,M J ~os Angeles World AirtJOrts November 20, 2007

The Honorable City Council of the City of City Hall, Room 395 Los Angeles, CA 90012

LAX Subject: BLANKET ORDER COVERING SECOND AMENDMENTS WITH AIR CARRIERS TO EXTEND THE TERM OF THE LA/Ontario NON-EXCLUSIVE AIR CARRIER OPERATING PERMITS LA/Palmdale FOR LOS ANGELES INTERNATIONAL AIRPORT AND

Van Nuys LA/ONTARIO INTERNATIONAL AIRPORT

City of Los Angeles In accordance with Section 606 of the City Charter, the Board of Airport Antonio R. ViililrèlieoSä Commissioners transmit for your approval a Blanket Order covering Second M¿¡yor Amendments with Air Carriers to extend the term of the Non-Exclusive Air Board of Airport Carrier Operating Permits for Los Angeles International Airport and Commissioners LA/Ontario International Airport. 1\lar.l. Rothcrberg President RECOMMENDA nON FOR CITY COUNCIL

--'cria C, Vcla'5co ;i"esirJclit 1. APPROVE the Second Amendments with Air Carriers (list attached). Josepr 1\. A'cdöci Vlichcicl ,A" liiwsor 2. CONCUR in the Board's action authorizing the Executive Director to Syvia Pfltsaour¿is Fern¡¡ndo lA rorre,,-Gil execute the Second Amendments to Non-Exclusive Air Carrier VValter/¡fkin Operating Permits with Air Carriers (list attached).

Ginci r/¡arie Lindsey Exccucive Director 3. FIND that the recommended action is exempt from the requirements of the Environmental Quality Act as provided by Article ill, Class 1 (1S)(c) of the Los Angeles City CEQA Guidelines.

The Board of Airport Commissioners, at their meeting held on November 19, 2007 by Board Order No. AO-50SS approved the Second Amendments with Air Carriers, subject to the approval of your Honorable Body is attached.

MAYOR'S TRANSMITTAL Enclosed is the approval by the Mayor and the Office of City Administrative Officer.

CONCLUSION

Please return the attached Permit to the Department of Airports' Board Office after City Council approval and Certification of that approval.

Two additional copies of the Permit are enclosed.

NOV 2 1 2007 TRADE, COMMERCE & TOURISM

1 Worlc Wöy i ri" Ang(+~~; C¿¡lifor'-ici 'JlOi.c;-5RC3 ~'1Hil PO, l:ox, ',);!)0 ~os Angeles Cölitor'ii" 9~-i(J09-2216 ICICO'lOr",c ::J':O 61)0 52;;2 Intcr~ct 1....W\\'jèlw¿UJ'S Los Angeles City Council November 20, 2007 Page 2

Very truly yours,

Sandra J. Miller - Commission Executive Assistant Ii BOARD OF AIRPORT COMMISSIONERS

cc. Trade, Commerce and Tourism Committee Councilmember Hahn, Ene. Councilmember Rosendahl, Enc. Councilmember LaBonge, Enc. CAO (Airport Analyst), Enc. CLA (Airport Analyst), Enc. City Clerk's Office, Enc. (one original and two copies) 0150-08251-0001 TRANSMITTAL TO DATE COUNCIL FILE NO. Gina Marie Lindsey, Executive Director Department of Airports NOV 0 1 2007

FROM COUNCIL DISTRICT The Mayor 11 & Ontario

Proposed Blanket Order Covering Second Amendments to Extend the Term of Non-Exclusive Air Carrier Operating Permits for Los Angeles International and LA/Ontario International Airports

Transmitted for further processing, including Council consideration. S" th, c;i Adm'm't,~"port. ,ttoh,d. ~YOR f-

KLS:A VM 100800451

CAO 649-d REPORT FROM

OFFICE OF THE CITY ADMINISTRATIVE OFFICER

Date: October 30, 2007 CAO File No. 0150-08251-0001 Council File No. Council District: 11 & outside the City To: The Mayor

