B. Board Meeting Schedule 1. May 12, 2014 4:30 p.m. Reno-Tahoe International Airport Users Committee Meeting 2. May 13, 2014 9:00 a.m. Finance & Business Development Committee Meeting 3. May 13, 2014 10:00 a.m. Planning & Construction Committee Meeting 4. May 15, 2014 9:00 a.m. Board of Trustees Meeting 5. June 10, 2014 9:00 a.m. Finance & Business Development Committee Meeting 6. June 10, 2014 10:00 a.m. Planning & Construction Committee Meeting 7. June 12, 2014 9:00 a.m. Board of Trustees Meeting 8. June 16, 2014 3:30 p.m. Airport Noise Advisory Panel Meeting C. President/CEO’s Report D. General Board comments, questions, and items for future Board meetings

XI. PUBLIC COMMENT, if any – Limited to three minutes per person

Board Agenda April 10, 2014 Board Meeting Page 3

XII. ADJOURNMENT

Items will not necessarily be considered in the sequence listed. This meeting may be continued if all of the items are not covered in the time allowed. If the meeting is to be continued, the time and place will be announced at the end of the portion of the meeting to be continued.

SUPPORTING MATERIAL: The designated contact to obtain supporting material is the Clerk of the Board, P.O. Box 12490, Reno, NV, 89510 or 775-328-6410. Supporting material is also available at the Reno-Tahoe Airport (Administrative Offices) and at the scheduled meeting.

Members of the public who are disabled and require special accommodations or assistance at the meeting are requested to notify the Clerk of the Board in writing at P.O. Box 12490, Reno, Nevada 89510 or by calling (775) 328-6410 prior to the meeting date.

THIS AGENDA HAS BEEN POSTED AT THE FOLLOWING LOCATIONS: 1. Airport Authority Administrative Offices – 2001 E. Plumb Lane, Reno 3. Reno City Hall – One East First Street, Reno 2. Washoe County Administrative Offices – 1001 E. 9th Street, Reno 4. Sparks City Hall – 431 Prater Way, Sparks

***These draft minutes have not yet been approved and are subject to revision at the next regularly scheduled meeting.***

RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES MEETING OF THE BOARD OF TRUSTEES March 13, 2014 9:00 a.m.

MEMBERS PRESENT ALSO PRESENT Adam Mayberry, Chair Marily M. Mora, A.A.E. Nat Carasali, Vice Chair President/CEO Rick Murdock, Secretary Dean Schultz, A.A.E Dr. Kosta Arger, Treasurer Executive Vice-President/COO Bill Eck Ann Morgan Jerry Hall General Counsel Steve Katzmann Cindy Riddell Bob Larkin Clerk of the Board Andy Wirth

MEMBERS ABSENT/EXCUSED Dr. Kosta Arger Andy Wirth

The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno- Tahoe International Airport, Reno, Nevada. Chair Adam Mayberry called the meeting to order. The Pledge of Allegiance was recited. Roll was called.

III. PRESENTATIONS AND AWARDS A. Employee, Tenant and Special Recognition None.

B. Introduction of New, Promoted and Retired Employees Dean Schultz, Executive Vice President/COO, introduced and welcomed Megan McIntyre as a new Facilities Supervisor, Jason McDaniel as a new Airfield Maintenance Worker I, Mario Garcia as a new Airfield Maintenance Worker I, and Collin Cavanagh as a new Firefighter. Mr. Schultz also announced the promotion of Brian Comis from Driver/Operator to Fire Captain.

C. Tenant Communications None.

IV. PUBLIC COMMENT None.

V. APPROVAL OF MINUTES On motion by Trustee Larkin, seconded by Trustee Katzmann, which motion duly carried by unanimous vote, the Board approved the minutes from the Board meeting of February 13, 2014. Meeting of the Board of Trustees March 13, 2014 Brief of Minutes Page 2 of 5

VI. APPROVAL OF AGENDA Per the recommendation of the Finance and Business Development Committee, Chair Mayberry tabled Item IX. B. regarding the release of eight aircraft storage T-hangars (Phase II) until June 2014. Chair Mayberry moved up on the Agenda Item X.a., the presentation by Chris Baum, President/CEO of the Reno-Sparks Convention Visitors Association, for the Regional Marketing Committee to be given prior to the Committee/Liaison Reports.

On motion by Trustee Hall, seconded by Trustee Larkin, which motion duly carried by unanimous vote, the Board approved the March 13, 2014 Board of Trustees’ meeting agenda with the above changes.

X. A. Presentation a. Regional Marketing Committee Presentation Chair Adam Mayberry introduced Chris Baum, President/CEO of the Reno-Sparks Convention Visitors Authority, who gave a presentation as Chair of the Regional Marketing Committee (RMC) providing information on the background of the Committee, where they are now, and where they need to go in the future in order to better support air service development. After giving a report on the history of the RMC and the current Committee members, Mr. Baum shared their recent marketing program with the Board and gave an overview of the 2013-14 RMC budget. Mr. Baum also discussed the challenges the Committee is facing in 2014, Mr. Baum talked about the proposed revisions to RMC, which includes changing the name from “Regional Marketing Committee” to “Regional Air Service Fund”.

VII. COMMITTEE/LIAISON REPORTS Committee/Liaison reports were given by: Finance/Business Development Committee–Trustee Steve Katzmann Planning/Construction Committee – Trustee Jerry Hall Airport Noise Advisory Panel – Trustee Bob Larkin Community Outreach Committee – Trustee Nat Carasali Stead Liaison – Trustee Steve Katzmann RSCVA Board – Trustee Jerry Hall Reno-Tahoe Air Service Task Force – Trustee Rick Murdock The Chamber Reno Sparks Northern NV – Tina Iftiger, V.P. Airport Economic Development RTIA User Committee – Trustee Bill Eck Compensation Committee – Trustee Adam Mayberry

VIII. CONSENT ITEMS FOR BOARD ACTION

A. #14(03)-10 APPOINTMENT OF NEW MEMBER TO THE COMMUNITY OUTREACH COMMITTEE – RICK LA MAY

On motion by Trustee Katzmann, seconded by Trustee Hall, which motion duly carried by unanimous vote, the Board approved Agenda Item #14(03)-10 as follows:

Meeting of the Board of Trustees March 13, 2014 Brief of Minutes Page 3 of 5

Approved the appointment of Rick LaMay for service on the Reno-Tahoe Airport Authority Community Outreach Committee.

B. #14(03)-11 AUTHORIZATION FOR THE PRESIDENT/CEO TO AWARD BID 13/14-08 FOR ONE CATERPILLAR 966M LOADER WITH ONE PLOW AND TWO BUCKETS FOR THE RENO-TAHOE INTERNATIONAL AIRPORT, TO CASHMAN EQUIPMENT COMPANY, IN THE AMOUNT OF $432,579

On motion by Trustee Katzmann, seconded by Trustee Hall, which motion duly carried by unanimous vote, the Board approved Agenda Item #14(03)-11 as follows:

Approved the award of one Caterpillar Model 966M four-wheel drive loader with a 27-foot cupping plow, 4.5-cubic yard four-in-one bucket and 8-cubic yard general purpose bucket for Reno-Tahoe International Airport in the amount of $432,579 and authorized the President/CEO or her designee to sign.

C. #14(03)-12 APPROVAL OF A MODIFICATION TO THE RENO-TAHOE INTERNATIONAL AIRPORT USERS COMMITTEE GUIDELINES, THAT ALLOWS THE COMMITTEE TO FUNCTION BEYOND JUNE 2014

On motion by Trustee Katzmann, seconded by Trustee Hall, which motion duly carried by unanimous vote, the Board approved Agenda Item #14(03)-12 as follows:

Approved the modification of the RTIA Users Committee Guidelines removing termination language, so that the Committee can continue to meet and function beyond June 2014.

IX. ITEMS FOR BOARD INFORMATION, DISCUSSION AND POSSIBLE ACTION

A. #14(03)-13 RECOMMENDATION FOR CHANGE IN FISCAL YEAR 2013-14 FINANCIAL PERFORMANCE CRITERIA AND GOALS FOR RENO-TAHOE AIRPORT AUTHORITY PRESIDENT/CEO BASED ON MID-YEAR BUDGET REVIEW

On motion by Trustee Larkin, seconded by Trustee Murdock, which motion was duly carried by unanimous vote, the Board approved Agenda Item #14(03)-13 as follows:

Authorized the Amendment to the financial goal for the President/CEO to maintain an airline cost per enplaned passenger from $7.85 to $7.95 as recommended by the Compensation Committee.

B. #14(03)-14 AUTHORIZATION FOR THE PRESIDENT/CEO TO RELEASE EIGHT AIRCRAFT STORAGE T-HANGARS (PHASE II) FOR LEASE LOCATED AT GENERAL AVIATION WEST AT THE RENO-TAHOE INTERNATIONAL

Meeting of the Board of Trustees March 13, 2014 Brief of Minutes Page 4 of 5

AIRPORT AND INCREASE THE FY 2013-14 CAPITAL PROJECTS BUDGET BY $88,000 TO REHABILITATE AND REPAIR ASSOCIATED PAVEMENT AND T-HANGARS

Per the recommendation of the Finance and Business Development Committee, this Item #14(03)-14 has been tabled until June 2014.

X. ITEMS FOR BOARD INFORMATION AND DISCUSSION b. Staff presentation on the Airport Police K-9 Program

Sean Keast, Airport Police Sergeant, gave a presentation to the Board on the Airport K-9 Program. Sgt. Keast explained the history of the Cooperative Agreement between the Department of Homeland Security and the Reno-Tahoe Airport Authority (RTAA), which began in 2005. Sgt. Keast discussed the Airport responsibilities that the Airport canine teams are specifically trained for and described the K-9 Unit Training Program given at Lackland Air Force Base in San Antonio, Texas. The RTAA Police K-9 Unit also provides VIP, dignitary and community support. Following the presentation and at the conclusion of the Board meeting, Sgt. Keast gave the Board a demonstration of Airport K- 9, Zino, performing a search for a mock explosive device in the courtyard area outside of the Board Room.

B. Board Meeting Schedule Trustee Mayberry announced the dates of the upcoming Board and Committee meetings for April 2014 and May 2014. Mr. Mayberry also mentioned that on April 10, 2014 the Board Budget Workshop will be held immediately following the Board meeting.

