Baker Municipal Airport Commission Minutes April 12th 2023
Convene: Called to order at 12:08 by Chairman Dennis Twedt
John Tronstead – Member
Dennis Twedt – Chairman
Roger Meggers – Airport Manager
Darin Meggers – Asst. Manager
Sheila Ware – Acting Board Secretary
Rod Johnson – Member
Mark Jacobsen – Member
Dale Hinton – Member
Craig Canfield, KLJ
Steve Zachman – Baker Montana Mayor
Steve Baldwin – Fallon County Commissioner
Kevin Braun – Fallon County Commissioner
Minutes/Financials Review & Approval:
Minutes of the last meeting on February 8, 2023 and financial reports for March 2023 were reviewed and Roger confirmed the accuracy of the financials. John Tronstad motioned to approve as written, seconded by Dennis Twedt.
Roger advised the Board that there was not a quorum present, but that Rod Johnson was available to second any motion or aid in a vote.
Roger informed the members of a meeting next Wednesday with the County Commissioners to discuss Hangar Rental and Lease Agreements at the Commissioner’s Office. All Board members are invited to attend.
Craig Canfield proceeded with the fuel system status report. He spoke with Young Gun Construction, which will resume work on 4/24/23. It is expected to take 2 weeks to finish the concrete, fencing and sidewalks. Once concrete is set, the fuel tanks can be moved to their final position. Fuel tank repositioning must be coordinated with Mascot, but no date has been set.
Craig explained the problem with replacing the 100LL and Jet fuel systems. It required 3 separate bids. The original contract was with the lowest bidder, but they were found incompetent and the bidding process was started again.
In addition, he explained to the members the order of operations:
1st Change Order – Install 3 phase power. Craig stated that the Jet fuel system operates better with 3 phase power.
2nd Change Order – Site revisions: Repave parking lot to drain water away from fuel system. This consisted of raising the footings and removing the old tanks prior to repavement.
Craig stated that new fuel system installation is still on budget. $1,000,000 was allocated to complete the new fuel system and all the various components. Craig informed the board that the FAA has granted $660,000 so far. He stated that there is $320,000 of unfunded eligible work and that he has applied for a second grant, which should fulfill 90% of the remaining eligible work. He further stated how the use of BIL infrastructure funds should cover the remainder. Craig indicated that more than 90% will be paid for by the FAA. $82,000 of the fuel system replacement expenses are ineligible parts. Specifically, the old tank removal. Craig notified the board that he had applied for a grant from Montana Aeronautics, but was declined. No grants were given for the removal of fuel tanks. Craig indicated that the new system should be completed by the end of May.
Craig updated the board in reference to contract times on the fuel system. The original contract was 30 days. We are well beyond that due to changes to the site grading that was implemented, thus requiring multiple concrete pours. The time needed for completion was grossly underestimated. Craig will address this with the contractors.
Roger inquired about the additional contract times due to delays and travel. He wanted to know if there was a way to assess for damages. He stated that the fuel system is operational but inconvenient in its current state of incompletion. He inquired as to the possibility to seek reimbursement for damages due to going over the contracted time for completion, and the possibility to recoup this from Young Gun Construction.
Kevin Braun queried as to how much could be expected to recoup? Craig responded that $6,500 in engineering fees, plus additional costs incurred due to the need to rebid the job 3 times. Craig thought all engineering fees and fuel system would be eligible for reimbursement from FAA except the tank removal.
Craig informed the County Commissioners and Board that the 2nd Grant should be received by Oct 1. He assured the County that they should not have to carry the ineligible expenses not covered by the first grant for much longer.
Roger asked if this would work for the county financially?
Kevin Braun responded that the grant will be accounted for in the upcoming budget meeting.
Craig announced that Baker was awarded a $16,000 grant from Montana Aeronautics for the replacement of the existing airport beacon. The estimated expenditure for the beacon is $10,000 with an installation expense of $2,500. The result will be a new beacon light with installation at no cost to the county. KLJ is working with the Airport on the specifications, will order the beacon and contract with a local electrician for beacon installation.
Roger stated the benefits of the new refined beacon light. There will be minimal invasive flash to disturb homes located in the vicinity of the beacon.
Craig informed the Board that Young Gun Construction will cover the repairs on the recently damaged loader. A check will be sent shortly for those repairs.