From: Karen L. Sisson, City Administrative Officer~r

Reference: Transmittal from the Department of Airports dated September 18, 2007; referred for report on September 19, 2007

Subject: PROPOSED BLANKET ORDER COVERING SECOND AMENDMENTS TO EXTEND THE TERM OF NON-EXCUSIVE AIR CARRIER OPERATING PERMITS FOR LOS ANGELES INTERNATIONAL AND LA/ONTARIO INTERNATIONAL AIRPORTS

SUMMARY

The Department of Airports (Department) requests authorization to adopt a Blanket Order covering - --Second Amendments (Amendments) of existing Non-Exclusive Air Carrier Operating Permits (ACOPs) at Los Angeles International Airport (LAX) and LA/Ontario International Airport (LA/ONT). The ACOP is the primary legal instrument used to define and set the standard operating terms, conditions and requirements and to impose the collection of fees for the use of landing facilities. Non-Exclusive ACOPs allow air carriers access to common airport areas such as runways, taxiways, service roads and common use ramps for the purpose of conducting commercial air carrier operations. The current ACOPs terms will expire January 31,2008. The proposed Amendments will extend the terms until June 30, 2009, continue current practices and allow the Department's Executive Director or designee to execute new ACOPs which also wil have a June 30, 2009 expiration date. Pursuant to Charter Section 632, the Board of Airport Commissioners (BOAC) has the power and duty to fix and collect rates and charges for the use of airport assets and other services provided by the Department. City Council approval of the proposed Amendments is required pursuant to Charter Section 606.

Background

The ACûPs serve as the frarriework for the cûllection ûf fees fûi the üse of aircraft landing facilities, including though not limited to landing fees, aircraft apron parking fees and passenger facility charges. Two ACOPs, one for LAX and one for LA/ONT, were adopted on May 21, 2002 under Board Order AO-4814 and Board Order AO-4815, respectively. The terms were July 1,2002 to June

30,2007. Earlierthis year on May 21,2007, the BOAC authorized the first amendments to these two ACOPs and the term expiration dates were revised to January 31,2008. CAQ File No. PAGE 0150-08251-0001 2

Beginning in 1997, air carriers and Department staff began to collaborate when updating the ACOP to make sure that the agreement would conform to national industry standards and local legislation. The collaborative efforts shaped the language of the ACOPs. Specifically, key provisions that were revised to develop the ACOPs (effective July 1, 2002 to June 30, 2007) pertained to: a) Term, b) Fees, Rates and Charges, c) Security Deposit, d) Airfield Provisions, e) Administrative Requirements, and f) Terminology. An extensive background of the LAX ACOP is contained in a prior CAO report dated June 10, 2002 (CAO file number 0150-00939-0050).

Proposed Second Amendments

The proposed Amendments will extend the current ACOPs to ensure that the provisions for air carriers to conduct operations at LAX and LNONT will not be interrupted. In addition to landing fees, ACOP provisions include insurance and security deposit requirements and other charges. The Department revenue projections in its 2007-08 budget state that approximately $167 million and $16 million will be received from flight fees this fiscal year at LAX and LNONT, respectively.

Currently LNONT has 17 permitted air carriers (seven passenger and ten cargo) and LAX has 89 permitted air carriers (63 passenger and 26 cargo). The number of permitted air carriers fluctuates as airlines begin and/or end operations and as airlines elect to renew or not to renew their ACOPs. Department staff reported that LAX had 115 permitted air carriers when the ACOP first amendment was considered; it is anticipated that the number of permitted air carriers at LAX will increase from 89 \to 105 after all compliance issues are resolved.

Air carriers which complied with first amendment criteria, by June 30, 2007, and were granted term extensions to January 31, 2008 will need to submit executed ACOP second Amendments by January 31,2008 to ensure continuity as permitted air carriers. Additionally, according to Department staff, "air carriers that adequately execute the term amendment to the current ACOP at LAX and properly adhere to ACOP provisions will continue to have the permitted landing fee rate extended to them." Air carriers which fail to meet the deadline will be required to pay non-permitted air carrier landing fee rates, which are 25 percent greater than permitted air carrier landing fees, until signed amendments are received.