C. President/CEO’s Report Marily Mora, President/CEO, reported that the Regional Planning Commission unanimously approved the Regional Plan Goals and Policies documents for Reno-Tahoe International and Reno-Stead Airports. There was no public comment at their meeting and there is a 10-day appeal period. If there are no appeals, the decision will be final. Ms. Mora also indicated that the document “One Region, One Voice” that was produced for Northwestern Nevada and that supported the visit to Washington D.C. last week had been provided to the Board and is a good reference of all the federal priorities from all the participating organizations. Ms. Mora also mentioned a follow up item from the February mid-year Budget Review, and a document which gives the background information on airline rate making methodology, had been provided to the Board as a result of a request made during the February mid-year Budget Review.

D. General Board Comments Trustee Hall requested an update on the status of the “Good Samaritan Fund” employee program. Marily Mora indicated that this fund has been included in the budget for next year.

XI. PUBLIC COMMENT None.

XII. ADJOURNMENT

Meeting of the Board of Trustees March 13, 2014 Brief of Minutes Page 5 of 5

There being no further business, the meeting was adjourned at 10:24 a.m.

______Chair Adam Mayberry ATTEST:

______Secretary, Rick Murdock

***These draft minutes have not been approved and are subject to revision at the next regularly scheduled meeting.***

***These draft minutes have not yet been approved and are subject to revision at the next regularly scheduled meeting.***

RENO-TAHOE AIRPORT AUTHORITY BRIEF OF MINUTES SPECIAL MEETING OF THE BOARD OF TRUSTEES March 28, 2014 2:00 p.m.

MEMBERS PRESENT ALSO PRESENT Adam Mayberry, Chair Marily M. Mora, A.A.E. Nat Carasali, Vice Chair President/CEO Rick Murdock, Secretary Dean Schultz, A.A.E Bill Eck Executive Vice-President/COO Jerry Hall Ann Morgan, Fennemore Craig Jones Vargas Steve Katzmann General Counsel Bob Larkin Cindy Riddell (Interim) Andy Wirth Clerk of the Board

MEMBERS ABSENT/EXCUSED Kosta Arger, Treasurer

The Board of Trustees met in the Board Room, Airport Authority Administrative Offices, Reno- Tahoe International Airport, Reno, Nevada. Chair Adam Mayberry called the meeting to order.

I. ROLL CALL Roll was called.

II. PUBLIC COMMENT None.

III. ITEMS FOR BOARD DISCUSSION AND POSSIBLE ACTION #14(03)-15 DISCUSSION AND POSSIBLE ACTION TO CONFIRM SETTLEMENT WITH THE ELIZABETH YOUNGER AGENCY

Chair Mayberry disclosed to the Board that his employer, the City of Sparks, has an agreement with the Elizabeth Younger Agency, but he has no involvement or financial interest.

On motion by Trustee Hall, seconded by Trustee Carasali, which motion duly carried by unanimous vote, the Board approved Agenda Item #14(03)-15 as follows:

Special Meeting of the Board of Trustees March 28, 2014 Brief of Minutes Page 2 of 2

Approved the settlement agreement with the Elizabeth Younger Agency as outlined by General Counsel, terminating the nonexclusive in-terminal paid advertising concession license effective June 30, 2014 for the sum of $446,098.25 with the parties agreeing that any disparagement of the other party in the next five years shall result in a liquidated damage award of $100,000, to be determined by binding arbitration.

IV. PUBLIC COMMENT None.

V. ADJOURNMENT There being no further business, the meeting was adjourned at 2:05 p.m.

______Chair Adam Mayberry ATTEST:

______Secretary, Rick Murdock

***These draft minutes have not been approved and are subject to revision at the next regularly scheduled meeting.***

Board Memorandum Reno-Tahoe Airport Authority

Date: April 2, 2014 Memo #14(04)-16 To: Chairman & Board Members For: April 10, 2014 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: AUTHORIZATION FOR THE PRESIDENT/CEO TO AWARD A CONSTRUCTION CONTRACT FOR PHASE 21 OF THE SOUND INSULATION PROGRAM – GROUP 21.5 FOR 64 RESIDENTIAL HOMES LOCATED IN RENO, SPARKS AND WASHOE COUNTY NEIGHBORHOODS NORTH AND SOUTH OF THE RENO-TAHOE INTERNATIONAL AIRPORT, WITH G&G SPECIALTY CONTRACTORS, INC. IN THE AMOUNT OF $948,618

STAFF RECOMMENDATION Staff recommends that the Board approve the construction contract with G&G Specialty Contractors, Inc. in order to complete noise mitigation on Phase 21.5, the final residential phase of the Airport Authority’s Sound Insulation Program, which includes 64 residential homes.

PURPOSE This action will approve the award of a construction contract with G&G Specialty Contractors, Inc. for the implementation of Phase 21 of the Sound Insulation Program at the Reno-Tahoe International Airport (RTIA). The Sound Insulation Program supports the guiding principles and strategic priorities identified in the Reno-Tahoe Airport Authority’s Strategic Plan such as Customer Service and Environmental Responsibility by improving compatibility between aircraft operations and noise sensitive land uses, which in turn, allows the airport to continue its role in the community.

BACKGROUND A Sound Insulation Program for Sparks and Reno neighborhoods was included in the FAR Part 150 Noise Compatibility Program Update, which was approved by the Federal Aviation Administration (FAA), on April 7, 2004. On June 28, 2011, the Reno-Tahoe Airport Authority (RTAA) accepted an FAA grant in the amount of $2,399,169 for Phase 21 of the Sound Insulation Program and then, on September 7, 2011, the RTAA was offered and accepted additional FAA Phase 21 grant monies in the amount of $4,600,831. This total funding of $7 million has allowed the RTAA to create a total of four previous bid packages for the sound insulation of more than 284 homes, condominiums and residential apartment units, located both north and south of the RTIA. This current bid package, Group 21.5, includes the acoustical treatment of 64 residential homes located in the cities of Reno and Sparks, as well as unincorporated Washoe County. Construction for Group 21.5 is scheduled to occur in summer/fall 2014.

DISCUSSION On February 11, 2014, an Invitation to Bid for Group 21.5 was advertised in the Reno Gazette- Journal newspaper. A mandatory pre-bid meeting was subsequently held on February 26, 2014 and prospective bidders had an opportunity to view and walk through selected homes in the project. Based on recent past bid awards and the requirements of this specific project, the project Architect estimated the cost to be in the amount of $990,000. On March 13, 2014, bids were received and opened for Group 21.5. The results are as follows: Sound Insulation Program – Group 21.5 #14(03)-15 April 10, 2014 Board Meeting Page 2

Contractor Base Bid G&G Specialty Contractors, Inc. $948,618 Alpine Energy, Inc. $1,000,000 G.E. Chen Construction, Inc. $1,084,600

Award of the contract for bid Group 21.5 is determined on the base bid amount for 64 residential homes for a total award of $948,618. The low bidder, G&G Specialty Contractors, Inc. has also been found to be responsive and responsible, as required in the bid specifications. Since this is a federally grant funded project, the 5% in-state bidder’s preference provisions provided for in NRS 338 is not permitted.

A Notice to Proceed will be issued to G&G Specialty Contractors, Inc. for Group 21.5 upon approval by the Board and the FAA, as well as receipt of required documentation.

COMPANY BACKGROUND G&G Specialty Contractors, Inc. is a Phoenix, Arizona based firm. G&G Specialty Contractors, Inc. has provided sound insulation construction services to the RTAA since 2010. During this four year period, they completed six phases of construction, which included improvements to 121 single and multi-family homes and 986 residential apartment units. Additionally, G&G Specialty Contractors, Inc. has provided these types of services for other airports around the country including over 5,000 homes in Arizona, California and Washington.

FISCAL IMPACT Total compensation for the contract is not to exceed the amount of $948,618. Funding, in the amount of $889,329.37 (93.75%) of the contract, is to be provided from an Airport Improvement Program (AIP) grant. The RTAA's matching share of the cost is in the amount of $59,288.63 (6.25%) and will be provided from the General Purpose Fund.

COMMITTEE COORDINATION This item is scheduled to be presented at the April 8, 2014 Planning and Construction Committee meeting.

RECOMMENDED MOTION It is hereby recommended that the Board adopt the following motion:

“It is hereby moved that the Board approve the award of a construction contract for sound insulation for Phase 21 of the Sound Insulation Program – Group 21.5 for 64 residential homes located in Reno, Sparks and Washoe County, with G&G Specialty Contractors, Inc. in the amount of $948,618 and authorize the President/CEO, or her designee, to sign.”

MMM/tt/cr RTIA—Phase 21.5 (1 of 3) AIP 03‐32‐0017‐91

Sullivan Ln 18th St El Rancho Dr

Greenbrae Dr

Oddie Blvd

Rock Blvd

Prater Wy

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Sound Insulaon Program Eligible Area—Sparks RTIA—Phase 21.5 (3 of 3) AIP 03‐32‐0017‐91

S McCarran

Longley

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Sound Insulaon Program Eligible Area—Reno RTIA—Phase 21.5 (2 of 3) AIP 03‐32‐0017‐91

Foothill

S Virginia

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Flanders Sound Insulaon Program Eligible Area—Washoe County RTAA Sound Insulation Program Activity Summary July 1996 through February 2014

Estimated Estimated Total Residences Number of Phases 2013 Pending 2014 Number of Completed or in Eligible Completed Construction Construction Eligible Progress Residences Residences Remaining

Jurisdiction 1 – 18 20.4 19.1 – 19.5 21.4 1 – 22 20.1 – 20.3 22.1 21.5 21.1 – 21.3

Number of Units 1,761 414 14 2,189 2,229 40 City of Reno Total $ $23,638,758 $3,058,681 $26,837,113 Committed

Number of Units 2,357 29 34 2,420 2,525 105 City of Sparks Total $ $27,191,046 $450,548 $27,980,801 Committed

Unincorporated Number of Units 486 22 16 524 659 135

Washoe County Total $ $12,073,614 $592,634 $12,825,875 Committed

Number of Units 4,604 465 64 5,133 5,413 280 Total for all

Jurisdictions Total $ $62,903,418* $4,101,863* $638,508* $67,643,789* Committed

* Sums shown indicate funding that is currently encumbered for the previously approved construction and design via Contracts and Professional Services Agreements respectively.

