Greater Orlando Aviation Authority Board Meeting

Wednesday, March 18th, 2020

Impact of Coronavirus

ANALYSIS OF WAGE IMPACT

BACKGROUND

Analysis requested by the Board January 2020

Three Year Model • Year 1 - $13.00 Minimum • Year 2 - $14.00 Minimum • Year 3 - $15.00 Minimum

Scope – GOAA Staff and Contractors

CONSIDERATIONS/GOAA EMPLOYEES

836 GOAA employees • 80 employees @ < $15.00 • 6 employees @ < $13.00 • Salary Structure Update Each Year to Establish New Minimum

*Includes 126 bargaining unit employees

CONSIDERATIONS/GOAA EMPLOYEES

Annual Cost

Year 1 = $3,029,299.84 Year 2 = $3,979,740.54 Year 3 = $4,408,354.72

*Total 3 Years =$11,417,395.10 *Assumes no change in employment levels

CONSIDERATIONS/CONTRACTORS Four GOAA departments handle the majority of our large service contracts

Nine different services offered by 17 different companies

Total of 1,452 employees

2019 - current total annual salary - $36,839,359

2020 - $13 total annual salary - $40,639,448

2021 - $14 total annual salary - $43,094,018

2022 - $15 total annual salary - $45,646,797

ANALYSIS Living Wage Impact Analysis (As of January 2020)

$13 $14 $15

Department Service Description 2019

Annual Salary 2020

Annual Salary 2021

Annual Salary 2022

Annual Salary

Customer Experience Customer Service Ambassador $2,655,390.40 $2,735,052.11 $2,817,103.68 $2,961,045.55 Maintenance Janitorial $5,659,076.80 $6,845,601.78 $7,341,225.95 $7,842,850.75 Maintenance Janitorial $1,413,422.40 $1,758,151.20 $1,892,800.00 $2,028,000.00 Maintenance Janitorial $423,384.00 $541,289.84 $582,400.00 $624,000.00 Maintenance Janitorial $2,424,656.00 $2,835,933.98 $3,040,298.05 $3,248,527.80 Maintenance Electrical $24,960.00 $27,040.00 $29,120.00 $31,200.00 Maintenance Landscaping $840,320.00 $871,769.60 $931,840.00 $998,400.00 Maintenance Landscaping $786,240.00 $892,320.00 $960,960.00 $1,029,600.00 Maintenance Landscaping $445,328.00 $458,962.40 $480,344.07 $508,499.46 Maintenance Interior $29,120.00 $29,993.60 $30,893.41 $31,820.21 Maintenance Interior $183,040.00 $216,320.00 $232,960.00 $249,600.00 Operations Parking Facilities O&M $3,418,563.20 $4,089,844.10 $4,400,321.82 $4,710,878.67 Operations Shuttle Bus Management $1,321,840.00 $1,361,495.20 $1,402,340.06 $1,444,410.26 Operations FIS Customer Service & Support Staff (BAGS) $3,450,241.60 $3,733,464.18 $3,962,197.70 $4,192,052.43 Operations BHS/PBB/GSE Maintenance $3,134,976.00 $3,229,025.28 $3,325,896.04 $3,428,682.48

Security Personnel Screening(HSS) $6,552,000.00 $6,814,080.00 $7,338,240.00 $7,862,400.00 Security Personnel Screening $4,076,800.00 $4,199,104.00 $4,325,077.12 $4,454,829.43

TOTAL $36,839,358.40 $40,639,447.26 $43,094,017.89 $45,646,797.04 INCREASE ($) $3,800,088.86 $2,454,570.63 $2,552,779.15 w/o Burden

w/o Burden INCREASE (%) 10.32% 6.04% 5.92%

TOTAL $36,839,358.40 $40,639,447.26 $43,094,017.89 $45,646,797.04 Burden Rate $6,447,509.32 $6,866,652.79 $7,262,601.17 $7,667,613.86

TOTAL + Burden Rate $43,286,867.72 $47,506,100.05 $50,356,619.06 $53,314,410.90

INCREASE ($) $4,219,232.33 $2,850,519.01 $2,957,791.84 w/ Burden w/ Burden INCREASE (%) 9.75% 6.00% 5.87%

6.2% Social Security/1.45% Medicare 37.5% Loaded Factor Markup (BAGS Only) 48.7% Loaded Factor Markup (HSS Only)

CONSIDERATIONS/HOTEL MANAGEMENT

Reach $15 rate by 2022

Tipped associates are not included but their benefit rate will meet those amounts