Approval of the term extension will allow additional time to resolve several actions and activities which may impact the language in the successor ACOP, including the following:

. Department staff reports that the rulings of ongoing litigation before the Department of Transportation as well as existing litigation with may have bearing upon the language of the ensuing .A,COP. Therefore, negotiating provisions and/or finalizing the language of successor ACOP after the completion of the litigation is a more efficient strategy than presenting a revised ACOP for approval, yet knowing its language could require further refining.

. Department staff report that airlines have questioned new environmental provisions and contract language such as the new First Source Hiring Program. Additional time is needed to address the concerns with domestic and foreign airlines administrators and provide proper provision implementation. CAD File No. PAGE 0150-08251-0001 3

Additionally, approval of the term extension agreement at LAONT will ensure continued consistency in the language between the ACOPs at LAX and LA/aNT. The proposed ACOP Amendments

comply with applicable City contract provisions. Council approval of this request is required pursuant to Charter Section 606.

RECOMMENDATION

That the Mayor approve the Department of Airports' proposed Blanket Order covering Second Amendments (Amendments) to existing Non-Exclusive Air Carrier Operating Permits (ACOPs) at Los Angeles International Airport and LA/Ontario International Airport to continue current practices forthe period February 1,2008 through June 30, 2009 and return the request to the Department of Airports for further processing, including Council consideration.

FISCAL IMPACT STATEMENT

Approval of the proposed Amendments will continue the current practice of setting the standard operating terms, conditions and requirements of air carriers conducting operations and imposing the collection of fees covering the use of landing facilities for commercial air carriers. Since the Department of Airports is only bound by the City Debt Management Policies, the City Financial

_~. Policies are not applicable. Approval of the proposed Amendments will have no impact upon the City General Fund.

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Los Angeles World Airports

BOARD ORDER NO. AO-5088

BLANKET ORDER AUTHORIZING AMENDMENT OF NON-EXCLUSIVE AIR CARRIER OPERATING PERMITS FOR LOS ANGELES INTERNATIONAL AIRPORT AND LA/ONTARIO INTERNATIONAL AIRPORT TO EXTEND THE TERM AND CONTINUE CURRENT PRACTICES UNTIL JUNE 30, 2009.

Section 1. WHEREAS, the Board of Airport Commissioners approved a Blanket Order authorizing LAX Amendment of Non-Exclusive Air Carrier Operating Permits for Los Angeles LA/Ontario International Airport and LA/Ontario International Airport to extend the term and continue current practices until June 30, 2009; and LAJPalmdale Van Nuys WHEREAS, the Non-Exclusive Air Carrier Operating Permit (ACOP) is a City of Los Angeles comprehensive agreement that defines and sets the standard operating terms, conditions and requirements of air carriers conducting operations at Los Angeles AIlÜirio R. V;il;iraigosa Mciyor International Airport ("LAX") or LA/Ontario International Airport ("LA/ONT"); and

Board of Airport Commissioners WHEREAS, Los Angeles World Airports (LAWA) continues to seek resolution for the following activities and issues that may impact the language in the successor ACOP: Alan Rothenberg President 1) Litigation before the United States Department of Transportation; _ '-'leria C. Velasco 2) New environmental provisions and the First Source Hiring Program as a result of ~ Pre s i dent the LAX Master Plan Mitigation Monitoring and Reporting Program, Community

Joseph A. Aredas Benefits Agreement, and the Stipulated Settlement Agreement; and M;ehael A. Lciwson 3) Existing litigation with United Airlines that directly involves the ACOP; and Syiviöl'¡ilSèloums rernardo M. Torres-Gi' V,'¡¡ltcrZifkin WHEREAS, in this interim period, pending completion of a comprehensive review and