Revised 3/12/14 Printed 4/3/2014

Board Memorandum Reno-Tahoe Airport Authority

Date: April 2, 2014 Memo #14(04)-17 To: Board Members For: April 10, 2014 Board Meeting From: Adam Mayberry, Chairman Subject: DISCUSSION AND CONFIRMATION OF CHAIRMAN’S APPOINTMENT OF TRUSTEE KOSTA ARGER TO SERVE A TWO- YEAR TERM ON RENO-SPARKS CONVENTION AND VISITORS AUTHORITY BOARD EFFECTIVE JULY 1, 2014

PURPOSE The purpose of this action will be to select and appoint a Trustee to serve a two-year term representing the Reno-Tahoe Airport Authority as the air service representative on the Reno-Sparks Convention and Visitors Authority (RSCVA) Board effective July 1, 2014. The Chairman recommends that Trustee Kosta Arger be appointed to the two-year term.

BACKGROUND The RSCVA is governed by a 13-member Board of Directors representing: gaming, general business, financial industry, air service, motel industry, cities of Sparks and Reno, Washoe County and Incline Village. The Reno-Tahoe Airport Authority Board appoints one of their Trustees to serve as the air service representative on the RSCVA Board. Each appointment to the RSCVA is only allowed to serve two two-year terms. The second two-year term for Trustee Jerry Hall as the Airport Authority Board’s representative on the RSCVA expires on June 30, 2014. By Statute, Trustee Hall is not eligible to be reappointed for a third two-year term and therefore another Trustee must be appointed.

COMMITTEE COORDINATION This item has not been coordinated through any Board Committee.

FISCAL IMPACT There is no fiscal impact to the RTAA.

RECOMMENDATION Chairman Adam Mayberry recommends that Trustee Kosta Arger be appointed to a two- year term on the RSCVA Board effective July 1, 2014.

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Board Memorandum Reno-Tahoe Airport Authority

Date: April 2, 2014 Memo #14(04)-18 To: Chairman & Board Members For: April 10, 2014 Board Meeting From: Marily M. Mora, A.A.E., President/CEO Subject: DESIGNATION OF INDEPENDENT AUDITOR AND AUTHORIZATION FOR THE PRESIDENT/CEO TO EXECUTE A FIVE-YEAR PROFESSIONAL SERVICES AGREEMENT FOR AUDITING SERVICES WITH CROWE HORWATH LLP IN THE AMOUNT OF $266,990

STAFF RECOMMENDATION Staff recommends that the Board designate Crowe Horwath LLP as the independent Auditor to perform auditing services for the proposed five-year term and authorize the President/CEO or her designee to execute a Professional Services Agreement (PSA) for professional auditing services for the Reno-Tahoe Airport Authority (RTAA).

PURPOSE The purpose of this action is to obtain Board of Trustee approval and authorization for the President/CEO to execute a professional service agreement for auditing services for the RTAA. This action is in support of the Guiding Principles of Financial Integrity to ensure the financial stability of the airports under Authority control ensuring that staff has maintained proper internal controls and reporting is transparent and accurate in all of our financial transactions.

BACKGROUND NRS 354.624 requires the Airport Authority to designate an accountant or firm annually to complete an independent audit. The objective of the audit is to determine and report as to whether the financial statements are presented fairly, in conformity with U.S. generally accepted accounting principles and to report on the fairness of the additional information when considered in relation to the financial statements taken as a whole.

The objective also includes reporting on internal control related to the financial statements and compliance with laws, regulations, and the provisions of contracts or grant agreements and internal control related to major programs and the passenger facility charge program. The independent auditor or auditing firm will communicate with the Finance and Business Development Committee regarding any significant deficiencies.

DISCUSSION The Request for Proposals (RFP) was issued and posted on the Authority’s website on January 10, 2014. The solicitation was advertised on January 15, 2014 in the Reno Gazette Journal. To supplement legal advertising, staff e-mailed Request for Proposal (RFP) information directly to 19 firms that had either expressed prior interest or were capable of providing such services. Six proposals were received and opened on February

Auditing Services 5-Year PSA April 10, 2014 Board Meeting #14(04)-18 Page 2

12, 2014 from the following firms: (1) BDO USA LLP, (2) Crowe Horwath, (3) Grant Thornton LLP, (4) Kafoury, Armstrong & Company, (5) Macias Gini & O’Connell LLP, and (6) Muckel Anderson.

A selection committee comprised of the Board Treasurer and staff evaluated all proposals received and narrowed the finalists to three firms – Crowe Horwath LLP, Kafoury, Armstrong & Company, and Macias Gini & O’Connell LLP. Oral interviews were held on March 26, 2014 with the finalists resulting in Crowe Horwath LLP being selected as the firm whose proposal was most advantageous to the Authority.

In accordance with the terms and conditions of the RFP solicitation, the term of the proposed PSA shall be for an initial five-year period. The proposed contract also includes an optional term extension for two additional two-year renewal options, subject to Board of Trustees’ approval. To exercise the option period, staff will evaluate the quality of services provided, negotiate proposed pricing and make a recommendation prior to requesting the Board’s consideration of an extension.

COMPANY BACKGROUND Crowe Horwath LLP (Crowe) is one of the largest public accounting and consulting firms in the United States. Founded in 1942 in South Bend, Indiana, Crowe uses its deep industry expertise to provide audit services to public and private entities, while also helping clients reach their goals with tax, advisory, risk and performance services. With offices coast to coast and 3,000 personnel, Crowe is ranked as one of the nation’s top 10 accounting and consulting firms.

The National Governmental Services section, which will serve the Authority, includes approximately 200 individuals that serve more than 600 federal, state and local governments including public transportation organizations throughout the United States.

Crowe Horwath LLP has significant experience auditing airports including: • Louisville, Kentucky • Lexington (Blue Grass), Kentucky • Fort Lauderdale – Hollywood International Airport (Broward County), Florida • Fort Wayne – Allen County, Indiana

In addition, Crowe also provides internal audit, financial advisory services and IT implementation at the following airports:

• Nashville, TN • Memphis-Shelby County, TN • Washington, D.C. (Metro Washington Airport Authority) • Indianapolis, IN • Tulsa, OK • Little Rock, AR

Auditing Services 5-Year PSA April 10, 2014 Board Meeting #14(04)-18 Page 3

The Authority will be served from the Indianapolis, Indiana office, which serves as the location of the airport audit team lead by Mr. Scott Nickerson, Certified Public Accountant (CPA), Engagement Partner, and Mr. Jason Eaves, CPA, Senior Manager. Mr. Nickerson has 23 years of auditing experience and he serves as the audit partner on the Louisville, Lexington and Fort Wayne airport audits and is an advisor to Metro Washington Airports and Indianapolis Airport projects. Mr. Eaves has over 13 years of auditing experience and is the senior manager on the Louisville International Airport Authority audit.

FISCAL IMPACT The proposed compensation to Crowe Horwath LLP for the initial five year period is as follows:

Fiscal Year Cost of Auditing Services 2013-2014 $52,710 2014-2015 53,890 2015-2016 53,310 2016-2017 53,370 2017-2018 53,710 Total $266,990

The audit fee of $52,710 is below the $63,000 paid in FY 2013-14 to audit the Authority for the fiscal year ending June 30, 2013. In addition, the fee proposal was the lowest of the six firms submitting proposals. Fees for the audits of fiscal years ending 2015, 2016, 2017 and 2018 will be budgeted in the Accounting and Administration Division’s budgets for those subsequent fiscal years.

COMMITTEE COORDINATION This item is scheduled to be presented at the April 8, 2014, Finance & Business Development Committee meeting.

RECOMMENDED MOTION It is hereby recommended that the Board adopt the following motion:

“It is hereby moved that the Board authorize the President/CEO to execute a five-year Professional Services Agreement for professional auditing services with Crowe Horwath LLP in the amount of $266,990 and designate Crowe Horwath LLP as the independent auditor for the Reno-Tahoe Airport Authority.”

Board Memorandum Reno-Tahoe Airport Authority

Date: April 2, 2014 Memo #14(04)-19 To: Chairman & Board Members For: April 10, 2014 Board Meeting From: Marily M. Mora, A.A.E., President / CEO Subject: APPROVAL TO AMEND THE RENO-TAHOE AIRPORT AUTHORITY INVESTMENT POLICY TO ALLOW INVESTMENT OF AIRPORT AUTHORITY FUNDS IN THE WASHOE COUNTY POOLED INVESTMENT FUND, AND AUTHORIZE THE PRESIDENT/CEO TO EXECUTE AN INTERLOCAL AGREEMENT TO PROVIDE THIS INVESTMENT OPTION

STAFF RECOMMENDATION Staff recommends Board approval of the amended Reno-Tahoe Airport Authority (RTAA) Investment Policy to allow investment of RTAA funds in the Washoe County Pooled Investment Fund as outlined in the revised policy, and authorize the President / CEO to execute an InterLocal Agreement and any other necessary documents necessary to provide these investment options.

PURPOSE The purpose of this action is to obtain authorization for the RTAA to update its investment policy allowing the RTAA to invest funds in the Washoe County Pooled Investment Fund. In addition, staff is requesting Board authorization for the President/CEO to execute an InterLocal Agreement with Washoe County and all other documents as required by the County Treasurer who operates and manages this pool.

This action is in support of the strategic priority goal to “Facilitate Economic Development at both Airports” by enhancing long-term financial stability and remaining self-sufficient. Additionally, this action supports the Guiding Principle/ Operating Practice of Financial Integrity, by which RTAA will do all we can to ensure the financial stability of the airports under our control.

BACKGROUND Nevada Revised Statutes (NRS) 277.18(1) provides that the RTAA may contract with any one or more other public agencies to perform any governmental service, activity or undertaking which any of the contracting agencies is authorized by law to perform. Also, NRS 355.168 and 355.175 authorize the County’s Treasurer to invest by pooling any money held by the Treasurer for local governments. Upon legal review by Washoe County and RTAA legal counsel, the RTAA is permitted to participate in this investment pool.

This investment pool serves two key roles: (1) it offers an alternative investment, similar to a money market fund, that is highly diversified and very liquid to local governments; and (2) Amendment of RTAA Investment Policy #14(04)-19 April 10, 2014 Board Meeting Page 2

it provides investment expertise to local governments that either do not have the expertise, size of investment, or staffing to properly manage its funds. By pooling the various local government funds, economies of scale can earn a higher rate of return than the individual government entities can do on its own.

In addition, NRS 355.171 provides the following additional authorized investments for counties and school districts with county populations greater than 100,000 and city governments with city populations greater than 150,000.

1. Notes, bonds and other unconditional obligations for the payment of money issued by corporations organized and operating in the United States that:

a. Are purchased from a registered broker-dealer; b. At the time of purchase have a remaining term to maturity of no more than 5 years; c. Are rated by a nationally recognized rating service as “A” or its equivalent, or better; d. Such investments must not, in aggregate value, exceed 20 percent of the total portfolio as determined on the date of purchase; and e. Not more than 25 percent of such investments may be in notes, bonds and other unconditional obligations issued by any one corporation.

