COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Department of Public Works

DATE:

May 14, 2008

BOARD MEETING DATE:

June 3, 2008

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

James C. Porter, Director of Public Works

SUBJECT:

Fee Schedules for San Carlos and Half Moon Bay Airports

RECOMMENDATION:

Adopt a resolution:

1.

Adopting the proposed schedule of fees for the use of facilities at the San Carlos and Half Moon Bay Airports effective July 1, 2008;

2.

Adjusting the hangar, T-shade, tiedown, transient, storage and right-of-entry fees each succeeding July 1, through June 30, 2011, to reflect the increase or decrease in the Bay Area Consumer Price Index using 1988 as the base year, with said changes rounded to the nearest dollar;

3.

Increasing the square footage rate for the “C” through “G” and “T” hangars at the San Carlos Airport an additional 3% each succeeding July 1, beginning July 1, 2009, through June 30, 2011;

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:

1.

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, storage and right-of entry fees based on the change in the Bay Area Consumer Price Index (CPI) effective each July 1^st of 2005, 2006 and 2007.

2.

Adopted Resolution No. 68089 on June 20, 2006, adjusting the schedule of fees for use of facilities at the San Carlos and Half Moon Bay Airports.

3.

Adopted Resolution No. 69263 on February 12, 2008, establishing the monthly rental fees for the new aircraft hangars at the San Carlos Airport at 120% of the existing square footage hangar rate and the monthly rental fees for the new T-shade spaces at $250 per month.

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 on July 1, 2004, which included an automatic rate adjustment on July 1^st of each of the three successive years based on the change in the Bay Area CPI. The three-year period of automatic fee adjustments has expired.

DISCUSSION:

We are recommending that your Board adopt the proposed schedule of fees to be effective July 1, 2008, which include:

Ø

Monthly rental fees for San Carlos Airport’s new aircraft hangars at 120% of the existing square footage rate for metal hangar buildings; and $250 per month for the new T-shade spaces as established by your Board on February 12, 2008;

Ø

An increase in the monthly outside tiedown fees at Half Moon Bay Airport from $40 to $60; and the overnight transient fees from $5 per night for small aircraft and $10 per night for large aircraft to $8 and $15 respectively to more accurately reflect regional fair market value for these services;

Ø

No increase in the $.10 per gallon fuel flowage fees paid by fuel vendors for the right to sell at County Airports which are then passed on to purchasers;

Ø

A general increase of 2.8% for other hangar, tiedown, transient, storage and right-of-entry fees based on the increase in the Bay Area CPI over the previous year, with several small adjustments to standardize hangar square footage rates among like-hangars.

Additionally, we are proposing that your Board increase the square footage rate for the “C”, “D”, “E”, “F”, “G” and “T” hangars at the San Carlos Airport an additional 3% each succeeding July 1, beginning July 1, 2009, through June 30, 2011, to more accurately reflect fair market value for these facilities and to help fund the future replacement of these older hangars.

The proposed Airport Fee Schedule, effective July 1, 2008, reflects the foregoing and is attached to the Resolution. We have notified the airport tenants and pilots associations of the proposed fee increases and the date when your Board will be considering our recommendation.

The resolution has been approved as to form by County Counsel.

FISCAL IMPACT:

The increase in revenue to the Airport Fund from the rate adjustments recommended for July 1, 2008, is estimated at an additional $31,000 for the first year. Additional revenue from the 3% adjustment for the “C” through “G” and “T” hangars is estimated at $11,000 for each of the succeeding three years. Increases or decreases from the three-year annual automatic CPI adjustments for hangar, T-shade, tiedown, right-of-entry and transient fees would depend on the change in the Bay Area CPI during those subsequent years.

There is no impact to the General Fund.