Gina 1\.1ar'e Lindsey resolution of matters that may impact the language of the ACOP, it is important that Executive Di:cctor LAW A have signed documentation with the air carriers that extend and maintain enforcement of the current provisions of the ACOP, which include insurance and security deposit requirements. Those air carriers that adequately execute the term amendment to their current ACOP at LAX and properly adhere to the ACOP provisions will continue to have the permitted landing fee rate extended to them; and

WHEREAS, this Order provides for continued current practices and for the Executive Director, or her designee, to continue to execute new ACOPs at LAX, pursuant to Board Order No. AO-4814, with an expiration date no later than June 30, 2009. The extension of the ACOPs for LA/ONT under Board Order No. AO-4815, including the ability to continue to execute new ACOPs at LA/ONT, will ensure the continued consistency in the language between the Operating Permits at LAX and LA/ONT; and

vVHEREAS, this ûrder aiso authorizes the Executive Dir-edor tu require that air carriers that fail to submit an executed Amendment to their Non-Exclusive ACOP by January 31, 2008 must pay landing fees at the rate of non-permitted carriers until such time as signed documents are received and compliance obtained; and

WHEREAS, issuance of permits, agreements, and renewals, amendments or extensions thereot, or other entitlements granting use of an existing municipal airport involving negligible or no expansion of use and/or alteration or modification of the facilities or its operations beyond that previously existing or permitted is exempt from the requirements of the CEQA pursuant to Article III Class 1 (18)(c) of the Los Angeles City CEQA Guidelines, as amended by the City Council on July 31,2002; and

:i 'yVor:d Way Los .~.rigele~ CJ ilorn J ')O::4:)-jöCr, Mail PO. Liox 92216 L:is i\ngclcs Cciliforc-i" ,:(J009 ::?1£; Tele:irore 3::0646 52j) IWe'r-,el wwwl;iwilorg Board Order No. AO-5088 -2-

WHEREAS, Permittees are subject to the provisions of the Service Contractor Worker Retention and Living Wage Ordinances; and

WHEREAS, each Permittee must submit an Affirmative Action Plan and comply with the provisions of the Affirmative Action Program; and

WHEREAS, each Permittee must provide a Business Tax Registration Certificate number or Letter of Exemption by the City Office of Finance prior to the execution of the Non-Exclusive ACOP; and WHEREAS, Permittees must comply with the provisions of the Child Support Obligations Ordinance; and

WHEREAS, Permittees must maintain approved insurance documents, in the terms and amounts required, on fie with LAWA Risk Management Division; and

WHEREAS, Permittees will be required to comply with the provisions of the First Source Hiring Program for all non-trade LAX airport jobs once the program is formally implemented by LAWA; and

WHEREAS, action taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of the Los Angeles City Charter Section 606;

NOW, THEREFORE, IT iS ORDERED that it is in the best interest of the City of Los Angeles to adopt the Staff Report, to make and enter into said Amendments, which are exempt from CEQA requirements, and the Amendments as now before this Board are hereby approved, and the Executive Director of the Department of Airports is hereby authorized and directed to execute these Amendments on behalf of this Board and the City of Los Angeles upon approval as to form by the City Attorney, and upon approval of this Order and said Amendments by the City CounciL.

Section 2. IT IS FURTHER ORDERED that the Secretary of the Board is hereby directed to transmit to the City Council of the City of Los Angeles certified copies of this Order, together with copies of said Amendments for appropriate action of its part, in accordance with Section 606 of the Charter of the City of Los Angeles.

Section 3. IT IS FURTHER ORDERED that the Secretary of the Board certify to the passage of this Order and cause the same to be published once in a newspaper of general circulation in the same manner as Ordinances of the City of Los Angeles are published, upon approval thereof by the City CounciL.

000

I hereby certify that the foregoing is a true and correct copy of Board Order No. AO-5088 adopted by the Board of Airport Commissioners at a Regular Meeting held Monday, November 19, 2007.