2. Collateralized mortgage obligations that are rated by a nationally recognized rating service as “AAA” or its equivalent.

3. Asset-backed securities that are rated by a nationally recognized rating service as “AAA” or its equivalent.

With the RTAA not being able to purchase the securities listed above, participation in the Washoe County Pooled Investment Fund will allow the RTAA to take advantage of income from these additional investment instruments.

DISCUSSION The following is the proposed addition to Section VI - Suitable and Authorized Investments, Item I of RTAA’s investment policy:

J. Washoe County Pooled Investment Fund. The Washoe County Treasurer is authorized to pool, for purposes of investment, any money held for local governments within the county as identified under NRS 355.168

The revised investment policy is attached for review.

The Washoe County Treasurer strictly adheres to the “prudent person” investment standard as prescribed by law. The “prudent person” standard states that, “Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, Amendment of RTAA Investment Policy #14(04)-19 April 10, 2014 Board Meeting Page 3

discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived.”

Washoe County Pooled Investments are carried at fair value determined by quoted market prices, net of accrued interest. All pooled investments are physically collateralized and held by Wells Fargo Bank. As of June 30, 2013, the County administers an external investment pool combining County money with voluntary investments from Truckee Meadows Fire Protection District, Sierra Fire Protection District, the Washoe County School District, Regional Transportation Commission, Nevada Works, Truckee River Water Quality Settlement Agreement Joint Venture, Western Regional Water Commission, Washoe County, Nevada OPEB Trust, Truckee River Flood Management Authority, the Library Investment Fund, the Deferred Compensation Fund, the South Truckee Meadows General Improvement District and the Southwest Point Fund.

The Board of County Commissioners has overall responsibility for investment of County funds, including the Pooled Investment Trust Fund, in accordance with NRS 355.175. The Washoe County Chief Investment Official is the Washoe County Treasurer, under authority delegated by the Board of County Commissioners. The external investment pool is not registered with the Securities and Exchange Commission (SEC) as an investment company.

The participants’ share and redemption value are calculated using the same method. Each participant’s share is equal to their investment plus or minus the monthly allocation of net income, realized and unrealized gains and losses. The determination of realized gains and losses is independent of the determination of the net change in the fair value of investments for the previous year(s) as well as the current year.

Washoe County has engaged Public Financial Management, LLC (PFM) as an investment advisor and is working with them to maintain a strong investment portfolio.

The PFM Group of companies are national leaders in providing independent financial advice as well as investment advisory, management and consulting services to local, state, and regional government and non-profit clients. Public Financial Management, Inc. has been ranked by Thomson Reuters as the nation’s overall number one financial advisor for the past fifteen years.

Upon Board approval, both parties will execute the Interlocal Agreement.

Amendment of RTAA Investment Policy #14(04)-19 April 10, 2014 Board Meeting Page 4

FISCAL IMPACT Investments held in the Washoe County Pooled Investments as of December 31, 2013 of $494.677 million were allocated as follows:

Investment Type Fair Value Percent of Rate Holdings Money Market Mutual Funds (Wells $ 281,255 .0% 100% Fargo) Cash (Bank of America) 108,242,545 22% 100% Commercial Paper 19,996,640 4% 20% Certificates of Deposit 49,985,398 10% 20% U.S. Treasury Securities 53,380,827 11% 100% U.S. Agency Securities 179,783,521 36% 100% U.S. Agency Mortgage Backed 12,455,151 3% 40% Securities Collateralized Mortgage Obligations 505,800 0% 40% Corporate Notes 70,045,582 14% 18% Total $494,676,718 100.0%

Upon Board approval, this investment alternative will enable the RTAA to take advantage of a diversified and liquid investment option. By pooling of funds, the participants can earn a higher rate of return than the individual government entities can do on its own and increase diversification of investment alternatives by participating in a pool rather than investing in corporate notes.

This investment opportunity also provides the benefit of the professional investment advisory services of Public Financial Management, LLC.

COMMITTEE COORDINATION This proposed action is scheduled to be presented at the April 8, 2014, Finance & Business Development Committee.

RECOMMENDED MOTION It is hereby recommended that the Board adopt the following motion:

“It is hereby moved that the Board approve the amended RTAA Investment Policy to allow investment of Airport Authority funds in the Washoe County Investment Pool as outlined in the revised policy and authorize the President/CEO to execute an InterLocal Agreement and any other necessary documents necessary to provide this investment option.”

Reno-Tahoe Airport Authority

INVESTMENT POLICY

PURPOSE

The purpose of these investment guidelines is to formalize the framework for the Reno-Tahoe Airport Authority’s (RTAA) daily investment activities. It is the policy of the RTAA to invest funds in a manner which will provide market rate of return with the maximum security while meeting the daily cash flow demands of the RTAA and conforming to all Nevada Revised Statutes (NRS) and ordinances governing the investment of public funds.

REFERENCES

Reno-Tahoe Airport Authority Act, Chapter 474, Statutes of Nevada. Local Government Budget and Finance Act, NRS 354. Public Investments NRS 355. Bond Resolution Official Statement c- 14.

POLICY

I. Scope

This investment policy applies to all financial assets of the RTAA. Should bond covenants be more restrictive than this policy, bond proceeds will be invested in full compliance with those restrictions. Additionally, all funds are accounted for in the RTAA’s Comprehensive Annual Financial Report.

Unless prohibited by law or contract, the RTAA may pool cash from several different funds to maximize investment earnings and to increase efficiencies with regard to investment pricing, safekeeping and administration. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

II. General Objectives

The primary objectives, in priority order, of investment activities shall be safety, liquidity, and yield:

Safety Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit risk and interest rate risk.

Credit Risk: The RTAA will minimize credit risk, the risk of loss due to the failure of the security issuer or backer, by:

• Limiting investments to the safest types of securities • Pre-qualifying the financial institutions, broker/dealers, intermediaries, and advisers with which the RTAA will do business

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• Diversifying the investment portfolio so that potential losses on individual securities will be minimized.

Interest Rate Risk: The RTAA will minimize the risk that the market value of securities in the portfolio will fall due to changes in general interest rates, by:

• Structuring the investment portfolio so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities on the open market prior to maturity • Investing operating funds primarily in shorter-term securities, money market mutual funds, or similar investment pools.

Liquidity The investment portfolio shall remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands. Furthermore, since all possible cash demands cannot be anticipated, the portfolio should consist largely of securities with active secondary or resale markets (dynamic liquidity). A portion of the portfolio also may be placed in money market mutual funds or local government investment pools which offer same-day liquidity for short-term funds.

Yield The investment portfolio shall be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above. The core of investments is limited to relatively low risk securities in anticipation of earning a fair return relative to the risk being assumed. Securities shall not be sold prior to maturity with the following exceptions: • A security with declining credit may be sold early to minimize loss of principal. • A security swap would improve the quality, yield, or target duration in the portfolio. • Liquidity needs of the portfolio require that the security be sold.

III. Standards of Care

Prudence The standard of prudence to be used by investment officials shall be the "prudent person" standard and shall be applied in the context of managing an overall portfolio. The "prudent person" standard states that, "Investments shall be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived."

Ethics and Conflicts of Interest Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program, or that could impair their ability to make impartial decisions. Employees and officers

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shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the RTAA.

Delegation of Authority Under authority delegated by the Board of Trustees of the RTAA, in accordance with chapter 474, Statutes of Nevada, NRS 354.474 and 355.175, and Bond Resolution 459, the investment of RTAA funds is the responsibility of the President/Chief Executive Officer (CEO). All cash, including bond proceeds, received by the RTAA will be invested by the Chief Financial Officer (CFO).

The President/CEO’s responsibilities include the authority to open accounts with financial institutions and broker/dealers, to arrange for the custody of securities, and to execute such documents as may be necessary to carry out these responsibilities. The CFO is responsible for furnishing authentic, timely instructions to the safekeeping bank(s) concerning settlement of investment transactions, and verifying accuracy of completed transactions.

IV. Authorized Financial Institutions, Depositories, and Broker/Dealers

The CFO will maintain a list of approved broker/dealers and financial institutions which are authorized to provide investment services to the RTAA. Authorized broker/dealers will be limited to "primary" dealers or other dealers that qualify under SEC Rule 15C3-1, the Uniform Net Capital Rule.

A. The CFO shall conduct periodic reviews to identify those firms which offer diverse approaches, access to markets, analysis, and interpretations needed to effectively manage the portfolio. All approved firms are expected to be familiar with the precautions appropriate to public sector investments while also being expected to familiarize themselves with the RTAA's investment objectives, policies, and constraints.

B. The CFO will require that a current financial statement be on file for each broker/dealer and financial institution through which the RTAA invests.

V. Safekeeping and Custody

Securities purchased by the RTAA shall be delivered against payment (delivery vs. payment) and held in a custodial safekeeping account with the trust department of a third party bank insured by the Federal Deposit Insurance Corporation designated by the CFO for this purpose in accordance with NRS 355.172. A custody agreement between the bank and the RTAA is required before execution of any transactions.

The CFO shall establish a system of internal controls, which shall be documented in writing. The internal controls shall be reviewed by the President/CEO, the Internal Auditor and with the independent auditor. The controls shall be designed to prevent the loss of funds arising from fraud, employee error, and misrepresentation by third parties, unanticipated changes in financial markets, or imprudent actions by employees and officers of the RTAA.

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VI. Suitable and Authorized Investments

The CFO, in accordance with the provisions of Nevada Revised Statutes 355.170, 355.180, the current bond resolutions, and this investment policy, is authorized to invest in:

A. United States Treasury Bills, Notes, Bonds, and Debentures of the United States 1. Maturity dates of which do not extend more than 10 years after the date of purchase;

B. United States Government Agency Securities; Maturities must not exceed 10 years from the date of purchase. 1. Federal National Mortgage Association (FNMA - Fannie Mae) 2. Federal Home Loan Bank 3. Federal Farm Credit Bank 4. Federal Home Loan Mortgage Corporation (FHLMC - Freddie Mac) 5. Student Loan Marketing Association (SLMA - Sallie Mae) 6. Federal Agricultural Mortgage Association 7. Government National Mortgage Association

C. Demand Deposits, Time and Savings Deposits including Negotiable Order of Withdrawal (NOW) accounts 1. Issued by insured commercial banks, insured credit union or insured saving and loan associations, either within the limits of insurance provided by an instrumentality of the United Sates and/or collateralized as required under the Nevada pooled collateral program (NRS 356).

