COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

June 2, 2006

BOARD MEETING DATE:

June 20, 2006

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Neil R. Cullen, Director of Public Works

SUBJECT:

Fees Charged at Half Moon Bay and San Carlos Airports

Recommendation

Adopt a resolution:

a)

establishing a fee for using a credit card to pay monthly rental and lease fees;

b)

increasing overnight transient fees at San Carlos Airport;

c)

reducing fees for tiedowns at Half Moon Bay Airport; and

d)

eliminating the automatic adjustment for monthly tiedown fees scheduled for July 1, 2006, and July 1, 2007.

Vision Alignment

Commitment: Responsive, effective and collaborative government.

Goal 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

Appropriate fee schedules allow the County Airports to continue to be economically self-sufficient.

Background

Previous Board Action

Adopted Resolution No. 66708 establishing a schedule of fees for the use of facilities at San Carlos and Half Moon Bay Airports effective July 1, 2004, through June 30, 2008, including automatic rate adjustments for hangar, tiedown, transient and right-of entry fees based on the change in the Consumer Price Index (CPI) effective each July 1^st of 2005, 2006 and 2007.

History

The Airport Division operating revenue is financed primarily with various fees for the use of Airport facilities. Your Board approved the current fee structure in 2004, and it includes an automatic adjustment each year based on the change in the Consumer Price Index. However, we believe that some of the rates need to be modified to reflect the level of activity which has changed at the Airports.

Discussion

We are recommending that your Board adjust the schedule of fees to be effective July 1, 2006, as follows:

Establish a three percent charge (3%) for the use of credit cards in paying monthly fees

Tenants may pay their monthly fees by cash, check, credit card or electronic transfer of funds. The use of a credit card is the most time consuming for staff to process and the Airport is billed by the credit card company for these transactions. The proposed fee will offset some of the costs that the Airport is incurring by allowing this method of payment. Credit card payments for overnight transient parking or one-time fees would not be subject to the 3% fee.

Increase the overnight transient parking fees at San Carlos Airport from $8 per night for small aircraft and $15 per night for large aircraft to $10 and $20 respectively

There has been an increase in the demand for overnight transient aircraft parking space at San Carlos Airport and we believe increasing the fees will more accurately reflect the current market value of this service.

Reduce the monthly tiedown fee at Half Moon Bay Airport from $59 to $40

There are currently no aircraft owners opting to park their aircraft on the monthly tiedowns at Half Moon Bay Airport due to the effects of the coastal climate on aircraft surfaces. We believe reducing the monthly tiedown rate from $59 to $40 may increase the potential use of these tiedowns.

Eliminate the automatic CPI adjustments on tiedown fees scheduled for July 1, 2006, and July 1, 2007.

Monthly tiedown fees at San Carlos Airport are the highest of all Bay Area general aviation airports. The number of aircraft tiedown accounts has declined slightly over the past several years due to effects of the poor economy, and as aircraft owners have moved out of the area or relocated their aircraft to airports with less expensive fees. We believe that foregoing the remaining automatic CPI rate adjustments on tiedown fees scheduled for July 1, 2006, and July 1, 2007, will help avoid a further decline in tiedown accounts.

Adjustment of All Other Fees

We are not recommending any other changes in the fees as established by your Board on June 8, 2004. The other fees will increase based on the change in the CPI which as been calculated at 2.9%.

A summary of all fees reflecting the recommended changes is attached; and a form of resolution has been approved by County Counsel.

Fiscal Impact

It is estimated that the proposed adjustments to the schedule of fees will result in an overall net increase of $6,000 to $7,000 in revenue to the Airport Fund during the next fiscal year. The net increase in fiscal year 2006-07 will depend on the Bay Area CPI increase during that year.

There is no impact to the General Fund.