Sandra J. . er - Secretary BOARD OF AIRPORT COMMISSIONERS r 1 AMENDMENT TO NON-EXCLUSIVE AIR CARER OPERATING PERMIT BETWEEN AND , A PERMTTEDTHE CITY OF LOS ANGELES CARRIER, COVERIG OPERATIONS AND THE USE OF LANDING FACILITIES FOR AIR CARRIER AIRCRAFT OPERA TIONS AT LOS ANGELES INTERNATIONAL AIRPORT

This r 1 Amendment (the "I 1 Amendment"), made and entered into as of this day of , 200_, at Los Angeles, California by and between the City of Los Angeles, a municipal corporation ("City"), acting by and through its Board of Airport Commissioners ("Board") and ("Permittee"), is made with reference to the ((i)) Non-Exclusive Air Carrier Operating Permit between the City and Permittee, a Permitted Carrier, covering the Use of Landing Facilities for Air Carrier Aircraft Operations at Los Angeles International Airport (and (ii) r 1 Amendment to Non-Exclusive Operating Permit between the City of Los Angeles and Permittee, a Permitted Carrier, Covering Operations and the Use of Landing Facilities for Air Carrier Operations at Los Angeles International Airport) ((collectively,) the "Permit").

City and Permittee do now agree that "Section 4. Term" of the Permit is hereby amended by deleting the numerals and words "terminate no later than midnight on January 31, 2008," and replacing the said deleted numerals and words with "terminate no later than midnight on June 30, 2009,".

It is understood and agreed by and between the paries that, except as specifically

provided herein, this r 1 Amendment shall not, in any manner, alter, change, modity or affect any of the rights, privileges, duties or obligations of either of the paries under the Permit and except as expressly amended herein, all of the terms, covenants and conditions of the Permit and all amendments thereto, shall remain in full force and effect.

(signature page follows)

#247112 r i Amendment to ACOP IN WITNESS WHEREOF, CITY has caused this r 1 AMENDMENT to be executed as of the day and year written above.

APPROVED AS TO FORM: CITY OF LOS ANGELES Rockard J. Delgadillo, City Attorney

Date: By By: Executive Director Deputy/Assistant City Attorney Department of Airports

The foregoing r 1 Amendment is hereby accepted and the undersigned hereby agrees to be bound by the conditions herein stated as of the day and year written above.

ATTEST: .

By By Secretary (Signature) Signature

Print Name Print Name

(SEAL) Print Title

#247112 2 r 1 Amendment to ACOP Los Angeles International Airport Air Carrier Listing

) /i ..) ...... )/ ../// ...... f..) ...... ) Ih...))...... i...... '. ~/...i...... i...... -LA ABX Air Inc Airborne Express LA Aer Lingus Ltd Aer Lingus PLC LA Aero California SA de OJ Aero California LA Aerofiot Russian International Airlines Aerofiot LA Aeromexpress SA De OJ Aeromexpress LA Aerotransporte De Carga Union S A de C A Aerotransporte De Carga Union S A de C A LA Aerotransporte Mas De Carga MAS Air LA Aerovias De Mexico S.A.DE c.v. Aeromexico LA Aerovias del Continente Americano Avianca LA Air Atlanta Icelandic Air Atlanta Icelandic LA Air Canada Air Canada LA Air China Air China LA Air India Limited Air India LA Air Jamaica Holdings LId Air Jamaica Ltd LA Air New Zealand Air New Zealand LA Air Pacific Ltd Ai r Pacific LA Air Tahiti Nui Air Tahiti Nui LA Air Transport Int'I LLC Air Transport Int'l LLC LA Airtran Airways Inc Airtran Airways Inc LA Inc Alaska Airlines LA All Nippon Airways CO LW All Nippon Airways LA Inc American Airlines LA American Eagle Airlines Inc American Eagle LA Amerifight LLC Amerifiight LA Asiana Airlines Asiana Airlines LA Astar Air Cargo Inc Astar LA ATA Airlines, Inc, ATA LA Atlas Ai r Inc Inc LA PLC British Airways LA Capital Cargo International Airlines, Inc. Capital Cargo International LA Cargo 360, Inc. Cargo 360, Inc. LA Cargolux Airlines International SA Cargolux Airlines International LA Cathay Pacific AI rways Ltd Cathay Pacific LA China Airlines LId China Airlines LA China Cargo Airlines L TD China Cargo Airlines L TD LA China Eastern Airlines China Eastern Airlines LA China Southern Airlines China Southern Airlines LA CMA Mexicana Airlines Mexicana Airlines LA Consorcio Aviaxsa SA de OJ Aviacsa Airlines LA Inc Continental Airlines LA Copa Airlines Copa Airlines LA Inc Della Air Lines LA EI AI Israel Airlines Ltd EI AI Israel Airlines LId LA Inc Empire Airlines LA Eva Airways Corporation Eva Airways Corporation LA ExpressJet Airlines, Inc. Continental Express & Delta Connection LA Federal Express Corporation Federal Express LA Florida West International Airways Inc Florida West International Airways