D. Negotiable & Nonnegotiable Certificates of Deposit; 1. Issued by insured commercial banks, insured credit unions or insured savings and loan associations, except certificates that are not within the limits of insurance provided by an instrumentality of the United States.

E. Bankers' Acceptances; 1. Maximum maturity of 180 days 2. Aggregate book value may not exceed 20% of the total book value of the portfolio F. Commercial Paper; 1. Is purchased from a registered broker-dealer; 2. Maximum maturity of 270 days 3. Rating must be A-1, P-1, or its equivalent or better 4. Aggregate book value may not exceed 20% of the total book value of the portfolio

G. Money Market Mutual Funds; 1. Are registered with the Securities and Exchange Commission. 2. Rating must be AA or equivalent by nationally recognized rating service. 3. Invests only in securities issued by the Federal Government or its agencies or in repurchase agreements fully collateralized by such securities.

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H. Obligations of state and local governments; 1. The interest on the obligation is exempt from gross income for federal income tax purposes. 2. The obligation has been rated “A” or higher by one or more nationally recognized bond credit rating agencies.

I. The Local Government Investment Pool (“LGIP”) as established by the Nevada State Treasurer for the benefit of local agencies and identified under NRS 355.167

1. Aggregate book value may not exceed 20% of the total book value of the portfolio

K. Securities which have been expressly authorized as investments for local governments by any provision of Nevada Revised Statutes or by any special law.

VII. Investment Parameters

Diversification Assets held in the investment portfolio shall be diversified to eliminate the risk of loss resulting from over-concentration of assets in a specific class of securities.

Maximum Maturities To the extent possible, the RTAA shall attempt to match its investments with anticipated cash flow requirements.

VIII. Reporting

A quarterly investment report will be submitted to the Finance Committee. The report will summarize investment transactions that occurred during the reporting period, and discuss the current portfolio in terms of maturity, rates of return and may include other features.

IX. Internal Controls

The investment portfolio is subject to periodic audits by the RTAA’s Internal Auditor, including unscheduled cash and securities counts. The investment portfolio will be audited annually by the RTAA’s independent auditor.

X. Review of Investment Policy

The investment policy shall be reviewed every year by the President/CEO and changes will be presented Finance Committee.

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SIGNATURE AUTHORITZATION LINE

Marily M. Mora, A.A.E., President/CEO Date

Page 6 of 6 Revised 3/31/2014 President/CEO’s Report March 2014 Marily M. Mora, A.A.E., President/CEO______

Financial Summary • The following table summarizes the operating statement information for the eight month period ending February 28, 2014:

FY 2013-14 FY 2013-14 Dollar Percent Actual Budget Variance Change Landing Fees $ 4,361,456 $ 4,370,563 $ (9,108) 0% Terminal Building Rentals 5,151,994 5,049,200 102,794 2% Total Airline Revenues 9,513,450 9,419,763 93,686 1% Concession Revenue 2,945,848 3,185,267 (239,419) -8% Auto Rental 3,967,476 3,916,933 50,543 1% Parking & Ground Transportation 5,873,650 5,457,467 416,184 8% RTIA Building/Land Rents 3,836,356 3,882,933 (46,577) -1% Other 2,763,101 2,666,496 96,605 4% Total Non-Airline Revenues 19,386,431 19,109,096 277,335 1% Total Operating Revenue $ 28,899,881 $ 28,528,859 $ 371,022 1%

Due to operating expenses being 4.8% below budget, the airline cost per signatory enplaned passenger, based on actual activity for the eight month period ending February 28, 2014, is estimated to be $7.69 as compared to budgeted cost per enplaned passenger of $7.85.

Parking Comparison MARCH PUBLIC PARKING STATISTICS MONTHLY COMPARISON BETWEEN FY 2011/12, FY 2012/13, AND FY 2013/2014 COMPARISON $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS MONTHS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) MARCH 11/12 $697,839.00 38,928 $17.93 14,898 $39.80 3.3 24,030 $4.36 3.8

MARCH 12/13 $699,327.00 39,081 $17.89 14,849 $40.27 3.4 24,232 $4.18 3.7

MARCH 13/14 $707,645.00 35,220 $20.09 13,172 $43.32 3.6 22,048 $6.21 5.4

DIFFERENCE BETWEEN MARCH 2011/12 AND MARCH 2012/13 $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) $1,488.00 153 ($0.04) (49) $0.47 0.1 202 ($0.18) (0.1)

DIFFERENCE BETWEEN MARCH 2012/13 AND MARCH 2013/14 $ PER LONG TERM TRANSACTIONS SHORT TERM TRANSACTIONS REVENUE TRANS. TRANS. TOTAL AVG. REVENUE DURATION (DAYS) TOTAL AVG. REVENUE DURATION (HOURS) $8,318.00 (3,861) $2.20 (1,677) $3.05 0.2 (2,184) $2.03 1.7

REVENUE TRANSACTIONS

80.00

40,000 70.00

35,000 60.00

30,000 50.00

25,000 $40.00 Mar. 11/12 Mar. 11/12 #20,000 30.00 Mar. 12/13 Mar. 12/13 Mar. 13/14 Mar. 13/14 15,000 20.00 10,000 10.00 5,000 0.00 TOTAL $ PER L/T AVG S/T (DIV BY TRANS $. AVG.$ 0 TOTAL SHORT LONG TERM 10,000) TRANS. TERM

President/CEO’s Report – March 2014 April 10, 2014 Page 2

Air Service • Reno-Tahoe International Airport (RNO) served 228,035 passengers in February 2014, a decrease of (12.1%) versus February 2013. The loss in traffic can be attributed to a lack of consistent snowfall during both January and much of February, resulting in softened snowsports traffic. In addition, the combined men’s and women’s bowling tournament, which is a smaller group this year, did not start until late February.

• Southwest Airlines saw the largest decrease in total passengers, carrying 27,901 fewer passengers in February 2014 compared to the same month last year, representing a decrease of (20.4%). The loss of Oakland, Salt Lake City, seasonal service from Ontario, coupled with Portland and Chicago- Midway service reductions, decreased the scheduled monthly totals by 150 departures with 16,924 departing seats. Overall, Southwest’s scheduled departures were down (22.8%) in February 2014 versus February 2013.

• Alaska Airlines and Delta Air Lines both saw year-over-year February increases in the amount of 2,308 combined total passengers.

Total Passengers

400,000

350,000

300,000

250,000

200,000

150,000

100,000

50,000

0 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

2012 2013 2014

President/CEO’s Report – March 2014 April 10, 2014 Page 3

Total Passengers

2012 2013 2014 YOY Change JAN 259,012 264,265 241,181 -8.7% FEB 265,017 259,299 228,035 -12.1% MAR 292,939 306,049 APR 275,926 279,418 MAY 279,857 295,494 JUN 325,260 328,755 JUL 347,060 333,321 AUG 350,934 322,083 SEP 290,333 283,565 OCT 277,030 262,473 NOV 248,067 227,213 DEC 267,855 270,051 TOTAL 3,479,290 3,431,986 469,216 YTD 523,564 469,216 -10.4%

• With respect to air cargo, RNO handled 9,486,697 pounds of cargo in February 2014, a significant increase of 9.9% over February 2013. These volumes represent the third highest February on record, behind the peak years of 2007 and 2008 before the global economy fell into recession. UPS posted an increase of 14.1% and FedEx experienced a rise in volumes of 9.8%, while Ameriflight (DHL) posted a slight decrease of (1.5%).

Total Cargo

15,500,000 14,000,000 12,500,000 11,000,000 9,500,000 8,000,000 6,500,000 5,000,000 3,500,000 2,000,000 500,000 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

2012 2013 2014

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Total Cargo

2012 2013 2014 YOY Change JAN 8,813,491 10,269,546 10,303,380 0.3% FEB 8,274,037 8,635,807 9,486,697 9.9% MAR 9,304,722 9,457,376 APR 8,175,766 8,639,232 MAY 9,706,074 9,398,212 JUN 9,302,777 9,001,339 JUL 9,096,013 10,149,807 AUG 10,398,754 10,859,694 SEP 9,573,812 9,689,115 OCT 9,677,334 10,834,930 NOV 10,469,628 10,099,499 DEC 13,007,942 13,998,438 TOTAL 115,800,350 121,032,995 19,790,077

YTD 18,905,353 19,790,077 4.7%

Business Development

• Staff, along with Reno City Councilman Oscar Delgado, attended a Headquarters meeting with Volaris Airlines on March 18, 2014 to present the Reno – Guadalajara business case to the network planning leadership team. In general, the meeting was extremely positive and encouraging. Volaris mentioned that Reno-Tahoe International Airport (RNO) is a natural extension of their Northern California markets due to our large percentage of Hispanic population. They are targeting a potential launch of the Guadalajara service the first quarter of 2015, but could start+ as early as December 2014. In addition, the Guadalajara Airport management group has offered a marketing package of $674,000 to support new Reno service.

• Staff met with United Airlines at their headquarters, on March 24, 2014. The team focused on maintaining Houston air service year round, adding additional West Coast opportunities (Los Angeles International Airport (LAX)/ San Francisco International Airport (SFO)) as well as proposing a route analysis targeted at adding Washington-Dulles service. Overall the United team was very pleased with the performance of RNO’s routes and believes that Houston (George Bush International Airport (IAH)) can grow to daily service in 2015.

• New service reminders: a. American Airlines (AA) will be bolstering all of its markets served from RNO during the upcoming summer months, with the LAX increase to continue beyond that period. Details are as follows: . Effective June 11 through August 18, 2014 service to Dallas/Fort Worth International Airport (DFW) will increase from two to three daily departures, with a slight upgauge in equipment as well, with the market being served by three 150-seat B737-800s, rather than the current two 140-seat MD-80s. President/CEO’s Report – March 2014 April 10, 2014 Page 5

. During that same time period, AA will increase service to Chicago’s O’ Hare International Airport (ORD) from one daily departure to two, also with the 150-seat B737-800 (already being used on that route). The new flight will be a midday turn, departing RNO at 1305. . Finally, effective June 12, 2014 AA will increase service to LAX from four daily flights to five on a Sunday-Monday-Thursday-Friday basis. They will continue to use the same equipment, 50-seat CRJ200s. No end date to this increase appears to be loaded. b. Alaska Airlines announced it will add additional frequencies to both the Portland and Seattle markets, effective June 8. These additions will help to reduce the lost capacity created by Southwest Airlines which will drop service to both markets on that same day. c. Delta Air Lines will begin seasonal Saturday service from RNO to Minneapolis starting on June 7, 2014.