CY 2021 is $650,000

CY 2022 is $225,000

The State of Customer Experience

Award Purchasing Contract 19-20, Customer Service Ambassadors at Orlando

International Airport, to Real Time Services dba Top Talent Staffing

BACKGROUND • Purchasing Contract No. 19-20 provides all labor, supervision, management,

administrative oversight, supplies, and all other items necessary for Customer Service Ambassador Services at the Orlando International Airport

• Goal of all Ambassadors: uphold the core tenets of ‘Safety, Comfort, Ease, & Speed – providing exceptional customer service wherever assigned

• Provides accurate information and assistance to passengers, visitors, employees,

• Interface with all aspects of the Airport and Customers

• Uniformed group immediately recognizable as a resource for information and guidance

ISSUES • The term is for 36 months to commence on or about April 1, 2020

• The Aviation Authority will have options to renew the Contract for two additional periods of one year each

• Pricing is based on a Management Fee and a Reimbursable Payroll and Operating Expense (not-to-exceed amount approved by the Aviation Authority)

• The amount paid to the Contractor is based on actual work requested, performed, and approved by the Aviation Authority

SMALL BUSINESS PARTICIPATION

• A Minority & Women Business Enterprise (MWBE) participation goal of 20% was established

• The Small Business Development Department reviewed the bids for this contract

• Acara Solutions, Inc. and Recruiting in Motion did not satisfy the MWBE goal and were deemed non-responsive

FISCAL IMPACT

• The three-year bid price is a not-to-exceed amount of $14,996,768

• The new contract includes a pay rate increase for ambassadors

• This new pay rate increase will assist in hiring and retaining ambassador staff

RECOMMENDED ACTION Accept the recommendation of the Concessions/Procurement Committee to:

• Deem the bids from Real Time Services dba Top Talent Staffing, Baggage Airline Guest Services, Inc., and Prospect of Orlando, LTD, Co. as responsive and responsible

• Deem the bids from Acara Solutions Inc. and Recruiting in Motion as non-responsive

• Award Purchasing Contract 19-20, Customer Service Ambassadors, at Orlando International Airport, to Real Time Services dba Top Talent Staffing as the lowest responsive and responsible bid, for an initial three-year term with two one-year renewal terms

• Authorize funding from the Operations and Maintenance Fund in the amount not-to-exceed $14,996,768

• Authorize an Aviation Authority Officer or the Chief Executive Officer to execute the appropriate agreement following satisfactory review by legal counsel.

QUESTIONS?

Award the Purchase of Four Passenger Boarding Bridges to John Bean

Technologies Corporation dba JBT AeroTech Jetway Systems

BACKGROUND

• The Aviation Authority currently owns and maintains 95 airline Passenger Boarding Bridges (PBBs) at the Orlando International Airport.

• The proposed purchase is for four new PBBs, including removal of the existing PBBs, freight, installation, training and commissioning.

ISSUES

• The new PBBs will replace existing PBBs which are nearing the end of their useful life.

• Per our Non-Competitive Procurements Policy, staff requested and received a quotation under the Denver International Airport Master Purchase Order with JBT AeroTech Jetway Systems for the purchase of four PBBs in the amount of $2,403,544.

• On February 24, 2020, the Concessions/Procurement Committee approved Staff’s recommendation to award the purchase.

SMALL BUSINESS PARTICIPATION

• Due to limited and specialized scope of the required services, and/or lack of ready, willing and able certified small businesses, this procurement does not lend itself to MWBE/LDB/VBE participation.

FISCAL IMPACT

• Proposed purchase is $2,403,544

• Funding is available from previously-approved Capital Expenditure Fund

RECOMMENDED ACTION

Accept the Concessions/Procurement Committee’s recommendation to:

• Award the purchase of four new Passenger Boarding Bridges, pursuant to Denver International Airport Master Purchase Order to JBT AeroTech Jetway Systems in the amount of $2,403,544

• Authorize funding from previously-approved Capital Expenditure Fund in the amount of $2,403,544

• Authorize the Purchasing Office to issue the appropriate purchase agreement following satisfactory review by legal counsel

QUESTIONS?

Approve Single Source Procurement of Original Equipment Manufacturer Parts for

Maintenance and Repair of the Baggage Handling Systems and Passenger Boarding

Bridges at Orlando International Airport

BACKGROUND

• The Aviation Authority’s contract for Ground Support Equipment Maintenance and Repair Services requires us to provide Original Equipment Manufacturer (OEM) parts for the maintenance and repair of the Baggage Handling System and the Passenger Boarding Bridges

ISSUES • We provide the OEM parts to ensure these parts are available when

needed.