Prepared by LA Airfeld Permits 10f3 (310) 215-5464 Los Angeles International Airport Air Carrier Listing

... .. 7~ ...... i...... ,X;!! i\...... ~...... lA Inc Frontier Airlines lA Gemini Air Cargo LLC Gemini Air Cargo lA Grand Holdings Inc Champion Air lA Gulf & Caribbean Cargo, Inc Gulf & Caribbean Cargo lA Inc Hawaiian Airlines lA Industries Inc Horizon Air lA IFL Group Inc IFL Group Inc lA Japan Airlines International Company, LTD Japan Airlines lA Jazz Air LP Air Canada Jazz lA JetBlue Airways Corporation JetBlue Airlines lA Kalitt Air LLC LLC lA Kitt Hawk Aircargo Inc Kitt Hawk Aircargo lA KLM Royal Dutch Airlines KLM Royal Dutch Airlines lA Korean Airlines Korean Airlines lA Lan Airlines Lan Chile Airlines lA Lan Cargo SA Fast Air lA Lan Peru SA Lan Peru SA lA Lineas Aereas Coslarricenses SA LACSA lA Lufthansa German Airlines Lufthansa German Airlines lA Luftransport -Unternehmen LTU International Airways lA Malaysian Airline System Malaysian Airlines lA Martinair Holland Martinair Holland lA MaxJet Airways Inc. MaxJet Airways lA , Inc. Mesa Airlines lA Miami Air International Inc Miami Air lA Midwest Airlines, Inc. Midwest Airlines lA MN Airlines LLC lA Nippon Cargo Airlines NCA lA Northwest Airlines Inc Northwest Airlines lA Omega Air Holdings LLC Focus Air lA Inc Omni Air Express lA Philippine Airlines Philippine Airlines lA Polar Air Cargo lA Qa ntas Ai rways Ltd Qantas Airlines lA Shanghai Airlines Cargo Int'I Co Ltd Shanghai Airlines Cargo Int'I Co Ltd lA Singapore Airlines Cargo Pte Ltd Singapore Airlines Cargo lA Singapore Airlines Ltd Singapore Airlines lA Skyest Airlines Inc Skyest Airlines lA ISoclete Air France Air France lA I Southern- Air Inc :'OUII ern Air Inc lA Co Southwest Airlines lA Inc Spirit Airlines Inc lA Swiss International Airlines Swiss International Airlines lA TACA International Airlines SA TACA EI Salvador lA Thai Airways International Ltd Thai Airways International Ltd lA Tradewinds Airlines Inc Tradewinds Airlines Inc lA Transmile Air Service Transmile Air lA United Air Lines Inc United Air Lines Inc lA United Parcel Service United Parcel Service Co

Prepared by LA Airfeld Permits 20f3 (310) 215-5464 Los Angeles International Airport Air Carrier Listing

lA US Airways Inc US Airways e ir ines nc e ir ines lA Varig Logistica 51 A Variglog lA Virgin America Inc. Virgin America lA Virgin Atlantic Airways Ltd Virgin Atlantic lA Westjet Westjet lA Worldcorp Inc World Airways Inc