• Effective April 8, 2013, Atlantic Aviation will vacate their interim facilities at the Fixed Base Operator (FBO) East office and begin operations from their new FBO/Hangar facilities. Arrangements will be made for continued access to the restroom facilities at the FBO East office.

• A new three-year lease agreement was executed with I.T. Heating & Air for 2,200 square feet of warehouse space at the Airport Mini Warehouse. I.T. Heating & Air is an existing tenant who is expanding their business and moving from a small office at 1280 Terminal Way to a larger office/warehouse space. The total contract value is $28,512.

• A new twelve-month lease agreement was executed with Darin Carolus for 1,000 square feet of warehouse space at the Airport Mini Warehouse. Mr. Carolus will use the warehouse space for storage in relation to his computer repair business. The total contract value is $5,160.

• Select Service Partners (SSP), the Airport’s food and beverage concessionaire, is moving forward in bringing Peet’s Coffee service to the grab and go area outside the Timber Ridge Restaurant located in the Airport’s terminal. High tables and chairs have been installed in the adjacent area and Peet’s drip coffee is anticipated to be available at the counter within the next several weeks. SSP is currently looking into acquiring a cappuccino machine and the logistics involved for its installation as part of the second phase of the expansion.

• Staff continues to work closely with InterVISTAS Consulting, LLC, the firm approved by the Board to analyze general aviation. As of March 15, InterVISTAS has started the process of benchmarking RNO services and facilities with like airports In addition to the benchmarking, InterVISTAS has prepared a draft tenant survey that will be distributed to all tenants in April seeking input on customer satisfaction and demand for new services.

InterVISTAS Consulting is also completing an economic impact study of the potential effect of a proposed tax abatement program. Nevada is not competitive versus neighboring states in how it taxes aviation-related business property and sales/use. The study is geared toward examining what, if any, change in the state’s taxes might have on industry and employment in Nevada. The survey will be distributed to Nevada Business Aircraft Association (NVBAA) members to facilitate data summary/analysis.

President/CEO’s Report – March 2014 April 10, 2014 Page 6

The results from both the General Aviation and Tax Abatement studies should be completed and ready for presentation at the June 2014 Board Meeting.

• The Airport Authority continues to work with the Nevada Institute for Autonomous Systems (NIAS) to finalize the Operating Location Vendor Teaming Agreement (formerly known as the Range Vendor Agreement). It is anticipated that this agreement will be executed in April.

• On March 3, 2014, the Airport Authority issued a Request for Qualifications (RFQ) seeking qualified professional firms with expertise in large scale and small scale industrial land and facility development on approximately 3,500 acres, or a portion thereof, of undeveloped aeronautical and non-aeronautical land at the Reno-Stead Airport. A mandatory Pre-Submittal meeting for interested parties was held on March 18, 2014. The Pre-Submittal meeting included 29 participants representing 20 companies, four of which were out of market. Many of the companies were engineering/planning/general contractor firms representing an undisclosed developer or seeking opportunities to partner up into a development team. Developers that attended include Unique Infrastructure Group (Reno Tech Park - Apple), Lewis Operating Corp, Dermody, ProLogis, Panattoni, Sterling, and American Airports Corp. Following the Pre-Submittal meeting, an Addendum with thirteen questions and the meeting sign-in sheet was provided to attendees and posted on the Airport Authority’s website on March 25, 2014. RFQ responses are due to RTAA on April 17, 2014. As presented to the board in January 2014, a Selection Committee will review the responses and notify preferred Responders in May 2014. Preferred Responders will be invited to participate in Phase 2, a 120-day due diligence period. Following due diligence, the Selection Committee will invite interested Respondents to Phase 3 Development Proposal submission. Staff anticipates this RFQ process and a Selection Committee recommendation will be presented to the Board at the November 2014 meeting.

• The RTAA executed the First Amendment to the Reno Air Racing Association Special Event License, which revised Event terms, fees, and emergency support services effective December 12, 2013. This amendment extends the term of the license through May 31, 2016 and reduces the License fee to $25,000 paid in cash or in-kind or a combination thereof.

Project Status In Progress

Reno-Stead Airport Projects • Terminal / Emergency Operation Center Project The GMP contract with Q&D Construction, in the amount of $4,407,856 was approved at the January 2013 Board meeting. The Notice to Proceed was issued on April 15, 2013 and substantial completion was effective on December 14, 2013. The City of Reno issued a Certificate of Occupancy for the building on December 4, 2013. The grand opening event was conducted on December 16, 2013. The project is complete, and contract close out is underway. A project budget review will be scheduled for presentation at the May 2014 Planning and Construction Committee.

• Taxiway ‘C’ Reconstruction Project The project consists of reconstruction of approximately 25,000 square yards of asphaltic concrete (AC) pavement of the existing taxiway between Runways 8-26 and 14-32. The work consists of President/CEO’s Report – March 2014 April 10, 2014 Page 7

demolition, excavation, stabilizing fill and base material placement, utility relocation, asphalt pavement, drainage, and taxiway edge lighting system installation.

The AIP grant offer for design services was issued by the Federal Aviation Administration (FAA) on August 8, 2013. The Professional Services Agreement for design services with Wood Rodgers, for $345,500 was approved at the February 2104 Board meeting. Upon completion of the design work, a separate construction contract will be issued for bids and Board approval for summer 2014. Construction is tentatively scheduled for the summer of 2014, contingent upon a subsequent AIP grant offer from the FAA.

Reno-Tahoe International Airport Projects • Apron Reconstruction (Phase 17) Project The Airport Improvement Program (AIP) grant offer was issued by the Federal Aviation Administration (FAA) on September 17, 2013. The construction contract with Q&D Construction, approved by the Board in April 2013 for $2,782,052, was subsequently issued for award and will be scheduled for construction starting spring 2014. A Pre-Construction meeting was conducted and a limited Notice To Proceed was issued for material and equipment procurement. A separate Notice To Proceed for construction was issued for March 24, 2014. The project is scheduled for completion on July 2, 2014. The project consists of reconstruction of approximately 13,320 square yards of concrete pavement in the air cargo ramp area. The work consists of demolition, excavation, asphalt treated base placement, formwork, and concrete placement. Extensive stakeholder coordination meetings have been conducted with Reno-Tahoe Airport Authority (RTAA) Operations, airlines and FAA Air Traffic regarding schedule and logistics for this project. The Safety Risk Management (SRM) program for this project was conducted by the FAA with project stakeholders on January 23, 2014. Concrete pavement demolition is scheduled from March 26-29, 2014. Local television news programs have broadcast segments advising the public of noise and vibration due to heavy equipment operations during the night time demolition activities.

• Runway 16L-34R Touchdown Areas Rehabilitation Project The bid opening was conducted on May 7, 2013. The award of the construction contract to the low bidder, Granite Construction Company, in the amount of $2,162,693 was approved at the July 2013 Board meeting. A Pre-Construction meeting was conducted and a limited Notice To Proceed was issued on December 30, 2013 for material and equipment procurement. A separate Notice To Proceed for construction is tentatively scheduled for April 14, 2014. The project is scheduled for completion on August 15, 2014. The project consists of the demolition and reconstruction of portions of runway concrete pavement, requiring closure of Runway 16L-34R during construction. Originally, due to AIP grant funding constraints known at the time, this contract approved in July 2013 consisted of the base bid and bid alternate #1 only. The overall program consists of the base bid and bid alternates 1 through 11, for a total program estimate of $7,300,000. The remaining work areas would be implemented as additional AIP funding became available on a multi-year basis.

• Subsequently, an AIP grant offer in the amount of $5,756,250 was issued by the FAA on September 24, 2013, which included additional FAA discretionary funds to address all bid alternates. The construction contract with Granite Construction, approved by the Board in July 2013 for $2,162,693, was subsequently issued for award. Commensurate with the additional grant funding provided by the FAA, bid alternates 2 through 11 were awarded as Change Order No. 1 at the October Board meeting, in the amount of $3,033,570, for a total of $5,196,263. Work area alternates 2 through 11 will require an additional 60 days of construction, for a total of 175 days of runway closure. President/CEO’s Report – March 2014 April 10, 2014 Page 8

Project coordination meetings were conducted with RTAA, Airline, Fixed Base Operator, FAA, Transportation Security Administration, US Customs, and Reno-Tahoe International Airport (RTIA) Users Group stakeholders on November 7, 12, and 18, 2013. These initial meetings presented the tentative schedule, work areas, and airfield impacts associated with the RTIA 2014 construction program. Stakeholder input and coordination of issues were documented in the meeting summary which was distributed to stakeholders. Additional follow up meetings were conducted with the RTIA Users Committee on February 10 and the Airline Station Managers on February 18 and March 18, 2014. The Safety Risk Management (SRM) program for this project was conducted by the FAA with project stakeholders on January 23, 2014.

• Central Disposal Facility (CDF) Upgrade The project consists of improvements to the existing CDF consisting of structural modifications, roof refurbishment, overhead door retrofit, upgrade of the sand / water separator, plumbing modifications, electrical modifications, water service modifications, equipment replacement and site improvements. The facility consists of three separate bays for waste water and glycol disposal, vehicle wash down, high pressure water and steam cleaning equipment. The facility provides disposal services for most of the airline Ground Service Equipment (GSE) and aircraft deicing glycol.

• A Request For Qualifications (RFQ) was solicited in August 2013 for the selection of a Consultant for design services. Statement of Qualifications (SOQ) were received from submitting firms on September 12, 2013. The Professional Services Agreement for an initial Program Study with H+K Architects was issued by administrative award in November. Specific project requirements and design features for the facility upgrade were discussed with project stakeholders, as part of the Program Study during coordination meetings on January 16 (RTAA Facilities) and January 21 (Airline Station Managers). Alternate locations for the facility will also be evaluated prior to initiation of the design phase. The estimated budget for this program (including soft costs), is $1,500,000. The project scope and design alternates will be defined in the initial Program Study and recommendations of the study will be presented at the April 2014 Planning and Construction Committee meeting. Based on the discussion at the committee meeting, a preferred alternate may be selected and the subsequent design fee negotiated and subject to Board approval in May 2014. This process was discussed at the January 14, 2014 Planning and Construction Committee meeting.

• Sound Insulation Program There are currently two active phases (phases 21 and 22) in the sound insulation program. The 2014 construction season includes 64 residences located in Reno, Sparks and Washoe County, as shown in the table below. All of these residences are currently in the pre-construction phases of the program.