• The list of parts and quantities required were determined based on manufacturer’s recommendation, actual usage, maintenance schedules, estimated delivery times, and anticipated required repairs.

• The use of a Single Source Procurement is allowed per GOAA policy 450.03 and is the most advantageous in this situation.

• On February 24, 2020 the Concessions Procurement Committee approved Staff’s recommendation to approve the Single Source Procurements.

SMALL BUSINESS PARTICIPATION

• Due to the limited and specialized scope of the required services, and/or lack of ready, willing and able certified small businesses, this procurement does not lend itself to MWBE/LDB/VBE participation.

FISCAL IMPACT

• The proposed purchase is $1,435,000

• Funding is from the Operations and Maintenance Fund

RECOMMENDED ACTION Accept the Concessions/Procurement Committee’s recommendation to:

• Authorize the purchase of the OEM parts required for the Baggage Handling System and Passenger Boarding Bridges as a Single Source Procurement

• Award the Single Source Procurements from the list of OEM providers (copy on file) through February 28, 2021, in the not-to-exceed amount of $1,435,000

• Authorize the Purchasing Office to issue the appropriate purchase orders.

• Authorize staff to allocate the funding per OEM as needed.

QUESTIONS?

Approve the Purchase of Computer Hardware and Software Maintenance

Support, License Renewals and Technology-Related Subscriptions

BACKGROUND Aviation Authority computer hardware and software applications require technical maintenance and support for their continuous efficient and effective operation

• Maintenance and support are provided through the purchase of annual service contracts, license renewals and technology related subscriptions

• The IT and Purchasing Departments collaborate to continuallyreview and update the Aviation Authority’s Master List of hardware and software applications that require ongoing technical maintenance and support

ISSUES On March 20, 2019, the Board authorized the purchase of various annual service agreements for April 1, 2019 through March 31, 2020

• The amount of computer hardware and software applications requiring technical maintenance and support has increased because of the airport expansion and expiring warranties

• On February 24, 2020, the Concessions/Procurement Committee approved staff’s recommendation to purchase new annual service agreements based on its updated list for April 1, 2020 through March 31, 2021 for a not-to-exceed amount of $7,570,243.24 which includes a 20% contingency for potential price increases

SMALL BUSINESS PARTICIPATION

• Due to the limited and specialized scope of services required, a Minority and Women Business Enterprise, Local Developing Business or Veteran Business Enterprise participation goal has not been established for these service agreements.

FISCAL IMPACT

• One year fiscal impact is not-to-exceed $7,570,243.24

• Period is April 1, 2020 through March 21, 2021

• Funding is from previously-approved Operations and Maintenance Fund

RECOMMENDED ACTION Accept the following recommendations of the Concessions/Procurement Committee to:

• Approve the purchase of computer hardware and software maintenance support annual service agreements from the updated list of required service agreements for April 1, 2020 through March 31, 2021, in the amount not-to-exceed $7,570,243.24

• Authorize funding from previously-approved Operations and Maintenance Fund in the amount not-to-exceed $7,570,243.24

• Authorize the Purchasing Office to issue the appropriate purchase orders following satisfactory review by legal council

QUESTIONS?

Award the North Terminal Complex Automated Retail Concession at Orlando

International Airport to Prepango, LLC

BACKGROUND

• Current agreement expires on March 31, 2020

• Incumbent is New Zoom, LLC, dba Zoom Systems

• Operates 8 locations on Airsides 1, 2, 3, and 4

• 256 square feet of floor space

• Concession Fee to the Aviation Authority is 10% of GrossReceipts

BACKGROUND

• Staff Issued a Request for Bid on November 25, 2019

• 3-year non-exclusive right for 8 units at existing locations

• No MAG with a Concession Fee of not less than 10% of Gross Receipts

• Bid awarded to the highest responsive and responsible bidder

• Due to the limited scope, no ACDBE goals were established

ISSUES Bids Received

New Zoom, LLC dba Zoom Systems • Submitted a bid of 13% of gross receipts • Estimated sales for the 3-Year term is $8,863,526 • Estimated revenue to Aviation Authority is $1,152,258

Prepango, LLC • Submitted a bid of 21% of gross receipts • Estimated sales for the 3-Year Term is $6,724,324 • Estimated revenue to Aviation Authority is $1,412,019

RECOMMENDED ACTION

Accept the Concessions/Procurement Committee’s recommendation of February 24, 2020 to:

• Rank the bid received from Prepango, LLC, first at 21%, and rank the bid received from New Zoom, LLC dba Zoom Systems second at 13%;

• Award the North Terminal Automated Retail Concession, at Orlando International Airport, to Prepango, LLC, as the highest responsive and responsible bidder; and

• Authorize an Aviation Authority Officer or the Chief Executive Officer to execute the appropriate agreement following satisfactory review by legal counsel.