Prepared by LA Airfeld Permits 30f3 (310) 215-5464 0150-08251-0002 TRANSMITTAL TO DATE .. COUNCIL FILE NO. Gina Marie Lindsey, Executive Director Department of Airports (JUN'.1200 9 FROM COUNCIL DISTRICT The Mayor City of Ontario

Proposed Replacement Non-Exclusive Air Carrier Operating Permits at LA/Ontario International Airport

Transmitted for further processing, including Council consideration. See the City Administrative Officer report, attached. liat:-~.~ MA~Y)

RPC:A VM:1 00901571

CAO 649-d REPORT FROM

OFFICE OF THE CITY ADMINISTRATIVE OFFICER

Date: June 2, 2009 CAO File No. 0150-08251-0002 Council File No. Council District: outside the City To: The Mayor .\ ~\\ From: Raymond P. Ciranna, Interim City Administrative Officer "";wi

Reference: Transmittal from the Department of Airports dated April 7, 2009; referred for report on April 8, 2009

Subject: PROPOSED REPLACEMENT NON-EXCLUSIVE AIR CARRIER OPERATING PERMITS AT LA/ONTARIO INTERNATIONAL AIRPORT

SUMMARY

The Department of Airports (Department) requests authorization to approve a Blanket Order to authorize the Executive Director to issue replacement Non-Exclusive Air Carrier Operating Permits (ACOPs) at LA/Ontario International Airport (LA/ONT). An ACOP is the primary legal instrument used to define and set the standard operating terms, conditions and requirements and to impose the collection of fees forthe use of landing facilities. Non-Exclusive ACOPs at LAfONT and Los Angeles International Airport allow air carriers access to common airport areas such as runways, taxiways, service roads and common use ramps for the purpose of conducting commercial air carrier operations for commercial passengers and cargo. Existing ACOPs at LAfONT will expire June 30, 2009. The proposed replacement ACOPs will continue existing standard terms, will revise certain provisions and will provide an additional five years by establishing a new expiration date of June 30, 2014. City Council approval of the proposed replacement ACOPs is required pursuant to Charter Section 606 because the cumulative term exceeds five years.

Background

In general, an ACOP provides three broad functions at LAfONT: authorizes the use of landing facilities; establishes standard terms and conditions for use of ONT's facilities; and, identifies the fees and charges which apply to regularly scheduled commercial passenger and cargo air carriers subject to the ACOP. These costs include, though are not limited to, landing fees, aircraft apron parking fees and passenger facility charges.

Initially, the ACOP for LAfONT was adopted on May 21,2002 under Board Order A0-4815. The Board of Airports Commissioners (BOAC) authorized the first and second amendments for ACOPs at LAfONT on May 21, 2007 and November 19, 2007, respectively. CAO File No. PAGE 0150-08251-0002 2

Two groups of air carriers are referred to as "Non-Signatory Airlines" or "Permitees" at LAfONT. The first group consists of 13 ACOP air carriers; six are passenger and seven are cargo air carriers. These air carriers operate more than six flights annually and have elected not to execute ONT's Operating Use and Terminal Lease Agreement (ULA). The second group of "Non-Signatory Airlines" or "Permitees" consists of air carriers that operate six or less flights annually and have obtained a Single Use Operating Permit. Air carriers which operate under the ULA are called Signatory Airlines. The 13 ACOP air carriers at LAfONT are as follows:

Cargo Air Carriers Passenger Air Carriers

Air Cargo Carriers , Inc. Air Transport Int'I,LLC ExpressJet Airlines, Inc. Inc. Great Lakes Arrow Air Miami Air International, Inc Gulf and Caribbean Cargo Ryan International Airlines IFL Group Kalitta Air LLC

Both the ACOP and the ULA provide for the use of landing facilities and certain other areas on the LAfONT airfield. However, there are notable differences between these legal instruments.

• Non-Signatory Airlines may opt out of the ACOPs on relatively short notice.

• Within the ULA framework, Signatory Airlines are required to lease space and are obligated financially for approximately five-year periods.