City of Sparks City of Reno Washoe County Phase Single/Multi Single/Multi Single/Multi Total 21.5 34 14 16 64 Total 34 14 16 64

Phase 21: Group 21.5 consists of a total of 64 single, multi-family and condominium residences in Reno, Sparks and Washoe County. Construction bids were opened on March 13, 2014 and a total of three bids were received. The apparent low responsive and responsible bidder is G&G Specialty Contractor’s Inc. Authorization to award a construction contract to G&G for Group 21.5 has been placed on the April 10, 2014 President/CEO’s Report – March 2014 April 10, 2014 Page 9

Board Agenda for consideration. Construction for Group 21.5, the final phase of residential construction, is scheduled for summer / fall 2014.

Phase 22: The Airport Authority’s acoustical consultant, Brown-Buntin Associates (BBA), completed initial noise mitigation eligibility testing on Phase 22.2 in January 2014. Phase 22.2 includes two Washoe County public schools, Elizabeth Lenz Elementary and Marvin Picollo Elementary. Currently, BBA is in the process of drafting a report to submit to the Federal Aviation Administration (FAA) in late May. If the schools are determined to be eligible, based on FAA noise standards, then noise mitigation construction would occur in summer 2015.

• The Regional Plan Goals & Policies of the Reno-Tahoe International Airport 2013 and the Regional Plan Goals & Policies of the Reno-Stead Airport 2013 documents were submitted to Truckee Meadows Regional Planning Agency (TMRPA) for conformance review with the 2012 Truckee Meadows Regional Plan on January 31, 2014. In concurrence with Regional Planning staff recommendations, the Regional Planning Commission determined that both documents conform with the 2012 Regional Plan at a public hearing on March 12, 2014. The documents are publicly available on the airport website.

• Geographic Information System The RTAA received seven (7) Statements of Qualifications (SOQs) pertaining to the development of a Federal Aviation Administration (FAA) approved Electronic Airport Layout Plan (eALP) for Reno-Tahoe International Airport. On Monday, March 10, 2014, the selection committee, consisting of RTAA trustees and staff, met and generated a short list of four candidates to advance to on-site interviews scheduled for Wednesday, March 26. Each candidate was allotted fifteen minutes for a formal presentation, followed by a 25-minute question and answer session. Arora Engineers Inc. was selected as the highest ranked candidate. Staff will negotiate scope and fees with the intention of bringing a Professional Services Agreement (PSA) before the Board of Trustees in May for consideration.

Organizational Issues

• The Reno-Tahoe Airport Authority (RTAA) Leadership Series continued in March with an in-house webinar titled, “All In” featuring Chester Elton, co-author of The Carrot Principle and The Orange Revolution. This webinar focused on how to: improve team culture; get people to buy into new ideas, and motivate employees to give extra effort. All RTAA Civil Service Plan (CSP) and Management employees are invited to participate in the Leadership Series.

• New Employee Orientation was presented in a revised format. Three half-day sessions were offered on all three shifts and included information on the Airport Authority’s mission and vision, “everyday leadership,” and key policies that covered sexual harassment, Equal Employment Opportunity, safety, technology use and social media as well as workplace violence.

• Staff has entered into negotiations with all three collectively bargained units: Airport Authority Police Officers’ Protective Association, Teamsters Local 533 and the Reno Airport Fire Fighters Association, IAFF Local 2955. Each of these agreements are due to expire on June 30, 2014.

President/CEO’s Report – March 2014 April 10, 2014 Page 10

• The Insurance Committee has begun the process of reviewing the Airport Authority’s health insurance plans and claims experience as well as the initial bids for renewal coverage. The Insurance Committee is comprised of individuals represented by the Teamsters, the Police Officer’s Association, the Civil Service Plan group and Management Guidelines. The Insurance Committee considers the renewal of employee group health insurance each year with the objective to make recommendations to the President/CEO. The current health insurance contract is due to expire on June 30, 2014.

• The RTAA is currently participating in the Best Places to Work Competition. The Best Places to Work award was established in 2008 to honor organizations that deliver an outstanding workplace experience. Best Places to Work winners are determined exclusively on confidential and anonymous survey responses to an Employee Engagement Survey conducted by an independent firm. The survey has now closed with more than 50% of Airport Authority employees completing the survey. The Airport Authority is in the running and notified that we are one of six finalists in the large employer category.

Misc. Information • President/CEO Marily Mora participated in a Nevada Business Magazine women in business discussion which is featured in the April issue of the magazine.

• The Collings Foundation, a non-profit Educational Foundation from Stow, Massachusetts will return to Reno-Stead Airport with their “Wings of Freedom” tour June 4-6, 2014. The “Wings of Freedom tour” includes two fully restored WWII bomber aircraft, a B-17 Flying Fortress and a B-24 Liberator, and a P-51C Mustang. The “Wings of Freedom” tour has two goals: to honor the sacrifices made by our veterans, and to educate visitors, especially younger Americans, about our national heritage and history. The aircraft will be available for public walk-through tours and for the public to participate in a true flight experience.

• The Airport Authority’s In-Line Baggage Handling System Operations and Maintenance contract with Elite Line Services (ELS) expires August 31, 2014. As a result, the Airport Authority released a Request for Proposals (RFP) solicitation on February 14, 2014. The notice and request was direct mailed to sixteen companies that expressed an interest in submitting a proposal and was also advertised in the Reno-Gazette Journal, on the RTIA website, in the searchable classified databases of Aviation News and American Association of Airport Executives, and in the Aviation News Today and Airport Report Today newsletters. The mandatory pre-proposal meeting was held on March 17, 2014; nine companies attended and are eligible to submit a proposal. Written requests from interested companies for information and clarification of the RFP was due by April 1, 2014 and the Airport Authority will post the written responses to the questions not later than April 15, 2014. The proposals are due on May 1, 2014 and will be reviewed by a selection panel. Oral interviews of the short list of candidates (if needed) will take place the first week of June with the intent of having a company selected and a new contract and ready for Board consideration at the July Board meeting. The new contract will commence on September 1, 2014.

• The Airport’s social media exposure grew to slightly over 6,600 Facebook followers and 3,150 Twitter followers. Total reach for Facebook increased exponentially to 1.3 million views, a 24% increase over the previous month. The team was able to build awareness for fare sales through community partnerships, such as utilizing social media and community partners to push out a “This President/CEO’s Report – March 2014 April 10, 2014 Page 11

Weekend Only” fare on American Airlines. The push resulted in 161 consumer clicks to the American Airlines link booking page for sale. Other initiatives that were focused on this month include: Open positions at the Reno-Tahoe Airport Authority, Delta Air Lines On-time Performance Award, Real Estate Development Request for Qualifications (RFQ), and the Swope Middle School Career Event.

• As part of the Strategic Plan to Increase Air Service, staff partnered with the Nevada Commission on Tourism to welcome Asiana Airlines representatives who flew in for a familiarization tour of the region. Approximately 12 Asiana Airline employees arrived from Seattle and were greeted at the gate by staff at a welcome table with water and snacks. Signage was posted in their language at the gate and in Baggage Claim. The welcome was well received and the airline stated that they had not been greeted in a similar manner at any other airport.

• Following the announcement that Nevada is one of six FAA designated Unmanned Aerial Systems (UAS) test sites, staff began developing a marketing outreach plan for the Reno-Stead Airport in terms of UAS testing. Staff will be attending the Association for Unmanned Vehicle Systems International (AUVSI) convention in Orlando, Florida from May 12-15, 2014 to promote the new UAS test site at Reno-Stead Airport. The AUVSI Convention is the nation’s largest UAS industry gathering each year. Staff will be working from the Nevada Institute of Autonomous Systems trade show booth during the show. Promotional materials and a video are being designed to help promote the Reno-Stead Airport at the convention.

• Beginning March 21, 2014 through April 16, 2014, the Airport Authority has contracted with KPS3 Marketing to conduct a Customer Satisfaction Survey. Surveyors will invite passengers to take a short survey of their experience at Reno-Tahoe International Airport. The most recent survey was conducted in 2010 and it is important now that the Gateway Construction is complete to find out from passengers what they think of the new offerings: from consolidated security, to new restaurants and shopping. The survey results will be shared in late spring with the Reno-Tahoe Airport Authority Board, staff and tenants.

• Atlantic Aviation and the airport will host a Grand Opening April 8, at 3:00 p.m. at their new Fixed Base Operation. Board, staff, tenants and news media are invited to attend the celebration of the completion of a $7 million construction project that includes a modern 2-story 13,000 sq. ft. terminal, 29,800 sq. ft. attached aircraft hangar, an internet café, pilots lounge and private data rooms, two conference rooms with AV capability, a new parking lot, signage and landscaping.

• In partnership with the Governor’s Office of Economic Development (GOED), staff conducted a Legislative Briefing on UAS technology at the Reno-Stead Airport on March 19th. Several Assemblymen and Senators from Nevada were present to hear from GOED, the Airport Authority, Bowhead and the University of Nevada on how UAS technology and development can benefit the region. In addition, the company Drone America brought out several UAS’s to display for the group.

• The Airport Authority hosted the Council of Mayors in the River Room on March 20, which brought sitting mayors from across the state of Nevada together to discuss issues that impact all areas of the state.

• At the request of the American Association of Airport Executives (AAAE), staff was asked to give a presentation at the “Second Bi-Annual Evolution of the Airport and Air Carrier Industry: Harnessing President/CEO’s Report – March 2014 April 10, 2014 Page 12

the Power of Partnerships” conference held in Tucson, Arizona. The presentation focused on the impact of social media on the aviation industry and how the Reno-Tahoe International Airport has been able to strategically position social media to drive the strategic priorities outlined by the Board of Trustees in 2013.

• The 135-kilowatt solar system installed at the Reno-Tahoe Airport Authority’s Aircraft Rescue and Firefighting Facility (ARFF) has been fully operational since March 2011. Solar power generation results are provided below. Banked credits have been used during those months when not enough power is generated to cover the monthly use.

