HomeMy WebLinkAboutIR 10349 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 10349
To the Mayor and Members of the City Council December 10, 2019
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*a SUBJECT: PROPOSED AMENDMENT TO AGREEMENT FOR THE
rrn MANAGEMENT, OPERATION AND MAINTENANCE OF
FORT WORTH ALLIANCE AIRPORT
The purpose of this Informal Report is to provide the City Council information on a proposed amendment
to the contract for the management, operation and maintenance of the Fort Worth Alliance Airport with
Alliance Air Management Ltd. (AllianceAir)
On December 15, 1993, the City and Alliance Air Services, Inc. entered into City Secretary Contract
("CSC") No. 20060, an agreement for the management, operation and maintenance of Fort Worth Alliance
Airport, which was subsequently amended five times for various reasons, including the transfer of the
contract to Alliance Air Management Ltd. The current contract ends on December 31, 2023 with an
opportunity to extend for one ten-year term to December 31, 2033.
AllianceAir would like to move forward with the exercising the current 10-year extension as well as amend
the current contract to provide for the ability to extend the contract to 2053, contingent on a major
investment by AllianceAir. The request is based on the need to have the ability to finance a planned
significant investment to develop a state-of-the-art Fixed Base Operations (FBO) facility and other
improvements in existing facilities on the airport. The extension to 2053 would be automatically reduced
to the original 2033 date, with optional extensions, if the development with a minimum investment of$30
million is not completed by December 31, 2028. If the FBO is not completed as outlined, the additional
extensions would be at the City's option.
Additionally, AllianceAir is proposing to change the current operating airport revenue split with the City.
Under the current contract, the City retains 25% of airport revenue while AllianceAir receives 75%. The
proposed change reduces the AllianceAir portion to 65% of revenues and increases the City portion 35%.
10% of the city's revenue will be segregated for capital projects at the airport as approved by the city in an
annual capital plan. Changes to the revenue share begin on January 1, 2020 if the amendment is approved.
Based on the proposed changes as outlined above. Staff will be placing an item on the agenda for City
Council action on December 171h to authorize the City Manager to execute an amended agreement for the
management, operation and maintenance of Fort Worth Alliance Airport.
If you have any questions or concerns related to this proposed amendment, please contact Jay Chapa,
Assistant City Manager at 817-392-5804.
David Cooke
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS