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Home My WebLink About1/19/2000 - STAFF REPORTS (11) DATE: January 19, 2000 TO: City Council FROM: Assistant City Manager and Director of Aviation FEDERAL INSPECTION SERVICES (FIS)FACILITY-ASSET LEVERAGE RECOMMENDATION: It is recommended that City Council endorse the concept of an Asset Leverage of Airport Property to achieve development of a full FIS facility and approve a Resolution seeking congressional assistance for legislative changes to facilitate the FIS project. BACKGROUND: The final step needed forthe Airport to receive commercial flights from foreign comrties,other than Canada,is the development of FIS Facility. The minimum acceptable facility to the federal agencies is a 30,000 sq.ft. building which equates to an investment of some $6 million. This is the type of facility that cannot be financed with regular airport revenue bonds as the airline agreements do not allow for the use of airport revenues for this purpose. Last year,the idea of a TOT override was quietly circulated between Valley cities and little or no support was found. City and Airport staff have been examining other methods of achieving the FIS goal, thus the Asset Leverage. The Airport has property south of the existing Mid-Valley Parkway Airport Extension which could be leveraged in such a fashion to develop a much larger building than FIS requires and have the lease payments from the bigger building pay for the cost of the FIS facility. The potentials for leverage partners run the gamut from private developers to the federal government. Discussions have been held with several federal government agencies that have expressed interest in a Joint Agency Federal Office Building. The federal process for procuring office space for various agencies is handled through General Services Administration(GSA)process. They seek proposals when they have a need from interested lessors. For the Airport to fund a multi-agency facility through a Revenue Bond Issue, lease commitments must be in-hand. The existing federal process does not accommodate such a need. To accommodate the lease commitment need,it is suggested that the City approach the congressional delegation to try and secure federal legislation or a helpful interpretation of GSA rules. Suggested legislative language is as follows: "Federal agencies seeking office space may accept solicitations from local government entities or airports and sign letters of commitment to lease or leases if the local government entity or airport is developing amulti-agency federal office complex and will guarantee at or below market rates to the federal agencies." The Airport Commission,at its January 5,2000,meeting unanimously supported the Asset Leverage approach. A Resolution is attached for City Council consideration. ALLEN F. SMOOT,AA JERI Y. RIDDLE Assistant City Manager-Operations Director of Aviation APPROVED 4 City Manager �. ATTACH MATS: TS. 1. Resolution 2. Map 1 , I , --> ----------------------------------------------------------------------------- ----------------------- -r---- PALM SPRINGS INTERNATIONAL AIRPORT SMALL COMMUTER SMALL PARCEL AIRCRAFT FACILITY i 7 �! BRIDGE OVER Tc� AIRPORTAl ,, 1 y ..._.._....._.........._.._ .._.._.._.._ _.! ; ENTRANCE 9< ROAD ■ `,-'f f LARGE TRUCK DELIVERY ROUTE j FIS UPPER LEVEL !�OFFICEIINDUSTRIAL LOWER LEVEL t PROPOSED FEDERAL INSPECTION SERVICE FACILITIES �`°R LEVERAGED ASSET PROGRAM i RESOLUTION NO. 19728 OF THE CITY COUNCIL OF THE CITY OF PALM SPRINGS,CALIFORNIA,AUTHORIZING THE STAFF TO DEVELOP AN ASSET LEVERAGE PLAN FOR THE DEVELOPMENTOF AMULTI-AGENCY OFFICE COMPLEX TO FACILITATE THE ESTABLISHMENT OF A FEDERAL INSPECTION SERVICE (FIS) FACILITY AT THE PALM SPRINGS INTERNATIONAL AIRPORT AND TO SEEK CONGRESSIONAL ASSISTANCE TO SECURE NECESSARY FEDERAL LEGISLATION OR INTERPRETATION OF FEDERAL REGULATIONS. WHEREAS Palm Springs International Airport currently provides Customs Services via an assigned Customs Officer under the Federal User Fee Program; and WHEREAS these existing Customs Services cannot accommodate aircraft with larger than 19 passengers; and WHEREAS the Airport's Master Plan contemplates full FIS facilities on the Airport; and WHEREAS the City has determined that the most expeditious way to develop an FIS facility is to include it as part of a Multi-Agency Federal Building; and WHEREAS the General Service Administration(GSA)rules of procedure do not allow for Federal Agencies to commit to long-term leasing arrangements without a competitive solicitation process; and WHEREAS for the City to be able to sell revenue bonds based on lease revenues from the Multi-Agency Federal Building,the City must have commitments in-hand, NOW THEREFORE BE IT RESOLVED as follows: I. That the City Council of the City of Palm Springs hereby expresses its support for the Palm Springs International Airport's effort to develop Federal Inspection Services Facility as part of a larger Multi- Agency Federal Office Building. 2. That the City Council of the City of Palm Springs hereby seeks the assistance of the City's Congressional delegation to pursue changes to GSA regulations via legislative change or regulatory interpretations as follows: "Federal agencies seeking office space may accept solicitations from local government entities or airports and sign letters of commitment to lease or leases if the local government entity or airport is developing a multi-agency federal office complex and will guarantee at or below market rates to the federal agencies." ADOPTED this 14_day of .la n�_, 2000. AYES: Members Jones, Oden, Reller-Spurgin and Mayor Kleindienst NOES: None ABSENT: Member Hodges f� ATTEST: CITY OF PALM SPRINGS, CALIFORNIA By City Clerk City Manager REVIEWED & APPROVED AS TO FORMG� J� ��—� .