• Air carriers under ACOPs are required to pay landing fees that currently are 25 percent higher than those paid by ULA air carriers.

• Air carriers under ACOPs are not required to lease space in passenger terminals at LAfONT or related space on the airfield (cargo air carriers).

• Air carriers under ACOPs that decide to lease terminal space (under a separate agreement) will pay a terminal rental rate that currently is ten percent higher than that paid by ULA air carriers.

Proposed Replacement ACOPs

The proposed replacement ACOP will provide a new revenue item, the assessment and collection of joint use fees from Permittees of passenger air carriers. As described, this fee will help recover the maintenance and utility costs of joint use space, such as baggage and passenger processing and screening areas. Approval of the proposed Blanket Order will update standard City contract terms and allow the Department Executive Directorto issue new ACOPs. Pursuant to Charter Section 632, the BOAC has the power and duty to fix and collect rates and charges for the use of airport assets and other services provided by the Department. CAOFileNo. PAGE 0150-08251-0002 3

Between 2003 to 2009, ACOP revenue averaged $413,800 annually at LAfONT. Department staff anticipates receiving revenue of approximately $518,900 annually during the ensuing five years. Staff estimates the ACOP revenue sources will be $74,200 from new Joint Use Fees and $444,700 from Aircraft Landing Fees from cargo and passengers carriers at LAfONT.

City Contract Compliance

The proposed ACOPs are subject to approval by the City Attorney as to form. Unique to this particular request, the Non-Signatory Airlines (Permitees) are expected to comply with applicable City contract requirements. Permittees must provide a Business Tax Registration Certificate number or a Letter of Exemption from the City's Office of Finance prior to the execution of the ACOPs. Additionally, Permittees are to maintain approved insurance documents on file with the Department in the terms and amounts requested. The Permittees are subject to the provisions of the Service Contractor Worker Retention and Living Wage Ordinances. Also, the Permittees must submit an Affirmative Action Plan and a Certification of Compliance with Child Support Obligations as well as comply with the provisions of the Affirmative Action Program and the Child Support Obligations Ordinance.

The proposed request is not subject to the provisions of: Charter Section 1022 pertaining to the use of independent contractors; the Contractor Responsibility Program; the Equal Benefits Ordinance under federal case ATA v. City and County of San Francisco (1999); the First Source Hiring Program; and, the MinoritylWomen Business Enterprise program pursuant to the Mayor's Executive Directive 2001-26.

The issuance of agreements, renewals and amendments or extensions thereof, and granting use of existing facilities at a municipal airport involving negligible or no expansion of use is exempt from the requirements of California Environmental Quality Act (CEQA), per Article III, Section 1(18)(c) of the Los Angeles CEQA Guidelines. Pursuant to Charter Section 606, this request will be submitted to Council for its approval or disapproval.

RECOMMENDATION

That the Mayor approve the Department of Airports' proposed Blanket Order to authorize the Executive Director to issue replacement Non-Exclusive Air Carrier Operating Permits at LAlOntario International Airport for Non-Signatory air carriers to continue operations for another five-year period, from July 1, 2009 through June 30, 2014, and return the request to the Department of Airports for further processing, including Council consideration.

FISCAL IMPACT STATEMENT

Approval of the proposed replacement Non-Exclusive Air Carrier Operating Permits will allow the Department to continue to collect revenue from Permittees in the form of fees covering the use of landing facilities for Non-Signatory passenger and cargo air carriers at LAfOntario International Airport. Since the Department of Airports is bound only by the City Debt Management Policies, the CAO File No. PAGE 0150-08251-0002 4

City Financial Policies are not applicable. Approval of the proposed request will have no impact upon the City General Fund.

TIME LIMIT FOR COUNCIL ACTION

Pursuant to Charter Section 606 "Process for Granting Franchises, Permits, Licenses and Entering Into Leases", unless the Council takes action disapproving a franchise, permit, license or lease that is longer than five years within 30 days after submission to Council, the franchise, permit, license or lease shall be deemed approved.

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