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Home My WebLink AboutPresentation - Agenda Item 2C - Brown Act Public Hearing 2022-01-27Palm Springs International Airport 1 Brown Act Public Hearing -January 27, 2022 Per Transaction Date CFC Implementation •CFC Overview •PSP CONRAC Overview •Brown Act Public Hearing Requirements •Brown Act Public Hearing Recommended Findings •Recommended City Council Action •Discussion 2 AGENDA Customer Facility Charge (“CFC”) Overview California CFC Statute and Peer Airport Rates 3 CFC Eligible Costs –California Government Code, Article 6, Section 50474 •Planning, Design & Construction of CONRAC facilities •Debt Service •Renewal & Replacement Fund •Common Busing Fleet Acquisition •Common Busing Operation and Maintenance •Related Infrastructure (Allocation of Enabling Project Costs) 4 CFC Rates at Other California Airports - Airport Abbreviations •BFL -Meadows Field Airport •BUR -Hollywood Burbank Airport •FAT -Fresno Yosemite International Airport •LAX -Los Angeles International Airport •LGB -Long Beach Airport •MRY -Monterey Regional Airport •OAK -Oakland International Airport •ONT -Ontario International Airport 5 •PSP -Palm Springs International Airport •SBP -San Luis Obispo County Regional Airport •SMF -Sacramento International Airport •STS -Charles M. Schulz Sonoma County Airport •SJC -Norman Y. Mineta San Jose International Airport •SAN -San Diego International Airport •SFO -San Francisco International Airport CFC Rates Other Airports 6NOTE:5-day maximum per California State CFC Statute. $- $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00 $16.00 $18.00 SFO LGB MRY OAK ONT PSP SBP SMF STS SJC SAN LAX BUR BFL FATCFC Per Day/TransactionPER TRANSACTION PER TRANSACTION DAY SOURCE:Rental car websites (Enterprise Holdings,Hertz Global Holding,and Avis Budget Group),August 11,2021. California Government Code, Article 6, Section 50474 Requirements to Consider a Per-Day CFC •Conduct rental car industry informational meeting •Review / accept Independent Auditor’s Report Findings •Conduct a Brown Act Public Hearing •File Compliance Report with the State of California •Advise rental car companies of Effective Date 7 PSP CONRAC Overview 8 PSP CONRAC Program Overview •Three Consolidated Rental Car (CONRAC) Facility Options North Site South Site (provides common use transportation between the CONRAC facility and the passenger terminal) Split Site •Funded through Customer Facility Charge (CFC) revenues and rental car industry payments (i.e., facility O&M and ground rent) 9 PSP CONRAC Facility Concepts 10SOURCE:Gensler,Palm Springs International Airport |CONRAC,Rental Car Stakeholder Update,February 20,2020. Brown Act Public Hearing Requirements 11 Independent Review •California Government Code, Article 6, Section 50474 requires an independent audit review of projected CFC revenues and related costs to ensure they are reasonable PUN Group, LLP provided an attestation dated November 29, 2021 •PUN Group, LLP attestation submitted to the State of California on January 10, 2022 12 Brown Act Public Hearing Requirements •Provide a detailed description of established reasonable Project Costs •Offer a determination the current $10.00 per transaction fee will not generate sufficient revenue •Provide an indication that a CONRAC project requires the additional amount of revenue to be provided by a per day CFC •Describe steps taken to limit Project Costs •Describe other funding alternatives explored for meeting Project costs other than CFC •Provide requirements for rental car companies and other facility users to pay for use other than CFC 13 Brown Act Public Hearing Recommended Findings 14 PSP CONRAC Rough Order of Magnitude Cost Estimates 15 16 CFC Capacity Analysis SOURCE:Palm Springs International Airport,Customer Facility Charge and Common Transportation Analysis,January 2021 CFC Gap Analysis 17SOURCE:Palm Springs International Airport,Customer Facility Charge and Common Transportation Analysis,January 2021 CFC Capacity Analysis Recommended CFC Rate •$9.00 / transaction day 1 •Closes the funding gap in covering eligible project costs, provided the Council authorizes the CFC rate at the maximum rates $9.00 per transaction day rate currently permitted under the California Government Code Article 6 Section 50474. 1 Applies to maximum of 5 days per transaction, pursuant to California Government Code Article 6 Section 50474.21 18 Steps Taken to Limit PSP CONRAC Costs 19 •Evaluate phasing methods for project delivery •Defer / delay construction to build additional CFC Pay-Go capacity •Evaluation of multiple facility concepts Other Potential Alternatives to Meet Revenue Needs •FAA Airport Improvement Program Grants •Passenger Facility Charge (PFC) Revenue •General Airport Operating Revenues 20 User Charges and Fees 21 •Tenant Upfits for Exclusive Use Areas •Annual CONRAC operating and maintenance expenses •Fair market value land rent •A portion or all the common use transportation system annual operating and maintenance expenses; if applicable. Recommended City Council Action 22 Recommended City Council Action •Conduct Brown Act Public Hearing / Receive Public Comment •Consider adopting this Resolution authorizing $9.00 per transaction day CFC rate (5-day maximum period) •Prepare draft “compliance” report to support implementation of alternate CFC, including Brown Act public hearing “findings” required under Section 50474 –submit to State •Notify Rental Car Concessionaires of CFC rate change and effective date 23 DISCUSSION 24 Relevant Council Actions To Date May 2007 Approve Municipal Code related to the establishment of a CFC (16.39) October 2015 Approved PSP Master Plan September 2019 Notice To Proceed for CONRAC Planning and Design Effort January 2020 Council briefed regarding CONRAC Planning and Design Effort work to-date 25 CFC Statute -California Government Code Article 6 Section 50474.3 Provisions Applicable to Implementation of Per-Transaction Day CFC at PSP •The implementation of a CFC at California airports is governed by state statute (Government Code Article 6 Section 50474). The provisions of Section 50474 govern the criteria for implementation of a CFC, CFC-eligible costs, and post implementation-auditing requirements. It authorizes airports to impose a CFC for development of consolidated rental car facilities and common use transportation systems serving those facilities. •The CFC statute sets out the process that must be followed by an airport sponsor intending to implement the CFC. •Airport authorized to implement a CFC to “finance, design and construct consolidated airport car rental facilities,” and “to finance design and construct and operate common-use transportation systems that move passengers between airport terminals and those consolidated car rental facilities, and acquire vehicles for use in that system”. (Section 50474.21) 26 CFC Statute -California Government Code Article 6 Section 50474.3 (cont.) •Under certain circumstances, airport can implement an alternative CFC of up to $9.00 per transaction day commencing (5-day maximum) for the eligible uses. (Section 50474.21) •Revenues collected do not exceed the reasonable costs of financing, designing, constructing, and operating any common-use transportation system, or acquiring vehicles for use in that system and shall not be used for any other purpose. (Subsection (a)(6)) •Airport obtains independent audit that determines that the aggregate amount to be collected will not exceed the reasonable CFC-eligible costs of the project. (Subsection(b)(4)(B)(i)) 27