Power Generation Current FY 2013-2014 FY 2012-2013 FY 2011-2012 Month Energy Offset from Monthly Bill $3,270 $29,460 $38,619 $35,960 Energy Credits Banked $0 $0 $7,944 $14,906 Banked Credits Applied ($682) ($6,490) ($5,868) ($1,404) Total Earned $3,270 $29,460 $40,695 $49,462 Banked Credits Remaining N/A $9,088 $15,578 $13,502

Quarterly Strategic Plan Update • Over the past quarter, the staff have completed and/or initiated a number of efforts that assist in the implementation of the Reno-Tahoe Airport Authority’s (RTAA) FY 2014-18 Comprehensive Strategic Plan. RTAA will soon adopt a new planning tool from OnStrategy (M3 Planning) to track the Strategic Plan. Since unveiling the Strategic Plan to the community on December 3, 2013 there has been an active community outreach program to discuss the Plan. Some of the key accomplishments are highlighted below:

Increase Air Service

• On October 28, 2013 staff and Trustee Murdock made a headquarters visit to Delta Air Lines in Atlanta, Georgia and the following day made a headquarters visit to Jetblue Airlines in New York, • On March 18th, staff and Reno Councilman Delgado made a headquarters visit to Volaris Airlines in Mexico City • On March 24th, staff made a headquarters visit to United Airlines in Chicago • Staff is working closely with the Regional Marketing Committee (now known as the Regional Air Service Committee) to help focus their efforts and reinvigorate their membership • Staff is working on the development of re-formatted air service task force that better engages the business sector and community as a whole. In concert with this effort, staff is also working on the development of an air cargo focus committee

President/CEO’s Report – March 2014 April 10, 2014 Page 13

Optimize General Aviation Operations and Services

• The Board approved a Professional Services Agreement with InterVistas Consulting, Inc. to analyze the GA demand for facilities and services in order to attract private capital investment to meet their needs. • As a follow-up to the December 4th SWOT analysis conducted with the Reno Tahoe Aviation Group (RTAG), staff met again on March 5, 2014 with RTAG to present the consolidated results and discuss measures to start addressing the findings. • Staff has developed and vetted amongst stakeholders the framework of a quarterly newsletter for RTIA GA tenants. • Staff is working on improvements to the website that includes more useful information for the general aviation community.

Expand Cargo Development and Services

• Staff has worked extensively over the last several months in order to secure services by a new air cargo airline. It is anticipated that the RTAA will be able to announce the details of this new service later this month

Facilitate Economic Development at Both Airports

• In accordance with the schedule discussed with the Board, staff has produced and advertised a Request For Qualifications (RFQ) seeking interest in land development of the property at the Reno- Stead Airport • The RTAA executed a lease agreement with the Nevada Institute of Autonomous Systems (NIAS) for the lease of office space in the Reno-Stead Airport Freedom Flight terminal to support their Northern Nevada Program Management Office operations. On April 1st, Retired Lt. Col. Warren Rapp started working out of this office as NIAS representative • On April 8th, a grand opening celebration will be held for the new terminal and hangar facilities at Atlantic Aviation. This $7 million+ investment will help to better serve our general aviation community • Since the announcement that Nevada has been selected by the FAA as a UAS test site, staff has coordinated information requests and site visits by numerous interested parties. • Staff is working on a new website specific to Reno-Stead Airport with an emphasis on development and UAS opportunities

Provide a Positive Environment and Experience for All

• In March, a passenger survey was initiated to gather demographic information regarding our customers and identify strengths and weaknesses pertaining to the facilities and services provided. • Staff initiated the process to participate in the “Best Places to Work” competition. The requisite number of employees completed to make the RTAA eligible and based on those survey responses the RTAA has been notified that our organization is one of the top six finalists in the large employer President/CEO’s Report – March 2014 April 10, 2014 Page 14

category. The final announcement of the top three finishers in that category will be made at the awards ceremony on April 24, 2014 • Staff has started the process of re-evaluating the organizational goals using members of the leadership/mentorship program to lead this effort • Staff has developed a draft of a succession program which is currently being reviewed by executive management. The process proposed involves wide participation and multiple steps which will begin to be rolled out in April • Staff, through an outside consultant, has completed a compensation review study • Staff is implementing a “We Heard You” campaign which specifically calls out any new initiative/change to policies and/or procedures that were instituted as a result of feedback received from the employee survey conducted last year. As an example of this program, a night all-employee meeting held quarterly to accommodate employees who work the graveyard shift has been added

Guiding Principle Activities

• Staff initiated a Request For Qualifications (RFQ) process to select a consultant to assist with the implementation of a Geographic Information System (GIS). Proposals were received and reviewed and following interviews with a shortlisted number of proposers a selection was made. The Professional Services Agreement will be brought to the Board in May • Staff initiated a Request For Proposals (RFP) process to select a consultant to serve as the RTAA’s Auditor. Proposals were received and reviewed and following interviews with a shortlisted number of proposers a selection was made. The Professional Services Agreement will be brought to the Board in April • Staff initiated a Request For Proposals (RFP) process to select a consultant to serve as the RTAA’s insurance broker. The Board approved the 5-year contract in January 2014 • Staff initiated a Request For Proposals (RFP) process to select a baggage handling system maintenance contractor. Proposals are due May 1st and a contract will be brought for Board consideration in July 2014 • Staff is preparing for the FAA required triennial disaster exercise which will take place on May 29th. This exercise is being led by the RTAA but will include support from numerous agencies within the community

Legislative/Government Affairs Update • Government Affairs efforts conducted by McDonald Carano Wilson (MCW) since March 1, 2014 include:

• On March 4, MCW attended a A Democratic Assembly fundraiser in Las Vegas and spoke with: . Mike Sprinkle – who stated he wants to play a pivotal role in the passage of the aviation tax abatement – so continuing to deepen our working relationship is vital.

. Irene Bustamante Adams – Chair of Taxation – really wants to handle the legislation and to help us strategize about how to overcome the political dynamics in the Assembly President/CEO’s Report – March 2014 April 10, 2014 Page 15

• On March 19, MCW attended the northern Nevada legislator briefing on Unmanned Aerial Systems/UAV organized by Steve Hill and GOED staff. The event provided a good opportunity to interact with legislators, literally in the “home” of the tax abatement issue. Reno-Tahoe Airport Authority President/CEO, Marily Mora, took full advantage of the opportunity to insert the tax abatement issue into the conversation. Senator Smith is interested in following up and MCW has scheduled a meeting with her on April 7 to do so.

• On March 20, in a collaborative effort with National Business Aircraft Association (NVBAA) to build the tax abatement coalition, MCW toured the North Las Vegas Airport (NLV) and visited with a number of Maintenance, Repair and Overhaul facilities. The firms MCW spoke with were very supportive of any effort to provide incentives to get aviation-related business to stay in Nevada. MCW collected business cards and will follow up at the appropriate time. As there is significant developable land around the NLV airport, MCW also recorded names/information from signage in order to contact brokers to solicit support, as well as airport property leasing agent contact information.

• On March 24, MCW had lunch with Assemblyman Harvey Munford, whose district includes NLV; he is very interested in learning more about how to fill airport businesses and said to let him know if he can help us in any way.

• At the DRI Nevada Medal dinner in Las Vegas on March 27, MCW: . Spoke with the Governor and Steve Hill about the abatement issue. . Apprised North Las Vegas Mayor John Lee about the InterVISTAS study and told him MCW would share the results with him when they are available. He said he’d love to find a way to fill up empty businesses around the airport. . Told Clark County Commissioner Chris Giunchigliani about the InterVISTAS study and suggested MCW would visit with her when the results are available. She seemed very positive.

Political Dynamics: 1) The North/South battle is serious; the southern Nevada caucus (both sides of the aisle and both houses) is united in going after their “Fair Share” in 2015. Without full buy-in from Clark County Aviation, the tax abatement will be perceived as a Northern Nevada issue.

The Southern Nevada Forum – an entity that grew from the caucuses and is supported by the Las Vegas Chamber of Commerce -- met on March 14 to prioritize their top economic development issues. The top three are:

. #1 Funding support for implementing the UAS industry . #2 State funding for new infrastructure (site development); and . #3 Appropriations for the Catalyst Fund . The 4th ranked issue was “creation of new incentives to support business retention in targeted industries.”

2) On March 20, the Nevada Supreme Court ruled that Harrah’s Operating Co. is entitled to a $4.4 million refund on the use tax paid on two planes purchased out of state. After this story broke, Jon Ralston wrote: ‘Dumbest: Caesars entertainment winning their tax refund on the plane purchases, President/CEO’s Report – March 2014 April 10, 2014 Page 16

rest assured that the Legislature will take note and fix the loophole. That’s kind of a congratulations, and oops.’

The dynamics around corporate tax breaks is not a positive for the abatement conversation.

• On February 20th, staff met with Mr. Bruce Miller, Congressman Amodei’s Legislative Director, to brief him on airport issues and provided him a tour of the airport facilities following the meeting.

• During the week of March 3rd, the RTAA President/CEO joined 30+ other Northern Nevada officials on a trip to Washington D.C. as part of their collaborative efforts on the Shared Federal Framework initiative. Although each entity has their own federal issues of concern, the purpose of the Shared Federal Framework is to demonstrate to the congressional representatives and senior leadership at federal agencies in Washington that Northern Nevada is “One Region – One Voice” working cooperatively to better the community as a whole. The document produced through this effort and delivered on this visit is a compendium of all entities issues of concern, including those of the RTAA providing the decision-makers in Washington with an easy reference guide. The President/CEO had the opportunity to participate in a number of meetings with legislators who sit on key committees and Department leaders

• During the week of March 24th, the RTAA Board Chair, President/CEO and Executive Vice President/COO spent three days in Washington D.C. attending the AAAE/ACI-NA Spring Legislative conference and making visits with members of the Nevada congressional delegation. Our federal lobbyist arranged meetings with Congresswoman Titus, Congressman Amodei and Senator Heller. During these meetings, the Chair and staff were able to discuss the Airport’s concerns regarding infrastructure funding preservation (AIP and PFC) and Customs and Border Protection support for new air service to Guadalajara. We also expressed our appreciation for their support in obtaining the FAA’s UAS test site designation and briefly discussed our state legislative initiatives (tax abatement and transportation fund). In addition to the delegation meetings, the Chair and staff had a meeting with the FAA to discuss sound insulation program issues and several meetings with the both the FAA and industry representatives to discuss UAS testing and development opportunities at the Reno-Stead Airport

Presentations • Numerous presentations and interviews have been given this month on the Strategic Plan, Air Service, and Reno-Tahoe International Airport’s Economic Impact to groups including: • Nevada Delegation in Washington D.C. • Northern Nevada Network • Reno Downtown Rotary Club • South Washoe Dems • Men’s Breakfast Club

• Future presentations include the Reno City Council at noon on April 16, 2014 and the RSCVA Board at 9:00 a.m. on April 24, 2014.