Comprehensive Annual Financial Report for the Year Ending

September 30, 2019

BACKGROUND

• Requirement: In accordance with the Laws of Florida, Chapter 57-1658 Section 13 as amended by Chapter 98-492, the Aviation Authority shall cause an audit to be made by an independent certified public accountant, which audit shall be accompanied by the accountant’s opinion

• The Comprehensive Annual Financial Report fulfills this requirement

ISSUES Financial Statement Highlights for the Years Ended September 30, 2019 and 2018

September 2019 September 2018 Total Assets $5,656,018,000 $5,085,369,000 Total Long Term Debt $2,628,528,000 $2,285,364,000 Operating Revenue $581,964,000 $537,476,000 Operating Expenses ($330,687,000) ($305,843,000) Operating Income $251,277,000 $231,633,000 Before depreciation

Depreciation ($183,147,000) ($165,527,000) Total Operating Income $68,130,000 $66,106,000

• Unmodified Audit Opinion • No Management Letter Comments

ISSUES Single Audit:Audit of Compliance for Each Major Federal Program and Major State Projects for the Year Ended September 30, 2019

• Procurement • Program Cost Eligibility • Matching Requirements

• Federal Award Expenditures: $18.6 million • State Financial Assistance Expenditures: $12.8 million • Unmodified Audit Opinion • No Findings and No Management Letter Comments

ISSUES

Passenger Facility Charge Program:Compliance for the Year Ended September 30, 2019

• Collections: $107.4 million • Current Expenditures: $63.5 million • Unmodified Audit Opinion • No Findings and No Management Letter Comments

Certificate of Achievement for Excellence in Financial Reporting

ISSUES

Financial Statement Highlights for the Years Ended September 30, 2019 and 2018

September 2019 September 2018 Remaining Revenues $178,248,106 $148,322,075 GOAA Share $101,136,837 $90,662,726 Airline Share $77,111,269 $57,659,349

RECOMMENDED ACTION

It is respectfully requested that the Aviation Authority Board resolve to accept the Comprehensive Annual Financial Report (CAFR) of the Greater Orlando Aviation Authority for the years ending September 30, 2019.

Non-Bargaining Unit Compensation Fiscal Year 2020

BACKGROUND

Fiscal Year 2019 was a record year for the Aviation Authority

• 49.8 million annual passengers including 7.2 million international passengers • 340,635 operations (landings and takeoffs) at MCO • 120,506 operations at ORL (17.6% increase) • $721 million expended on capital projects ($605 million for South Terminal) • $177.8 million - Participating Airline Revenue • $85.2 million - Concession Revenue • $200.5 million - Ground Transportation Revenue including $101,269,000 Rental Car

Revenue • $77.1 million paid to Participating Airlines • Cost per Enplaned Passenger (CPE) $4.34 for Participating Airlines compared to a budget of

$6.40

ISSUES

Aviation Authority staff have: • managed costs • maintained high credit ratings (AA-/AA-/Aa3/AA) • provided excellent customer service • maintained facilities to a high standard • managed contractors to produce desired results • continued to provide a safe and secure environment for

passengers and guests • continued timely progress on the South Terminal project

ISSUES (CONTINUED)

To provide competitive compensation for hiring and retention of non-bargaining unit employees a compensation adjustment is recommended that updates and revises salary structures based on market conditions including Executive (appointed positions) and Aircraft Rescue and Firefighters (AARF)

Bargaining unit employees will be addressed in accordance with the collective bargaining process

Minimum for entry level step will be $13.19

Lowest hourly rate for incumbents will be $13.41

Appointed positions will be limited to 2% increase

FUNDING

Fiscal Impact for FY 2020 is $1,338,447

Annual Impact is $2,676,894

RECOMMENDED ACTION

It is respectfully requested that the Aviation Authority Board resolve to: (1) authorize expenditure of not-to-exceed $1,338,447.30 for compensation adjustments and associated payroll and benefit costs for non-bargaining personnel for the remainder of Fiscal Year 2020; (2) approve revised non-bargaining unit salary structures (including Fire Department and Executives) and (3) authorize the Chief Executive Officer to implement the compensation adjustments by August 2020

Greater Orlando Aviation Authority Board Meeting

Wednesday, March 18, 2020