Roger asked Kevin Braun and Steve Baldwin to expound on the yearly and nightly Hangar Rental rates. He stated that many airports in Montana do not charge for hangar ground lease in order to promote aviation.
Craig mentioned that hangar rates are all over the board and it depends on the airport. Kevin asked Craig if those hangars are county owned? Craig replied that it depended on whether the hangar was county owned or privately owned. He mentioned that his last hangar rental was an FBO (Fixed base Operator) and it was a very competitive price. Kevin stated that the rates charged in Baker are relatively cheap and postulated about raising the rates to be more in line with the rest of the country. Kevin questioned why hangar rent in Baker is so low compared to what the county is required to pay for insurance coverage. Steve Baldwin stated that due to the high insurance rates, the rates should increase.
Roger queried if it was for all leases or just the county? Steve Baldwin replied that the increase applied to strictly county rates. Roger inquired about the individual leases rates for buildings on County property. Kevin stated that individual hangar lease is insignificant because the building owners pay tax on the building. The county receives the revenue for the building tax.
Roger informed the board that the current monthly hangar rate is $125/month for a single engine aircraft. Hangar rates are variable according to aircraft size. The heated hangar rentals have been quite slow. In addition, he informed the county that Nebraska charges $40/night and the potential to possibly raise rates to $50/night.
Roger addressed to both Kevin and Steve that the typical flow fees paid to a county are 5 cents/gal of fuel sold. He informed them that Baker Air Service pays to the County 10 cents/gallon of fuel sold. Kevin replied that the extra cost per gallon was to cover the cost of insurance in case there was an unforeseen accident to either an aircraft fueling accident or hangar accident with damage to an aircraft. He postulated about as to the possibility of the taxpayers to pay for hangar insurance. He stated that the county does not want to make money, just cover insurance liability.
Darin asked what is the coverage? Kevin replied that it is $1,000,000/building but does not cover aircraft replacement. Kevin inquired if individual aircraft owners have replacement coverage? Roger confirmed this as accurate. Kevin stated that he would review all liability paperwork and forward to Roger. Steve Baldwin asserted that when rates increase, there will be a need to review at that time. Roger affirmed that the cost of insurance across the board is out of control. Kevin mentioned that Most insurance companies discourage the use of their services. Craig informed them group that aviation is only 1-2% of the market, so underwriters charge whatever they want.
Kevin speculated if there was a fuel spill, who would be liable? Baker Air Service owns the fuel. The county owns the tanks and equipment. Steve Baldwin stated that the policy will need to be reviewed in order to answer that type of question. Steve also presented the question as to who is responsible to fix any type of fuel spill or potential fire. Roger explained that Jet A pumps have a Deadman Control, and the pump would automatically shut off so there is no possibility of a spill due to operator error when fueling. Kevin suggested a sit down with Jade to get a better understanding of the what if scenario. Roger agreed to the necessity for clarification.
Roger asked the Commissioners to review how much revenue is generated yearly from hangar rentals. Kevin inquired how many full-time planes does KBHK hangar/year? Roger informed him that there are 3 full-time planes at present in the cold storage hanger. Roger informed the group that there is competition from Beach, ND, Bowman, ND and Ekalaka, MT. Darin added that hangar use increases during certain times, Hunting season is one such occurrence.
Dennis asked if there was anything else to discuss? Steve Zachman informed the members that the property west of Mangold field will be utilized as a community garden. He inquired if there were height restrictions due to its close proximity to the airport. Roger informed him that yes, there are height restriction for that location and the importance of having the garden area fenced to prevent attracting wildlife to the area and possibly wandering onto the runway.
Steve Zachman indicated that the garden is within 35,000 ft of the airport and is considered within the affected area. Roger reminded Steve that there is a 35 ft maximum height restriction within the affected area. Steve Baldwin inquired if there is possibly an alternative location to place the community garden? Steve Zachman informed him that next to the old feed plant was another possible location.
Steve Baldwin expressed the need for an updated Access Agreement. Roger replied that the agreement is a 5-year lease and has been renewed 3 times over 20 years. The fee assessed for access is the same as the annual hangar leases. Kevin informed the group that this would be discussed in the upcoming budget meeting in July.
At 1:11 p.m., John motioned to adjourn the meeting, Dennis seconded the motion. Motion carried.
The next meeting is set for May 10, 2023, at 12:00 p.m.
s/Chairman Dennis Twedt s/ Act. Secy. Sheila Ware