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Adopt a resolution authorizing application to the California Department of Transportation for a State Airport Loan in the amount of $453,000 to renovate aeronautical office building spaces at the Nut Tree Airport; and Delegate signing authority to the County Administrator to execute the application, agreement, loan modifications for project funding and any other necessary documents associated with the State Airport Loan
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Published Notice Required? Yes ____ No _X _
Public Hearing Required? Yes ____ No _X _
DEPARTMENTAL RECOMMENDATION:
The Department of General Services recommends that the Board of Supervisors:
1. Adopt a resolution authorizing application to the California Department of Transportation for a State Airport Loan in the amount of $453,000 to renovate aeronautical office building spaces at the Nut Tree Airport (Attachment A); and
2. Delegate signing authority to the County Administrator to execute the application, agreement, loan modifications for project funding and any other necessary documents associated with the State Airport.
SUMMARY:
On May 11, 2018 the Board approved actions for a state loan agreement for the T-Hangar Project, at that time, staff indicated that approvals necessary to advance the office remodel project would be presented to the Board at a later date. Therefore, the General Services Department is recommending the Board approve a resolution authorizing the application to the California Department of Transportation (Caltrans) for a State Airport Loan and authorize the County Administrator to execute the loan application and associated loan agreement to secure the Caltrans aeronautical office building space renovation project plan.
FINANCIAL IMPACT:
The aeronautical office building space renovation project (Office Renovation Project) is estimated to cost $982,786. Of the total Project cost, $453,000 would be funded by the Caltrans airport loan and $386,593 would be funded from the balance of the repurposed General Fund loan proceeds. The costs associated with preparing the agenda item are nominal and absorbed by the department’s FY2018/19 Adopted Budget. Attachment B provides a breakdown of project costs and funding sources.
DISCUSSION:
Design of the Nut Tree Airport Office Renovation Project was recently completed and construction of the Project is planned for Winter/Spring 2019. The Project includes renovation of 6,200 square feet of existing building space (4,400 square feet in the Airport Administration Office Building and 1,800 square feet in Hangar A office space) consisting of the remodel of public restrooms, lobbies and meeting spaces, installation/upgrades of mechanical equipment, heating and cooling control systems for multiple tenant spaces, reroofing of the Airport Administration Office Building, interior and exterior lighting upgrades to light-emitting diode (LED) fixtures, and other upgrades/improvements to non-code compliant office spaces. The Office Renovation Project will result in upgraded office spaces accommodating a substantial expansion by the Wings Flight School currently operating at the Airport. The County has received commitments and deposits on the expansion office space and all other office spaces on the Airport are at 100% occupancy. An aerial photograph depicting the Office Renovation Project area is included in Attachment C.
A portion of the Project will be funded by repurposed General Fund loan to the Airport. The Board repurposed the General Fund loan proceeds during the FY2017/18 and FY2018/19 budget processes to support the Airport’s economic development to fund office building remodels and new aircraft rental hangars. A portion of the Office Renovation Project would also be funded by a loan from Caltrans, through the Division of Aeronautics, Local Airport Loan Program.
Revenue generated by the T-Hangars and office remodels will fund repayments of the General Fund loan to the Airport and repayment of the Caltrans airport loan. Following the Project construction bid process, currently in progress, the office remodel project will be presented to the Board, to consider the award of a construction contract and will include construction cost, project financing and budget adjustment necessary to support the office remodel project.
The purpose of the recommended resolution is to authorize the County Administrator to execute the loan application and associated loan agreement with Caltrans.
ALTERNATIVES:
1. The Board could choose not to approve the resolution authorizing the Caltrans loan application and acceptance. This action is not recommended as completion of the office remodel during the 2018/2019 construction season, to allow expansion of the flight school is dependent on the timely filing, processing and acceptance of the Caltrans loan application and funding.
2. The Board could elect to not delegate signing authority to staff. This action is not recommended since delegated authority will enable efficient filing and management of the Caltrans loan application and funds
OTHER AGENCY INVOLVEMENT:
Coordination has occurred with Caltrans Aeronautical regarding the office remodel project. County Counsel reviewed the recommended resolution.
The Nut Tree Airport Advisory Committee reviewed the project during the Committee’s February and April 2018 meetings and recommended approval of the State Airport Loan application.
CAO RECOMMENDATION:
APPROVE DEPARTMENTAL RECOMMENDATION